Marketing Automation Skills are Scarce: Vendor Strategies to Close the Gap

The marketing automation industry continues to grow quickly, with many vendors announcing their client bases have more than doubled in 2011. But there’s also a growing realization that many marketing automation systems are used for only simple tasks – often no more than email, landing pages, and CRM integration. For example, LoopFuse found that nearly twice as many used email and web landing pages as lead scoring.

Even more worrisome are increasing reports of user dissatisfaction – not enough to stop people from using the systems, but perhaps enough to prevent them from expanding their deployments or recommending marketing automation to their friends. Act-On Software recently reported that 40% of marketers are dissatisfied with their campaign management program.

Surveys, like this one from IBM, show many obstacles to successful deployment.  But the ultimate problem is staff skills: marketers who know how to use their systems and understand their benefits can make a compelling case for investments in programs, integration, technology, data, process change, and whatever else is required.

Marketing automation vendors are painfully aware of these issues. They've taken a range of approaches to addressing them. I've seen four distinct strategies:

• training. This is the most direct approach: if users don’t have enough skills, then teach them. I’m using “training” in a broad sense to include all types of preparation before deployment: these include marketing planning, process change, content development, metrics definition, and organizational realignment as well as actual training in system use.  This is the traditional strategy for B2C marketing automation and at B2B firms large enough to afford substantial pre-deployment investments.  It’s also the preferred option of most industry consultants (myself included) because it provides the strongest platform for future success. Among B2B vendors, Eloqua is the poster child for this approach. (And I should note that many vendors are supporting the Marketing Automation Institute's training program too.)

But not everyone can afford through training and preparation for a marketing automation deployment. The remaining strategies are designed to help those who cannot.

• ease of use. Simple systems let marketers get started with minimum preparation. This is by far the most popular strategy among vendors, presumably because it increases sales by placing the fewest demands on buyers.  It's applied by Marketo, Pardot, Act-On Software, Genius, Net-Results, and many others. It’s also the most popular strategy among buyers, judging by how many installations never grow past the basic functions. But the approach is also probably the reason for high dissatisfaction: marketers must find they face a much steeper learning curve than they expected to use their systems' fully. For long-term success, vendors who take this approach must ensure that their clients keep growing after the initial deployment.

• automation. Instead of training marketers to do hard things or making those things easier, automation has the system do them instead. This is a much less common strategy, in part because it's technically demanding and expensive to execute.   It's also a partial solution at best, since no one thinks marketing can be fully automated.  Still, it's being applied to lead scoring (creating the actual scoring formulas automatically, instead of asking users to define them); to content selection (letting the system predict which content a visitor is likely to want); and to contact frequency (letting the system determine how often a lead should be contacted). HubSpot is following this approach most aggressively although others are also applying it in places.

• full service. This strategy argues that it’s ultimately more efficient for the vendor to do complex marketing automation tasks than to teach marketers to do the tasks for themselves. That’s not as crazy as it sounds: marketing automation tasks like setting up a new program are often complex, rarely required, and quick for a well-practiced expert. So buying a couple of hours or days of service each month really does save time and money.  It also gives access to more expertise than a small marketing department could ever build internally. As you might expect, this approach is most common among at the small business end of the marketing automation spectrum: Genoo, MakesBridge, and OfficeAutoPilot are good examples. But it seems to be creeping upstream: LeadLife, Treehouse Interactive, and Manticore Technology apply it to larger customers.

Although I’ve associated specific vendors with each strategy, the reality is that most companies apply a mix of several. This violates the classic strategy rule to select one clear goal and focus all resources on reaching it.   But a mixed approach probably makes sense for marketing automation, where a tactical choice like making your system easier can support several strategies and where different buyers may need different treatments.

This doesn’t mean that vendors can get away with being sloppy.  The market is too competitive and marketing automation is too complex to succeed despite poor execution. It’s also likely that a dominant approach will emerge within each customer segment.

But even then, one size won’t fit everyone. Both vendors and buyers will still need to match the deployment strategy to the buyer’s situation.

B2B Marketing Automation Vendor Comparison -- Here's a Sample

I’ve been having way too much fun working on my new industry report. I decided to make it an interactive document that lets users (viewers? readers? The Chosen?) set their own weights for the different scoring categories and do detailed, side-by-side comparisons of vendors they select. This gives the document vastly more play value than a simple report. Much more important, it reinforces the point that I keep stressing, which is that every evaluation must be based on the buyer’s unique needs. Having three different sets of scores was a step in that direction, and making things interactive goes still further.

Click here to download a sample of the format. (Beware that it's a big file and can take several minutes to load.) Vendor names have been replaced with football teams and the specific details are excluded. But you can see the results of the different scoring schemes and also get a list of the specific items with their weights and definitions. The sample also contains draft versions of the introductory materials, which need some reformatting. (Note to Mac users: this is an Adobe Flash document; you'll have to use Adobe Reader to view it.)

In case it’s not obvious, you can move the little sliders on the “Sector Chart” tab to see how the different vendors move around depending on how you weight different categories of attributes. The final report will show directly how much each category contributes to each vendor’s score. You can also adjust the category weights on the grid within the “Scoring Weights” tab, which shows the detailed items. You have to mouse over the numbers in the grids – not the most convenient method, but the one allowed by the software I’m using (SAP Business Objects’ Xcelsius).

I actually did work up a version of the report that lets users set their own weights for the individual items. Unfortunately, that seems to overtax the software, so I’ll have to leave that out of the final product. I might put it out as a separate product or upgrade to the base report.

Please take a look and let me know what you think. The report itself should be ready for distribution within a few days, and of course I'll announce it here first.

Predictions for B2B Marketing in 2011

I don't usually bother with the traditional "predictions for next year" piece at this time of year. But I happened to write one in response to a question at the Focus online community last week. So I figured I'd share it here as well.

Summary: 2011 will see continued adjustment as B2B lead generators experiment with the opportunities provided by new media.

1. Marketing automation hits an inflection point, or maybe two. Mainstream B2B marketers will purchase marketing automation systems in large numbers, having finally heard about it often enough to believe it's worthwhile. But many buyers will be following the herd without understanding why, and as a result will not invest in the training, program development and process change necessary for success. This will eventually lead to a backlash against marketing automation, although that might not happen until after 2011.

2. Training and support will be critical success factors. Whether or not they use marketing automation systems, marketers will increasingly rely on external training, consultants and agencies to help them take advantage of the new possibilities opened by changes in media and buying patterns. Companies that aggressively seek help in improving their skills will succeed; those who try to learn everything for themselves by trial-and-error will increasingly fall behind the industry. Marketing automation vendors will move beyond current efforts at generic industry education to provide one-on-one assistance to their clients via their own staff, partners, and built-in system features that automatically review client work, recommend changes and sometimes implement them automatically. (Current examples: Hubspot's Web site grader for SEO, Omniture Test & Target for landing page optimization, Google AdWords for keyword and copy testing.)

3. Integration will be the new mantra. Marketers will struggle to incorporate an ever-expanding array of online marketing options: not just Web sites and email, but social, mobile, location-based, game-based, app-based, video-based, and perhaps even base-based. Growing complexity will lead them to seek integrated solutions that provide a unified dashboard to view and manage all these media. Vendors will scramble to fill this need. Competitors will include existing marketing automation and CRM systems seeking to use their existing functions as a base, and entirely new systems that provide a consistent interface to access many different products transparently via their APIs.

4. SMB systems will lead the way. Systems built for small businesses will set the standard for ease of use, integration, automation and feedback. Lessons learned from these systems will be applied by their developers and observant competitors to help marketers at larger companies as well. But enterprise marketers have additional needs related to scalability, content sharing and user rights management, which SMB systems are not designed to address. Selling to enterprises is also very different from selling to SMBs. So the SMB vendors themselves won't necessarily succeed at moving upwards to larger clients.

5. Social marketing inches forward. Did you really think I'd talk about trends without mentioning social media? Marketers in 2011 will still be confused about how to make best use of the many opportunities presented by social media. Better tools will emerge to simplify and integrate social monitoring, response and value measurement. Like most new channels, social will at first be treated as a separate specialty. But advanced firms will increasingly see it as one of many channels to be managed, measured and eventually integrated with the rest of their marketing programs. Social extensions to traditional marketing automation systems will make this easier.

6. The content explosion implodes: marketers will rein in runaway content generation by adopting a more systematic approach to understanding the types of content needed for different customer personas at different stages in the buying cycle. Content management and delivery systems will be mapped against these persona/stage models to simplify delivery of the right content in the right situation. Marketers will develop small, reusable content "bites" that can be assembled into custom messages, thereby both reducing the need for new content and enabling more appropriate customer treatments. Marketers will also be increasingly insistent on measuring the impact of their messages, so they can use the results to improve the quality of their messages and targeting. Since this measurement will draw on data from multiple systems, including sales and Web behaviors, it will occur in measurement systems that are outside the delivery systems themselves.

7. Last call for last click attribution: marketers will seriously address the need to show the relationship between their efforts and revenue. This will force them to abandon last-click attribution in favor of methods that address the impact of all treatments delivered to each lead. Different vendors and analysts will propose different techniques to do this, but no single standard will emerge before the end of 2011.