Marketing Automation:A transformational building blockStrategy conversations very rarely start with marketing automation, but they very often end there.Through the strategic development process, as we design customer strategy that is based onresponding to customer interactions, we very quickly appreciate the need for an executional processwhere the number of resources required does not rise linearly with the number of campaigns orinitiatives. The move from 10’s of executions per day to 100’s or 1000’s necessitates automation.The automation of marketing is critical to delivering the necessary scalability to support any marketingprogram that seeks to achieve more than last year’s activity plus a bit!Is it only automating marketing?Literally speaking, marketing automation is a technology that automates repetitive and mundanetasks in marketing processes. These might include, for example, marketing workflow and approvals,planning and budgeting, campaign development, execution, measurement and analysis. It helpsmarketers to increase their speed- to- market, liberates them from many operational tasks and givesthem more time to focus on marketing analysis and strategy. However, Marketing Automation isnot just about automating marketing tasks and processes - it’s the foundation of transformationalmarketing programs.Why should you care about Marketing Automation?Marketing Automation is like the foundation of a house. If it’s not well constructed, the houseyou build on top will be unstable. Marketing Automation is the solid foundation you need in orderto execute your customer-centric strategies with precision and provides a scalable platform forimproving customer experience through multiple touch-points.The underlying purpose of marketing automation is not simply to automate existing processes butto use the migration to marketing automation to create transformational change to your marketing.Work processes and strategic thinking need to synchronise with your Marketing Automation programand this is likely to require changes to the way you approach customer targeting, how you initiatecustomer conversations and adjust campaign specifications. It will also change the volume, frequencyand manner in which you launch campaigns. It’s therefore evident that Marketing Automation is thefirst step in the journey to transform your marketing into strategic database marketing.
Past research from the Aberdeen Group into planned technology among Top Performer’s overa 12-24 month period shows the high importance of Marketing Automation. Technology Solution Area % selected Marketing Automation Tools / Applications 66 BI / Predictive Analytics Tools 66 Outsource Services: MSP, Agency, Consultancy 63 Call Centre / Service & Support 62 Data Warehouse / Data Mining 57 Enterprise Marketing Management 57 Web Analytics 53 Information Service Providers: External Lists 53 Customer Relationship Management 42 Figure 1: Planned Technology InvestmentMA capabilitiesMarketing automation drives transformational change to your marketing processes: AnalyticsAnalytic capability is used as a forward-looking tool to predict the next action of customers basedon the customer’s behaviour rather than looking backward to statistical models that only show whathappened in the past. This shift alone will take you to the next level of campaign execution. Campaign ideas and developmentThe old practice of outbound marketing was to launch large volume campaigns that bombardedsegmented groups. New generation customers however are repelled by this method of‘communication’ and in any case, marketers struggle to execute campaigns in a timely manner.MA enables marketers to split up mega-campaigns into micro-campaigns that are more effective,the work process consumes less time and marketers are able to stay ahead of the game.
Customer contact strategyMarketing Automation has changed the nature of contact strategy from calendar-driven campaigns tocustomer-initiated campaigns. The system is set-up with a series of rules to trigger appropriate actions.Integrated checks and balances ensure that relevant content goes to the right individual at the righttime via their preferred channels. Customers should only be contacted when they are ready to opt intomarketing campaigns. Customer engagementMA drives effective targeting, timing and customer relevance. It allows marketers to detect changesin a customer’s status and to promptly engage in real-time marketing in response to identifiedopportunities, i.e. triggers. This distinguishes MA from manual executions.What is in it for you? MA supports more effective engagement with customers and drives sales revenueWith Marketing Automation it’s easy to see what’s working for you and how well. You can measurethe sales opportunities sourced and the conversions influenced all the way through to the revenuegenerated. According to Aberdeen group research last year with 106 companies using MarketingAutomation, the Best-in-Class companies realized a 67% current increase in annual revenue and 65%year-over-year increase in Return on Marketing Investment (ROMI). Free up resourcesMarketing Automation potentially releases more resources that can be re-allocated to developstrategy and conducting analysis, enabling you to do more at a lower cost. Speed to marketThe time span from development to execution is greatly reduced so that new campaigns in responseto specific circumstances or opportunities can be initiated and launched faster, gaining first moveradvantage. Tidbits from Unica Campaign implementation (Debitel Netherland case study): Boost campaigns response rate to over 5% Reduced average campaign design and testing time to four hours Increase campaign volume to 300% Time to production is less than three months
Operational efficiencyThe increased efficiency, accuracy and reduction in human error also reduce risk exposure.Process standardisation is inherent within automation, so MA campaigns can run at lower volumes,more frequently. This is because the costly set-up and labour intensive elements are built into theautomated processes once and then re-used with each similar campaign. Improved campaignA case study below indicates that companies achieving the highest performance in key metrics likerevenue, conversion and return on investments are more likely to use marketing automation technology. Case Study from ING (Unica Campaign Management Solution Implementation) Situation: In the past two years, ING was struggling with its traditional Direct Marketing processes which were found ineffective and generated low returns. To solve this situation, ING needed to create more effective and productive marketing processes by adopting appropriate technology. Solution: After ING moved from Traditional Outbound to Personalized Inbound Marketing, ING is able to initiate the communication to the customers by sending a personal offer through their preferred channels based on the individual’s profile. Besides this, ING can predict the next logical action of the customer based on transactional information and send out relevant messages in order to stay in touch with the customer. Additionally, with an automation capability, ING can launch the campaigns in a shorter period of time and meet the real-time needs of the customer. Outcome: The results of this new technology implementation are already impressive, even though ING hasn’t yet fully applied it at all bank branches. Higher response rates: the average response rate to a product offer is 60% higher than with the traditional direct marketing campaigns Lower direct marketing cost: thanks to the efficient automation program ING has reduced the marketing cost by 35% per year Faster to market: the campaign cycle time has fallen from 26 weeks to 4 weeks. This makes it easier for marketers to take corrective action or to integrate lessons from one campaign to the next.
Requirements before kick starting MAHere are some steps to consider...Define objectives: which marketing processes do you want to automate?Technology is nothing without a suite of solid business processes behind it. You’ll need to specifywhat you expect to accomplish, then the system needs to be set up according to your individualrequirements and goals.New mindset:An understanding and awareness of organisational resources at every level is vital. The broad reachof Marketing Automation and the wide-spread changes to work procedures required throughout theorganisation has an impact on all resources, roles, and responsibilities. For example, the workforceinvolved in Marketing Automation, both directly and indirectly, needs clear demarcation andguidelines so that their respective roles are understood and agreed by all involved, hence ensuringthat each works cohesively with their peers. In effect everyone needs to cultivate a new collaborativemindset.Using the MA toolset: training and experience are essentialThe toolset can only perform to full potential if the skill set and expertise of the end users are equalto the system. It is wise to review this at an early stage in case the necessary knowledge and skillresources need to be acquired, either by training or recruitment. It is also important when selectingvendors to fully explore the extent of training required, what they provide themselves and on whatterms and any additional training that may be necessary for other third parties toolsets employedwithin the system.Insource VS outsourceTechnology changes rapidly, so seeking additional support from external providers may be anotheralternative worth considering. There is a wide range of vendors and consultants with extensiveexperience in Marketing Automation who can assist you to find appropriate out-of-the-box softwareor niche software as well as outsourcing providers who take on the responsibility for looking afteryour system.These are just a few of the issues you need to consider, but be assured that in the long run MarketingAutomation is not only worth it – it’s essential!
In conclusion, Marketing Automation is not the single panacea or the one “solution” thatwill resolve all of your database marketing issues. It is however the cornerstone and an essentialtool for developing the system you need to take advantage of future opportunities. MarketingAutomation places the customer’s needs centre stage and provides the relevant information neededto navigate the buying process, which in turn helps customers to make informed buying decisions.Satisfied buyers lead to long term customer relationships and for marketers, that’s the holy grail.Marketing Automation clearly drives transformational change to all of your marketing processes andit is the only way to compete in future. Your next strategy development discussion should thereforestart with Marketing Automation.About Digital AlchemyDigital Alchemy is Australia’s largest dedicated Database Marketing Service Provider. We have alarge and growing pool of specialist resources dedicated to working with our clients to improve theirmarketing efficiency and capturing latent customer value through marketing automation, customeranalytics, and strategic consulting. Our ever-growing client community includes a wide range oforganisations and industries such as financial services, telecommunications, motoring services,automotive, etc. Our proven transformation process ensures the blending of Digital Alchemy’scapabilities in analytics, campaign management, database design, and development and hosting toyour business knowledge. “This document has been prepared for the purpose of providing general information and should not be relied on in substitution for individual professional advice. Copyright in this document is owned by Digital Alchemy Consulting Pty Limited, and except as permitted under the Copyright Act 1968, no part of it may reproduced by any process, electronic or otherwise, in any material form or transmitted to any other person or stored electronically in any form without the prior written permission of Digital Alchemy Consulting Pty Limited.”
Reference CitedAment, Leslie (2006). The precision Marketing Benchmark Report: How top performers turbo-charge their investments, Aberdeen Group research“Field Marketing 2.0: The Heart of Growing Conversion Rates,” SiriusDecisions 2008<http://customerexperiencematrix.blogspot.com/2010/09/hard-data-to-justify-your-marketing.html >“Lead Lifecycle Management,” Aberdeen Group, July 2009<http://customerexperiencematrix.blogspot.com/2010/09/hard-data-to-justify-your-marketing.html >“Crossing the Chasm with Automated Lead Management”, Aberdeen Group, January 2010< http://customerexperiencematrix.blogspot.com/2010/09/hard-data-to-justify-your-marketing.html >Alexander Hesse (2009). “Case Study: ING delivers personalized product offers across channels inreal time”<http://www.unica.com/documents/us/Unica_CaseStudy_ING_021910.pdf>“Case Study : Debitel Netherlands Selects Unica to Increase Campaign Volume and Boost ResponseRates”<http://www.unica.com/documents/us/Unica_CaseStudy_debitel_A4_072109.pdf>“Marketing Automation as Part of Integrated LeadGen”<http://ilgresults.com/marketing-automation-as-part-of-integrated-leadgen/>