You've heard of the elusive 80-20 rule - the idea, inspired by the work of the Italian economist Vilfredo Pareto, that 80 percent of your ROI comes from only 20 percent of your effort. It's a compelling concept: You can dramatically amplify your results simply by focusing on the right things. But what are those right things? One place midsize companies should consider focusing their energy is on marketing automation. By systematizing your marketing process (such as automating emails in a lead-nurturing campaign), you can spend less time chasing dubious prospects and more time closing genuine sales.
Can marketing automation help your business thrive?
Of course, there's a risk: Won't customers be turned off by the robotic feel of canned communication? That can certainly happen, says Dharmesh Shah, cofounder and CTO of HubSpot, a middle market company that provides marketing software solutions - but only if you are doing it wrong. "Done incorrectly, marketing automation often comes across to people as nothing more than glorified spam," he says. "The dark side...is when companies simply buy a large list of 'prospects' and run them through an automation system in the hopes of getting some leads. This is less and less effective for one simple reason - people don't like receiving unsolicited email."
So what is the right way to do it? First, he says, you need to ensure customers actually want to hear from you - and the best way is by creating useful content such as blog posts, podcasts, or videos that will prompt them to request hearing more from you. For instance, if a prospect downloads a white paper, marketing automation would allow you to trigger a follow-up email asking if they'd like a product demo. VeriFirst, a middle market company that worked with HubSpot, was able to generate 35x more leads in a six month period by developing a robust content strategy.
The next step is to properly segment and personalize your communications with the customer so they feel relevant and valuable. "As much as possible," Shah says, "automated messages that are sent to a person should take into consideration as much context about that person as possible. Where are they in the buying process? Have they interacted with you before? What industry vertical are they from? Are they using a mobile device?" For example, if a customer fills out a form indicating he works for a B2B company, follow up with relevant information that might be distinct from what you offer B2C customers.
Marketing automation is particularly valuable for companies dealing with a large volume of leads. If you have a dozen clients, you can probably market to them in a highly personalized fashion. But all that changes when you have hundreds or thousands of leads, which is true of many middle market companies. Ironically, says Shah, "it's this personalized, human approach where software can help the most" because for companies dealing with a high communication volume, it's simply not possible to send targeted messages manually.
To verify that marketing automation is working for your company, keep an eye on some key metrics over time - is your cost per customer decreasing? Is your average sale price increasing? And how is your close rate on the leads generated through your marketing? Most importantly, says Shah, the goal of marketing automation is to "nurture relationships at scale" and create meaningful, personalized connections with your customers.
Dorie Clark is an NCMM contributor and a marketing strategist who teaches at Duke University's Fuqua School of Business. Learn more about her new book Reinventing You: Define Your Brand, Imagine Your Future (Harvard Business Review Press) and follow her on Twitter.