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Why Lead Management Automation Really Matters

October 22, 2010 by

We should care more about lead management automation in B2B marketing. Maybe we don’t care enough because we’re focusing on the wrong reasons for doing it.

It isn’t because the software for automating this stuff has improved, or because it’s available through the cloud so you don’t have to deal with those people over in IT.

No, there’s something bigger going on here. And that is a huge change in the buying process.

In part it is being driven by social media. ITSMA’s annual survey of IT buyers found that this year, for the first time, a majority of buyers in the US—and 75% when you include other countries—are using social media in the purchasing process—especially the younger ones.

In our research we’ve also seen consistently over the past few years that two-thirds of buyers prefer to research their buying options themselves rather than waiting for vendors to contact them. Indeed, research by Forbes and Google found that 80% of C-level executives perform at least three web searches per day.

And finally, the trade press and general business media are dying. We have fewer and fewer outlets to do the heavy lifting of thought leadership for us by featuring our subject matter experts in in-depth analytical articles. Yet buyers are hungrier than ever for this kind of information and insight.

Buyers are removing salespeople from the buying process
What this all means is that buyers are really trying to remove salespeople from the earliest stages of the buying process. They want to become as informed as possible about current trends and their buying options before they ever speak to a salesperson.

This is where we as marketers need to provide more content—but not sales content. This content must be like what the press used to provide, objective, idea-based, and educational—not selling. Put another way, we have to use content to establish a relationship with buyers where our salespeople can’t. And we have to continue to build that relationship over time until those buyers are ready to talk to us.

That’s why lead management automation is important. It’s too difficult to track that relationship and know when someone is ready to do more than just read your white papers unless you have a process for lead management and can automate it. You have to be able to connect content with behavior with action. That’s not possible manually. It just won’t scale.

What do you think? What is stopping your company from creating an automated lead management process?

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Four reasons to stop measuring marketing

July 31, 2009 by

It’s time to declare marketing metrics a failure once and for all. ITSMA research has long showed that when we do it at all, we do it poorly. It’s difficult to parse out the contribution that marketing makes to a sale and it’s even more difficult to get salespeople to spend the time figuring out/checking the box/giving credit in the quest to determine whether marketing played a role in making the sale.

So we should just stop. Now.

I’ve had some good conversations this week with ITSMA’s Julie Schwartz and with lead management guru Brian Carroll and we all agree that in the broadest sense, measuring marketing misses the point. We should be measuring revenue and what Julie calls the Cost per Order Dollar (CPOD). Both marketing and sales should work together to reduce CPOD because that’s what really matters in terms of marketing’s contribution to the business. In this report (free with guest registration), Julie points out that marketing’s primary role is to make sales more efficient. Period.

Stop apportioning blame
So why do we continue to measure marketing separately from sales? If we started measuring CPOD and tracked it year over year, we would know that marketing was doing its job without forcing the annual showdown between marketing and the business in which marketing stands before the firing squad to justify its mere existence.

As Brian pointed out to me this week, this is all about growing revenue. It’s time to measure sales and marketing together in that process.

So here are some simple rules to think about:

  1. Stop measuring marketing in isolation. Marketing and sales are both part of the same process: raising revenue. Measure CPOD instead.
  2. Create a unified lead process. You need a closed-loop lead process that tracks prospect activity from beginning to end (and back again, in the case of lead nurturing) that is supported by a system (see this post for more on that).
  3. Get adult supervision. In working with companies to develop lead management programs, Brian has found that the most successful companies have a CEO who does not try to parse marketing from sales and assign credit/blame to each. He or she emphasizes one revenue generating process that both groups contribute to.
  4. Create content that is tied to (and signals) the different stages of the buying process. As we in B2B focus more and more on trying to pull in prospects through thought leadership, we need to understand that our life’s blood is the Epiphany Stage of the buying process. We need marketing content specifically targeted at that stage, as well as the more traditional stages like awareness and interest. When we create content targeted to specific buying stages—and get sales to agree to that categorization—we no longer need to get salespeople to check off the box for marketing’s contribution; that contribution will become implicit.

What would you add to this list?

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Filed Under: ITSMA Research, Marketing Automation, Marketing Metrics and Analytics, Sales and Marketing Collaboration Tagged With: , , , , , , ,

We need an app for that

July 24, 2009 by

I’ve been working on a report for ITSMA clients this week about analytics and it got me thinking about the proverbial bigger picture of B2B marketing.

We know from our research that we in marketing don’t do much with analytics—i.e., using data to determine and predict customer buying patterns. Only 50% of marketers in our survey said they had analytics programs, and of these, few were focused on predicting behavior; most were simply reporting past behavior. Even rarer is the ability to carry those analytics all the way through to a sale.

But we need to start doing that. Two of the companies I spoke to for my report use analytics to determine which marketing tactics are working and which ones aren’t. That lets them be more productive in marketing, by focusing effort and budget on the good stuff, and it lets them reduce the time to a sale by giving salespeople better tools to work with. One of them told me that it had used these analytics to reduce the average number of interactions needed to schedule a sales appointment in half.

So what are the rest of us to do? I’ve said before that this isn’t just a problem with the issues that come back to us in the surveys: lack of budget, clean data, and unified IT systems. We also have a cultural problem: numbers and metrics just aren’t in our bones; we’re the creative types, what others might refer to derisively as the English majors (yep, me too).

Make the analytics come to us
This is why we have to automate our way out of this problem. The metrics and analytics have to come to us; we can’t continue to expect to dive in and pull them out because we just don’t do it. The things we do and the content we produce need to be contained within an IT system that can watch what we do and tell us about it. This is especially important as more of our work moves online.

But I don’t think you can just start with an IT system, because we’re not much more inclined to be IT geeks than we are to being analysts. So you have to start with the bigger process picture.

I haven’t seen a better articulation of what marketing should be doing in B2B than Brian Carroll’s marketing funnel concept. He differentiates between a marketing funnel and a sales funnel because so many leads are lost in the handover between marketing and sales—94%, according to this report. The marketing funnel helps focus attention on a number of important issues:

  • Qualify leads. Marketing can’t send every lead to sales, nor can it spend too much time qualifying leads.
  • Universal lead definition. A lead that both sales and marketing agree is ready to be pursued.
  • Lead scoring. You can’t call everybody who downloads a whitepaper. You need a system for determining who is ready to talk. And as I discussed in this post, the qualification process needs to be gradual and non-invasive, what Brian has since christened “micro-conversion.” Steve Woods of marketing automation vendor Eloqua has an excellent list of questions to ask about lead scoring here, but I wonder if they rely too much on making people fill out forms.
  • Lead nurturing. There needs to be agreement on when and how a lead will come back to marketing if sales doesn’t pursue it or if the prospect turns out not to be interested.

But what about the fact that sales and marketing don’t talk to each other?
The key to this process is getting sales and marketing to work together create an integrated process. Suzanne Lowe makes the radical assertion that marketing and sales must be integrated together. Eliminate the silos, imbue people with both sales and marketing skills, and eliminate the problem. Once again, however, we have a cultural issue: Sales and marketing people are just different.

The system we’d like to see
In organizations where sales and marketing are forever destined to be separate, processes and systems have to do the integration work. At its foundation, it is a system that sees that the lead process is a loop, not a linear progression—especially considering the length and complexity of the B2B buying process—and is capable of tracking every interaction with a lead over the course of this torturous route.

The system needs to house every bit of content marketing creates, for both customers and sales, and integrates with the lead management system, so that marketers and sales people can use content, not qualification forms, to gauge progress towards a sale. For example, if sales has visibility into the content that prospects are downloading, and both marketing and sales have agreed on the pieces of content that indicate serious buyer interest, the system can signal salespeople to make the call, rather than waiting for marketing to ship the lead to them.

The system needs to be interactive with both prospects and salespeople so that they can rate and comment on the content. And finally, the system needs to integrate with whatever salespeople use (CRM, most likely), so that marketing’s impact on a sale can be automatically tracked from beginning to end.

If marketers had such a foundational system, we wouldn’t need to “create” analytics programs, all we’d need to do is look at what our customers and prospects are doing.

What do your process and system look like?

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Filed Under: Lead Generation, Marketing Automation, Marketing Metrics and Analytics, Marketing Strategy, Sales and Marketing Collaboration Tagged With: , , , , , ,

Fix the relationship with IT

October 3, 2008 by

In 13 years of covering IT for CIO magazine, there was a recurring theme: the tribal mistrust between IT and the business. It’s those Mac vs. PC ads writ large—almost postal. IT people are really angry about the way business people treat them like servants, and business people hate how IT people treat them as if they are stupid and helpless.

So when I created our survey on marketing automation this summer, I made sure to ask questions about marketing’s relationship with IT. I wasn’t surprised by what I saw. Nearly 70% of respondents said they have no formal IT strategy. Marketers don’t think it’s their fault, however—67% of respondents blamed the lack of strategy on a lack of support from IT.

Clearly, we have a relationship problem here. When we asked people about their biggest challenge in marketing automation, 70% said money. But everyone always says that. It’s a bit of a red herring. Our belief is that it’s the relationship with IT that’s really getting in the way here. Following closely behind money as the primary challenges were organizational support and change management processes. Who in the organization is supposed to provide support for technology? And who is supposed to develop change management processes for the implementation of technology? I hope you said IT.

Marketing Needs Help

One of the things that intrigued me about the relationship issues I saw between the business and IT when I was at CIO was the currents flowing beneath the sentiments. IT people are like tradespeople, often more loyal to their craft and their peers than to the businesses they serve. This drives businesspeople crazy, partly because they think it leads to poor IT support inside their companies, and partly because businesspeople lack that kind of broader community. The business itself is their community and that’s where their entire loyalty is focused—they are impatient (and maybe a little bit jealous) with those whose loyalty is more broadly focused.

I guess I hoped that marketing’s relationship with IT might be a little better than the broader relationship between IT and the business, because IT and marketing have something very important in common: they are both viewed as support functions by the clueless inside their organizations.

Marketing people can be as downtrodden as IT people can. And empathy is a critically important component of good relationships. If you can’t get inside your significant other’s head and imagine what it was like to hear that snarky comment that a colleague made at the meeting, you have a problem.

But IT and marketing people both know what it’s like to be treated as a servant and it could actually be the key to improving the relationship. You should try sharing some of that misery with them sometime.

I say that in part because having a technology strategy is going to become more and more important to success in marketing because marketing needs more automation—especially as so much of our work begins migrating online. IT decisions have gotten much more complex. Years ago, marketers could get away with approaching their major IT decisions much as consumers do: Discover a need, find a tool, and install it for yourself and perhaps for a few colleagues. But today you need to weigh carefully issues such as scaling the tool to all areas of marketing, data storage and retrieval, and integration. These are not decisions that marketers are equipped to make on their own.

Marketing needs to take steps to fix the relationship with IT. Though IT is the natural target for blame, marketing needs to take a share of it, too. In our survey, we found that only half the marketers had tried to develop a formal liaison relationship with IT (and vice versa). This has to change. If it doesn’t, it’s unlikely that marketing will ever achieve its goals with automation. If you lose the ongoing dialogue with IT below the C level, it’s unlikely that things will go your way at the C level, either.

This is something you can look into and fix today. Do you have someone in your marketing organization who loves IT and is interested in working with IT? You have your spokesperson. It costs you nothing. They can still do their day jobs.

There are many other mechanisms for creating a better dialogue with IT that are more formal, such as steering committees, periodic joint off-sites, collocating IT and marketing people together, and, at the ragged edge of reality, a coup d’état. At one of our member companies, the CMO literally took over the responsibility for IT. As you can guess, there were no issues with the marketing automation budget after that.

So before you start being one of those outlaws who goes around IT when you need software, first pick up the phone and see if you can enlist IT’s help. It will hold up your plans a bit, I know, but it’s becoming ever more critical to success.

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Automating the Processes that Matter Most

September 19, 2008 by

Applying technology to marketing makes you a better marketer. In our recent survey about marketing automation, we saw that there is a correlation between the degree of automation in some of marketing’s core operational support processes and respondents’ level of competency in those processes.

Trouble is, the processes we are best at aren’t the ones that matter most.

In my last post, I talked about how things like email marketing, CRM, and web analytics are the processes where people have applied the most automation—and say that they do them well.

But to support the core goal of services marketing—putting good thought leadership before customers and prospects at the right time and in the right context—you need to be good at processes like content management, lead management, campaign management, and segmentation/predictive analysis. All of those processes ranked lower in their levels of automation and competency.

The good news is that you know what you should be automating. When we asked survey respondents to rate the ROI they have gotten or expect to get from automating processes, lead management, and campaign management rise to the top. And segmentation rises, too. And of course, contact management is up there, because nearly everyone has some sort of a CRM system these days.

Meanwhile, the highly automated processes—especially web analytics and email marketing—drop like stones in terms of ROI. This says to us that we are spending at least some of our marketing technology dollars in the wrong places.

I think it’s also a testament to the relative complexity of automating the processes that really matter. The four key automation areas of content management, lead management, campaign management, and segmentation/predictive analysis won’t be successful if they are developed and implemented in isolation from each other. They should be integrated into a holistic process-based approach to generating leads and nurturing them until they are sales ready (and salespeople agree that they are sales ready).

What do you think?

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Beware the Platform Concept

August 15, 2008 by

There are only two really successful platforms in computing today: the internet and Microsoft Windows. By successful, I mean that developers have created software that other developers want (or need) to write software for and computer users want (or need) to use.

Many, many developers try to turn their software into platforms, because it makes their work ubiquitous and it makes them rich like Bill Gates. But few succeed. Some software providers are trying to create software platforms for running your marketing operations, integrating and automating the most important marketing processes together on a single software application.

The lure of such a platform is obvious: Eliminate the complexity and inefficiency of many different—and often redundant—software applications and integrate data in one place to get a single view of all the different things you are trying to do in marketing. There are two primary benefits for doing this, and their relative importance is often determined by the overall standing of marketing in the organization:

1. Improving the productivity and effectiveness of marketing

2. Demonstrating the ROI of marketing activities

But you should beware the platform concept. Windows and the internet are successful because they are infrastructure platforms with limited ambition. They take care of the basic communications but leave the functional capabilities to others. Smart move. There are only so many ways that computing infrastructure needs to communicate. But people are a different story.

And this is the problem with trying to create computing platforms for the ways that people do things. In my experience, it requires a least-common-denominator approach. To create a viable software platform for marketing operations, the developers need to create a software model for the ways that marketers do things that is applicable for the highest possible number of users. And that means inevitable compromises in functionality—most importantly in specificity. At best, these platforms are missing important functionality to serve your marketing processes. At worst, they require that you change your processes simply to be able to use them.

In the end, software platforms that claim to be all-encompassing are a myth. There’s just too much variation out there. And if you do fit exactly to one of these platforms, you should be worried—you probably aren’t very differentiated from your competitors. In 13 years of covering enterprise software platforms for business as a journalist, I’ve learned some basic lessons that can be applied to marketing automation:

1. Don’t do it for integration’s sake. It may seem tempting to throw away all those old software applications and replace them with one, but it’ll never happen. There will always be some important function that falls outside of the capabilities of the platform.

2. Do do it if the platform contains a lot of functionality that you don’t already have. In talking to hundreds of CIOs about their enterprise software projects, the ones who got the most value were the ones who were able to add new business capabilities as a result of the installations—which inevitably run over budget, over schedule, and encounter deep resistance from users who thought the old software worked just fine for their needs. You need to give these people added value for them to suffer the pains of adapting to new software and processes willingly.

3. Have an IT strategy for marketing. Marketing is like most areas of the business when it comes to technology: opportunistic. A specific need arises and you find technology to fill it. That may lead to choosing the best software for the particular job, but not necessarily for the strategic goals of marketing and IT. For example, maybe the software isn’t scalable to other marketing groups, or maybe it is incompatible with existing software, etc. Of course, such issues are what often leads marketing to go around IT in the first place; IT rejects the best software for the job because of all these concerns. In the end, marketing and IT have to have consistent communication about marketing’s goals with technology. That usually means assigning a liaison on both sides.

So how do you start down the marketing automation path? It’s going to sound like a cliché, but you need to take a process view. Chances are, you don’t have a map of all of marketing’s processes, much less the ones that could benefit from some kind of automation. I’ve tried to create a broad list of processes that could benefit from automation. No provider covers this entire list, but that’s not the issue anyway. The issue is, which of these processes are you doing manually today, and which ones, if automated, would provide the most value—not just to marketing operations, but to the overall strategic goals of your organization?

Here’s my list of the major processes:

  • Get a single view of the customer. Collect data from multiple places to improve analysis of individual customers
  • Model the behavior of the customer so you can predict which ones are the best to do business with.
  • Collect and manage conversations about you online and offline.
  • Contact customers when and how they want to be contacted.
  • Organize marketing content so that it can be targeted at a specific customer, delivered at the right time and in the right context. Automate the delivery of content that supports different customer interactions—call center, sales call, for example—and different events that occur, such as high number of transactions.
  • Improve interactions with customers on your website. Can you make your site respond to the customer’s actions and history on the site?
  • Better measure and manage marketing activities

Does this cover all of your major processes? What have I left out?

I have a survey out in the field about marketing automation that will wrap up soon. I will be presenting some of the findings during this online briefing in September.

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One of the Reasons Marketing Gets No Respect: Lack of Automation

August 8, 2008 by

We’re all like the geek who is consumed by technology but doesn’t own a computer.

Let me explain. In this year’s ITSMA Services Marketing Budgets and Benchmarks Survey, you said that online marketing is the fastest-growing category of spending in your marketing budget this year (79% of you plan to spend more in 2008), yet only 36% of you have a marketing automation system to track marketing programs and results.

This adds up to a dramatic difference between the way you use technology externally with customers and internally in your own operations. This is not a sustainable gap. The good news is that 63% of you say that spending on marketing automation will increase this year—with total spending increasing from 3.1% to 4.2% of your services marketing budget in 2008.

Lots of Data, No Insight

In the meantime, online marketing is generating tons of data, and many of you don’t have automated means of converting it into knowledge and insight. Indeed, there seem to be no plans to change the situation. For example, “Advancing data mining and customer analytics” ranked last on your list of priorities for 2008.

This isn’t just bad for marketing; it’s bad for marketing’s reputation inside the company. In my research into this subject over the past six months, one theme has emerged over and over: Marketing is the least automated major function in the corporation.

While other functions have been automating—and more important, integrating—their operations since the mid-1990s, marketing has been mostly on the outside looking in. Indeed, when it comes to technology, marketing is one of those messy best-of-breed environments that your company might make millions fixing. Talk about the shoemaker’s children.

Automation Equals Accountability

It’s no accident that marketing struggles to prove its ROI. With automation comes accountability and efficiency—the ability to assemble hard numbers and data. Not only does marketing lack this ability, but it trails most other functions that are trying to do the same thing. No wonder that marketing struggles to get the respect of top management in many companies.

But before you get defensive, don’t think I’m blaming you for all this—at least not entirely. Software providers don’t offer an integrated marketing platform that does it all. IT and the business leadership play a role here, too. My sense is that many marketing groups do not have a strategy for IT, in part because leadership changes and reorganizations within marketing are common. I also suspect that IT does not pay as much attention to marketing as it does to the rest of the business. Indeed, I wonder if marketing even controls its own budget in most of your companies.

This month we have a survey out to the membership that will address all these issues and more. I hope you will join us for the September 9 Online Briefing, where we will address the future of marketing automation and offer some best practices for addressing the marketing automation challenge.

In the meantime, please tell me about the state of marketing automation in your company and the challenges you face.

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