Historical Trends in Marketing Automation

Today's Marketing Automation: Foundation & Context

Most people buying Marketing Automation software consider it a multi-year investment and strategy. Therefore, it is important to take a broad view of the space and its development. Several historical trends can help you better understand vendors' positioning, in context of how the marketing automation space has developed over time:

1. Market consolidation

The last few years have seen very high levels of acquisition activity in the Marketing Automation space. Most of the acquisitions have been large enterprise software companies acquiring pure-play Marketing Automation providers. However, some Marketing Automation providers like Marketo have also been acquisitive. The following is a list of acquisitions that have occurred in the last few years:

  • 2010: IBM acquired Unica for $480 million
  • 2011: Teradata acquired Aprimo for $525 million
  • 2011: Act-On acquired the assets of Marketbright
  • 2011: HubSpot acquired Performable
  • 2012: CallidusCloud acquired LeadFormix
  • 2012: Marketo acquired CrowdFactory, a social campaign platform.
  • 2012: Microsoft acquired MarketingPilot
  • 2012: Oracle acquired Eloqua for $810 million
  • 2013: ExactTarget acquired Pardot for $95 million
  • 2013: Salesforce acquired ExactTarget for $2.5 billion
  • 2013: Adobe acquired Neolane for $600 million
  • 2013: Marketo acquired Insightera for $20 million
  • 2013: Oracle acquired Responsys for $1.5 billion
  • 2013: Infusionsoft acquired GroSocial
  • 2014: Callidus Cloud acquired LeadRocket (formerly Genius)
  • 2014: IBM acquired Silverpop for an estimated $270 million

There have also been a number of new entrants in the last few years. Among the many new entrants are Autopilot (2011), SharpSpring (2011), Hatchbuck (2012), LeadSquared (2012), Spokal (2012), inBoundio (2013), 7Sheep (2014), INBOX25 (2009) for Sugar CRM, Leadsberry (2010), Leadsius (2009), Target360 (for Microsoft Dynamics 2012), ClickDimensions (for Microsoft Dynamics 2010), Prospecteer which blends Content Marketing with Marketing Automation capabilities, and Engagio (2015), which brings Account-based Marketing capabilities to Marketing Automation.

2. Increasing product breadth through development, acquisition and integration

Photo of Howard J. Sewell, President, Spear Marketing Group“I don't think any solution, certainly not today, does it all. We have many clients who use Marketo and HubSpot side-by-side, for example. Or take a newer solution like Captora, who very specifically position themselves as feeding the top of the lead funnel at the same time that they trumpet their integration with more traditional Marketing Automation systems. I'd be very skeptical of any solution that claims to be an ‘all-in-one’ marketing system. And with today's cloud-based software and open architectures, there's little reason not to pursue a best-of-breed strategy.”
Howard J. Sewell, President, Spear Marketing Group

Small business-oriented Marketing Automation tools typically include inbound capabilities for blogging, SEO and social media publishing. Marketing Automation tools designed for larger organizations are also expanding their range of capabilities through product development, integration or acquisition. Here are some examples:

  • Web Conferencing: The ability to manage leads coming in from webinars makes these integrations essential. Pardot, Eloqua, HubSpot, Net-Results, and others achieve these integrations by partnering with 3rd-party vendors like ReadyTalk to build connectors that allow for invitations, registration tracking, reminders, etc. Act-On, Marketo, and several other smaller vendors, including SharpSpring, have built their own direct connectors to both WebEx and GoToWebinar.
  • Dynamic Website/Progressive Profiling: Understanding who is visiting the website without requiring the visitor to fill out a form is critically important to improve conversion rates. Once something is known about a visitor, the web browsing experience can be tailored with that information to provide a more customized experience. Silverpop, as a vendor with a large proportion of B2C customers, has recently developed “Visitor Insight” which does exactly that; Adobe Campaign and HubSpot both offer something similar, as well. Eloqua partners with Demandbase and Get Smart Content to offer this capability. Marketo acquired Insightera in December 2013 to add this increasingly important capability to its arsenal of tools. Similarly, SharpSpring offers anonymous visitor identification with a feature called VisitorID, which uses reverse IP lookup to identify anonymous visitors that visit a website, including how they arrived at the site, the pages visited and how long they spent. SharpSpring also launched the ability to serve dynamic web content in 2015; this is done through integration to users' CMS.
  • Marketing Resource Management: These capabilities that have always been associated with high-end tools like Unica and Teradata (formerly Aprimo), are now starting to get some attention from other vendors, too. Marketo, for example, introduced Financial Management, which is designed for managing marketing budgets across marketing teams.
  • Social Media Management: Marketing Automation products have traditionally been focused on email, but the ability to include social capabilities within the workflow has become almost a core requirement. Almost all vendors have made some progress in integrating social capabilities into their platforms. Silverpop does particularly well here with “Publish-to-Social”, which allows marketers to send email and social updates at the same time. HubSpot also has strong capabilities in the social arena, offering both listening and publishing tools. Marketo acquired social marketing company Crowd Factory in 2012 to add social campaign capabilities to the platform.

Some vendors have decided to solve the problem of escalating breadth requirements by building partner ecosystems inspired by the Salesforce AppExchange. Best-of-breed point tools sometimes provide much better functionality than what can be built in-house. Marketo started LaunchPoint in 2012 and it currently has over 250 integrated partner companies and 550 total participating partner companies. Similarly, Oracle Eloqua has the App Cloud and Act-On has the Partner Exchange (APEX).

3. Emergence of enterprise and small business-focused marketing offerings

The large enterprise software companies like IBM, Oracle, Salesforce and Adobe have all made acquisitions of Marketing Automation platforms (Unica and Silverpop, Eloqua and Responsys, ExactTarget, and Neolane, respectively) as part of a larger vision to create enterprise marketing cloud offerings. These vendors are focused on building enterprise marketing cloud suites where Marketing Automation is just one component of a full suite of modern digital marketing tools. For example, Adobe's marketing cloud also includes web analytics, A/B testing, social listening, publishing & analytics and ad management.

Solutions focused on the other end of the spectrum have cropped up as well. Small businesses weren't originally Marketing Automation's target customers, since few had the budget and/or resources needed to support the software. However, in the past few years some vendors have shifted their growth focus down-market, offering basic packages for smaller databases and/or fewer users. For example, recently Marketo has grown its SMB customer base. In addition, new products designed for entrepreneurs or small teams on a budget have entered the market, like 7Sheep and Spokal. Small business-focused products are often all-in-one platforms that can include simple CRM and/or eCommerce capabilities. They tend to be highly rated for usability and implementation, but may not have all the bells and whistles of an advanced MA solution.

4. Creation of a marketing database of record & CRM integration

Historically, many enterprises have considered their CRM the database of record. Increasingly, marketing functions consider their Marketing Automation system their database of record—it contains all the data relating to lead generation and lead nurturing campaigns, customer communications and data across channels like social.

While smaller organizations do not have a marketing-led, sophisticated lead qualification process—they just hand the leads over to Sales to qualify—larger organizations tend to have lead scoring and qualification processes that make handover more complex. Many contacts (leads) in the marketing database have typically not yet reached the threshold where they become SQLs (Sales Qualified Leads) and are ready for a salesperson to follow up—the logical point to pass them to the CRM system. This typically occurs via a data sync between the two systems. The difficulty is that data syncs are inherently complex and are frequently a cause of customer dissatisfaction, as is attested to by the attention given to this topic in reviews of these products. More and more, customers want the integration between these systems to be real-time—sales wants the leads immediately with no waiting. In addition to sending leads to the CRM when they hit a pre-determined score, other data sync requirements are also becoming more common, making the process more complex. For example, the Marketing Automation application is required to send alerts to salespeople when a prospect performs an action such as visiting a web page, or leads must be automatically assigned to the right sales rep through territory mapping rules.

Some vendors like Marketo, HubSpot, and Net-Results, have addressed this problem by building applications that are native to platforms like Salesforce. Salesforce itself says that it is addressing this problem by porting Pardot to the same underlying CRM database so that Marketing Automation becomes an extension of Salesforce automation. Although we're still hearing complaints about CRM integration from Marketing Automation users, the whole notion of a data sync may eventually be eliminated. Some SMB-focused vendors, like GreenRope and HubSpot, have also built their own CRMs designed to work with their Marketing Automation programs. Other marketing automation vendors have taken a combined approach. For example, SharpSpring describes itself as “CRM-agnostic”: it offers a simple built-in CRM for free, direct integration with Salesforce, or connection to 3rd party CRMs through a Zapier integration or the SharpSpring open API.