The continuing growth of B2B marketing and marketing automation is indeed good news for those of us in the B2B marketplace. Despite the claim by some that automation is “floundering”, marketing automation is clearly gaining steam and poised for even more growth in 2011. Just recently, Gartner stated that “SaaS within the CRM industry could top $4 billion in revenue by 2014 . . . . and the segment with the strongest growth is marketing automation.” With these kinds of forecasts and vendors adding to their customer numbers quarterly, it’s hard not to be optimistic about the future of the space.
One of the keys to continuing this kind of growth will be the ongoing education of the marketing automation buyer. This is no small challenge, due in part to some in the market who use interchangeable terms and inaccurate definitions when describing marketing automation. This inconsistency can cause significant confusion. This was seen most recently in the MarketingSherpa report “CMO’s Perspective on B2B Marketing Automation”. In this report, MarketingSherpa states the following regarding the definition of marketing automation:
“Since there is a number of marketing automation software solutions on the market, a common perception of the term marketing automation is that it refers to a software application. To the contrary, marketing automation is a highly sophisticated set of rules and processes for lead scoring, nurturing and management that move prospects through the various stages of the marketing-sales funnel.
For the record, we are fans of MarketingSherpa and the work they do. However in this case, they missed the mark with phraseology that runs counter to what the market should be should be reading.
The issue of confusion and lack of definition is surely being felt throughout the market as evidenced by a question posed last week by our friend Steve Gershik on Focus.com. He asked: “What’s the difference between demand generation, lead management and marketing automation?” If I may be so bold, I’d like to set the record straight, seeking to lessen the confusion. In response to Mr. Gershik’s question, I offer the following definitions:
- Demand Generation is the practice of creating interest or desire for your product or service. The end result of demand generation is leads. Leads are the “the top of the funnel” activity whereby inquiries are acquired and move into a “dialogue stage” with the organization.
- Lead Management is a defined set of processes that manage the acquired lead from creation through close of sale and into the customer lifecycle. A solid lead management process framework is made up of a set of seven individual yet connected processes including:
- Data Management
- Lead Planning
- Lead Routing
- Lead Qualification (including definitions and scoring)
- Lead Nurturing
- Content Development Process
This is known as The Annuitas Group Lead Management Framework™. Only by having these process areas working together will a company obtain prospect/customer engagement, and ultimately greater revenue.
- Marketing Automation is an enabling technology that powers both demand generation and lead management. Marketing automation allows for the consistent and repeatable communications to buyers, tracks their behavior, and allows for lead qualification, data segmentation, metrics and other features. Marketing automation should not be looked at as being able to deliver demand generation strategy or lead management process.
Many in our industry have declared that we are in the midst of defining times in B2B marketing. Marketing automation has helped get us there. As B2B marketing continues to rise in prominence, it’s imperative that we work to keep our definitions clear and our language common. Defining moments should not be derailed by confusing language.