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Will marketing automation kill the ESP/email software market in b2b?
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6 Answers
As the need for Marketing Automation continues to be understood by B2B marketers, the confusion about the differences that MA tools provide over just plain email marketing will be clarified. Studies show that companies who employ marketing automation technologies are improving their sales effectiveness by 30% and more. Straight up traditional email marketing doesn't provide that sort of impact.
The interest in Marketing Automation is heating up, and those organizations that get started -- beyond just using MA as a traditional email marketing engine, will begin to reap the rewards that email marketing provided several years ago, but in a more measurable and sustainable way going forward.
As companies become more and more interested in providing relevant messages to leads based on what they exhibit interest in, marketers will stop the batch and blast approach that ESP's enable. MA tools will replace ESPs as the tool of choice for email marketing and in the process, allow B2B marketers so many more benefits and opportunities across the breadth of marketing management -- particularly focused around online marketing and social media for things such as lead generation, lead nurturing, lead scoring, and content marketing.
As companies realize MA is as affordable as their ESP offerings but provides greater return, and much more flexibility for lead generation, nurturing and management, the MA space will go into hyper-growth, and ESP's will be scrambling -- because effective marketing goes way beyond emails, and B2B's need the comprehensive management of their marketing pipeline, campaigns, and results.
I'm with Kevin and Len -- it's more likely that ESPs will expand into MA than the other way around. Obviously that's what Silverpop tried with Vtrenz but it's hard to merge external technology. More likely they'll grow their functions organically.
Hmmm, let's see, the ESP/Email software market has somewhere between half a million and a million clients, and all Marketing Automation Vendors combined have about 2000 clients....and let's imagine they are doubling that number every year....calculating...ask me again in 8 years. The bigger question is why is there such a volume gap between marketing automation vendors and email vendors since at the low end of MA there is not a huge difference in functionality?
-Kevin
I think the lines are becoming increasingly more blurred. ESPs are starting to develop robust MA suites in order to address the increasing cross-channel businesses and concerns of today's online retailers. If you look around at the ESP marketplace and the top tier contenders you'll see that the next generation platforms are branching out in terms of addressable channels and creating life-time value tools for marketers to build interactive programs upon rather than just batch and blast engines. That I'm happy to say is mostly yesterday's news. Today's marketers are aware that in order to be successful they have to know their customers and their online and offline behaviors. Competition for the inbox is driving marketing automation sophistication on the back end. So I don't think that MA will kill the ESP market, rather the ESPs will encompass more MA functionality and vice versa, MA suites will probably subsume some smaller ESPs.
Rather than direct replacement, imagine it as two bell curves.
The email bell curve has reached the downward turn. While volumes will continue to rise as smaller businesses come on board, the number of useful B2B communications over email is declining. It is becoming saturated and its value as a prospecting tool is declining as people suffer from email overload.
This is being driven by lazy marketing. For example I just received a communication via Brighttalk to an advanced course. Along the way it tells me that to be eligible for this course, I have to have completed the basic part of the course. So why send it to me?
Marketing Automation is a smaller bell curve but we are still on the upward curve. MA techniques can improve matters and will be increasingly adopted, not solely by the adoption of MA solutions but by the incorporation of MA techniques into CRM, bulk email and Sales Force Automation solutions. But we are seeing the same lazy techniques adopted there.
People have had enough and email intrusion is now being legislated against. More importantly opt-out is being built into most major browsers.
So it is not MA which is the threat to bulk email providers, it is customers themselves.
The new battlefield for marketers will not be email but social media. Nurturing through social media is already well advanced and so is demand generation. Unfortunately we are already seeing the same interruption marketing techniques and this is likely to queer the pitch for everyone.
There really is no solution other than to adopt basic permission marketing principles and build your own tribe of people who trust you, enthusiastically share information about you and work with you - the dumb consumer reacting to push emails methodology is dead.
I agree and expect that ESPs, with their customer base, services and revenues, will progressively add Marketing Automation functionality to retain their customers.
The pure MA players are pioneering and trail-blazing, by raising awareness and educating the market and establishing a bridgehead.
The challenge I see is to help marketers see and then justify the cost:benefits of the MA set-up investment to get MA working well, while also generating leads day-to-day, in an increasingly competitive and crowded market.
A pilot MA project within a mainstream ESP account provides a useful test-bed, for designing the customer journey, setting up the rules and content, then test, measure and refine.
Whether the incumbent ESPs or hungry MA providers, or their respective agency channel partners, do this will be very interesting at many levels.
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