By Jon Miller, VP of Marketing Content and Strategy, Marketo
Marketing automation is hardly a new concept. According to the Google Ngram Viewer and Google Insights, the term was first used in 1980, gaining traction in the late 1990s and peaking around 2004. The term reached a low point in 2007 before it began to rise again. Today, it’s back up near the 2004 peak. Why the seismic shifts?
By Jon Miller, VP of Marketing Content and Strategy, Marketo
Marketing automation is hardly a new concept. According to the Google Ngram Viewer and Google Insights, the term was first used in 1980, gaining traction in the late 1990s and peaking around 2004. The term reached a low point in 2007 before it began to rise again. Today, it’s back up near the 2004 peak. Why the seismic shifts?
The first rise and fall of marketing automation was tied to the dot-com boom and bust. The late 1990s brought an explosion of vendors, including Aprimo, Epiphany, Paragren, Revenio, SAS, Siebel, Teradata and Unica.
{loadposition C2C13IAA}But then the bust happened. Only one of those companies (privately-held SAS) survived as a standalone vendor. While some of the solutions are still on the market today — Epiphany is part of Infor Epiphany CRM solutions, Unica is part of IBM, and Siebel is part of Oracle — overall, it left marketing automation with a tarnished reputation.
The middle of the 2000s marked another shift for marketing automation with the emergence of next-generation vendors, including Eloqua (now owned by Oracle), Infusionsoft, HubSpot and Marketo,marketing automation started to get hot again. Here’s why:
1. The Buyer-Seller Relationship Changed
Before the proliferation of mobile, web sites and social, buyers had limited ways to obtain purchase information and relied heavily on sales representatives. But the proliferation of online resources and their own social networks moved buyers into the power position, bringing them to the ‘sales moment’ with more knowledge than ever.
To address the new dynamic, marketers started to play a larger role in the revenue process. They nurtured relationships with early-stage prospects, but this solution posed a challenge of its own in terms of scalability. Self-empowered buyers demand relevant, personalized conversations on their own timeframe. If you don’t provide that experience, they’re likely to opt out. But how do you manage individual dialogues with hundreds of thousands — even millions — of potential customers?
This is why having a marketing automation platform became so critical in the mid-2000s. There wasn’t any other way to keep up.
2. Turmoil Breeds Opportunity
No business completely escaped the impact of the economy in 2008. But while some organizations hunkered down to weather the recession, forward-thinking companies recognized that turmoil breeds opportunity. They reorganized to increase revenue effectiveness, addressing traditional dysfunctions between marketing and sales and investing to automate revenue generation processes.
At the same time, budget cuts across companies nationwide made it essential to measure the effectiveness of their marketing investments. Empowered with these new tools, companies determined what was working and what wasn’t, and scientifically re-allocated their resources to operate more strategically.
3. A New Software Delivery Model In The Cloud
Unlike prior generations of marketing automation, today’s leading companies provide their solutions using a SaaS model — meaning marketers can access the tools in a browser with little or no IT support. These solutions are also sold as a recurring subscription, so marketers can buy them using operating budgets instead of making massive capital investments upfront as with traditional software. These two factors have been essential in the rise of marketing automation technologies.
One of the biggest long-term marketing automation challenges has been getting the capital and IT support needed by traditional solutions. While marketers had large discretionary operating budgets to spend on programs such as tradeshows, online advertising and agency services, coming up with a large lump sum to get going often proved impossible. SaaS-based marketing automation vendors have removed the largest impediment to marketing automation adoption.
It’s not hard to see why SMBs are the fastest-growing group of adopters — as only after marketing automation software was offered as a cloud-based service was it made available to them. That shift drove rapid growth in the space, and as the industry began to mature, businesses from all sectors joined in. Soon, even traditionally pragmatic companies started to use marketing automation, which has resulted in the growth we’re seeing today – and the continued rise we expect to see in the future.
Jon Miller is vice president of marketing content and strategy for Marketo, a provider a cloud-based marketing software platform. You can follow him on Twitter @jonmiller and on Marketo’s blog: http://blog.marketo.com/blog/author/jon-miller.
