The increasing sophistication of email marketing and its widening role as a revenue generator is reflected in the surging adoption of marketing automation systems. With a strong email marketing program becoming ever more mission-critical, increasing numbers of companies are investing in marketing automation to keep pace with competitors and raise their email marketing game.
“Marketing automation is becoming a business imperative for attracting and keeping customers,” said analyst firm Ovum, “and is central to the long-term survival of the modern enterprise.”
A sharp uptick in marketing automation adoption is seen by major analysts who track the sector. IDC, Gartner, Forrester Research and Sirius Decisions all report adoption of marketing automation is on the rise and experiencing a major breakthrough. Aberdeen Group sees marketing undergoing a “dramatic transformation” driven by process automation and data.
These findings jibe with those of a BtoB Magazine study, which found “strong” or “full” adoption of marketing automation systems rose from 40 percent in 2012 to 62 percent in 2013, with the adoption rate projected to jump to 81 percent in 2014.
“Marketing automation is on the threshold of a quantum leap, moving from merely a marketing productivity tool to a means of real marketing innovation,” said BtoB research director John DiStefano. The impact of marketing automation, he said, was “the marketing equivalent of the transition from horseless carriage to modern automobile, with the ramifications equally profound in the marketing space.”
For companies looking to optimize their revenue generating capabilities, automation is needed to conduct the email marketing activities that are the heart of integrated multichannel marketing. And with email marketing trending towards more sophisticated modes like real-time triggered email and behavioral marketing, marketing automation provides the infrastructure necessary to conduct these types of complex campaigns.
Bigger Role, Bigger Budget
The rising importance of email marketing and marketing automation is reflected in a Gartner survey that found 72 percent of companies now have a Chief Marketing Technologist, a figure expected to grow to 87 percent by 2014. Gartner analyst Laura McLellan made a big news splash when she predicted that CMOs will control higher IT budgets than CIOs by 2017.
The top benefit marketers expect from a marketing automation solution, according to BtoB’s findings, is improved conversion rates, followed by increased email click-throughs and Web traffic, better email opens and reductions in email and website bounces.
Seventy-eight percent of survey respondents cited online lead generation as a major goal when implementing a marketing automation solution, followed by tracking website visitors (77 percent), managing marketing campaigns and tracking lead activity (70 percent each), lead scoring and qualification (69 percent) and automated lead nurturing (62 percent).
Aberdeen Group sees the surge in marketing automation driven by the large number of customer touches a prospect receives before a deal is closed. This, says Aberdeen Group, “reflects the reality of today’s buyer’s journey typified by highly informed and, thus, highly empowered customers.” As companies look to increase qualified leads and conversions of leads to customers, marketing operations have become “the new heroes of the marketing world,” says Aberdeen Group.
Market Numbers Climbing
A major spike in marketing automation adoption is reflected in analysts’ market growth figures. Sirius Decisions sees the number of B2B organizations using marketing automation accelerating and estimates that a $3 billion marketing automation platform market will grow from 20 percent penetration today to approximately 50 percent by 2015.
IDC sees marketing automation growing from a $3.7 billion market in 2011 to $4.8 billion in 2015, rising to $5.5 billion in 2016. Factors influencing the growth spurt, said IDC, are changing buyer behaviors, the emphasis on revenue generation and measurement and the ease of adoption via the software-as-as-service (SaaS) model.
IDC VP Mary Wardley sees a combination of technology maturity and marketing sophistication driving the adoption of marketing automation. “What was an area of learning and experimentation is becoming an environment of rapidly evolving applications and tools to serve the marketers’ expanding needs for automation, scale and customer insight,” she said.
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Photo Credit: Jill Mitchell