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Marketing Automation is Great, But Beware: Winter is Coming

August 14, 2012 | Justin Gray | 2 Comments |

The marketing automation space has been enjoying a pretty good run. Sales are up, momentum is building, the attention from major decision makers is growing, and with it so are budgets. The space has seen almost a 60% increase in revenue in the last year

According to David Raab. Every reporter in the B2B sales and marketing space wants to hear more about MA, because their readers are eating it up. LeadMD alone has published over 250 articles this year through media outlets and private requests for content. Basically life is good. Or is it?

I’ve recently become absolutely enthralled with the HBO series Game of Thrones. Enthralled, I tell you. I downloaded it at the behest of several friends and watched it on one ill-fated flight to Florida where WiFi was in short supply and time was in abundance. Innocently, I tapped into my iTunes library, brought out the ear phones and went to work. Four hours is all it took to get me totally hooked.

It should be noted that I’m not a TV person, I just like the ambient noise. I routinely

create sonic ADD by turning all TVs on, firing up a playlist on the home stereo, and the get to work – in an orchestra of indiscernible, conflicting sounds. Most people can’t concentrate like that – I on the other hand need noise, movement and action – chaos.

Rarely however, does that chaos evolve into something that garners my attention. I simply need to be moving and I have popcorn brain.

That’s probably adequate backstory to provide a relevant backdrop to how absolutely out of character it is for me to sit down and watch four hours of TV straight through – and then four more hours when I got to the hotel room, and then two more hours the next morning which I woke up at 3:00 am to begin before a customer onsite that day. I am obsessed with Game of Thrones. I’ve finished both seasons and when I have time I go back and watch the standout episodes – which is to say I just keep repeating the entire seasons.

Throughout the show there is an ominous theme that the summer that they currently enjoy – which is much different than our summers, its actually closer to our winter – is coming to an end. Summer in the mythical land detailed in game of thrones simply seems to indicate “light” and winters bring long periods, many years, of “darkness.” Winter represents toil and evil and death. Winter sucks. Winter is coming, and with it the end of a fruitful age and the beginning of a period where mankind is reminded about the blessings of summer, reminded of how good things used to be, reminded that opportunity is to be cherished not squandered.

Like most things in my life I’m quick to draw parallels and create a metaphor. Many marketers don’t know that the marketing automation space is actually in its second iteration. Summer has come and gone and come again on the marketing software realm – and right now summer is in full bloom.

To look at the marketing automation space, is to look back at the CRM market. CRM went through many iterations before stabilizing into the backbone it has become today. I remember administering Saleslogix for much of my early career as a marketer. We had a handful of licenses for a sales staff of over 150 and each rep would turn their activity sheets in daily to marketing and I would have my data entry team enter these activities into CRM so we could track things like sales blitz results and call reports. It was a terrible broken process and the cause was a simple scapegoat many of you are probably familiar with – cost. It cost a lot of money back then to own CRM. There were servers in a big room, there were maintenance costs and downloadable hotfix packs and on top of al that there were licenses. Its not that the business couldn’t afford more licenses – it’s that the path to ROI wasn’t clear – so we created a shortcut that our owners would go for.

Today many marketers are short-cutting marketing automation. Marketers are fighting for the cost of software but they aren’t fighting for the elements of marketing automation that really drive success – and that’s everything BUT the software. Buying software is easy. These days you plop down a credit card and with quarterly or even monthly payments, you are the proud owner of a shinny new “solution.” You go through your implementation phase, which you are sold to be 30 days or less and the magic happens. Right? Well, the magic isn’t happening. Take a look at the results from the latest surveys being conducted around the MA space – last year Marketing Sherpa said that 76% of CMOS report their biggest challenge being “generating high quality leads.” Despite this, 19% of them have a marketing automation software fully implemented. Of the

organizations that have implemented MA less than 10% are saying that their results are considered a success from an ROI perspective. To compound those results, a recent study from the NY American Marketing Association, when asked to define marketing ROI, 37% of the respondents did not mention financial effects. 19% did not think that measuring the financial impact of their marketing was even considered marketing ROI!

Anyone know of another market that recently underwent this type of entry barrier collapse and what the results were there (hint: its at the root of every banking collapse in the last 5 years)? We are seeing this in many of the organizations we work with. We are often brought in as a last gasp effort to “save” marketing automation. Often we are asked to “re-sell” the concept of MA to the executive team. That’s an immediate red-flag for me. If you are viewing marketing automation #1 as something optional for your business and #2 as something that needs to be “sold” internally – I will say with no hesitation that you are not ready for marketing automation. MA software, despite the whirlwind of attention surrounding it, is not at the epicenter of modern day marketing success. Instead, the items at the center should be content, interaction, conversation, engagement – marketing automation software is simply an engine that enables repeatable process.

Many organizations purchased MA for the first time in 2010 and later. Those purchase contracts are coming due soon, and this time around CEOs and CMOs will evaluate purchase decisions with a bit more vigor and clarity. Unless MA vendors begin placing a focus on ecosystem, training, services and partners to ensure that customers receive the type of support necessary to foster success with a paradigm shift such as marketing automation software, we will find those contracts, which were so easy to sign, being torn up with similar ease with which they were originally signed. Just like they did with CRM 1.0 and 2.0. That fact is a shame, as the software in that scenario truly becomes a scapegoat for the real issues, which are training, integration and process.

Make no mistake about it, the veil of summer is gradually being lifted from the realm of marketing automation, and unless the focus is placed on the real elements that drive success, winter is coming.


  1. Steven on August 14, 2012 at 9:26 am

    I’m not sure I agree with the ominous tone and comparison to the financial system, but the analogy does hold in one respect: enterprise software is by its nature “too big to fail” while SaaS contracts are too easy to cancel. This alone could create a death spiral for a given vendor or the entire industry.

  2. […] such a post when skimming through a list of otherwise dreary headlines on a LinkedIn group.   “Winter is Coming,” from Justin Gray on the website LeadMD, jumped out at […]

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