I plead guilty to enjoying a cold beer or two, and I’ve watched with amazement as the decade-long bull market in the craft beer industry shows no signs of abating.
In researching our cover story topic, we discovered Funnelholic.com, a fun and insightful B2B blog by Craig Rosenberg, an independent consultant based in Northern California. In his Jan. 5 post titled “Ridiculous ramblings about the marketing automation market,” Rosenberg talked about the changes this new software platform has already experienced.
We reached him on the phone. Here are some of his thoughts from that discussion.
What are we talking about when we talk about marketing automation?
The way I would describe it is the application to manage your leads and manage your lead generation process. That includes the ability to track and follow and report on what’s happening with your leads and lead generation program and the ability to manage interactions with those leads over time.
There is a mentality shift, which is lead gen used to be a one-time field – a campaign or a tradeshow. Now, we’ve gotten smarter and we know now that leads take time to become opportunities and we have to manage that and we have to represent that. That’s what marketing automation allows companies to do.
Just because someone has decided to hit your website does not mean that they’re ready to talk to you. In the past, that was just not a good lead. Now we realize that is a good lead, it’s just not ready yet. To get them ready we’re going to continue to market to them via our marketing automation and we’re going to watch them, to the extent that we can watch their “body language” to really understand when they are ready to have a conversation with us. We have the ability to do that with the marketing automation platform.
So if it’s not a good time to contact them, what might be a good next step?
The other movement has been the content marketing movement. A lot of companies have moved away from flooding people with brochures. Instead, over time, they are closer to what you do than what the old vendors do. They’re going to write articles and create webinars, events and white papers that are focused on helping buyers through their purchase process. You want to create a website that has a lot of information that brings people back.
When did marketing automation hit the scene and has there been an evolution?
I don’t know the date and time, but I can tell you that all of the vendors had the same message. How we describe marketing today – nurturing, scoring, all of them did a great job of changing the way marketers look at the world. That has been a success. Most marketers don’t disagree with that anymore. It’s a business run for marketers by marketers. You can imagine how good they all are at marketing. They have done an amazing job of changing the way people look at the world. Over the course of the last two or three years it’s now this widespread view of the world that has been driven by the marketing automation vendors and all of the influencers who surround them. The overall numbers, the marketing automation market is not big if you compare it to a lot of other software markets. But a lot of these vendors are in hyper growth. They are hitting their numbers. There is triple-digit percentage growth for a lot of these vendors. My own qualitative assessment from talking to people is everyone feels they have to have it, similar to a CRM system.
The people who build marketing automation platforms talk a lot about “lead scoring.” Explain how that works.
What the marketing automation vendors said was instead of saying this lead is good and that lead is bad, you should score them and allow leads to self-select themselves into higher scores over time. As folks continue to visit your site or open your emails or attend your event, those are the kind of things you track and, based on how you value those activities, that will change their scores and their scores will tell you when you should go have a conversation with that potential buyer.
Is it expensive and hard to shop for?
It depends upon the size of your company. Most of the marketing automation vendors have settled in to where they are really good. Most of the applications do the core functions of lead scoring, lead nurturing and those types of things. They might have slight variations and they might have certain features that others don’t. I believe people are typically looking at the same marketing automation vendors. I don’t think they’re having a problem of finding out who they should go talk to. You can’t go wrong with the core functionality, and then there are specific needs to your organization that will make you choose one or the other. I used to think it was a real muddy area figuring out who you should talk to and what you should talk to them about, but one of the things about the marketing automation market is they advocate for people to put out as much free content as possible. The market is pretty well informed.
In my opinion it’s cheap for the value, but I might be in the minority. I feel like it’s worth a lot more money than they charge. For an application, I feel like the value is worth a lot more than the cost.
Your blog sounds a bit skeptical about marketing automation in some points. Are you a believer in it?
I definitely believe. The only thing I will say, and it’s not unique to me, the really smart people in the space will tell you that marketing automation does not create leads. Process, people, a strategy, best designs comes first. The automation supports it.
It happened with CRM. I met with a client and he said, “I bought CRM and I’m not seeing more revenue.” In the marketing automation space, I don’t know how many times a lot of smart guys just assumed that they could buy this software and their lives would change. But there is a lot of thought and strategy and process that have to go with it in order for you to be successful. That’s a big deal.
You also talk in your blog about the top providers of marketing automation software already resisting the use of the term “marketing automation” and you ask, “Should my blog have been titled ‘The death of marketing automation?’” What are you getting at?
What I meant is these guys, to their credit, are viewing what their providing people as a real platform to manage their entire marketing process so they are actually thinking big. Marketing automation is focused on the ability to create leads and there is so much more that happens in marketing and I believe these guys are starting to expand their horizons and really starting to think big for all of the things that are about to happen in the marketing space. I didn’t mean that marketing automation is dead, but rather the branding around the phrase might be going away and they might be going bigger with it.
Does marketing automation help a company answer the age-old question about which half of their marketing spending actually works?
Think of this way: You may actually want to go to tradeshows because you’ll be able to track their effectiveness. It does truly allow you understand what expenses drive revenue. The people who really drive a high-class demand-generation organization actually spend more money now because they know how to turn it into revenue.
People are cutting tradeshows no matter what, but the old way of marketing was to take the bingo cards and hand them over to sales. That didn’t work. Now you can go to tradeshow and dump them into a marketing automation system, nurture them over time, and they eventually become leads. That is a more effective way to market. That actually may drive higher ROI from tradeshows. Having a real understanding of what’s really driving revenue – that kind of enlightenment is really exciting.
Where do we go from here? What’s next in the use of this tool?
For years demand generation was a thing you checked the box and it didn’t work. Now there is a new way of thinking about things that everyone needs to get on board. That’s a big deal. The B2B sales and marketing folks need to realize that if you don’t have an organized and effective way of driving demand, then you can and you should. You should think first about how to create a lead management process that considers what happens to your process along the design cycle, creating marketing that supports that, and then go to sales and say, “Here is a definition of a lead that I will provide you.”
As hot as marketing automation is, everyone is talking about it because it’s so new, bright and exciting, but it’s actually still small. There is still a lot of room to grow.
Craig Rosenberg blogs at funnelholic.com