Industry Analysts Predict Increased Adoption, Sophistication For Automation In 2010

“The pain has subsided for marketing cuts,” said John Neeson, Managing Director and Co-Founder of SiriusDecisions, a leading provider of sales and marketing research and best practices services. “It appears to be more flat for next year. Demand generation continues to be the only area of the marketing budget that has gone up since 2001, increasing by 4%.”

Neeson added SiriusDecisions is seeing interest in marketing automation platforms (MAPs) from first-time customers, “and some changing of current suppliers. The key issue for automation adoption is the success of the business process change the organization goes through,” he said. Illustrating the lack of appreciation  for the business process change required to successfully deploy marketing automation tools, Neeson pointed out that an overwhelming number of early adopters are still under-utilizing the systems they have already purchased. “We believe less than 25% of those who have marketing automation are taking full advantage of the system’s functionality,” Neeson added.

Marketing services consultants who have helped to implement and deploy marketing automation solutions agree that change management is one of the biggest hurdles to the category seeing wider adoption. “Not enough companies have a good handle on what it costs to generate a qualified lead that is accepted by sales,” said Henry Bruce, President of The Rock Annand Group, a NY area based consultancy. “What many companies are starting to realize is that it’s not just the costs of the tools, but the resource costs involved in process change and development that often is the stumbling block towards realizing the value.”

In addition to awareness and sophistication around demand generation solutions increasing, industry insiders suggest the growing pressure to demonstrate ROI will move automation to the top of the pile. “Marketers will continue to have their budgets pared and be asked to deliver the same results with less money,” suggested Malcolm Friedberg, Principal with Left Brain Marketing, a Silicon Valley based consultancy. “Consequently, demand generation programs will take on greater importance if marketers are going to achieve their 2010 goals. Marketers will continue to reallocate budget from non-revenue generating programs.”

THE AUTOMATION AVALANCHE

The automation space may have benefitted from increased education in 2009, but a lot of companies still haven’t pulled the trigger on transforming their systems and process. Industry insiders predict that will change in 2010. “I think 2010 will be a tipping point in the world of marketing automation,” said Carlos Hidalgo, President of The Annuitas Group, a leading sales and marketing process consultancy. “With the market so under-penetrated, marketing automation is far from becoming a commodity and the vendors that can demonstrate an understanding of solving business process issues versus feature and function will be the ones who see the biggest increase in 2010.”

One of the factors expected to drive a spike in adoption in 2010 is the growing list of successful companies who have accelerated their pipeline and improved their marketing results as a result of marketing automation solutions. “I don’t see demand slowing and expect that as more success stories emerge and marketers truly understand how it will impact their business, more companies will become users,” said Left Brain’s Friedberg. “Quite candidly, I’d be concerned about being a B2B marketer in 2010 and not using some marketing automation platform to scale your marketing. If you ask any company that is successfully using marketing automation they will tell you (and, hopefully, show you) how it has contributed to their bottom line. Even done only adequately, marketing automation gives sales valuable insights that will translates into higher conversion rates at a lower sales and marketing cost. This benefit is certainly a market advantage and, in some cases, may provide a competitive differentiator in a given segment.”

Rock Annand Group’s Bruce added, however, that a common thread among the success stories is a balance of tools and processes. “The automation investment alone is not what creates the competitive differentiation, but how the tools are used to drive better marketing and lead management processes,” Bruce said. “In every successful project I’ve participated, the common thread was marketing’s ability to change from simply generating ‘hand-raiser’ leads for sales to become lead qualifiers.”

THE REVENUE CONNECTION

As marketing’s contribution to qualifying and converting leads becomes more pronounced, industry insiders suggest the ties that bind sales and marketing will become even tighter in 2010. “Marketing has to change their mindset towards sales and view them as their customer and involve them in the process of lead management and process development,” suggested Hidalgo of the Annuitas Group.

He added that organizations with strong alignment between sales and marketing will be better positioned to adapt to the buyer-driven sales process. “The mindset that the company drives the sale has to change.  B2B organizations must now understand that the buyer is the one driving the sale and companies must adapt their marketing and sales approach to respond to that, and the only way to do that is in a process based, automated format,” Hidalgo said.

Analysts say the prioritization on ready-buyers has emerged as one of the biggest competitive advantages for companies who have married sales and marketing automation. “The impact on sales performance is significant as the sales team spends less time with prospects that are not sales-ready,” said Bruce. “During 2009, the companies that were still closing deals were more focused on the high probable opportunities as marketing used automation to manage and develop qualified leads before turning over to sales.”

SEGMENTING STRATEGIES

As marketing and sales teams become more sophisticated with their measurement and execution, SiriusDecisions’ Neeson and others predict segmentation will emerge as one of the key competitive differentiators. Neeson said segmentation and targeting will be especially important as companies look to “get into new segments, or consolidate” existing verticals or product lines.

“I expect to see more focus on behavior-based segmentation in driving personalized/customized content for each campaign,” said Bruce.  “I believe 2010 will see marketing working even more closely with sales to define campaigns for very targeted groups of prospects. Using more online prospect intelligence tools such as ZoomInfo and Jigsaw, campaigns will be executed for prospect groups of 25-50 with a very specific call-to-action that sales/inside sales calls on within 48-72 hours for follow up. I have been executing a number of these type campaigns over the past few months with very strong results.”

The push for more targeted campaigns is also expected to drive greater adoption of business intelligence metrics and reporting around prospects and customers. “I believe that companies should begin to consider how to tie together all of their metrics across the organization to produce better business intelligence,” said Hidalgo. “Consider that marketing automation, CRM, customer support and finance all have their own reporting, yet who is bringing them all together to get a full 360 degree view of the customer. Perhaps 2010 is the year we begin to see Business Intelligence play a larger role in marketing and sales.”