DemandGen’s David Lewis: What’s Ahead For Marketing Automation In 2013
Editor’s Note: As part of our forthcoming Marketing Automation Technology Forecast project, we recently caught up with David Lewis, Founder and CEO of DemandGen International, Inc. David offered a number of insights during that conversation, and we’re excited to share some of these today. Enjoy!
DGR: What major trends do you see in terms of new and emerging technologies, or new applications for existing marketing automation (MA) technologies?
I see changes coming in three primary areas: ease of use, out-of-the-box functionality, and service offerings.
Greater ease of use. In this area, we’ll likely see MA systems providing more intuitive, and more insightful, reporting capabilities, which are also more standardized so that marketers have a defined set of commonly used metrics and reports like accountants do. New reporting developments will offer not only numerical information but will also provide better visuals to marketers to make understanding and presenting the information easier.
Maturing MA tools will also provide more automation capability in the areas of nurturing and lead scoring. An example is the automatic serving of better performing nurture emails, similar to the approach used in Google AdWords. And we’ll see simplification around designing and integrating lead scoring, nurturing and the demand funnel into the lead management methodology.
Through more intuitive interfaces and more use of predictive models, the solutions will adjust programs for you based on what’s working best, and will use historical sales and marketing data to help you develop predictive lead scoring and nurturing models.
More out-of-the-box functionality. I anticipate that the leading vendors will develop more out-of-the-box functionality to begin to address the very large untapped market of businesses that demand instant effectiveness of new technologies. Salesforce.com is a good example: When small to medium businesses buy Salesforce, they can use it effectively from that moment, even before it is completely tailored to the business.
Similarly, MA solutions will come with a library of templates that can be quickly adapted to your look and feel, so that you can create custom emails and landing pages as easily as a PowerPoint slide. Lead scoring and nurture programs will include template libraries that can be easily tailored to your business, rather than developed from scratch.
Expanded service offerings. Finally, I expect marketing automation vendors to broaden the services and capabilities that they provide to marketers. This will include offerings such as content management and campaign planning along with tools for project management.
All this functionality will help marketers plan and track all the tasks and deliverables necessary to assemble and execute campaigns. We can also expect MA solutions to offer better assistance with lead generation, through integration with your social networks and list brokerage services.
DGR: What major challenges related to marketing automation technology will define the market in 2013, and how will vendors respond?
The defining challenge for 2013 is all about CRM. As I mentioned above, when you buy a CRM solution you can move in immediately and become productive, but today’s MA systems are not packaged in a way that allows a marketing team to take immediate advantage of the solution. Most of that facilitation is still happening at the vendor level. But we’ll see more advances in this area, with pre-installed modules that are purpose-built for the specific needs of Marketing.
Ultimately, we’ll see the focus of Marketing shifting to developing content for the system and away from designing the programs.
DGR: Do you foresee any surprises in terms of market trends during the coming year?
B2B marketers are going to reevaluate the importance and significance of social media, and probably redirect their investment into other channels that will yield better results.
In addition, we’ll see some marketing teams moving to a variable compensation model tied closely to revenue, thanks to the new availability of reporting. In the past it was virtually impossible for Marketing to get credit for revenue derived from its programs. Now that we can demonstrate our contribution to revenue, why wouldn’t marketers want their compensation to be based on their performance — just like the sales organization?
Finally, to date, MA has been really targeted at the marketing department, but fundamentally it’s a communication platform. And because communication takes place throughout the whole organization — marketing, sales, training, customer service, human resources, even the partner channel — we may begin to see MA systems being applied to all different areas of the business and become a company infrastructure purchase rather than just a system for marketing.
Oracle And Eloqua: Making Sense Of The Marriage
By now, you’ve seen the news that Oracle shelled out $871 million to buy Eloqua. We have already shared a few thoughts about what the deal means for the marketing automation and CRM industries, but here’s some additional color commentary.
Oracle Got A Great Deal
First, this is a big deal, but why isn’t it even bigger? As Brian Hansford pointed out in an insightful Twitter post, it’s a screwed-up world when a “cheesy photo app” with a quicksand business model (and a legal staff that needs to quit drinking on the job) sells for $1 billion.
Yet a highly successful marketing automation vendor with a proven business and vast growth potential goes for considerably less than $1 billion. Go figure.
Market2Nowhere
The acquisition also evokes memories of Oracle’s 2010 purchase of Market2Lead, which promptly joined Spinal Tap in the “where are they now?” file. That was a peculiar deal to begin with; Oracle purchased the company’s intellectual property but basically dumped its customer base into the nearest ditch. (Eloqua CEO Joe Payne actually published a blog post at the time inviting Market2Lead customers to jump to his company’s platform. Check it out while you still can.)
Obviously, that’s not happening this time around. Like it or not, Eloqua’s client list is being invited to this party.
Four Questions To Ponder
Keeping that in mind, here are some issues worth considering as Oracle closes this deal:
- Oracle typically assimilates its acquisitions by swallowing them whole. Will Eloqua keep a separate brand identity for the time being? Does it make sense to do so, given some of the issues discussed below?
- We don’t know how many Eloqua customers are also Salesforce customers, but “a lot” seems like a safe answer. As a result, Eloqua is bound to have some interesting conversations with clients who depend on close integration of their Eloqua and Salesforce CRM systems.
- That sound you hear is Marc Benioff shredding Eloqua’s invitation to next year’s Dreamforce event. The Dreamforce Cloud Expo has always been fertile ground for marketing automation vendors, and Eloqua will – at the very least – find it a considerably less welcoming environment in the future.
- Salesforce doesn’t just integrate with Eloqua; it’s also a client. Sorting this out will have the entertainment potential of a Hatfield-McCoy wedding party.
Thanks for reading, Happy Mayan Apocalypse, and have a great holiday!
-Matthew McKenzie
Marketers As IT Buyers: The Big Shift Has Already Happened
You’ve certainly heard by now the Gartner prediction that CMOs will spend more on IT than CIOs by the year 2017. Yet while predictions are fun (and often wrong), what’s happening here and now can have a much bigger impact.
That’s why I want to share a slide from a Gartner webinar that profiles how the typical marketing organization functions as a technology buyer (click the image below for a larger version):
Some of these findings won’t raise any eyebrows; how many of you are surprised that marketing determines the need for the technology it will use? But look at some of those numbers further along the IT buying lifecycle. More than half of the marketers surveyed said their teams already handle final vendor selection, and a third handle the implementation and management.
So basically, a third of the marketing organizations surveyed already call the shots when it comes to selecting, implementing or managing new technology.
This certainly includes SaaS-based marketing technology, of which marketing automation may be the most popular example. But consider this: According to Gartner, half of CMOs now have a capital budget to purchase marketing software.
Given that most SaaS purchases are treated as OpEx rather than CapEx, this tells you just how much the rules of the technology game have already changed for marketers.
One more point: I wrote a while back about the advantages of hiring marketing professionals with strong analytical and data-management chops. According to Gartner, that’s another trend with the wind at its back; many of the CMOs they interview are busy hiring technical staff and creating jobs like Chief Marketing Technologist.
I don’t know what CIOs think of these changes. But it sure seems like they’d better get used to them.
-Matthew McKenzie
Marketing Analytics Drive Big Benefits For Fortune 1000 Companies
A recently published academic study offers strong support for companies looking to step up their investments in marketing analytics.
The Penn State Study included responses from 212 senior executives at Fortune 1000 companies. Those that increase their use of marketing analytics see an average 8% improvement in their return on assets, and the most aggressive analytics initiatives show a return of up to 21%.
In terms of net income, that’s a return of anywhere from $70 million to $180 million.
“Our study provides a strong rebuttal to executives who believe that information gathering and analysis result in excessive delays and ‘analysis paralysis,’” says Dr. Gary Lilien, cofounder and Research Director of the Institute for the Study of Business Markets at Penn State’s Smeal College. “On the contrary: when analytics is deployed with strong support from key executives, organizations thrive in competitive industries and react well to today’s customers, who frequently change their product preferences.”
There are two caveats here.
First, the authors noted that a separate 2009 McKinsey study showed only 10% of the respondents using marketing analytics in a meaningful way. That’s a lot of money being left on the table due to inaction.
Second, the study lays out some qualitative guidelines for a successful marketing analytics strategy:
- Employ marketing professionals with strong analytics skills.
- Deploy a sophisticated IT infrastructure.
- Create a culture that is able and willing to apply analytics to decision-making processes.
Other experts are also encouraging marketing organizations to hire team members with strong analytical chops. We’re big fans of that idea, and these findings show why that’s the case.
What is the Difference Between Email Marketing and Marketing Automation?
By Jon Miller, VP Content Marketing and Strategy
What is the difference between email marketing and marketing automation? And how do you know if your company is ready to make the switch? Here’s a quick primer on the key differences, and a handy-checklist to help you know when it’s time to graduate.
Feature Comparison
There are many differences between email marketing provider and a marketing automation platform. An Email Service Provider (ESP) provides functionality to send mass blasts and track open rates, but with marketing automation, you have access to powerful, strategic features like multi-step drip campaigns, lead scoring, and marketing program analytics.
Take a look at this feature comparison:
Email Marketing Alone Just Doesn’t Do it
If you are relying solely on email without automation, you are probably coming up against a few barriers. Here are some challenges you might be facing with email marketing alone, and how marketing automation can help:
Email Marketing is Time-Consuming
· Marketing automation removes the tedious manual work of crafting individual emails and allows you to focus on creating multi-stage, automated campaigns to nurture your leads and automatically respond to their actions while you get other work done.
Your Sales Teams Don’t Know Which Leads Are Worth Their Time
· Marketing automation allows you to automatically monitor and score your leads based on how they engage with campaigns or content, in addition to demographics or lead characteristics, so you can identify truly sales-ready leads to send to your sales team.
You Are Unable to Keep Leads Engaged Through Your Communications
· Marketing automation allows you to automatically nurture your leads. This means you can segment your database based on criteria most relevant to your business and lead them through your funnel using content and calls to action that are most relevant to each group, keeping them more engaged with your communications.
You Are Having Trouble Scaling Programs
· Marketing automation is a solution that can grow as your company’s needs grow. Instead of just building more and more email programs, you can run multiple types of campaigns, create lead nurturing programs, score your leads, and attribute revenue directly to each marketing program.
You Can’t Attribute Revenue to Your Email Marketing Efforts
· Instead of relying on CTR and OR for marketing success metrics, marketing automation allows you to clearly demonstrate which marketing programs – email or otherwise – are bringing in revenue, allowing you to make better decisions on which programs to run and which are most cost-effective.
Checklist: Top Signs You Need Marketing Automation
If you are still unsure whether it is time to graduate from your Email Service Provider, take a look at your organization and marketing practices. You should consider marketing automation if:
- Your customer buying process lasts longer than a week
- Sending emails alone does not seem to drive sales
- Your marketing team needs an easier way to create and send targeted, multi-touch email campaigns
- Your marketing department does not have enough time to do everything they need to do with their current resources
- You sell different products or services to different demographics
- You want to send different messages to different titles and industries
- Your sales people are complaining about the quality of leads your marketing team is delivering
- You want to know which of your marketing campaigns are the most effective
- You can’t tell if you should be spending more or less money on marketing
Still not sure? Check out our new whitepaper Graduating from Email Marketing to Marketing Automation for more insight.
Social Media Now Plays A Decisive Role In IT Buying Decisions
Earlier this year, a Demand Gen Report study found that social media played a role in at least half of all B2B buying decisions. Now, new research suggests that number is much higher among IT firms.
The study, conducted by Forrester and LinkedIn, included 400 North American IT decision-makers. It found that 73% of these buyers have engaged with IT vendors on a social network.
Perhaps more surprising: 58% of these B2B buyers say they “rely” on social networks to make purchasing decisions, versus 46% that use online periodicals for this purpose.
“IT decision makers are three times more connected with peers and others than the average LinkedIn user,” said Mike Weir, Head of Category Development for LinkedIn’s Marketing Solutions Division, in an article published today on Direct Marketing News. “They’re three times more likely to follow companies, four times more likely to follow tech companies.”
We already know that the IT industry is packed with early adopters – that’s certainly true when it comes to marketing automation, for example. Even so, it’s surprising just how quickly IT buyers have moved from using social media in a peripheral capacity to putting it at the center of their decision-making processes.
Other industries probably aren’t as far along in this process. But they’re going to get there, and it may happen more quickly than most B2B marketers expect. That makes it even more important to move past using social media simply as a vehicle for branding or awareness, and turning it into an integral part of your demand-generation strategy.
IDC: Marketing Automation Continues Double-Digit Growth
The latest market research from IDC continues to show a strong market for both marketing automation and sales automation solutions.
IDC’s Worldwide Semiannual Software Tracker for the first half of 2012 showed overall software market growth of 4.7% year over year. This marks the beginning of what IDC says will be a period of slower single-digit growth for the market.
Drilling into the numbers, however IDC found that CRM software in general experienced above-average growth of 8.1%. Within the CRM category, three out of four sub-categories – marketing, sales and customer service – showed a combined growth rate of more than 12%. (The fourth sub-category, call center software, showed much lower growth.)
This is all good news for the marketing automation industry, and it matches predictions from other research firms that predicted double-digit growth for marketing automation through at least 2014.
Return Path Acquires Context.IO For Email Data Integration
Return Path, a provider of email delivery and intelligence services, announced last week that it had acquired Montreal-based firm Context.IO. Financial terms of the deal were not disclosed.
Context.IO develops API interfaces between email data stores and business applications. Return Path will use the acquisition to give enterprise developers better access to email for data-mining and marketing intelligence activities.
One common use of Context.IO is to support synching of email and CRM systems, allowing the efficient use of historical customer data.
“Return Path and Context.IO share the same vision – the email channel not only has longevity, but can serve as a dynamic platform that helps brand marketers better connect with consumers,” said Matt Blumberg, CEO of Return Path, in a statement. “The innovative API Context.IO provides, combined with access to Return Path’s expansive panel data, and offers developers the tools to create applications that will push the boundaries of the medium.”
Return Path said it will also invest $1 million in an innovation program created by Context.IO to foster email API advancement among software developers.
Video: 10 Strategies For Content Marketing
This week, we’re going to dive into the archives and give you a presentation well worth watching if you didn’t see it the first time around. In this Dreamforce 2011 session, Ann Handley, Chief Content Officer of MarketingProfs, and Jon Miller, VP Marketing of Marketo, offer 10 timeless strategies for content marketing, events and marketing automation success.
Video: Marketing Automation & Email Marketing
Email marketing is a time-tested, and highly effective, way to reach prospects and customers. This Salesforce.com video explains how to move your firm beyond “batch and blast” email marketing to guarantee that you always deliver the right message, to the right person, at exactly the right time.
