Marketing Automation Systems

Marketing automation is a very active segment of the CRM software market. Not only are new vendors entering the market, but existing market leaders are constantly innovating and delivering new product updates. Today, the majority of solutions can be split into business to business (B2B) and business to consumer (B2C) solutions. The two groupings are very different and so are their functional needs. Businesses that sell to other businesses (B2B) firms have longer sales cycles and engage in more relationship building activities. Businesses that sell to consumers (B2C) rely more on brand and high-volume direct outreach efforts. This overview aims to improve understanding of how marketing software applications work and provide an update on trends every buyer should know.

Here’s what we’ll cover:

What Is MA Software?
What Type of Buyer Are You?
The MA Vendor Landscape

Market Trends You Should Understand
Benefits & Potential Issues
Recent Events in the Industry

What is MA Software?

Henry Procter is credited with saying “I know I waste half of my advertising dollars. I just wish that I knew which half.” This is precisely the question that this software answers. It assists firms in developing, executing, and tracking campaigns. Managers use these systems to automate workflows, manage collateral, track prospect behavior, and qualify leads before they are passed to sales.

B2B systems have sophisticated lead generation and lead management capabilities. For example, lead scoring functions score leads based on demographics (e.g. geography, industry, size) and behavior (e.g. website activity, responses to campaigns). The resulting scores ensure that the sales department only receives qualified leads that are close to making a purchase. For leads that are not ready to buy, marketing tracking software provides campaign management, which helps marketers to foster the relationship through techniques such as drip and “stay in touch” campaigns. 

B2C systems tend to manage vast databases of customer data - often millions of records. These systems have sophisticated tools for analyzing and segmenting customers into different categories of buyers. Markets can then execute specific campaigns, or “treatments” for each segment. Campaigns are typically designed to elicit a direct response, such as returning to a website to make a purchase. Alternatively, campaigns may feed a target prospect list into a call center systems for telesales outreach. 

MA software also provides companies with advanced reporting and analytics to measure the performance of initiatives. This allows managers to see which campaigns and channels are driving leads, along with the costs and revenue of those initiatives. In the end, this helps organizations decide how to better allocate resources.

What Type of MA Buyer Are You?

We believe that most buyers segment into the following four categories:

• B2C enterprise buyer. These buyers work for firms that market to consumers. With millions of prospects and huge volumes of data, they need sophisticated analytics and segmentation tools to define, select, and reach members of their target markets.
• B2B enterprise buyer. These buyers work for firms that market to other businesses, and engage in longer sales cycles. They are primarily seeking capabilities that help them nurture relationships with prospects. Lead nurturing, lead scoring and sales force automation (SFA) integration are critical capabilities.
• CRM suite buyer. These buyers have less sophisticated requirements, but value integration with their other customer relationship management (CRM) programs. They are typically content to trade feature depth for native integration with CRM, SFA and other applications. 
• Email emphasis buyer. These buyers work for small businesses that want to engage in more sophisticated email outreach, but are not ready to deploy enterprise-class MA. Marketing campaign management software buyers are primarily focused on managing a database of contacts and executing regular email campaigns. 

The MA Vendor Landscape

Market Trends You Should Understand

There are a number of market trends that buyers should understand, including:

• Software as a Service (SaaS). In the MA market, SaaS is less of a trend than it is the dominant model for deploying software. Buyers will find that the majority of solutions - with the exception of some high-end B2C solutions - are delivered through the online marketing software model where the system is hosted by the software vendor and accessed over the Internet by user. A benefit of web-based email marketing software is increased accessibility. They can be accessed on multiple devices and from any operating system, whether you're a Mac or PC.
• Social media. Social networking gives managers a new channel. Firms tweet coupons to customers and post special offers to friends on Facebook. Advertising videos are successful if they go viral on YouTube. MA is embracing all of this. Social networking integration will drive the next generation of MA.
• Use of two dimensional barcodes. Two dimensional (2D) bar codes are seen more and more often on print ads, bill boards, bus stop benches, and even as tattoos.  Customers can use smart phones as code readers to get information about a product or service immediately on their mobile browser. Current solutions can use 2D bar codes with third-party solutions, but new versions will have built in support.
• MA vendor consolidation. Large ERP and CRM vendors will acquire some firms, while some niche providers will combine to remain competitive. IBM and Terradata both made significant acquisitions by picking up Unica and Aprimo, respectively. Oracle purchased the assets of Market2Lead. Buyers should expect to see more M&A activity going forward. 

Benefits & Potential Issues

Buyers who successfully implement a MA system should expect to realize the following benefits:

• Identify and qualify more leads. MA allows firms to better target potential customers, quickly qualify leads, and send them to the appropriate sales rep.
• Improved sales coordination. MA helps firms better coordinate inter-team activity. For example, a firm can promote a single product and track the effectiveness by looking at the number of qualified leads generated and comparing that to the number of leads converted to sales.
• More effective campaigns. MA lets firms measure their campaigns and adjust those campaigns based on what they learn. 
• Decrease costs. The savings per dollar shows up in several ways. Two of the most important are number of the employees in the department and the dollars spent on outside support. 

Issues with MA software often results from unrealistic expectations and poor implementations. For example, this software cannot make a bad service or product into a good service or product. If the collateral is bad or misses the point, MA will simply deliver a bad message more efficiently. Finally, if the wrong target market is selected, effective delivery to that target market will not help the bottom line.

Recent Events You Should Know About

The industry has experienced recent pricing volatility due to rising competitive pressures, particularly for shoppers in the lower end of the revenue spectrum. The plethora of new automated marketing solutions has pushed down prices, but also complicated the marketing automation comparisons process. Buyers now have many options, ranging from highly complex and customizable to basic email marketing automation tools.

The cost shift has also affected the industry in another way. Smaller companies are able to consider automated marketing software for the first time, where before they wouldn’t have had the budget. Below are recent announcements from four popular marketing automation vendors.

• SilverPop - On May 14, SilverPop released a free Facebook application described as helping marketers “convert likes into revenue.” The automated email marketing developer said the tool--dubbed Social Pull--allows users to unify social and automated lead generation processes. Marketers can easily create landing pages and social forums to capture customer interactions on a business Facebook page. The application also includes a form builder and “like-gate” that allows companies to require visitors to like the page to access additional content.

• Marketo - On April 18, Marketo acquired social campaign management developer Crowd Factory Inc. to augment its popular marketing automation platform. Officials said the combined solution allows marketers to amplify and measure social-enabled campaigns in greater detail. Users can now integrate Facebook, Twitter, LinkedIn and other social channels into campaigns in a way that encourages sharing.

  "Crowd Factory pioneered the idea of Social ROI by empowering marketers to push viral campaigns throughout the social web, and then track that valuable social activity back to individual influencers and conversions," Crowd Factory Sanjay Dholakia said in a press release.

• Optify - On April 25, Optify released its new Email Manager tool for direct email campaigns. The lead management software already provided deep customer intelligence for prospects captured through inbound methods. But the latest release adds that insight to email campaigns. The tool tracks such activities as open rates, click throughs and return-to-website activity. The so-called Closed-Loop Email solution is integrated in the existing inbound marketing suite and available to all current and future buyers. Also this year, Optify enhanced its Contact Manager portal and simplified its Landing Page application.

• HubSpot - On May 15, Hubspot launched new email software and an improved contact database. Officials said the tools are meant to improve marketing to existing and new customers through a unified client database. The resource also integrates with CRM systems to promote increased intimacy with the sales team. Marketers can track online browsing history, email history, form submissions and social media information all in one place. Customers can then be segmented and targeted according to behavior collected through automated marketing systems. The email campaign capabilities allow for greater personalization to email body, subject line and sender information.

Have an opinion on this guide? Email the authors. We appreciate the feedback.