Carlos Hidalgo, CEO, Annuitas Group – Executive Interview Series

Only 25 percent of marketing automation software users are getting the full value from their system, relates Annuitas Group CEO, Carlos Hidalgo. This results from companies buying a system but not implementing what he refers to as a “lead management framework.” Software has potential, but without well-defined processes, your organization can never fully realize it.

In this interview, Carlos discusses how building a strong framework can help uncover some significant ROI. He also talks about Annuitas Group’s recent move to vendor agnosticism, and provides suggestions for evaluating the many marketing automation solutions available.

Carlos Hidalgo, CEO, Annuitas Group

Full Interview Transcription

DF: Hi, I’m Don Fornes from Software Advice, and we’ve got a visitor here in our offices in Austin, Texas. Carlos Hidalgo is the CEO of the Annuitas Group. Carlos tell us about what you do in marketing automation.

CH: Yeah, we help companies answer the fundamental question of, "I've generated a lead, now what do we do?" So our focus is developing lead management process for organizations that bring marketing and sales together around the whole area of demand gen, and help them manage a lead from the minute it comes in through the front door all the way through the customer lifecycle. And by doing that, really help marketing better contribute to bottom line revenue.

DF: You recently wrote a blog post, “Is This the Beginning of the End?” where you talked about a Sirius Decisions statistic that less than 25 percent of marketing automation users were getting the full value from the system. Can you talk more about that? What that means to the industry and what the solution is to improve that?

CH: Yeah, the blog post was posted and written more to generate a lot of questions around, “We’ve got this wonderful marketing automation space, so what does that mean for all of us?” Last year at the Sirius Decisons summit, they mentioned from the stage, and then it was later also published in the Propelling Brands blog, that said less than 25 percent of automation owners are receiving the full value. So the post was really to pose the question of, “Wasn’t automation supposed to solve all of the marketer’s issues? Wasn’t automation supposed to make our lives easier and supposed to allow marketers to do all these wonderful things?” And then you look at, OK, only 25 percent are receiving the full value. So what that kind of means is that it has to be more than just software. While the automation software solutions that are out there are very robust and can do a lot of things, I think that statistic alone proves that marketers need more than just software in order to truly be successful.

DF: What are some of the things that you’re working with your clients to do to make sure that they’re successful and get the full value?

CH: We work with our clients on really definining their lead management process and what we call at Annuitas Group the "lead management framework." And that consists of data, lead planning, lead routing, lead qualification, nurturing and metrics. And we work with our clients to really do a full analysis of where they are and what gaps exist in each of those process areas. And then we produce recommendations from a best practice perspective on what they need to do to remediate those gaps that exist. Just through that process alone, we’ve uncovered over $500 million in revenue with our clients that they can recoup as an organization if they install these best-in-class processes. We then sit with them as a second phase and help them develop, and to your point you said change management, really transform and change the way they work as an organization between sales and marketing. Not only do we see them, then, bring that revenue back into the organization, but another result of our work is we oftentimes see marketing and sales groups align much more closely. So while so many organizations are trying to figure out, "How do I get marketing and sales on the same page?", we really believe that’s more of a symptom of a greater problem, the greater problem being lack of process.

DF: So, what would just one or two really specific examples be of processes that people typically struggle with?

CH: I think number one is data. We sit with prospects all the time and even clients who say, “We know our data is bad. We know that we’re going to have bad data. We don’t do segmentation. We have no personas built. We don’t even know who our ideal customer is.” So, that’s first and foremost. We work with them on defining those prospect personas, those ideal customer profiles, what their segmentation strategy should be, what their data hygiene strategy should be. Because even if you have great segmentation, if you have bad data, you’re marketing to people who don’t exist. So, that’s number one. I would say number two is lead qualification. We see a lot of organizations move right into scoring, and we’re even seeing a lot of people define lead management by saying “Oh, lead scoring, lead nurturing.” What we say is, “Let’s take a step back.” First you have to decide, in a collaborative fashion with marketing and sales, “What is a lead?” But even more so, what’s a response? What’s a qualified response? What is a lead? What is a marketing-qualified lead? Sales-accepted lead? All these different variations. Once you decide that in a collaborative fashion, then you start assigning criteria to each of those definitions. Then you can move on to say, based on behavior and demographic, which ties back to the data work we’ve already done, now we can start to design and build out a lead score model. And so those are just two examples of what we do with our clients on a daily basis.

DF: Got it. Now you also made a change in your business recently where you went from working with one particular vendor to working with a broad set and being, essentially, vendor-agnostic. Why make that move and what have the implications of that been?

CH: That’s a great question. First and foremost, there were two driving factors for us in that move. Number one was we were hearing loud and clear from the market at large saying, "What Annuitas does in the way of lead management process, we need, but we also need you to have a better understanding of all the vendors’ products." So, we were hearing that from prospects. We were hearing that from some customers, and just the market at large. And then along with the market was the maturation of it. When we started 5 ½ years ago, the terms ‘lead management’ and ‘marketing automation,’ many people would kind of look at you and get that dear in the headlights look, and say, “Well, I don’t understand. What are you talking about?” Now, those terms are so commonplace in the B2B market. You’ve got vendors like Silverpop, and Eloqua, and Marketo and Manticore and Pardot who are very well-known in the market. So, we were hearing from a maturation standpoint, it made sense. The implications are really more value to our customers. So we can now go through that audit and analysis phase, and pick out what the issues are and identify the gaps, and then take the best vendor that’s going to help match those gaps and enable our process best, and really match that customer with the right product. So it’s really a broader base for our customers that allows us to better meet their needs.

DF: So as you try and match up the right solution for the right customer, what do you find tends to be the most effective criteria? What are the three to five things that really set systems apart that people watching this video can say, “OK, I’m going to incorporate that into my evaluation framework”?

CH: That’s a great question. I think a lot of it has to do with what is the maturity of the organization that’s going to be buying the software? So, I think if you look at some work that I was able to do with Adam Needles and David Raab on some marketing software selection, you know you kind of have your advanced users and then your basic users. We’re working with a client right now who is a multi-million dollar, hundreds of millions of dollar organization, and they’ve never had automation and they just recently installed a CRM system. I can’t take an enterprise-type product and bring that into, even though they could pass for a mid-market, upper mid-market company. To bring an enterprise-type product into that organization, they don’t have the people, they don’t have the necessary resources from any kind of IT or even sales interaction, and they don’t have the marketing maturity to take that kind of solution. So I think number one is understand where you are as an organization. Understand the needs of your customer. What kind of sales cycle do you have? What kind of data segmentation strategy are you going to need? Is it a quick sale? Are you going to have to have complex nurture streams? So I think as you take a look at those types of things, you really have to base on what kinds of solutions should we go for? Should we go for a more robust, a solution that can do more complex things? Or should we start basic to say we need to be able to send email, we need to be able to tie into our website, we need to be able to track our customer behavior and interaction, do some basic scoring and basic nurturing. So depending on where you fit as an organization, I think that will help determine what kind of solution you need.

DF: Got it. Well, Carlos, thanks a lot for taking time to come in and visit.

CH: Yeah, it’s been great. Absolutely, I’ve enjoyed it. Been a good afternoon.