Analysis. The PSP Marketing Automation Opportunity. July An Introduction. Service Areas. Comments or Questions? Business Development Strategies

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1 Analysis July 2012 An Introduction Service Areas Business Development Strategies Production Workflow Solutions Production Workflow Solutions Europe Comments or Questions?

2 Table of Contents Introduction... 3 Key Highlights... 3 The Marketing Automation Opportunity... 3 Defining Marketing Automation... 4 Capturing the Attention of SMB Marketers... 5 SMB Adoption of Marketing Automation... 5 Marketing Automation Providers... 6 Getting Started... 7 Multi-channel Approach... 8 Measurement and Communication of Success... 8 A Consultative Approach... 8 InfoTrends Opinion... 9 About the Author List of Figures Figure 1: Marketing Automation, the Next Big Thing... 6 Figure 2: SMB Marketing Media Diversification... 8 InfoTrends

3 Introduction Marketers of all sizes are seeking providers that can create automated programs to welcome new customers, cross-sell and upsell, nurture new leads, increase customer satisfaction, and win back customers. Print service providers have an opportunity to provide services to marketers that enable them to automate their marketing and lead generation efforts. Large enterprises have been the early adopters of marketing automation as they possess the volume and resources to support this level of automation. However, the introduction of cloud-based marketing automation software tools is capturing the attention of the small and medium business (SMBs) market. This paper will present research findings from InfoTrends Capturing the SMB Marketing Automation Opportunity, which highlights the opportunity for print service providers in targeting SMB firms with marketing automation solutions. Key Highlights Marketing automation is a software solution that uses predefined processes to automate marketing and demand generation tasks. It is a tool for streamlining the sales and marketing processes by replacing high-touch, repetitive manual processes (e.g., lead nurturing) with automated responses. Solutions today focus primarily on fulfilling the digital components of marketing campaigns and ignore the print component. Print services providers have the opportunity to bring print into the mix, and provide marketers with a complete range of self-service marketing tools that will help to facilitate more print business. Large enterprises have been the early adopters of marketing automation. However, the introduction of cloud-based marketing automation software tools is capturing the attention of the SMB market. To better understand marketing automation interest and trends in the SMB market, InfoTrends surveyed 2,010 small and medium businesses in the U.S. as part of its Capturing the SMB Marketing Automation Opportunity study. Small- and medium-sized businesses are looking for partners to help them market and sell in today s cross-media world. Print service providers have a leading edge as SMBs reported that commercial printers, office superstores, and online printing services are their go-to resources for marketing services. The Marketing Automation Opportunity Marketing automation is a growing service area flooded with solutions focused on fulfilling the digital components of marketing campaigns such as , landing pages, and webinars but overlook print marketing that can complement digital efforts and InfoTrends

4 reach key prospects that digital media may not. Print service providers can fill the void by understanding how marketing automation solutions can complement their existing offerings and provide their customers with a complete range of self-service marketing tools that will help to facilitate more print business. Large enterprises have been the early adopters of marketing automation as they possess the volume and resources to support this level of automation. However, the introduction of cloud-based marketing automation software tools is capturing the attention of the SMB market, as these entities are faced with limited resources to execute and manage campaigns. An example of a marketing automation application commonly used by the insurance industry is to automatically send a welcome kit to a new customer at the moment of account creation, without requiring a customer service representative to initiate it. The SMB market presents a large opportunity for print service providers to target with marketing automation solutions. SMBs are the backbone of the U.S. economy, accounting for the majority of U.S. firms in existence today. According to the U.S. Small Business Administration, there are roughly 6 million firms (with payroll) that have fewer than 500 employees, and 5.4 million of these firms have fewer than 20 employees. This presents a large opportunity to those software and print service providers who provide solutions that target their needs. Defining Marketing Automation Marketing automation is a software solution that uses predefined processes to automate marketing and demand generation tasks. The use of marketing automation tools streamlines the sales and marketing processes by replacing high-touch, repetitive manual processes (such as lead nurturing) with automated responses. Marketers are guided through the solution to specify actions that should be taken based on specific behaviors or actions to create a communication workflow. They determine what action (such as downloading content, attending a webinar, or creating a reservation) triggers what response (such as an confirmation or direct-mail welcome package), or what action (such as a flag in the customer relationship management software to direct a sales representative to call) ensures appropriate automated communications. The most commonly automated responses are those triggered from a company website. A potential customer may visit the website to request more information, download content marketing, or connect with the company on social media. No matter what the action is, once their contact information is provided, an automated response can be triggered and the event captured to trigger the next step in the automated workflow. Through integration with a customer relationship management (CRM) tool, lead information and actions can be captured to drive personalized messages or offers to encourage a purchase. InfoTrends

5 As time goes on and more is learned about what works and what does not, the marketer can alter the workflow and messaging. Capturing the Attention of SMB Marketers One of the primary reasons marketing automation is gaining the attention of SMBs is that it can fill a number of sales-related gaps. These organizations have invested in marketing services, but these services generally do not support rich features, such as lead capturing landing pages, webinars, mobile marketing, or direct mail. Marketing and sales are increasingly working more closely together to ensure that precious marketing dollars are allocated in areas that result in the most profit. For small businesses, there may be no differentiation between the sales and marketing departments at all, driving the need for automation to fill the gap in resources and enable focus on those leads closest to making a sales decision. Over time, as these companies grow, the need for solutions that can automate, track, and manage marketing and sales effectiveness is driven by the need for centralizing marketing and sales efforts. Despite the many benefits marketing automation can provide, SMBs are highly cost conscience and, therefore, many wait to reach a breaking point before abandoning adhoc, manual process and investing in a solution that enables automation. This breaking point could be the result of: word of mouth marketing reaching its peak, the need to acquire more leads outside of the core customer area, or when the volume of leads acquired from a business expansion requires a more optimal way to manage capturing and nurturing. Many current solutions, however, lack a full spectrum of media management and primarily focus on digital channels, such as , search engine marketing, and webinars. SMB Adoption of Marketing Automation To better understand the marketing media mix, marketing automation interest, and challenges that SMB marketers face, InfoTrends surveyed 2,010 small and medium businesses in the U.S. as part of its Capturing the SMB Marketing Automation Opportunity study. Just over 14% of respondents reported currently using a marketing automation solution for their business, while another 25% are considering it. A look at the study findings by company size reveals that adoption is much higher in medium-sized organizations (10 to 99 employees) at 33%; more than double its smaller and quadruple its micro counterparts. The higher adoption rate by larger companies can be explained by the fact that most businesses reach a breaking point for how much marketing they can do manually to drive sales through people and resources before some level of automation is required. InfoTrends

6 The largest group of businesses considering marketing automation is the or small range, which makes businesses in this range a prime audience for targeting with introductory or basic levels of a scalable marketing automation solution. Figure 1: Marketing Automation, the Next Big Thing Does your business use a marketing automation solution or service to track and manage marketing/advertising programs and their results? 100% 4% 4% 6% 9% 16% Yes, and plan to continue 80% 23% 27% 17% Yes, but considering something else 60% 21% No, but considering 40% 62% 50% 35% No, no plans to use 20% 0% 8% 8% 11% 1 to 9 10 to to 499 N = Source: Capturing the SMB Marketing Automation Opportunity, InfoTrends 2012 Do not know Users of marketing automation tools expressed a level of disappointment with what they had in place, as over half were considering something else a strong indication that their current solutions are not meeting all of their needs. Many of these solutions take time and a level of expertise to configure and deploy to be used to its full extent. Marketing Automation Providers The number of marketing automation providers and available solutions has increased greatly in the past few years, and new solutions continue to be introduced frequently. Enterprise-sized businesses have been using these solutions for some time, supported by companies such as Eloqua, Aprimo, and IBM Unica. More recently, software providers are using the cloud to create scalable, cost-effective solutions for businesses of all sizes. Marketing automation solutions for SMBs are typically offered on a subscription basis often through tiered packages to provide businesses of varying sizes the capabilities they require, while enabling them to scale up or down should needs change. These solutions are very sales-centric as they integrate with popular CRM solutions to leverage data stored in these systems, while adding key information, such as prospect behavior, communication, and other trackable activity. While the enterprise market has a few key leaders, the leadership role in the SMB market is still up for grabs. The top three solutions used by InfoTrends SMB survey respondents InfoTrends

7 included Genius, Hubspot, and Fishbowl. Here is a brief overview and description of each solution: Genius ( focuses on inbound and outbound marketing management through and social media marketing. It also includes functionality for website tracking, web form creation for lead capture, campaign management, CRM integration, and marketing analytics. Hubspot ( primarily focuses on inbound marketing efforts to lead prospects to the business. The solution includes website and blogging tools; search engine optimization; marketing analytics; and lead management, such as automated . Fishbowl ( focuses on marketing automation specifically for restaurants. It enables marketing and analytics for individual branches and the overall business. It also includes support for social media; marketing; and relevant functions, such as offer management and guest loyalty. The successful solutions, however, are those that offer automation capabilities for all major media channels, be it print, web, , mobile, or social. The variety of media ensures the marketers can provide the preferred communication media to each lead automatically without individually sending each one after manual review. Getting Started Small- and medium-sized businesses are looking for partners to help them market and sell in today s cross-media world. They want solutions that integrate and automate marketing across print, online, mobile, and social media channels, while being agile enough to support emerging media types and channels as they rise in prominence. SMBs will often lean towards self-service tools that enable them to create and produce their marketing materials internally to save money. While the individual opportunities with SMBs are relatively small, the web-enabled ability to aggregate print and digital transaction volume adds up to huge market opportunity for service providers so much so that it is too big to ignore. Print service providers have a leading edge as SMBs have reported that commercial printers, office superstores, and online printing services are their go-to resources for marketing services. SMBs, especially on the smaller side, show a preference for onestop-shop solutions that can meet all of their marketing needs and goals. As this market matures and SMBs increasingly turn to technology to help augment their resource load and optimize their efforts, service providers need to step up to the plate. InfoTrends

8 Multi-channel Approach Many marketing automation solutions only focus on digital channels, however, SMB marketing needs show that the successful solutions will be those that offer automation capabilities for all major media channels, be it print, web, , mobile, or social. A wide variety of media support in a single solution ensures that marketers can provide the preferred communication type to each lead automatically without individually sending each one after manual review. Figure 2: SMB Marketing Media Diversification Do you currently use the following Marketing channels to promote your business? Company Website Search engine marketing Social network presence Printed direct mail (e.g., postcard) Online directory Print directory (e.g., Yellow Pages) Signage/Point of sale advertising Newspaper ads or ad inserts Social network advertising Display/Banner ads Magazine ads Wireless/Mobile (e.g., SMS) Content marketing Blogs 61% 61% 61% 59% 58% 56% 51% 44% 39% 35% 34% 33% 32% 77% 83% 13% 15% 20% 21% 17% 20% 12% 7% 9% 11% 16% 14% 13% 10% Yes 8% No, but considering Multiple Responses Permitted 0% 20% 40% 60% 80% 100% N = 2,010 Small & Medium Businesses Percentage of Respondents Source: Capturing the SMB Marketing Automation Opportunity, InfoTrends 2012 Measurement and Communication of Success SMBs are becoming more active in using data to drive marketing campaigns. They want solutions that drive demand, generate leads, measure marketing effectiveness across all channels, and deliver accurate calculations of marketing return on investment (MROI). Solutions that meet these needs are highly attractive to SMBs as they deliver a high likelihood for a campaign s success. Service providers need to have a strong understanding of marketing effectiveness to enable appropriate solutions and services that fill this need. A Consultative Approach Many small businesses, especially micro businesses, often lack marketing expertise within their firm. Incorporating marketing best practices into a marketing automation solution enables SMBs to fill the void of not having access to an internal marketing expert. Including access to content, such as whitepapers, webinars, examples of successful campaigns, as well as tips and tricks for using specific media, are all tools for guiding optimal use of the solution. Turning user data captured from the solution into InfoTrends

9 salient user alerts, such as X% of users are using to follow-up with webinar guests, is this right for you? provides insights into usage and that ability change approaches, if necessary. InfoTrends Opinion SMBs are aggressively seeking out systems to centrally manage marketing efforts, enhance sales productivity, increase the sales pipeline, and ultimately drive improved business results. Print service providers have a leading edge when it comes to serving the needs of SMB marketers because the structure to fulfill printing needs is already in place. It is time for print service providers to develop solutions and enter the world of marketing automation. This material is prepared specifically for clients of InfoTrends, Inc. The opinions expressed represent our interpretation and analysis of information generally available to the public or released by responsible individuals in the subject companies. We believe that the sources of information on which our material is based are reliable and we have applied our best professional judgment to the data obtained InfoTrends

10 About the Author Stephanie Pieruccini Senior Research Analyst Follow me on Twitter Connect with me on LinkedIn Stephanie Pieruccini is a Research Analyst for InfoTrends' Production Workflow & Custom Communications Service. In this role, she is responsible for responding to client inquires, conducting market research and analysis, and providing coverage of industry events. Comments or Questions? InfoTrends