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1 Crain Research Insights Inbound Real-time Marketing Solutions: The Right Message at the Right Time In partnership with
2 TABLE OF CONTENTS 1. The Opportunity in Real-Time Inbound Marketing 2. The State of The Art 3. The Landscape for Real-time Inbound Marketing 4. The Growing Value of Real-time Inbound Marketing 5. Marketing in a Multi-Channel Environment 6. The Solution: Key Drivers to Real-time Inbound Marketing 7. Future Outlook 8. Appendix 4 Methodology 4 List of contributors 4 About Crain Communications Inc. NOTES & RESOURCES Advertising Age and BtoB conducted an extensive online survey in March 2012 of 453 marketers about their views on real-time inbound marketing and how they can improve their efforts in this growing area. This white paper presents the findings, as well as suggestions for the future. See the Appendix for further details on the methodology. In partnership with APRIMO
3 THE OPPORTUNITY IN REAL-TIME INBOUND MARKETING For years companies were conditioned to deploying traditional marketing vehicles such as telemarketing, advertising and promotion. Such channels served marketers well and made for relatively easy consumer targeting. But the dramatic and ongoing changes in consumer behavior have rendered traditional marketing less valuable. Ad buys, promos and road shows, which are all forms of so-called outbound marketing, still play a significant role in marketing communications. Yet their margins are getting thinner. With traditional marketing on the wane, a new marketing platform is fast emerging: real-time inbound marketing. Real-time inbound marketing is defined as targeting customers during marketing communications when the customer reaches out to the enterprise whether through call center or clicking on a display advertisement on a website, and the enterprise responds with presenting a perfectly timed and perfectly appropriate offer. The foundation of that response is the decisioning process the robust data mining, heuristics, and rule-based algorithms that suggest the ideal solution discussion based on creating the highest value to the customer. As consumers engage the call center or pull content from the Web, marketers need to have the decisioning protocols at the ready, depending on which channel, stage, and value configuration that the prospect is engaged in the customer journey. The use of underlying technologies is the key for marketers who are eager to capitalize on real-time inbound marketing and enhance their ability to locate new customers. Use of all data about prospects and customers, including current interaction and historical data, along with self-learning algorithms and rules, enable real-time delivery of the right message at the right time. The essential opportunity in real-time inbound marketing is the application of real-time decisioning. In fact, this decisioning is the foundation of delivering exceptional value to the customer. THE STATE OF THE ART In this white paper we will explore the growth of real-time inbound marketing, the underlying reasons that are driving this type of marketing, and the key technologies needed to produce and a sustain a successful inbound marketing program. There are three interconnected trends that have pushed real-time inbound marketing to the core of marketing communications. The first trend is the rise of digital marketing and online clutter; the second trend is the decline in outbound marketing techniques; and the third trend is the growing pressure on marketers to achieve better ROI. But the new equation has made it tougher for marketers to cultivate new prospects and grow new revenue. Here s why: The ongoing rise in digital marketing channels and the decline in outbound marketing tools have conspired to create a fragmented marketplace, where companies face a growing amount of disintermediation between marketing their messages and reaching the right prospects at the right time. What s more, the challenge marketers now face in APRIMO
4 locating the right customers is compounded by sharper calls from the c-suite for more accountability, while, at the same time, budgets are being reduced. The sweet spot in the new equation is creating an effective inbound marketing strategy. Real-time inbound marketing solutions refer to those digital optimized technologies used in an inbound setting that anticipate a customers needs (i.e., decisioning) and proactively offers (i.e., delivery) the appropriate solution or content. Here is a typical scenario. A customer engages a financial call center to explore a mortgage payment acceleration. In real time, the technology offers decisioning based on the context of the current conversation. The technology examines Why is the customer calling? The real-time inbound technology then suggests, using rule-based algorithms, perhaps a secondary product such as a home equity loan. Decisioning --plus delivery. Today s Marketing Setting What s the Sweet Spot? Rise of Digital Marketing/ Increase Clutter? Decline of Outbound Marketing/Channel Fragmentation Budget Constraints/ Culture of Metrics Inbound Marketing More Effective by Wide Margin As the Web continues to upend traditional marketing strategies, a growing number of marketers are starting to recognize the value of inbound marketing techniques. According to the survey, 59% of the respondents reported that they viewed inbound marketing more effective than outbound marketing, compared with 39% of the APRIMO
5 respondents who reported that outbound marketing was a more effective marketing vehicle in driving sales. Interesting the preference gap (59% vs. 39%) in favor of inbound marketing far outweighs outbound marketing. Inbound marketing is the new conduit to sales Effectiveness of Outbound vs. Inbound Marketing Outbound Marketing Effectiveness 39% Inbound Marketing Effectiveness 59% 25% 50% 75% Percent shown for 4 or greater Question: Please rate the effectiveness of inbound marketing vs. outbound marketing to sell to your company s customers. Rate on a scale of 1 to 5 where 1 is Not Very Effective and 5 is Very Effective. N=453 Source: Advertising Age/BtoB magazine: Inbound Real-time Marketing Solutions, THE LANDSCAPE FOR REAL-TIME INBOUND MARKETING As digital marketing moves closer to the core of marketing, companies are starting to appreciate the need for online tools that can specifically cater to whichever channel the customer may be engaging the brand. The growing recognition of real-time inbound marketing coincides with the explosion in digital marketing channels, ranging from conventional marketing to social marketing via Facebook, Tumblr and Twitter. A majority of marketers (63%) reported that the growing use of digital channels (i.e. , search, display advertising, social media) is fueling the interest in inbound marketing that uses realtime customer solutions, the survey said APRIMO
6 Digital Channels Driving Real-time Inbound Marketing Extent Digital Channel Driving Use Real-Time Inbound Marketing Solutions 63% 25% 50% 75% Percent shown for 4 or greater Question: Please rate to what extent digital channels (e.g. , search, display, advertising, social media, etc.) are contributing to your interest in inbound marketing that uses real-time customer solutions. Rate on a scale of 1 to 5 where 1 is Low and 5 is High. N/A indicates Not Applicable. N=453 According to the survey, 37% the respondents reported that they have not integrated real-time marketing technologies with their sales and marketing units. While this finding at first analysis appears to be indicating a nascent market, it is important to examine the market context for this emerging technology. Interestingly, 22% reported at least moderate integration of real-time inbound solutions into the sales-and-marketing mix. This combined with the research findings that inbound marketing is almost twice as effective as outbound marketing (59% vs. 39%) suggests that the upside potential on the adoption curve for real-time inbound solutions is indeed very high. It is not uncommon for an emerging technology to score moderate to low on the adoption curve. However, when examining the stimuli to the technology we find the true potential. These stimuli manifest the customer pain as is the case with real-time inbound marketing APRIMO
7 Adoption of Real-time Inbound Marketing Stage of Adoption: Real Time Inbound Marketing Solutions 50% 37% 40% 25% 16% Stage One: No integration. We do not use Real-Time Inbound Marketing technology in our organization s sales and marketing. Stage Two: Somewhat integrated (i.e. 2 or more channels integrated) Stage Three: Moderately integrated (i.e. 3 or more channels integrated) 4% 4% Stage Four: Stage Five: Very integrated Fully integrated. (i.e. 4 or more We fully integrate channels Real-Time Inbound integrated) Marketing technology into our sales and marketing initiatives. (i.e. all channels integrated) Question: Please select which stage your company is at in reference to using Real-Time Inbound Marketing technology to improve your sales and marketing effectiveness or initiatives. N=341 THE GROWING VALUE OF REAL-TIME INBOUND MARKETING More than a third of the respondents reported the effectiveness of outbound marketing helps to drive or influence their consideration of supplementing outbound marketing with real-time inbound marketing solutions. Outbound marketing tools may have lost their luster, but they re still part of the typical marketing arsenal. The opportunity for marketers is to take depleted marketing vehicles, such as telemarketing and advertising, and harness them for customers and prospects that create their own purchasing cycles online APRIMO
8 Weakening Outbound Driving Real-time Inbound Marketing Effectiveness of Outbound Marketing on Increasing Consideration of Inbound Marketing 34% 25% 50% 75% Percent shown for 4 or greater Appeal of Value Proposition Question: Within your marketing department, how does the effectiveness of outbound marketing drive or influence your consideration of supplementing outbound with inbound marketing through Real-Time Inbound Marketing technology? Please rate on a scale of 1 to 5 where 1 is No influence and 5 is Very significant influence. N=341 With customers increasingly in control of the purchasing process, the onus is growing on marketers to deploy real-time inbound marketing technologies. The software can help put their brands in front of the ideal customer in the most effective fashion and communicate to customers and prospects on their own terms. Indeed, the value of proposition of real time inbound marketing is starting to resonate in the marketplace. In considering a real-time inbound marketing technology, developing a universal message and multi-channel deployment to the customer life cycle touch points were the two most important elements to achieving sales and marketing goals. However, respondents cited several marketing areas in which real-time inbound marketing technologies can play a positive role, such as the ability to integrate with CRM (58%), provide a continuous self-learning feedback loop (54%) and align the sales opportunity with the real-time voice of the customer (51%) APRIMO
9 Value Proposition of Real Time Inbound Marketing Resonates in Marketplace Appeal of Value Proposition 75% Percent shown for 4 or greater 50% 60% 58% 58% 54% 51% 25% Universal Message/ Communication Database Multichannel Deployment to Customer Life Cycle Touch points Ability to Integrate with CRM Continuous Self-Learning Feedback Loop Real-time Voice of the Customer Question: In considering a Real-Time Inbound Marketing technology, please choose how important the following element is to achieve your sales and marketing goals. Please rate on a scale of 1 to 5 where 1 is Not at all important and 5 is Very important. N=341 MULTI-CHANNEL ENVIRONMENT Selling in a multi-channel environment presents its own challenges, of course. Let s take a closer look at the major challenges facing marketers in the next 12 months and how real-time inbound marketing technology can be a major remedy to those challenges. According to the survey, 54% of the respondents reported that engaging the customer was the biggest challenge, followed by competing for the customer s attention (52%) and grappling with all of the emerging digital platforms (38%). A fragmented purchasing process across selling channels and more influences affecting the purchasing decision were also cited by a significant number of respondents APRIMO
10 Competing for Customer Attention Challenges in Multi-Channel Setting Engaging the customer Competition for the customer s attention (i.e. increased noise) 54% 52% Emerging digital platforms (e.g. mobile, social media, etc.) 38% Fragmented purchase process across selling channels More influences affecting the decision 26% 24% More complex products to sell Generation Y (18-35) abandoning the traditional Channels 22% 21% Increased emphasis on technical specifications 11% 25% 50% 75% Question: In the next 12 months, what are the broad challenges that you face as a marketer in a multi-channel environment? Please check three most important. N=341 Channel Proliferation Stymies Marketing Message The top three channels that customers are engaging with prior to making a purchase are the Web (71%), one-to-one selling and , both at 62%. The multitude of channels all competing for the user s time and attention reduces the ability among marketers to get their messages to the right prospects. At the same time, marketers need to deploy more and more of their messages through digital platforms. This presents an opportunity for inbound marketing through call centers, online channels and social media. Rather than cancelling out certain channels consumers are using myriad channels before making purchases, which adds to the pressure among marketers to adopt real-time inbound marketing solutions and supporting technologies APRIMO
11 Channels Involved in Purchasing Channels Used Before Purchase 51% Web 71% One-to-one Selling 62% 62% Social Media 36% Events 33% Call Center 29% Mobile 21% 25% 50% 75% Question: Typically, which of the following channels do your customers engage with before making a purchase? (Check all that apply) N=341 THE SOLUTION: KEY DRIVERS TO REAL-TIME INBOUND MARKETING Several of the key drivers of real-time inbound marketing technology play into many of the challenges faced by marketers as they transition to a digital age. The top two priorities are the need to create the right message at the right time in the customer life cycle (46%) and operating with fewer resources (35%). But there are other compelling reasons driving marketers involvement in evaluating real-time marketing technology, including the need to achieve faster and more relevant touch points in the marketplace (33%), the difficulty tracking users that have provided their contact information in multiple channels (29%), and the erosion in outbound marketing (22%) APRIMO
12 Key Drivers to Real-time Inbound Marketing Technology Key Drivers Need to create the right message atthe right time in the customer life cycle 46% Reduced resources (i.e. budget and staff) Need to achieve faster and more relevant touch points in the market Difficulty tracking multi-channel contact history 29% 35% 33% Limitations in justifying marketing budgets Weakening effectiveness of outbound marketing Inability of our current solution to provide meaningful analytics Increased difficulty to make offer and timing of offer specific to the customer Interest in managing closed-loop marketing costs 22% 22% 20% 20% 15% Inability to customize offer based on higher order business rules (e.g. likelihood of acceptance, spend amount, loyalty value, contact history, etc.) 12% 25% 50% Question: Within your marketing department, which of the following reasons are driving your involvement or would you consider when evaluating Real-Time Inbound Marketing technology? Please select up to three. N=341 Real-time inbound marketing technology as the foundation for right-message, right time mindset Let s summarize some of the major elements of this research. Real-time inbound marketing technology is designed to help marketers to align their messages with customers and prospects as they wend their way through the sales cycle. But the benefits of real-time inbound marketing technology go beyond getting closer to customers and enhancing lead generation. The technology affords marketers with a right-message, right time mindset that is so crucial in adapting to how consumers purchase products and services online. Indeed, right message, right time may now be the baseline for marketers who need to monetize their digital marketing channels APRIMO
13 According to the survey, 58% of the respondents reported that the right message and the right time is the best tag line to explain real-time inbound marketing technology while only 17% reported that the power of context is the best tag line to communicate its benefits and 9% reported that true message: every where, every time would be a suitable tag line. The Right Message at the Right Time 58% Tag Line 58% 4% 9% 12% Intuition unbound True message: every where, every time 100% Real-time offer first time, every time 17% The power of context The right message at the right time Question: In thinking about a tag line to explain Real-Time Inbound Marketing technology, which description below fits best? (Select Only One) N=341 The Differentiating Factor in Effective Inbound Marketing From the ability to integrate the program with existing CRM systems to managing communications databases, real-time inbound helps marketers differentiate their products, services and messaging from the competitors. The technology understands that consumers no longer advance from Point A to Point B when they re in purchasing mode, but, demand different types of content (e.g. advertising, ) as they travel along the path to purchase. The technology is able to harness of all of the emerging digital channels, such as search and social marketing, and communicate a universal message APRIMO
14 Real-time inbound marketing software also helps to re-energize outbound marketing channels so they don t deteriorate. Perhaps most important, the technology enables marketers to get in front of their customers and respond more proactively to their interests, regardless of the channel they re using. Real-time Inbound Marketing Solutions Value Proposition Differentiators Right message at the right time Universal Message Communication Database Real-time Voice of Customer Multi-Channel Contact History Ability to Integrate with CRM Variable Start-up Costs Incremental Buy Table stakes FUTURE OUTLOOK N=341 Real-time inbound marketing technology is very likely a game changer. As the conversational Web transforms into the social Web, the technology is helping marketers to transition their marketing efforts to engage with customers and prospects on whichever marketing channel they may be accessing, with the right message at the right time. Similar to , search, and social media, real-time inbound marketing technology is playing an integral role in the emerging online advertising infrastructure. For marketers looking to the future, real-time inbound marketing technology will enjoy a valued position in their portfolio APRIMO
15 APPENDIX Methodology Inbound Real-time Marketing Solutions: The Right Message at the Right Time, by Advertising Age and BtoB, is based on an online survey conducted in March 2012 of 453 marketers. Among industry sectors, financial services (including accounting, banking and insurance) represented by 24% of all respondents, with technology companies (20%), retail/retail distribution (9%) and publishing/media (9%) also well represented. CONTRIBUTORS Nearly a third of the respondents (27%) were senior level marketers, including directors and managers of marketing, product development and/or communications, while 13% of the respondents were CEOs, president, owners and partners of their companies. The titles CMO, EVP, SVP were also represented. 4 John DiStefano, Research Director, BtoB: Magazine and BtoBonline.com jdistefano@crain.com 4 Matthew Schwartz, Contributing Writer, BtoB: Magazine and BtoBonline.com matthew.schwartz38@yahoo.com 4 Wes Moore, VP of Solutions Marketing, Aprimo, Wesley.Moore@aprimo.com ABOUT CRAIN COMMUNICATIONS INC. Crain Communications inc. was founded in 1916 in Louisville, Kentucky by G.D. Crain, Jr. An industry leader, Crain Communications Inc. Is one of the largest privately owned business media companies with 30 leading business, trade and consumer brands in North America, Europe and Asia. The company s 850 employees in 11 locations produce exciting publications, digital products, events, marketing services, custom publishing, lead generation and research and data products to help its millions of readers and clients succeed. 4 Bob Felsenthal, Publisher BtoB Magazine and BtoBonline.com 711 Third Avenue, 3rd Floor, New York, NY bfelsenthal@crain.com 4 John Obrecht, Editor, BtoB Magazine and BtoBonline.com 150 N. Michigan Ave., Chicago, IL jobrecht@crain.com APRIMO
16 ABOUT APRIMO Aprimo supports a real-time environment with the latest inbound marketing technology. The Aprimo Real-Time Interaction Manager helps marketers deliver relevant, timely communications in direct response to current customer engagement. Aprimo is a leading provider of software and services that advance the productivity and performance of marketing organizations. We enable marketers to engage, lead and perform by empowering conversations on new engagement channels, enhancing internal collaboration, and improving marketing performance and accountability. Aprimo s modular and on demand Integrated Marketing Management (IMM) solutions provide a global, integrated marketing platform that can be broadly adopted across an organization, letting companies balance creativity with a data-driven approach and simplify the complexity of a rapidly changing marketing environment. Hundreds of thousands of marketers trust Aprimo to revolutionize their marketing, including over one third of Fortune 100 companies and nearly one quarter of Global 100 companies. Aprimo, a Teradata company, is headquartered in Indianapolis, Indiana, with offices worldwide Corporate headquarters 900 East 96th Street, Suite 400, Indianapolis, IN info@aprimo.com Teradata Corp. (NYSE: TDC) Innovation Drive, Dayton, OH U.S./Canada international APRIMO
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