Making the Case for Marketing Automation
How to Make the Case for Marketing Automation
The first thing to do when making the case for marketing automation is to establish a baseline to measure PMO (Present Method of Operation) against a Marketing Automation enabled FMO (Future Method of Operation). Track cost, revenues and close rates per lead by channel. Use this data to calculated marketing ROI by channel. If not currently tracking metrics to calculate marketing ROI by channel, and then use what data you have to estimate as best as you can. The goal is to calculate or estimate marketing ROI by channel for the PMO. These become your baseline Marketing ROI metrics.
Next, review the cost of Marketing Automation implementation. Look carefully at costs beyond just setting up the software and defining calls to action, lead nurturing, etc. to approximate the total cost of ownership for launching and maintaining the marketing automation solution.
Content creation, for instance, is an ongoing cost that can be estimated based on frequency of posting yet can be overlook in the ROI calculation. Factor in community management functions necessary to promote your content beyond the company blog using popular social channels such as facebook/LinkedIn/twitter/Pinterest/Google+.
Not all of these social channels are necessary or even relevant to your business and not all have to be implemented at once to gain significant ROI on a marketing automation solution. Once a cost estimate for the FMO Marketing Automation enabled solution is in place, compare the cost and expected returns of the PMO relative to the FMO factoring in:
- Increase the quantity and quality of leads through Internet marketing – 66% of business who blog once per week generate customers through their blog.
- Reduce the costs per lead over traditional “outbound” marketing , In fact, $135 is the average cost of an inbound Internet marketing lead as compare to $346 for leads obtained through traditional marketing channels (e.g. tradeshow, cold calling, TV). These differences in lead cost can have a dramatic effect on marketing ROI when comparing inbound and outbound marketing opportunities.
- Increase close rates by effectively nurturing your leads in a way that scales. Research has demonstrated that content search leads from marketing automation close x8 more than leads generated through traditional marketing channels. This is largely supported by the relevancy of marketing to those seeking information versus those that are “interrupted” by traditional advertising.
- Leverage social channels to increase content reach, to maximize marketing automation ROI. For example, 77% of B2C marketers survey said facebook is an effective channel to share their content, while 51% of businesses feel that LinkedIn is effective for B2B marketing. Marketing automation supports a holistic approach to social media and automates some of the more time consuming tasks.
- Effective marketing analytics for informed marketing decisions – enabling decision-makers to track and report on ROI, providing senior leadership real-time, dashboard access to marketing ROI information to make informed decisions on marketing investments and their opportunity costs.
- Lead segmenting and scoring can increase close rate on inbound leads . Improved lead scoring leads to reduced sales time wasted on pursuing unqualified leads.
- Enhance response rate to customer inquiries If you don’t have an automated, well-defined process in place to immediately capitalize on your most interested prospects, you’re missing out on potential opportunities. The odds of reaching a prospect that initiates a contact request drop by 100 times in the first 30 minutes (Source: InsideSales.com). Marketing automation assists with reducing these missed opportunities by enabling marketers to automatically and in a personalized way within the first 30 minutes.
- Lead nurturing to move unqualified leads to qualified leads. Without marketing automation, it’s very difficult, if not impossible, to follow-up on a large volume of leads. Based on research by Sirius Decisions, 14 out of 20 leads are “unqualified” by marketing and sales organizations, while. 12 of those so-called unqualified leads end up buying from you or your competitor within two years (Source: Sirius Decisions).
- Define once, leverage many through automated lead nurturing with email marketing paths with automated touch points for different lead segment based on expressed interest. This allows marketing to move leads through the sales funnel in a way that is relevant based on past lead behaviours such as what white papers or case studies where downloaded and when, while providing the sales team a more complete view of a prospect interest before they ever pick up the phone to reach out to that prospect, thus dramatically improving close rates.
Note: Points 1-4 above: Source: The 2012 State of Inbound Marketing.
Marketing Analytics for Getting to Yes
The tipping point for moving forward with Marketing Automation is the detailed marketing analytics and reporting (#5 above). Robust marketing automation platforms offer CMOs and Marketing executives the ability to drill down into the details of how and where revenue is generated. To an exectuvie management team, this alone can be priceless.
Marketing analytics from marketing automation informs future sales and marketing investment decisions, especially for those platforms that can report on “multi-touch attribution.” This attribution information enables executives and decision makers to track contacts, opportunties, lead and sales gained through different channels of a multi-channel marketing program, and for some, down to the individual campaign level.
Marketing automation analyics empowers CMOs to demonstrate the overall influence that marketing had on sales and revenue. If you are selling an enterprise solution and have an average sales cycle of 12-18 months, you may have at several marketing touches to close the opportunity. They say it takes 7 touches for brand awareness to talke hold. Multi-touch attribution can show which touches or programs were more effective. It can also show the impact that marketing can have on an opportunity from prospect to market qualified lead, through to close sale and beyond.
The marketing analytics and reporting capabilities help CMOs and other executives determine how to allocate sales and marketing budget with a focus on ROI for individual components for mult-channel marketing programs. This level of reporting and accountability, if executed effectively, can result in incrmental marketing budget.
This kind of marketing anlytics and reporting can lead to enhanced forecasting by sales and marketing as they interlock on sales and revnue goals with the product team which can stongly bolster the business case for marketing automation.
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