Email Marketing vs Marketing Automation

Email Marketing Was Initially the Only Choice 

Marketing has been in a constant state of evolution since the earliest known instance in 1000 B.C. Egypt. Montgomery Ward initiated the first mail-order business in the late 19th century; by 1917, the total annual mail order market was estimated to be 1.5 billion dollars in the U.S. Many businesses, most of the brick and mortar variety, made good use of direct mail, until they saw that online businesses were garnering more market share.

Email Marketing Supplemented Direct Mail

As email became mainstream, it was only natural that marketers would realize its potential and capitalize upon it. Email marketing has been used by businesses since the mid-1990s, providing a means of reaching potential customers directly and attracting them into the sales funnel. Email lists were traded, bought and sold, as well as built on-site or via paid ads. It was a critical aspect of many successful businesses’ marketing strategy, in terms of both attracting and qualifying prospects.
Even small businesses with only two or three hundred names on their list were able to take advantage of this very affordable method of putting their offering in front of potential buyers. But it still had its limitations.

Most businesses approached email marketing as a means of reaching new prospects, often buying email lists from list brokers – those whose business involved simply harvesting as many emails as possible. The more knowledgeable would seek lists that were filtered to be specifically tailored to their target demographic, while many novice marketers simply used the ‘shotgun’ approach… sending out thousands of emails, hoping to see some small percentage turn into qualified buyers. Since the cost of emailing is much lower than direct mail and faster than acquiring organic traffic, this method worked well for many.

But eventually, a problem of scale developed. Sending out 10,000 emails rather than 500 began to generate direct and indirect costs, while the conversion rate didn’t improve. The cost per sale began to climb and short of developing an in-house proprietary system (which also presented substantial costs), the only way to reduce the cost per sale was to improve the conversion rate.

Marketers, of course, love to strive for a phenomenal conversion rate, and with innovation, some were successful. But well into the 21st century, it has become obvious that simply casting a baited hook into murky waters can only deliver limited results. Something new was needed, in order to achieve notable success.

Enter: Marketing Automation

Any marketer will tell you that the key to success is to focus on highly targeted prospects. Regardless of the marketing vehicle, peddling girls’ dresses to old male pensioners is unlikely to yield the desired sales numbers. But even with well filtered email lists, there is still a lack. Has the prospect shown a previous interest in a product? Has the business made it a point to show that the customer’s interests or concerns are important? Is the business nurturing a relationship with the customer?

Experienced marketers know these are important issues to address, but they also know that a personal touch, while the most effective approach, doesn’t scale well. With thousands of prospects, it’s simply not feasible to have a customer service representative deal directly with each.
Plato was correct – necessity is the mother of invention. Realizing that the inability to scale such relationship nurturing was the greatest limiting factor, marketers refined their approach to an automated process.

The earliest efforts weren’t the best, as is often the case. Poorly used auto-responders, for instance, often left customers feeling more neglected than they might have felt, had they received no response at all. But as always, the most experienced marketers sought feedback, analyzed the results, tested new approaches. And eventually, they developed an automated process for moving prospects through a conversion funnel without alienating them, while providing valuable data for fine-tuning the process. This in essence always leads to increase conversions and more leads produced.

Marketing Automation is the Latest Step in Marketing’s Evolution

The basic goals of an automated marketing solution are precisely what they would be for a human-driven solution:

  • Engage with large customer lists on a one-to-one basis
  • Send marketing messages based on website interaction
  • Generate leads from dead visitors
  • Score leads based on website form answers
  • Score leads based off website behaviour
  • Manage your list more effectively with advanced segmentation
  • Track responses to prospects
  • Track actions by prospects
  • Promote conversions
  • Track performance of process
  • Provide analytics data

This provides a highly useful amount of information and assistance, allowing a business to deal with a customer base that is too large for their limited resources. But does it really do enough? Does it determine where the user is in their buying process? Does it convey a sense of worth to them? Or does it simply provide a template to a human, embellished with a bit more data? As it is, it really won’t scale much beyond the business’s human capabilities.

Studies indicate that nearly a third of online purchases take place after the 7th engagement. That alone should indicate that a requirement for human interaction makes scaling untenable. Consequently, in systems that do require human intervention, that 7th engagement rarely occurs… the sales staff simply haven’t the time or persistence.

Studies have also shown that approximately 1/4 of customers will purchase very soon, with another 1/4 unlikely to ever purchase. That leaves around 1/2 that will purchase, provided the right marketing messages are delivered at the right time. Utilizing a comprehensive marketing automation solution allows you to nurture that remaining group, keeping them engaged and leading them to convert.
Ideally, a system that can properly scale an automated marketing effort will need to:

• provide a comprehensive CRM, capable of managing all interactions with prospects and customers, organizing and automating, synchronizing sales, marketing, customer service, and technical support;
• allow tailoring of messages in a fashion that resulting traffic can be tied to specific messages and keywords;
• track movements on the website, in order to determine the interests of the majority of visitors that take no action on the site;
• send selected messages based upon a prospect’s activity on the site;
• escalate a prospect to human action at specific thresholds;
• provide performance analysis data on human calls;
• multi-user/multi-level access;
• highly secure management of sensitive data;
• securely accessible from multiple locations/devices.

The Critical Marketing Decision 

Gartner, Inc. recently reported that companies using marketing automation to nurture their prospective customers were seeing a 451% increase in qualified leads… who would want to ignore that opportunity? They also found that those companies were enjoying a 10% or greater increase in revenue over a 6 to 9 month period. Add to that the 5% increase in customer retention that Harvard Business School cites as a result of using marketing automation, and you have a good reason to consider automation of your marketing efforts going forward.

Any business that is seeing an inability to pay adequate attention to a growing number of prospects and customers, or that is experiencing a rising cost per sale with no notable improvement of its conversion rate, would do well to consider a marketing automation solution. Isn’t it time to take your business to the next level?

One Response to Email Marketing vs Marketing Automation

  1. Caitlin September 18, 2015 at 1:53 am #

    Wow! A 451% increase in leads is quite impressive, to say the least! I should think the possibility of such an increase would be reason enough for a company to move in the direction of marketing automation. Great post!

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