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How to Select The Right Marketing Software System

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I am the CRM chump.
In this blog I share my experiences, lessons and learning about Customer Relationship Management (CRM) Software, Marketing & Lead Management Systems, and other related business software systems.




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How to Select The Right Marketing Automation Software System

A Proven Approach to Evaluating Lead Management Systems

Marketing has always been charged with reaching out to new and existing customers and then forwarding prospect responses to the sales team. Historically, the marketing process has been more art than science; marketers often worked more by feel than by facts. That subjective work behavior resulted in performance inconsistencies. When marketers delivered highly qualified leads, they were celebrated; but when they didn't they were dismissed or put on the spot to explain themselves. The hit or miss performance cast doubt on the strategic value of the function and marketing often came to be seen as a discretionary expense, and it often suffered when companies downsized.

The marketing mission hasn't changed, but the business software tools at marketing's disposal have. A new breed of marketing automation software systems which leverage prospect behaviors and marketing best practices empower marketers to acquire more leads, but more significantly allow marketers to associate more intelligence with those leads, and thus better qualify them for the sales team. These marketing software systems also automate the lead scoring and nurturing processes, thereby automatically maturing leads until they are sales-ready.

Picking the right marketing automation software system can be relatively simple, if you understand what to look for.

Marketings Business Problem

The economic downturn has resulted in staff and budget cuts to many sales and marketing organizations. Sales people have more pressure to sell, and to do that they need to receive qualified leads at the time buyers are ready to buy. Studies by Aberdeen and Gartner reveal that sales reps actually now need more leads than in the past just to achieve flat revenue production. Finding those sales-ready leads is marketing's responsibility – and they too have to do more with fewer resources. However, while sales people have gained automation, information and productivity from Sales Force Automation (SFA) systems, Customer Relationship Management (CRM) systems and other sales tools, marketing staff have largely been forced to accelerate and amplify the manual practices that have yielded mixed performance results.

Marketing business processes are well known and laborious. They start with basic demand generation, followed by determining the readiness of leads to buy based on a weighted scoring system that attributes values to rank and qualify them. The qualified leads are passed to sales, while the rest are either disqualified or shifted into lead nurturing programs. Several of these programs may be conducted simultaneously, using the lead data to determine what content is most appropriate for each type of lead.

But these practices can easily break down. A remarkable percentage of sales leads received by the sales team are not acted upon. Leads passed to sales, but not deemed qualified by sales, are often simply ignored by sales and not passed back to marketing for continued nurturing. Similarly, lead nurturing often takes a back seat to lead generation and fails to receive the attention and effort it needs to succeed.

Also trying to perform these business processes manually is prone to error. "I don't think it is possible to do lead nurturing or lead scoring at scale (i.e. more than a hundred leads a month or so) without software automation, or throwing a ton of people at the problem," said Jon Miller, the CMO at Marketo. "It's not a difference of effectiveness, it's a difference of simply being able to do the job."

At the same time, while sales demonstrates its effectiveness through hard numbers – closed sales, pipeline, sales forecast, time to close and other revenue-oriented metrics – marketers have had less solid indications of their success. The two sides are often goaled differently – sales on revenue, marketers on activities, such as clicks, leads or some other data point that may or may not translate into real dollars. As a result, marketing is often in a tenuous position; contributing to Chief Marketing Officers having the shortest tenure of any C-level executive, with an average of 23 months.

Marketing Software Technology

Marketing software systems are accelerating their advancement the marketing function in terms of business process automation, information and accountability. The current generation of marketing software products is designed not only to discover new prospects but to understand where they are in the buying process. That entails learning what buyer activities they have performed to research their future purchases, what customer segments they identify with and what purchase characteristics most often identify them as likely buyers. All of this can be done automatically and can result in a far higher percentage of sales-ready leads for the sales team to act on. "Any company that has more than a couple marketers on staff and is generating more than a few hundred raw leads per month is a candidate for marketing automation software," says Miller.

Just as marketers vary in their sophistication, so do marketing automation systems. Some are basic and meet the essential requirements for most marketers, while others offer more advanced capabilities for discovering new leads, learning more about them and nurturing them to sales-ready status. The new breed of lead management systems is relatively young and is populated by many innovative emerging vendors, and their fresh approaches have created an array of features that buyers are wise to evaluate and examine during the marketing software buying process. As of only the last few years, marketing automation systems now routinely include mobile, analytics and collaboration capabilities, and they also offer a choice in delivery models such as on-premise or software-as-a-service (SaaS).

Here's a short list of key features you should evaluate.

  • Landing Page Management: A good marketing automation system will permit non-technical marketing staff to easily create personalized landing pages, as well as implement A/B or multivariate testing, as part of the lead acquisition process.

  • Web Site Activity Tracking: Cookies and tracking technology can identify website visitors, correlate their latest visit behavior to past visits, and flag certain behaviors or combinations of actions as triggers for changing their lead scores and forwarding their information to sales. Many tools provide real-time notification alerts to sales reps when a known lead, active prospect or customer is viewing the website, providing them reinforcements of the visitors continued interest and an cue to take action. "The time factor is critical," says Greg Ott, CMO at Demandbase. "Sales pros know that when they respond immediately to e-mail inquiries, their close rate is better. Why can't we do that further up the funnel?"

  • Personalized Microsites: These dynamically served websites allow marketers to deliver personalized and relevant messaging to each prospect based on information previously collected. These sites use a unique and personalized URL (PURL) for each prospect and can be developed using rules that automatically assign content based on a prospect's job title, industry, geography or other criteria.

  • Customer Segmentation: This feature applies configuration rules to assign prospects to distinct groups, not simply by the prospect's likeliness to become a customer, but based on a combination of explicit customer characteristics, implicit buying behavior traits or other defined behaviors that help tailor the marketing messages more precisely for the recipient. Customer segmentation functionality usually offers a horizontal selection of segmentation characteristics built into the system and makes it easy for marketers to append additional traits based on the unique qualities of their target markets.

  • Lead Scoring: This software feature assigns weighted values to a prospect's attributes and activities in order to gauge his readiness and likelihood to buy. When a lead enters the marketing software system, it is assigned a score based on past activities. As that lead is nurtured and additional behaviors are monitored, the score changes automatically. Lead scores don't always go up – some scoring factors, such as the passage of time without engagement, could cause the lead's score to decline. Other factors – such as website downloads, responses to email marketing offers, or calls to sales staff – generally increase lead scores. When a lead score reaches a threshold value, the lead is considered sales-ready and passed to sales for immediate follow-up. By using marketing software to automate these activities, more factors can be included, allowing a truer view of the lead.

  • Nurture Campaigns: Since the majority of acquired leads require nurturing before they are sales-ready, often over a long time frame, an automated system for maturing these leads is essential. Nurture campaigns allow marketers to create multiple flight distributions with messages based on buyer profiles and timed to drip communications to prospects at just the right intervals. Nurture campaigns are tightly coupled with lead scoring which then examines the reactions to those campaigns in order to know when prospects begin to move closer to a buying decision. Marketing systems correlate key buyer behaviors that indicate when a prospect's interest in making a purchase has shifted, and may include not just online interactions but responses to off-line marketing channels as well.

  • Email Distributions: This feature allows marketers to create and manage automated email marketing campaigns. Depending on the level of sophistication of the product and the user organization, these outbound messages can be precisely tailored to specific customer segments, and the responses to the messages can trigger subsequent prescribed events in the marketing or sales process. A good email marketing component will also include best practices to prevent email from being diverted to spam filters. Over time, a marketing software system will naturally refine your lead scoring system as well, said Jeff Solomon, Senior VP and founder of Leads360, a lead management software vendor. "More and more, you can back up behaviors with historical data," he advised. "That will help you spot which behavior demands an immediate sales call and which demands additional lead nurturing."

  • Real-Time Notifications: This feature alerts sales staff of the changing readiness of potential buyers, especially when they meet pre-set thresholds that indicate their interest is high or suggest that they are ready to buy. This feature can also help marketers understand which campaigns are receiving unusually positive or negative responses, allowing them to make changes quickly.

  • CRM Integration: Most marketing software systems include packaged integrations that permit them to easily exchange information with Customer Relationship Management systems. For example, lead alerts may be sent directly to a sales representative's CRM or SFA screen and appear on the interface used in daily work. Also, new leads uncovered by sales staff can be fed back into the marketing automation system so they are subjected to the same lead scoring and nurturing approach as leads generated by marketing.

  • Form and Survey Tools: These features allow leads to enter their own information into your database as part of the process of registering on a form, signing up for a newsletter or taking a survey. This data goes directly into the system instead of having to be input from paper forms or ported from another system. Progressive profiling allows the system to present one or a small number of incremental questions to prospects each time they interact with the website.

  • Membership Management: Hand in hand with registration is membership management, which provides log-ins to potential customers so that they can manage their email preferences and contact data after they've entered your CRM or marketing system database. Leads, prospects and customers will do this in order to access relevant news and information about your company or solutions. By giving them the capability to update their own information, you avoid the expense and information overload resulting in losing them and having to re-acquire them, or having duplicate entries for the same lead.

  • Data Hygiene: Most marketing automation systems include the ability to examine data as it comes in and remove duplicate, bogus, partial or otherwise incorrect data.

  • Integration with Off-Line Marketing: Some marketing software systems permit integration to off-line campaigns and channels, such as direct mail or call center surveys. This data allows marketers to understand which campaigns work best with each lead segment and deliver a more holistic view of the prospect.

  • Marketing Analytics: By integrating with other business systems such as CRM applications and back-office Enterprise Resource Planning (ERP) software, the marketing automation system can correlate marketing expenditures to earned revenues, thereby providing an easy and definitive method to determine whether a marketing spend should be decreased or increased. Budget cuts often target marketing departments and, until recently, there have been few automation methods to illustrate how marketing directly contributes to earned revenues.

What you Need to Know Before Buying Marketing Software

Before buying marketing software, it's imperative to first understand your marketing needs in a measurable and prioritized manner. Do you want a simple email marketing application, or are you planning for a more fully integrated marketing automation system approach? Are you having difficulties with lead acquisition or lead management? Is your business technically sophisticated, or are you relatively unsophisticated?

Making an honest assessment about your business and marketing department is vital to narrowing the field of potential products. A full-featured application that looks great in software demonstrations but which requires technical acumen may be the wrong marketing system for a company whose marketers are just learning to employ software technology. Similarly, a marketing team that's comfortable with customization, integration or business process automation may find a simpler solution to be too restricting.

Recognize that sophistication generally has nothing to do with company size. "Just because your company is big does not mean that your marketing approach is complex," advises Kristin Hambleton, senior director of marketing at marketing software manufacturer Neolane. Some very large companies have simple marketing automation software needs, while some small companies have precise, specialized requirements that only a more advanced solution can meet. "If you have multiple company brands or multiple product lines, you may be best served by a more sophisticated marketing software tool."

Also, be aware of how much time your staff will have for software automation. "Companies should look at how much time they have to invest in running these systems," advised Marketo's Miller. "Can they afford to allocate a full-time resource to run the system, or will it be a part-time job?"

Next, consider workflow processes and external partnerships A business process document describing your top lead management processes is extremely useful to have in hand. This document should include definitions of sales-ready leads, what data should be collected and exchanged between marketing and sales, how leads are entered into the system and how hot leads are fast-tracked to the sales team. This understanding will separate the marketing software systems capabilities and allow you to map marketing automation technology to existing processes.

"It helps formalize and force the lead transfer conversation," comments Marketo's Miller. "Sales has always been good at defining the sales cycle stages, but companies need to define all the stages of their revenue cycle, spanning marketing and sales. Getting this objective understanding in place is the key to effective lead management and marketing analytics."

You must also understand who will need access to your marketing software system — copywriters, PR agents and external partners, line of business managers, sales staff – or all of the above? Does your staff work remotely or on a contract basis? Do you work with agencies that may benefit from the data?

Also, you need to consider where output from the marketing system will go. To whom will lead alerts go — individual sales staff, sales managers, inside sales staff, help desk staff, partners or others in the organization?

Also, it's important to consider the transition path from whatever method you're currently using for lead management and marketing campaigns. Companies currently using marketing agencies may expect a marketing automation system to replace some or all of what their agency is doing. This may be a bad assumption, because the use of this business software can have a steep learning curve, one that agencies climbed long ago.

With these pre-requisites in hand, look for a marketing software vendor that has a view of sales, marketing and lead generation similar to your own. A mismatch in marketing and sales philosophies can result in a decision that forces your marketers to abandon processes that work for them in order to adapt to the constructs of the software.

Also, develop an understanding for how effectively each vendor explore emerging marketing technologies and techniques. Many Social CRM (SCRM) channels, such as blogs, wikis, social networking sites and consumer communities, are promising to marketers, but if a vendor does not build extensions for them into its products they will be largely inaccessible without significant manual effort or system integration costs. In fact, if a marketing software vendor does not employ these technologies in its own efforts, it's a warning flag: If the software vendor fails to understand the nuances and strategies behind using these emerging tools, how will it be able to help your company when you want to capitalize on them?

You'll also need to know your marketing software budget, which should include software, implementation and support. Because of the wide variation in pricing models for marketing software systems based on their functionality, deployment model and pricing structure, it's difficult to establish an apples-to-apples cost comparison. SaaS marketing solutions can range anywhere from $10 per user per month for an email marketing application such as Constant Contact to $10,000+ per month for Marketo's Enterprise edition. Other suppliers, such as Vertical Response and LoopFuse, base their pricing on a per-email or bandwidth-based criteria. As with any IT purchase, the up-front price will likely not be the total cost of ownership. Most new entrants to this market are pitching SaaS deployment, which reduces up-front costs but introduces recurring subscription costs. It's key for marketers to present the true total cost of a solution at the time of its introduction, as a failure to understand the total cost may result in a difficult-to-explain budgetary burden later.

Finally, before you make your purchase decision, try to learn as much as you can about the vendor's company viability and technology road map. These lead management systems are a fairly new area and there are many start-up and emerging companies bringing products to market. With an SaaS solution, many of the software management functions needed to maintain your database and campaigns are handled by the vendor's infrastructure and staff. You must have confidence that the vendor will deliver what it promises and avoid all too common pitfalls such as poor data management, updates that fail to go smoothly or arbitrary price increases. If the vendor's past history includes such behaviors, you can expect to incur similar events in your own implementation and use.

Measuring Marketing Software Return on Investment

Sales processes are modified to increase sales and margins. However, when it comes to understanding the impacts of marketing software automation, isolating factors from one another is difficult and can make using bottom line figures a misleading indicator of the real impact of a marketing automation solution. High-level measurements, such as improved productivity, are also difficult to quantify and can prove misleading.

This doesn't mean that creating a business case with supporting ROI is impossible. In fact, it's critical to solidly demonstrate how the enterprise software will impact your business. If you're a large organization, a solid ROI forecast can mitigate concerns from the CFO; or if you're in a small to medium-size company, a compelling ROI can sway limited funds away from competing projects.

There are sales-oriented performance metrics that can be leveraged to understand how well a marketing software solution is performing. Some examples include time to lead qualification, sales cycle duration, average ticket size, order to cash, customer churn rates, error reduction and cross-sell ratios. Further, many higher-end marketing software systems integrate with other business systems and include tools for computing ROI. "They can attribute revenue to campaigns or even to specific emails," said Kristin Hambleton.

Technical Criteria

Regardless of the power or potential of any given marketing software solution, it's all academic until the application is installed and running. There are some technical considerations you should factor in when selecting a marketing automation application.

As many marketers are automating for the first time, as opposed to converting from one marketing system to another, the need for a data migration strategy may not be considered critical. However, get your vendor's data migration policies at the start of your engagement if you're working with an SaaS solution. If you later decide to upgrade, change vendors or bring your marketing automation software in-house, having this in place will aid your transition and mitigate the loss of marketing information. Service Level Agreements (SLA) and and information security policies and preparedness should be thoroughly vetted well before a SaaS purchase decision.

Marketing software applications are generally intended for non-technical people. Therefore, ease of use is a critical success factor for user adoption. A cluttered, hard-to-use or non-intuitive user interface may result in only a few trained people in your business being able to master the application, which can lead to productivity-sapping bottlenecks. The best way to evaluate the system and interface is with a demo that simulates your business processes and uses real data. If a marketing software vendor doesn't offer a full functioning demo, beware. Look at the demo version with both the people who will be using it — marketing staff — as well as the people who will be championing it — the CMO, VP of Marketing, VP of Sales or possibly the CIO. Securing early buy-in from across this spectrum of players is essential to a successful implementation and roll out.

It's also important to understand your vendor's plans and processes for updates and upgrades to the product. Is the vendor ahead of the curve in adding features for new business development opportunities, or does it lag, or is it incorporating too many features that unnecessarily increase the complexity of the application? How often are point releases and new versions announced? How well are these upgrades organized — are they grouped around concepts, or are they simply a seemingly random collection of new features? All of this can impact how well your business aligns with the vendor and can have an effect on how well you use the marketing application.

How to Buy a Marketing Software System

Once you've documented your company's prioritized requirements, your sales and marketing business processes, the sophistication of your users, your available IT support and your budget, you can intelligently examine your options and make the most informed purchase decision.

When documenting your required features, start with the current pain points and then add areas you've targeted for future improvements. Not all software features and functions are equal to rank them on a 1 to 5 scale, or along a continuum from 'Nice To Have' to 'Must Have'. You can then score each marketing software system, precisely understand the weakness and make a fact-based, objective decision.

Also determine the degree of software integration the lead management system will have with other business systems in your organization. Some marketing systems run well as stand-alone products, but most are more effective when they work in concert with a CRM application. If your business wants to combine marketing automation with CRM, SFA, ERP, accounting, order fulfillment or business intelligence tools, the lead management systems integration tools may make-or-break your selection decision.

Understand the expertise and availability of internal resources and make an honest assessment of whether a third-party consultant should be employed for software selection, implementation or both.

Once you assembled your documentation and knowledge pre-requisites, it's finally time to view, compare and contrast the vendors. First, vet them by examining the highest priority features for your business. Next grasp both the sophistication and ease of use of the products. In both cases, you're not looking for the most impressive application but for the solution that works best for your unique circumstances. This elimination round should yield a short list of two to three vendors.

Following marketing software demonstrations, ask for a trial period to evaluate the solutions. Most marketing software buyers are absolutely amazed in the perceived ease of use differences between the demo and the actual hands on keyboard experience. Input from your marketing staff, sales staff and executive sponsors is critical at this stage, as is input from the IT staff who will implement and support the solution. Re-sequence your short list based on these results and move to the next step in the buying process.

Finally, starting with the top candidates, discuss the terms and costs in depth. Obtain a specific set of costs for everything associated with the product — not just the software costs, but also the costs of storage, customization and other aspects that may be hidden in the basic pricing. Discuss support, especially if you are planning to buy an on-premise solution. Finally, gather a minimum of three customer references and vet their experiences with the solution.

Marketing Success Favors The Prepared

If you're a marketer, all this talk of software technology, IT participation and data management might suggest that your time in a creative field is at an end and the world of marketing is becoming a computer-driven science rather than an art. Don't despair. "Marketing automation is in its infancy in terms of best practices," says David Thompson, CEO of, a marketing software and lead management system vendor. "It's now possible to collect so much data that it's up to marketing to decide what are the most important activities, what are the most meaningful customer behaviors and what's the most important digital body language. Not all of it is relevant, and what's relevant for one business may not be to another. So even with the new tools, there's an art and a science to marketing."

Marketing software automation allows you to apply your knowledge to an increasingly vast set of data to continuously improve results and to discover selling opportunities that were previously impossible to find because of the amount of manual effort required.

Buying marketing software can be daunting because the field is young and immature. There are many entries in the market to wade through in search of the ideal solution. The place to start is with your own business – understand your needs and the features that are most important to you – starting with those that make your marketing efforts different from other businesses. Then your in position to simply compare and score those needs relative to he market offerings. | CRM Software Blog & CRM Software Reviews