Marketing Automation Buyer Survey: Many Myths Busted but Planning is Still Key to Success

The marketing automation user survey I mentioned last March has finally been published on the VentureBeat site (you can order it here). At more than 50 pages and with dozens of graphs and charts, it’s not light reading. But it’s still fascinating because the findings challenge much of the industry’s conventional wisdom.

For example, industry deep thinkers often say that deployment failure has more to do with bad users than bad software. The underlying logic runs along the lines that all major marketing automation systems have similar features, and certainly they share a core set that is more than adequate for most marketing organizations. So failure is the result of poor implementation, not choosing the wrong tools.

But, as I reported in my March post, it turns out that 25% of users cited “missing features” as a major obstacle – indicating that the system they bought wasn’t adequate after all. My analysis since then found that people who cited “missing features” are among the least satisfied of all users: so it really mattered that those features were missing. The contrast here is with obstacles such as creating enough content, which were cited by people who were highly satisfied, suggesting those obstacles were ultimately overcome.*

We also found that people who evaluated on “breadth of features” were far more satisfied than people who evaluated on price, ease of learning, or integration. This is independent confirmation of the same point: people who took care to find the features they needed were happy the result; those who didn’t, were not.

But the lesson isn’t just that features matter. Other answers revealed that satisfaction also depended on taking enough time to do a thorough vendor search, on evaluating multiple systems, and (less strongly) on using multiple features from the start. These findings all point to concluding that the primary driver of marketing automation success is careful preparation, which means defining in advance the types of programs you’ll run and how you’ll use marketing automation. Buying the right system is just one result of a solid preparation process; it doesn't cause success by itself.  So it's correct that results ultimately depend on users rather than technology, but not in the simplistic way this is often presented.

I’d love to go through the survey results in more detail because I think they provide important insights about the organization, integration, training, outside resources, project goals, and other issues. But then I’d end up rewriting the entire report. At the very least, take a look at the executive summary available on the VentureBeat site for free. And if you really care about marketing automation success, tilt the odds in your favor by buying the full report.

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* I really struggled to find the best way to present this data.  There are two dimensions: how often each obstacle was cited and the average satisfaction score (on a scale of 1 to 5) of people who cited that obstacle.  The table in the body of the post just shows the deviation of the satisfaction scores from the over-all average of 3.21, highlighting the "impact" of each obstacle (with the caveat that "impact" implies causality, which isn't really proven by the correlation).  The more standard way to show two dimensions is a scatter chart like the one below, but I find this is difficult to read and doesn't communicate any message clearly.

 

Another option I tried was a bar graph showing the frequency of each obstacle with color coding to show the satisfaction level.  This does show both bits of information but you have to look closely to see the red and green bars: the image is dominated by frequency, which is not the primary message being communicated.  If anyone has a better solution, I'm all ears.

NurtureHQ Offers "Dead Easy Marketing Automation". Is That Enough?

I don’t know whether to laugh or cry.

New-ish marketing automation vendor NurtureHQ showed me its product recently. It’s really nice. Clean interface, easy to use, all the standard marketing automation features. Particular strengths in:

• split testing (separately for email subject lines and versions)
• lead scoring (automatically reduces scores from older events)
• CRM integration (Highrise, Capsule CRM, Sugar CRM, Salesforce.com, and an open API)
• marketing analysis (users can track multiple outcomes per campaign)
• content management (nice email/form/page builder, user-defined variables can be shared across messages to make changes easy)
• selection, segmentation, and campaign flow based on list tags (highly intuitive)
• low price ($495 per month for up to 20,000 contacts and 10 users with unlimited emails and landing pages and no annual contract)

In other words, this is a worthy alternative to Act-On, SalesFUSION, Net-Results, MakesBridge, Genoo, and other small business systems. Definitely take a look if you’re in that market for that sort of product.

But there’s my problem: “that sort of product” is widely available already. NurtureHQ hopes to differentiate itself as “dead easy marketing automation”, which it arguably is. But is it so much easier than the other products I just listed? I think not.  Regardless of whether it’s the easiest of them all, the difference isn’t likely to be large enough to matter.

Naturally, NurtureHQ disagrees. Before building its system, the company spent six months talking to current marketing automation users.  Many said they never progressed beyond email because the next step was too hard. This led NurtureHQ to believe that an even easier system could find a broader market than current products.

Other vendors have asked the same questions and reached the same conclusions.  But I’m beginning to think those marketers were really saying something else. What they found “too hard” wasn’t the software, but the planning and content creation needed for serious marketing automation. Without a clear understanding of what they wanted to do, they couldn’t figure out how to get the system to do it. That’s not a software problem.  Even a system that could build programs just by reading marketers' minds wouldn’t work if those minds didn't know what they wanted in the first place.

This isn’t a new insight. Marketing automation gurus have long argued that companies need to define their processes in advance of deploying a new system. The case was made yet again this week in an excellent blog post by Joby Blume, describing his former company’s struggles with marketing automation. (Be sure to read the comments). Howard Sewell of Spear Marketing Group made a similar point on his own blog. I reached the same conclusion myself in a post using data from a Gleanster report on marketing automation.

None of this means that “ease of use” is a bad strategy for NurtureHQ and others. On a practical level, ease of use helps sell systems to people who otherwise wouldn’t buy them. But vendors can't succeed if their clients fail – especially they rely on revenue from subscription renewals. So it only makes sense to sell marketing automation to companies without adequate processes, content, and other resources if those companies understand they’ll need to add those resources later. To really ensure success, vendors must actively help their clients through training and, in some cases, services to do the work for them.   Vendors including LeadLife, Genoo, and MakesBridge already offer low-cost service packages for their clients.  Other vendors also have service arms and agency partners to help out on a project basis. Third-party training resources such as the Marketing Automation Institute (where I’m a board member) can also help to fill the gap and benefit from substantial vendor funding.

What does this mean for the software vendors themselves? If the real keys to success are marketers’ skills and processes, does it really matter what’s in the software? To put another way, is marketing automation software already a commodity?

I hate to say it, but, to some degree, yes. There are certainly differences among products, both in capabilities and ease of use. But most marketers can find several systems that will meet their needs. This means vendors are increasingly competing on other dimensions including their own marketing and sales skills, cost structures, supporting services, pricing, and financial resources. As I pointed out last week,  it’s no coincidence that four of the five largest vendors are venture-funded (six of seven, if you include Infusionsoft and HubSpot). Another factoid that makes the point even more clearly: three of the four fastest growing received major new funding in the past year.

Still, I’m not entirely ready to give up on technology as a major differentiator. What’s needed is more radical innovation than a better interface. If the real barriers to success are creating content and identifying appropriate programs, then technology must address those directly. There are some already tools to help generate content, such as systems for news curation  and video posting.  I can't think of any products that recommend the right marketing programs, but proper analytics can identify patterns that reveal opportunities, and it’s perfectly conceivable that a rule-based system could check for known issues and make recommendations. HubSpot’s marketing grader does a something like this although it only examines externally-available information.

Of course, marketers will still have to create content and design programs. But better technology could dramatically reduce the necessary effort and move marketers past the deer-in-the-headlights paralysis of not knowing where to start. Vendors who really want to expand the market beyond the resource-rich few should look in this direction.

What Really Creates Marketing Automation Success: Data from Gleanster

Research firm Gleanster released its free “Gleansight” report on marketing automation late last month. I was principal author for much of the document and drafted the survey questions, although I didn’t write the individual vendor profiles or administer the survey. (I’ll also share in the revenues, which come when vendors pay for the names of people who download the report.) Although I’m obviously biased, I do think it’s an excellent product and highly recommend it.

Many readers of the report will be most interested in the vendor profiles and survey-based rankings. But I have my own data on those, so I’m more interested in the answers to the general survey questions. These asked why people implement marketing automation, what challenges they face, and what contributes to success. The survey compared answers from top-performing marketing automation users with answers from everyone else. This gives especially interesting insights (or should I say...GLEANSIGHTS) into the differences between sophisticated users and their less experienced brethren.

Here are some highlights – please look in the report itself for details.

Reasons to Implement: top performing companies listed higher revenue, better leads, and more leads as the most important reasons to use marketing automation. All other companies also listed revenue and more leads in their top three, but their most common answer was decreased marketing costs. By contrast, marketing efficiency ranked fourth among top performers and much lower among all others.

My interpretation is that top performers have learned that marketing automation might make you more efficient but won’t actually reduce your total marketing budget.  Other, less experienced companies that expect cost savings will probably be disappointed.  If anything, marketing automation will probably increase their marketing spend – hopefully with an even larger improvement in the revenues and leads to compensate.

Value Drivers: Both groups agreed that the two most important predictors of marketing automation success are cooperation with sales and ability to measure return on investment. But the top performers' third item was easy-to-use system while the others chose adequate staff training. This is a really interesting divergence.

The Gleanster people tell me that many of the top performers are now using their second marketing automation system because their first was too hard to use.  In other words, this is the voice of experience, and that voice is saying that training by itself can’t overcome a difficult system. Less-experienced companies who are relying so heavily on training may find it's not enough. But let’s not overstate this point: training is certainly necessary for success even if it’s not sufficient. Perhaps the top performers discounted training in part because they already had a lot of it.

Back to the data.  Both groups rated having an analytical culture as the fourth-most important value driver, while listing outside help, change management, and organizational resources as the least important.

These answers shed important light on the on-going debates about how marketers should approach their automation deployments. The message is clear: success depends on a marketing department’s own skill level, not on outside resources. A marketing department that pays attention to sales needs, carefully measures ROI, and makes fact-based decisions will succeed with marketing automation just as it probably succeeded without it.. A group that hasn’t mastered those basics won’t succeed at marketing automation no matter how much training, change management, and external assistance it brings to bear.

Challenges: Gleanster didn’t send me responses to this question broken out by top performers vs. all others. For the combined group, the top two challenges cited were data quality and creating content; the next three were poor marketing processes, lack of staff, and selecting metrics. These are all factors controlled by the marketing group. The lowest ranking factors were all the external ones: organizational culture, senior management mindset, lack of IT support, and lack of funding.

This is consistent with the previous answer: marketers create their own success. Marketing automation is just a tool.  It will help a well-run department work better but can’t save a poorly-run department from itself. Massive re-engineering isn't necessarily required to deploy marketing automation, but departments that lack a solid foundation need to build one before automation can do them any good.