The Power of Marketing Automation for Small Business: Executive Roundtable

by Lauren Carlson

CRM Analyst,

9/16/2011

When I first started at Software Advice, my CEO told me I would be covering an area of software called customer relationship management, or CRM for short. After calling it CMR for a week and burying myself in industry reports and whitepapers, I started to put all of the pieces together.

But there was a new segment of the industry, he said, that was emerging and poised to make a huge impact on the market – marketing automation. At the time, there were only a handful of vendors. Today, the enterprise marketing management software market is worth an estimated $2.5 billion and is expected to double annually. Guess he was right.

Small businesses have been a major driver of this growth. Previously, the market consisted of large banks and direct marketing firms. The new generation of easy-to-use SaaS marketing automation vendors have brought sophisticated marketing technology down market. We wanted to gain more insight about why the market has been so quick to adopt MA. So, we reached out to executives at some of the leading vendors in small business marketing automation software: Infusionsoft, HubSpot and Genoo. Before we get into the Q&A section, here is a little background on each of our roundtable discussion participants.

Greg Head, CMO of Infusionsoft
A CRM industry veteran, Greg joined the Infusionsoft team as CMO in spring 2011. He has held leadership positions at both ACT! and SalesLogix. With more than 20 years experience, Head clearly brings a thorough knowledge of CRM, but he is also deeply in tune with the needs of small business marketers.

 

Mike Volpe, CMO of HubSpot

Mike came on as the fifth member of the HubSpot team and now serves as Chief Marketing Officer of the inbound marketing software company. Before joining HubSpot, Mike was director of marketing operations at SolidWorks Corp., where he transitioned the company from outbound to inbound marketing. Under his leadership, HubSpot has won more than 30 marketing awards.

Kim Albee, CEO of Genoo
Before founding Genoo in 2008, Kim was founder and CEO of Einsof Inc., a sales and marketing performance software company. She has more than 23 years experience in the software industry and is focused on helping small businesses align their sales and marketing for improved top and bottom-line performance.

 

Q: According to Focus, small business is the fastest growing sector of the marketing automation industry. Why is that?

Head: There was a gap that needed to be addressed in terms of having an integrated solution as opposed to individual point solutions. Part of the SMB revolution is that small businesses are going online to figure out how to market and sell using the web. Most small businesses, if they are using any tools at all, are using email marketing tools, or basic CRM. The huge frustration comes when companies grow a bit and get traction, and all of these disparate tools aren’t working together. There’s a real gap. So, companies like Infusionsoft realized this and have developed products to help fill that gap.

Volpe: Small businesses have the biggest potential gains from totally transforming their marketing. All of the changes in how people shop and buy level the playing field – no longer do you need $100 million marketing budgets to get the word out to lots of people. And actually, according to Focus as well, the real growth is in inbound marketing. This Focus report said that 32 percent of marketers were investing in inbound marketing, while only 10 percent were investing in marketing automation.

Albee: Most of the marketing automation players focus on large business. Now small business is starting to get a lot more interested in what they can do to save time and resources. Small businesses are busy, but just imagine if I get a lead and I follow up with them in a personalized way. I can do that using technology to listen and respond because I’ve set the system up so that people are getting really good information and personalized communications so that if they hit reply, they’ll actually come to a human being that can respond to them. Now I’ve got technology doing the work for me. I’m not as crazy and I can focus on other things. And that is small business gold right there. And today, the tools on the market are cost-effective enough that it just makes sense for small businesses. And that’s why I think you’re seeing the biggest amount of growth in the small business sector.

Q: What is the primary problem or issue that small businesses are looking to address with marketing automation software?

Head: Well the first is that multi-system chaos problem. They’re looking for a comprehensive solution to that. They’re also looking for help, whether they’re the small business owner or the marketing sales leader, with transitioning from their current systems, which are often held together by bubble gum and bailing wire. Imagine if your website is converting leads, albeit inefficiently, into a shopping cart where money is going into your bank account each day. You’re pretty sensitive about moving that system, so you need help to transition quickly and smoothly.

Volpe: The key challenge for 99 percent of small and medium sized businesses is attracting more leads, and I think that is why so many of them are investing in inbound marketing software. The leading companies are figuring out how to use the web, social media, search engines, mobile devices and more to attract customers to them using inbound marketing.

Albee: A lot of people know they want to better leverage the Internet. Maybe they’ve heard the term “inbound marketing" or everyone is telling them that they need a blog. We ask our customers, “What is most important to you as a business?” Unequivocally, the answer is, “I want to increase my sales.” The other big issue is time. I’m a small business owner and it’s nearly impossible to get a hold of me because I’m constantly busy. These people need a way to automate and streamline their marketing efforts, freeing them up to manage the various other aspects of their business.

Q: Do you think the evolution of SaaS systems has influenced the adoption of MA software by small businesses?

Head: I would say a little bit. At this point, our type of user is pretty Internet marketing-aware, and they kind of expect web-based software. You can’t really do an integrated and automated approach without being web-based. There was very little B2B marketing software 10 years ago. But now the B2B purchase experience happens very interactively in a digital world. So tools are being supplied to support that. People are buying online, looking for products online and engaging online. The fact is that buyers are coming online and small businesses are learning how to meet them there. The web has enabled both sides of the equation.

Volpe: I think that SaaS is now totally mainstream (people think software on a CD is weird today), and that has made it easier for businesses of all sizes to more easily adopt new software. But again, the real adoption is happening in inbound marketing software.

Albee: I think adoption of cloud and having things run in the cloud makes things doable and affordable for small business. With cloud software, there’s more availability and at a more affordable price point – so it’s manageable as a small business. You don’t have any technical management, the upgrade headache or any of that stuff. I think that’s one of the big shifts happening with the Internet. I think five to 10 years from now, having software that runs locally on your computer that manages critical business activities is going to be a thing of the past.

Q: Small business are leaders when it comes to social media for business use. Can you speak to that in terms of what you've seen?

Head: Its obvious that social media is a major thing out there. It’s part of how people are now starting to connect. Some small business are very innovative because they can be, as opposed to large businesses that have to work out their own internal policy and make cultural changes. We view social media as a really important part of the lead conversion process and customer relationship. For a lot of these businesses, it’s not their main animal, but it’s starting to make it’s way into everything.

Volpe: I think many companies are starting to realize that the era of email is coming to an end, and that customers no longer want to read that inbox full of crap from marketers spamming their lists. Customers want to use tools – like social media – that give them more control and more ability just to get the communications they want. So far, we have seen a huge increase in the interest in social media, but to be honest most people are still doing it wrong. They have 48 Twitter followers, post a message once a week, and never have much interesting to say. The businesses getting real value out of social media are integrating it in with a comprehensive inbound marketing program where they have great content on their blog, they use social media to promote that content and use that content to attract more followers (companies that blog have 79 percent more Twitter followers), and they use their growing social following for lead generation and sales.

Albee: Quite frankly, back when pay-per-click marketing started out, small business were the ones to really start to use that before big business thought it was anything much. So I think small business is more willing to try things, to try and fail. In big business, they have either locked down social media from the get-go, or they’ve decided that it’s a time waster. Small business doesn’t have that mentality. Small business is like, hey, let’s try some stuff, let’s see what works, giving them the flexibility to be innovative.

 

1 Comment

Good work.

Really liked the format of the post. It was a very effective way of taking a snapshot of an industry from the insiders.

Comment by Christohper Cadwell
10/24/2011
 

Leave a comment