Marketing has come full circle—service is once again the defining factor of success. The industry started as a service sector, focused on helping clients achieve their goals through execution, responsiveness, and strategic thinking. However, over the last decade, marketers shifted their focus from service to SaaS. Success was measured by software adoption and implementation: Do you have Salesforce installed? What’s your HubSpot attribution model? Are your Apollo automations running? Investment in custom software or customization of popular applications became the primary differentiator in marketing. But today, if you cut through the noise of the rapidly evolving AI landscape, it’s clear that this differentiator is vanishing. This isn’t to say software isn’t essential—far from it. Software enhances service teams, and developers remain indispensable. However, the competitive moat that software alone once provided is rapidly disappearing, and the resurgence of service-based marketing is underway.
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So why is the SaaS moat disappearing? The short answer: AI. AI first lowered the barrier to entry by helping developers with complex debugging (can’t find where that semicolon goes? Ask ChatGPT!), but now, new tools like Cursor, Lovable.dev, and “core” tools like ChatGPT/Claude/Gemini have opened the world of vibe coding to everyone, democratizing development. These tools allow us to program in partnership with AI models, regardless of experience level, to increase the complexity of what can be accomplished without a specialized engineering team. Said differently, even the most code-curious marketers now have tools that will walk them and their teams through the development of complex applications in relatively short periods of time (and for relatively small investments). For example, JPMorgan Chase reported that implementing an AI coding assistant boosted their software engineers’ efficiency by up to 20%, allowing them to reallocate resources to high-value projects. You can imagine that today’s large software applications are now at risk of having their functionality re-created in smaller, lightweight applications by nimble teams within or outside of large companies. If the SaaS value-creation barriers were time spent on development, capital invested in development, or individual expertise, all of these moats have been destroyed by AI. So what does that mean for the marketer looking to differentiate?
When considering differentiation, I turn to Howard Marks. What would Mr. Marks think of the question we’re posing? If everyone can write compelling SaaS marketing experiences, then what makes your company stand out? A famous memo he wrote for his firm, Oaktree Capital, begins to answer our question:
“Remember, your goal in investing isn’t to earn average returns; you want to do better than average. Thus, your thinking has to be better than that of others – both more powerful and at a higher level. Since other investors may be smart, well-informed, and highly computerized, you must find an edge they don’t have. You must think of something they haven’t thought of, see things they miss, or bring insight they don’t possess. You have to react differently and behave differently. In short, being right may be a necessary condition for investment success, but it won’t be sufficient. You have to be more right than others …which by definition means your thinking has to be different.”
- Howard Marks in his memo entitled “I Beg to Differ”
Using Mr. Mark’s logic, we understand that having really good marketing software is no longer enough to differentiate, even if it is the best software on the market. Software alone no longer provides an edge (since software is so easily replicable); instead, you need an additional edge to be different and create superior value for your clients. So what is that edge?
Potential differentiators are endless, especially as access to powerful tools becomes more democratized. However, one edge that stands out emerged in a timely report from Forrester Consulting: Transform Partner Ecosystem Orchestration With An End-To-End Approach. Commissioned by Ansira, the study highlights a growing challenge: marketing teams are struggling with an overwhelming number of software applications. And this problem is only going to grow as AI accelerates software development, making it easier and cheaper to launch new tools. The edge? Integrating software and service (and marketing teams are already demanding it).
The issue isn’t just the number of applications—it’s the fragmentation they create. The study shows that marketing teams are operating within disjointed marketing stacks, so valuable data becomes siloed, workflows inefficient, and the overhead of managing software a distraction rather than a solution. Instead of technology enabling better outcomes, teams are drowning in complexity, unable to extract the full value from the software they have. If we know that AI and automation have eliminated the competitive advantage of software creation, then we know that differentiation will not come in the form of more software to manage the programs we have today. Instead, the answer is where we started before software came onto the scene: human execution. Strategy, integration, and adaptability become the new competitive moat. As software gets closer to eating the world, companies that rely only on software will find themselves indistinguishable from the competition. The true differentiators will be those who know how to strategically deploy software and layer it with expert service and human insight to find the edge and differentiation that Mr. Marks describes above. The next era of marketing success will not be defined by who has the best tools, but by who can wield them most effectively, in partnership with a service team, to create real value for clients.
Of course, software will always have a place in marketing. We need it to provide value to clients. However, as it becomes easier and easier to create compelling software, it will no longer be the differentiator that helps a company generate superior performance. Marketers are already demanding more service support from their software vendors. That call will get even louder as marketing services become more and more crowded with new entrants. At Semify, we believe those who can evolve within this changing landscape and back their software with superior service will be left standing to fight another day. We’re focused on ensuring our white-label digital marketing services will stand the test of time in this way.
