The 7 Key Functions of Marketing Automation
Before committing to or renewing a contract with your marketing automation vendor, read this to understand what you are buying. A key component of the revenue engine is marketing automation, so it is no surprise that every engagement at Yield Group involves working with this component of the marketing and sales tech stack. What we frequently find is that companies are only using a fraction of the capabilities of modern marketing automation systems and, if they are, they aren’t using them well.
One common example is paying tens of thousands of dollars for software that is primarily used for outbound email blasts (one of 50+ features), and failing to tag links in the emails so there isn’t clear attribution down-funnel.
For growth companies, three names, in particular, have become synonymous with ”marketing automation:” Hubspot, Pardot and Marketo. But what exactly can these tools do for your business if fully utilized? This is an important question to ask as you are likely paying $30,000 - $100,000+ per year for this one component of your stack.
Marketing Automation Providers for Mid-Market Companies
The Core Functions of Marketing Automation Systems
There are 7 core functions of marketing automation systems:
- Email Campaigns
- Nurture Journeys
- Forms & Landing Pages
- Lead Scoring
- Lead Management
- Social Media Management
- Integrations - Website, CRM, etc.
As buyer behavior evolves, so do the marketing automation platforms (e.g. web chat), but these are the "guts" of every marketing automation platform. We will cover each component in more detail below, but first, let’s briefly cover how marketing automation systems have evolved over the last decade.
The “Big Three” (Hubspot, Pardot, Marketo) were all founded in 2006 as marketing was moving quickly to digital touchpoints, which gave rise to the “inbound marketing” movement. These platforms were developed to help convert anonymous leads, primarily by capturing contact info on a form, and then nurture them via pre-defined, automated email sequences.
It is important to remember that, in 2006, Facebook had just opened to the public (after being limited to universities) and the iPhone was yet to be released (that happened in June 2007). In the current world of mobile everything and AI-powered voice assistants, that seems like a lifetime ago!
As the number of digital channels expanded, the marketing automation platforms began to build out (or buy) feature sets and continue to expand those features even today. There are, of course, two reasons for this expansion; (i) to adapt to the evolving needs of the market and (ii) to capture wallet share.
The promise of the all-in-one marketing automation platforms is that they are just that: all-in-one. One tool for the entire team. Each component of the platform is tightly integrated with the next, all of which are then integrated with your CRM (typically Salesforce).
But this all-in-one approach is often the Achilles heel of marketing and sales tech stacks. Here’s why:
Every software product or platform is designed with a point of view that determines how data should flow, how functions should perform and, most importantly, how users should engage. This helps keep all of these functions operating together, but it also forces you to adapt your business to the tool vs. the tool supporting your business, which is the reason so many businesses never fully utilize their marketing automation tool
The other common side effect is that each function within the platform has to make compromises in order to fit within the ‘closed’ ecosystem of the software. The end result is the capabilities and usability of each component are, at best, average relative to best-of-breed tools that serve that function.
With that in mind, we review each of the seven core functions as if they were discrete tools.
Important Note: We are, by design, agnostic to any and all software platforms. While we certainly have our favorites, and are even certified partners of many, we do not accept commission or revenue-share payments from any providers. This allows us to make the best recommendations to our clients with no ulterior motive, while at the same time exposing us to a broader set of tools across the martech landscape.
A core component of every marketing automation platform. Email campaigns are used to deliver messages to a large audience on a periodic basis (weekly, monthly, etc.). It is possible to have the content within the email vary widely based on dynamic variables.
Common alternatives: Mailchimp, Constant Contact, Campaign Monitor, Sendgrid
A related, but expanded function of email campaigns is nurture, which are semi-customized, triggered messages based on a variety of variables (user actions, status changes, etc.). Typically these messages are delivered via email, but they have now expanded to include other channels as well (sms, voicemail and even social media). Note that most marketing email solutions now do both Campaigns and Nurture, though the support of other channels varies.
Common alternatives: The tools listed above, plus Autopilot, Leadsquared
Forms & Landing Pages
The genesis of inbound marketing is the form. A tool that enables you to capture information from your prospects and then route it to various systems for storing and/or action. Many tools now also enable you to “progressively profile” your prospects by presenting different forms (or CTAs) to them based on the responses to previous forms. The close cousin to forms is the landing page, on which most forms live.
Common alternatives: Unbounce, Instapage, Formstack, Typeform
This component is integral to all marketing automation and email platforms. Because of that, there aren’t as many stand alone solutions. But this is starting to change, for two reasons; (i) the continued fragmentation of the buyer journey across digital channels and (ii) an increased emphasis on Accounts v. simply Leads (prospects or individuals). Many of these more advanced solutions are moving beyond scoring as a result of activities (visits, opens, clicks, etc.) and scoring based on perceived intent and/or buying stage.
Common alternatives: Madkudu, 6Sense, Leadspace, Infer, Zapier, Autopilot
Another core function of marketing automation platforms is that they serve as a “parking lot” for Leads that do not yet have enough information or have shown sufficient intent to pass on to Sales. For an increasing number of B2B organizations, this is becoming less relevant as the abundance of data on a targeted market segment makes it possible to move to a “contacts only” customer data structure, which brings every Account and Contact into the CRM.
Common alternatives: Email platforms, CRM
Social Media Management
As the number of social channels continues to expand, the complexity of managing all of the content, messages and engagement also expands. Marketing automation platforms have therefore incorporated social media management as a feature to allow for the distribution of content across most major social platforms into one place.
Common alternatives: Hootsuite, Buffer, Sprout, Postoplan, Recurpost
Probably the greatest perceived value of a marketing automation platform is the integration with a website and the CRM. The challenge with these integrations is that it is easy for them to become bloated and fragile as, over time, custom fields, data flows and automations expand to keep up with the ever changing needs of the business. In addition, the need to trigger actions on multiple platforms in order to keep up with the buyer requires more and more point-to-point integrations. If part of your growth strategy is acquisitions, this structure makes integrating systems from acquired companies extremely arduous.
Common alternatives: Data routing tools like Segment and Rudder (more on this below), ETL tools like Tray and Stitch Data
Focus on the Fundamentals of Marketing Automation
In our experience, it is rare that a company is an advanced user of the 7 key functions of their marketing automation platform, but they are still paying for them. In addition, because these platforms are so broad, they can be very challenging to learn and use. Just ask anybody who has had to build an email in Pardot, a nurture journey in Marketo or reports in Hubspot.
This is the primary rationale to reconsider your reliance on marketing automation. You are in a much better position if you have mastered the fundamentals, at a much lower cost, than paying for 100% of a marketing automation platform and using only 20% of the tool.
We recommend removing software from the equation and focusing on the functionality you will fully leverage to optimize the customer journey. Most companies need to start with only a handful of functions.
Here’s how we recommend getting started:
- Foundation - Marketing automation is one piece of the revenue engine, so make sure you have a solid foundation before you do anything else. The stack you build should serve the purpose of enabling the buyer through their journey. Start by defining this strategy, then determine the data you will need, then select the tools in the stack. This post will provide a template for your team to evaluate your go-to-market foundation (the revenue engine).
- Email - This is low hanging fruit and it is really easy to over complicate. This includes both campaigns and nurture. Content should be relevant for the buyer segment and appropriate for the stage, personalized by using clean customer data and an integrated lead management model. This content needs to deliver value to the prospective buyer. When integrated with digital marketing “air cover” (as we call it), email can help accelerate the buyer along their journey.
- Forms and Landing Pages - The next step is to master the content you are providing your prospects, which is often presented on a landing page. The content needs to provide value to the specific member of the buyer group that was targeted, and relevant to their stage of the journey. With forms, you need to balance the amount of information you collect. You may drive more form fills by asking for only a few key pieces of information, but then create significant work downstream to qualify the prospect. One alternative is to leverage progressive form fills where possible. Note, success in doing so is highly dependent on a quality customer data program. Also, every form should capture UTMs via hidden fields (more on best practices for attribution in this post here).
- Integrations - In parallel to the steps above, you need to audit your integrations, especially related to custom fields and workflow automations. These go stale quickly, creating technical debt and unnecessary complexity. Simple is better and will make migrating to new, more advanced and potentially less expensive tools much easier. Reference points #4 and #5 on this post regarding putting your stack on a diet.
- Scoring - This is last for a reason. It is so easy to get wrong. if you are using the out-of-the-box scoring logic provided by the vendors, stop. If you’re scoring is based solely on activities (visits, opens, clicks), stop. It may feel good to be creating MQLs, but it is likely you are simply creating work downstream in order to vet and qualify these prospects. Start by identifying your ideal customer profile, then reverse engineer their path to product. Then test, adapt, repeat. This post walks through how a software and services company completed this exercise.
You can (and should) execute all of these steps even if you are “trapped” in a multi-year contract with your existing marketing automation vendor. Instead of trying to utilize every feature because it’s there, focus instead on mastering the fundamentals of each component before moving on to the next.
If you are looking to replace or renew your marketing automation tool, you should first do a self-assessment of your team’s proficiency with the fundamentals. You may find that you will be better served by adopting a few “best-of-breed” tools, which are often far less expensive and offer monthly (v. annual or multi-year) contracts. This approach will provide you the flexibility to invest in new tools only after you’ve mastered the fundamentals of each component.
Alternatives to Monolithic Marketing Automation Platforms
The 7 components of marketing automation platforms are all critical elements to the revenue generation engine. These needs are most commonly met via these platforms, but it is important to remember that “Big 3” (Hubspot, Pardot, Marketo) are all nearly 15 years old. A lot has changed in 15 years! Have they evolved over that time? Of course, but have they evolved as fast as the buyer’s buying behavior?
An alternative approach is to start at the data layer, using data routing tools like Segment or Rudder, to collect and route event and attribute data to any and all tools as needed. This structure delivers a much more adaptable and flexible foundation on which to add (or remove!) automation tools as they are needed, which therefore enables you to select software appropriate for the specific function and cost, vs. being forced into buying more than needed as part of a suite of tools.
Even if you continue to use one of the marketing automation platforms, the data-routing structure pays huge dividends in terms of reporting and analytics.
Every tool in your stack should earn its keep. Take a hard look at the 7 key functions of your marketing automation platform. You may just find opportunities to improve the customer journey and reduce cost at the same time.
Photo by Hunter Haley on Unsplash
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