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Capturing the SMB Marketing Automation Opportunity
Project Director: Stephanie Pieruccini, Sr. Research Analyst
Senior Advisors: Kaspar Roos, Associate Director
Barbara Pellow, Group Leader
Bryan Yeager, Associate Director
Megan McCarthy, Market Research Analyst
Creative Services: Georgia MacDonald, Desktop Publisher
Editorial/Proofreading: Mark DiMattei, Corporate Editor
Eve Padula, Corporate Writer
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February 2012 Capturing the SMB Marketing Automation Opportunity
© February 2012, InfoTrends, Inc. www.infotrends.com Page 2
Table of Contents
Executive Summary ............................................................................................................................................. 7
Key Findings .................................................................................................................................................. 14
Recommendations ......................................................................................................................................... 15
Introduction ....................................................................................................................................................... 18
Project Objectives .............................................................................................................................................. 19
Methodology ..................................................................................................................................................... 20
Data Tabulations ........................................................................................................................................... 21
Mean vs. Median ........................................................................................................................................... 21
Project Deliverables ........................................................................................................................................... 22
Survey Respondents Profile .............................................................................................................................. 23
Research Findings ............................................................................................................................................. 27
SMB Defined .................................................................................................................................................. 27
Uncertain, but Optimistic SMB Business Outlook ..................................................................................... 30
Key Business Priorities ................................................................................................................................. 33
Advertising and Marketing Spend ............................................................................................................... 34
Marketing Mix Diversification Accelerates ................................................................................................. 36
Marketing Challenges ................................................................................................................................... 55
Reconciling Inbound and Outbound Marketing ......................................................................................... 58
Media for Awareness and Growth ............................................................................................................... 58
Media Buying and Production ..................................................................................................................... 59
Ordering Media Online ................................................................................................................................. 65
Customer Data Management and Analytics .............................................................................................. 68
Personalization .............................................................................................................................................. 70
Marketing Automation, the Next Big Thing ..................................................................................................... 73
Adoption of Marketing Automation ............................................................................................................ 74
Enabling Sales through Marketing .............................................................................................................. 78
Capturing the SMB ............................................................................................................................................83
Service Provider or Solution: the SMB Choice ............................................................................................83
Automating SMB Marketing: Examples of Solution Packages ................................................................ 84
Learning from the Agencies: the MSP Evolution ....................................................................................... 87
Reaching the SMB Audience ........................................................................................................................ 88
February 2012 Capturing the SMB Marketing Automation Opportunity
© February 2012, InfoTrends, Inc. www.infotrends.com Page 3
Critical Success Factors ............................................................................................................................... 90
Targeting Key Verticals ..................................................................................................................................... 93
Number of Firms and Employees ................................................................................................................ 93
Marketing Spend ........................................................................................................................................... 94
Mass Marketing Channels ............................................................................................................................ 94
Direct Marketing Channels .......................................................................................................................... 95
Internet Marketing ........................................................................................................................................ 95
Personalization .............................................................................................................................................. 96
Budget Allocations ........................................................................................................................................ 96
External Providers & Solutions .................................................................................................................... 97
InfoTrends’ Vertical Picks ............................................................................................................................. 97
Conclusion......................................................................................................................................................... 98
Appendix A: Brief Industry Profiles ................................................................................................................. 99
Accommodations ........................................................................................................................................... 99
Construction ................................................................................................................................................ 103
Education ..................................................................................................................................................... 107
Food Services ............................................................................................................................................... 110
Financial Services & Insurance .................................................................................................................. 114
Healthcare .................................................................................................................................................... 117
Manufacturing .............................................................................................................................................121
Non-Profits .................................................................................................................................................. 125
Professional Services ................................................................................................................................... 129
Personal Services ......................................................................................................................................... 133
Real Estate ................................................................................................................................................... 136
Retail Trade ................................................................................................................................................. 140
Wholesale Trade .......................................................................................................................................... 144
Appendix B – Marketing Automation Technology Overview ....................................................................... 147
February 2012 Capturing the SMB Marketing Automation Opportunity
© February 2012, InfoTrends, Inc. www.infotrends.com Page 4
List of Tables Table 1: Business Types ..................................................................................................................................... 25
Table 2: SMB Segments by Number of Employees ......................................................................................... 27
Table 3: Number of Firms and Employment Size, by Industry ...................................................................... 93
Table 4: Marketing Spend, by Industry ............................................................................................................ 94
Table 5: Mass Marketing Channels, by Industry ............................................................................................. 94
Table 6: Direct Marketing Channels, by Industry ........................................................................................... 95
Table 7: Internet Marketing, by Industry ......................................................................................................... 95
Table 8: Marketing Budget Allocations, by Industry ....................................................................................... 96
Table 9: Use of External Providers or Solutions, by Industry ......................................................................... 97
Table 10: InfoTrends Vertical Review .............................................................................................................. 97
List of Figures Figure 1: Number of Employees ....................................................................................................................... 23
Figure 2: Company Size by Industry ................................................................................................................ 24
Figure 3: Major Industry Mix ........................................................................................................................... 25
Figure 4: Total Number of Firms, 1998 to 2008 ............................................................................................. 29
Figure 5: SMB Industries by Number of Employees ...................................................................................... 30
Figure 6: Small Business Actual and Expected Sales, 1986 to 2011 ............................................................... 31
Figure 7: Optimistic Revenue Outlook for 2012 .............................................................................................. 32
Figure 8: Small Business Optimism Index, 1986 to 2011 ................................................................................ 32
Figure 9: Top Business Priorities – Next 12 Months ....................................................................................... 33
Figure 10: Mean Marketing Spend 2009 vs. 2011 ........................................................................................... 34
Figure 11: Mean Marketing/Advertising Spend, by Vertical ........................................................................... 35
Figure 12: Marketing/Advertising Spend Change in 2012 .............................................................................. 36
Figure 13: Marketing Budget Allocations ......................................................................................................... 37
Figure 14: Use of Mass and Direct Marketing for Business Promotion .........................................................38
Figure 15: Use of e-mail for Marketing, by Vertical ......................................................................................... 39
February 2012 Capturing the SMB Marketing Automation Opportunity
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Figure 16: Use of Direct Mail for Marketing, by Vertical ............................................................................... 40
Figure 17: Percentage of Marketing Materials Printed in Full-color .............................................................. 43
Figure 18: Agreement with Increase in Color Print Volume ........................................................................... 43
Figure 19: Use of Wireless/Mobile for Marketing, by Vertical ....................................................................... 45
Figure 20: Familiarity with Mobile Barcode Technologies ............................................................................. 46
Figure 21: Use of Digital Marketing Channels ................................................................................................. 49
Figure 22: Digital Marketing Channels; 2009 vs. 2011 ................................................................................... 50
Figure 23: Use of Social Media for Marketing, by Vertical ............................................................................. 53
Figure 24: Social Media Network Presence versus Advertising ...................................................................... 55
Figure 25: SMBs Face a Resource Struggle ...................................................................................................... 56
Figure 26: Top Challenges when Marketing to Existing Customers .............................................................. 57
Figure 27: Media Responsible for Business Awareness and Customer Acquisition ...................................... 59
Figure 28: Types of Service Providers Used – Last 12 Months ...................................................................... 60
Figure 29: Average Number of Service Providers Used – Last 12 Months .................................................... 62
Figure 30: Print Media Production .................................................................................................................. 63
Figure 31: Digital Media Production ................................................................................................................ 64
Figure 32: Use of Creative and Layout Software ............................................................................................. 65
Figure 33: Percentage of Total Print Volume Ordered Online – Last 12 Months, by Vertical ...................... 66
Figure 34: Service Providers Used for Internet Print Order – Top 15 ............................................................ 66
Figure 35: Service Providers Used for Ordering Digital Marketing – Top 15 ................................................ 67
Figure 36: Reasons for Not Ordering Print Online ........................................................................................ 68
Figure 37: Brand of CRM Ownership ............................................................................................................... 69
Figure 38: Type of Information Stored in Customer Database(s) or CRM .................................................... 70
Figure 39: Percentage of Promotional Materials that are Personalized ......................................................... 71
Figure 40: Top Reasons for NOT Using More Personalization ...................................................................... 72
Figure 41: Use of Marketing Automation Solution .......................................................................................... 75
Figure 42: Marketing Automation Solution Provided by Franchisor ............................................................. 76
Figure 43: Marketing Automation Brings Understanding .............................................................................. 77
February 2012 Capturing the SMB Marketing Automation Opportunity
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Figure 44: Top Marketing Automation Providers Used .................................................................................. 78
Figure 45: Marketo’s Integration with salesforce.com .................................................................................... 79
Figure 46: Use of Marketing Automation Solution Features ......................................................................... 80
Figure 47: Reasons for NOT Investing in a Marketing Automation Solution ................................................ 81
Figure 48: Motivating Reasons to Invest in Marketing Automation ..............................................................82
Figure 49: Preference for Managing Marketing across Multiple Channels ...................................................83
Figure 50: SMB Approach to Software-as-a-Service ...................................................................................... 84
Figure 51: Genius’ Marketing Automation Package Options .......................................................................... 85
Figure 52: Hubspot’s Package Options ........................................................................................................... 86
Figure 53: Vertical Response’s e-mail Marketing Plans ................................................................................. 86
Figure 54: Vertical Response’s Add-on Options .............................................................................................. 87
Figure 55: PSP to MSP to Agency; an Evolution ............................................................................................. 88
Figure 56: How SMBs Find Online Service and Marketing Automation Providers ..................................... 89
Figure 57: SMB Preference for Being Marketed To ........................................................................................ 90
Table 8: Personalization, by Industry .............................................................................................................. 96
Figure 58: Number of Accommodations (Hospitality) Firms by Company Size ......................................... 100
Figure 59: Number of Construction Firms by Company Size ....................................................................... 104
Figure 60: Number of Education Firms by Company Size ........................................................................... 108
Figure 61: Number of Food Services Firms by Company Size ....................................................................... 111
Figure 62: Number of Finance & Insurance Firms by Company Size .......................................................... 114
Figure 63: Number of Healthcare Firms by Company Size .......................................................................... 118
Figure 64: Number of Manufacturing Firms by Company Size .................................................................... 122
Figure 65: Number of Non-Profit Organizations by Type ............................................................................. 126
Figure 66: Number of Professional Services Firms by Company Size.......................................................... 130
Figure 67: Number of Personal Services Firms by Company Size ................................................................ 133
Figure 68: Number of Real Estate Firms by Company Size .......................................................................... 137
Figure 69: Number of Retail Firms by Company Size ................................................................................... 141
Figure 70: Number of Wholesale Firms by Company Size............................................................................ 145
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