A number of publications have suggested that advancements in technology have made the traditional salesperson obsolete. It’s easy to see that the sales process has changed over the past ten years; however, crediting that change to technology alone is inaccurate. Customers, like salespeople, are a key part of the sales process. As a result, consumer trends play an important role in determining which sales techniques work and which don’t.

The following three consumer trends have changed sales:

1. Decrease in Face-to-Face Interaction


   The most obvious factor changing selling is the decrease in face-to-face interaction. The web—along with various tools such as email marketing, social media and teleconferencing—has not only decreased face time with potential customers, but has also eliminated, or at least narrowed, the focus on one-on-one selling. Based on the availability of new technology, it is no longer cost-effective to sell low-value items using this method. In other words, the days of selling magazine subscriptions door-to-door are behind us.
2. More Informed Customers and Speedier Buying Decisions


   In the past, prospects would have to talk to salespeople to price compare, but with the availability of information today, buyers can come close to a buying decision without ever consulting a salesperson. In fact, there are large portions of the sales process that might not be visible to the company. As a result, buying decisions appear to occur much more quickly today. Salespeople whose companies implement marketing automation actually have a competitive advantage in cases like these, because they have a better idea of how prospects are interacting with the brand—visiting the website or attending a webinar, for example—earlier in the sales process.
3. Customer Service Expectations
   There is a customer service aspect of sales that has changed as society’s overall customer service expectations have decreased. We no longer look for a manager to help us in the grocery store—instead we’re willing to compromise service for lower prices. This transition towards commoditization has a dramatic effect on product differentiation and as a result, traditional selling, which was often dependent on highlighting the unique features of a product.

 

While it’s true that sales is changing, sales is far from a dying profession (just ask our new hires—we nearly doubled our sales force again in January). Just as customers are taking advantage of new technologies to aid in the buying process, there are new tools for sales professionals as well. Marketing automation allows sales professionals to weave together different businesses processes that touch the customer—including CRM. This gives sales professionals a better idea of who their sales leads are and how ready they are to buy.

If you’re a salesperson interested in taking your selling techniques to the next level—give us a call. We’re waiting to hear from you.

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Marketing automation is hot, no question. But why? Is it is really a breakthrough new technology that warrants all this love or is it simply the value prop of gold at the end of the rainbow that has marketers flocking to vendor sites wanting to learn more?

Having posed that question, it’s worth noting that marketing automation technology has been around for well over 10 years. This is not some new technological breakthrough suddenly appearing to capture the hearts and minds of marketers around the globe. What is new is the type and quantity of companies in which marketing automation has gained traction.

Online Marketing Goes Mainstream

The reason marketing automation is being embraced by entirely new varieties of companies is as simple as Everett Rogers’ technology adoption curve. When it comes to marketing automation, the early adopters were the most tech-savvy large enterprises. These organizations not only had the capital to implement this new technology, but also needed to prove that the results of online marketing programs could actually be quantified.

Fast-forward to today, and everyone—including old-line companies that didn’t even have websites five to ten years ago—are emailing often, running webinars and becoming fluent in SEO, SEM and social media. The goals of these companies: to gain competitive advantage and fill their sales funnels.

I actually saw a company that sells toilet seats marketing on Twitter last week. In other words, online marketing has become mainstream.

Core Capabilities of Marketing Automation Systems

As new companies begin to implement online marketing campaigns, they eventually start to feel the pain that early tech adopters and large enterprises felt years ago when first implementing marketing automation software. These new prospects tell us every day that that they are confused, frustrated and discouraged the deeper they dig into this technology and its vendors. All the conflicting vendor claims, mile-long feature checklists and the bombardment of emails, webinars, eBooks, and whitepapers are compounding the confusion. In the scramble to differentiate, every vendor has a list of off the wall features in the “go-to” sales handbook that they relentlessly hurl at prospects around every turn to differentiate themselves.

Salespeople, who are as confused as anyone, are saying yes to everything and checking feature boxes like Keno cards so they can hurry and follow up on the next lead.

Ok, time out. Hit pause on the webinar and put down the eBook for a moment. Here is my attempt to break down the value proposition of a marketing automation system into three core capabilities. It doesn’t have a clever, well-crafted three-letter acronym, nor does it promise a 7000% ROI, but here it goes:

• Integrated Marketing – Arguably the number one pain point that has marketers looking to marketing automation vendors for help. Bringing together all of your online marketing channels into one execution platform with centralized reporting and analytics (email, website analytics, web forms/landing pages, document downloads, webinars etc.). In short, marketers are tired of managing multiple systems with disparate data without access to high-level information on what is happening across all their marketing channels and how those channels relate to each other. They want to know if the prospect that clicked on the email also showed up on the website, or if someone that attended an event also downloaded a whitepaper. In brief, they want to see all the prospect’s actions in a single consolidated, integrated profile.

• Automated Marketing Process – The ability to create programs or tracks to guide your prospects through knowledge acquisition, the qualification process and sales funnel in preparation for sales engagement. Another aspect of this is automating the process of moving leads from marketing to sales (with the supporting information to answer the age-old sales question of “why is this a lead?”). Another example would be taking leads previously passed to sales that didn’t go anywhere and getting those back into the marketing mix.

• Lead Scoring & Behavioral Filtering – The third core capability involves assigning logic and process to qualifying leads based on how they interact with your online marketing assets.

I might be going out on a limb here, but I would argue that the above three bullets address the major pieces of the puzzle that marketers are trying to put together when they evaluate marketing automation solutions. I will also be the first to admit that every vendor in the space can address these adequately. The difference is in how vendors approach the solution.

Marketing Automation for the Fortune 5,000,000

We are often asked what makes Act-On Software different. The short answer is that our platform was designed from inception to demystify the advanced concepts of marketing automation and make them accessible to the masses at a reasonable price point. Act-On is not some enterprise software solution with a website that lightly throws around terms like “Easy to Use” and “Quick to Implement.” We do not claim to be the most feature-rich platform, nor do we claim to make your marketing and sales people love each other once you sign up for our service. Our mission is to make marketers’ lives easier and provide the vehicle for better marketing results—without the cost, resources, time to implement and overhead.

Ready to make marketing automation work for your company? Join us in one of our weekly live demos, request a one-to-one demo, or send us an email—we’re waiting to hear from you.

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We are very pleased to announce that we are adding our own three-letter acronym to the business lexicon: SMT, standing for Small Marketing Teams.

Since we target companies of all sizes (the “Fortune 5,000,000″), people tend to assume that we target SMBs. This is categorically not so — we focus on SMTs. These are in fact very different segments.

Generally speaking, the SMB segment is characterized by modest budgets and modest tactical objectives. It is very well served by the likes of Constant Contact and MailChimp, who do a few things but do them very well.

By contrast, the SMT segment features small marketing teams with big ambitions, and with minimal IT or technical support. They tend to be agile and aggressive, and want to use every available tool to achieve their larger marketing objectives. Speed of planning and execution are paramount. And they expect their marketing systems to evolve rapidly to include new marketing channels as they become available.

With marketing teams everywhere being asked to do more with less, this is the way the world is moving.

The vendor that is able to serve the needs of this segment will find rapid growth, happy customers, minimal churn and substantial upsells. We can attest to this

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Last week, I had the good fortune to hear Geoffrey Moore (famed author of Crossing the Chasm, The Gorilla Game, Inside the Tornado, Living on the Faultline and Dealing with Darwin) speak about the future of enterprise IT.

Moore has always had a special place in the collective consciousness of our company. Ours is a disruptive business model that has succeeded in bringing cutting-edge products to mainstream customers, a topic that is central to Crossing The Chasm. So the opportunity to hear him in person in an intimate environment was a real treat, and well worth the day trip to Seattle.

His talk, entitled Peering into the Future,  was filled with keen insights, and had the audience of high-powered investors and startup CEOs totally enthralled.

I was especially gratified to see that our approach at Act-On Software fits very well into his view of the future of enterprise software systems. Without attempting to do justice to his entire thesis, I am taking the liberty to list a few of his observations that are especially relevant for us:

• Enterprise software systems have become consumerized.
  Translation: People expect their enterprise software systems to be as approachable as, and to use familiar paradigms derived from, consumer applications like Facebook, YouTube, Twitter and so on.
  This mirrors our approach. We focus a lot on the user experience, trying to keep things intuitively simple and understandable without sacrificing power and functionality.
• Enterprise software systems have shifted from being systems of record (efficiency) to systems of engagement (engagement).
  Translation: Stop thinking about the database, that is so last decade. Instead, focus on systems that let you collaborate with peers and engage with prospects and customers across corporate boundaries.
  Our user experience de-emphasizes the database, even though there is a very sophisticated one behind the scenes. And we have made engagement channels like e-mail, social media, webinars and telephony central to the user experience we offer.
• Systems of engagement must meet four key design goals:
  Mobile to be in the moment
  Social to share facts and insights with others
  Ad Hoc because that’s how issues emerge
  Real Time because that’s when issues get resolved
  This rings so true for us! Ideas like “immediacy”, “real-time”, “always on”, “rapid response”, and so on are design imperatives at Act-On Software
• All systems of engagement are a Darwinian response to the future of work.
  What a cool statement! For us, rapid evolution is part of the company DNA. Our two-week release / upgrade cycle was designed from the outset to allow us to keep up with the dizzying pace of evolution in marketing. Any vendor that does not evolve is headed for extinction.

There is no way to do a blog post that does justice to Geoffrey Moore. I urge you to check out his website.

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I am not sure why our competitors are so afraid of us.

We are one of the last entrants into this space. We have a simple and elegant (but powerful) product that we sell at a very affordable price. We don’t believe in locking our customers into long contracts. Our customers like us. Hey, we are from Portland, Oregon, so basically we are nice people.

We don’t pay much attention to our competitors but some of them are obsessing over us (as evidenced by their visits to our website). And apparently we are starting to strike fear in some with our rapid growth and success.

One of our competitors, who shall remain nameless but is the darling of this space, is so concerned about losing repeatedly to us that they are willing to discount all the way down to match our price in order to win business. That’s really great for us, because it validates our solution as being on par with theirs, but at 25% or less of their price. And it’s great for their customers, because when they next renew, they can score a huge discount just by mentioning the coupon code “ACT-ON”.

So then we get this weird e-mail from their VP of Marketing last week. They are one of the sponsors of a party at Dreamforce ’11, and they appear to be nervous about us even showing up at this public event!

Whoa! This is very flattering!!! And don’t worry, guys! We don’t bite, and we are (mostly) housebroken.

Let me remind you that this is a monster market, less than 10% penetrated, so why are you even worried about us? This is a rising tide, and it should lift all (non-leaking) boats.

Just for the record (and because we are nice and courteous people), we would like to thank our nameless competitor for creating such a buzz up and down Sand Hill Road and University Avenue, that our recent $10M Series C round took less than 4 weeks from first meetings to multiple competing term sheets.

Returning to the question of why anyone would be afraid of us, Clint Eastwood said it best (in High Plains Drifter):
“It’s what people know about themselves inside that makes ‘em afraid.”

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True story.

One of our new sales reps was sending out a contract for a deal that he was closing. He fat-fingered the e-mail address, with the result that the contract was sent to the wrong company.

Next day, the rep gets a phone call: “Hey, I have never done business with you, but I just got a contract in the mail. Looks like you made a mistake. Who are you guys, anyway?”

The rep takes the call, goes: “So sorry about that, my mistake! Since you asked, let me tell you who we are and what we do…” and actually manages to get this guy into an online demo! And closes him the following week!!!

Further validation of the universal applicability of our all-in-one marketing platform (if we needed one).

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I happened to read a brand new research report yesterday from one of the many talking heads in the marketing automation space. (I am not going to mention any names since (a) they are famous and (b) we are a client of theirs because that is how the game works.)

The report was all about marketers having to prepare for marketing automation, and to not whine when it (inevitably) failed because the fault was theirs, they were not prepared, and it was not the software’s fault.

It is stunning in this day and age to find “experts” who still think like this. I wish everyone would read Donald Norman’s 2002 classic “Design of Everyday Things”. The prime design dictum — “the user is always right” — has driven so many companies to achieve user experience greatness (e.g., Apple Computer).

At Act-On, this is the very core of our design philosophy, which is why we are so different from a lot of the other companies in this space. We think marketing automation *should* be easy, and our software (and our market success) is proof that this is possible.

What really irks me is that we are actually paying these so-called “experts” to “help” us with our positioning! Enough said!

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What is the key to Intuit’s phenomenal success in the SMB marketplace?  IMO, this is their formula:

• Make enterprise software that is easy to use. For just about everybody!
• Keep making incremental improvements to the user experience
• Make it usable out of the box. No need to build custom reports and the like.
• Price it to make it accessible for companies of all sizes.
• Provide world-class support so users feel well taken care of.

We thought these were pretty good ideas to build our own company around.

So we are doing to marketing automation what Quickbooks did to accounting for small businesses.

We do not need to promise the moon and stars to make a sale, our prospects see the value right away. In addition, we are reaching a whole new class of customer: in over 50% of  our closed deals, we have no competition.  These are companies of all sizes in all kinds of industries.

Over 30% of our business every quarter comes from upsells, indicating that customers are using us more and more. Contrast this with the reports that in over 75% of the cases, owners of traditional marketing automation systems are struggling to get the most value from their automation investments, and that the automation platform ends up getting used as a glorified email engine.

We like to think that our anti-ERP approach stands in sharp contrast to that of traditional marketing automation vendors.

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In case you were wondering why there have been no new blog posts since Nov 19 2010, let me tell you it’s very difficult to write when moving at warp speed.

• We had a very successful financing round close at the end of November 2010.
  We pitched 4 firms, received 3 term sheets and ended up doing the round with 2 of them. We are very thrilled to add US Venture Partners (Menlo Park, CA) and Voyager Capital (Seattle, WA) to our list of backers, joining earlier investors Cisco Systems and Subrah Iyar (founder & CEO of WebEx).
• We had a monster Q4, the sales team blew past their quotas and are off to Las Vegas soon to celebrate. The celebration might be premature; Q1 2011 is shaping up to be even bigger.
• We had a splendid holiday party at one of the coolest restaurants in Portland.
• We rounded out the executive team, with David Appelbaum of BigFix fame joining us as our new CMO.  This David also loves to take on Goliaths; check out this and this to see samples of his slingshot tactics.
• We doubled the size of our sales team and our customer success team. We were fortunate to be able to attract the very best people possible, proven all-stars in web touch sales and support of SaaS.
• We opened a new office in Roseville, CA. We have a fleet of private jets (ok, Southwest Airlines) so our teams can go back and forth between our 2 locations easily.
• We won an award from the City of Beaverton for being a cool up-and-coming company.
• We replaced our aging database servers with speedy new NetApps based servers without any downtime. Sort of like changing your oil while you are driving on the freeway.

Could I possibly have squeezed any more excitement into this period (in addition to Thanksgiving, Christmas and New Year)?

The answer is yes!  My family and I spent 10 enchanted days in Egypt (Jan 1 to Jan 10), and got home right before the political situation over there exploded.  We had glorious weather, spectacular sightseeing experiences in Cairo, Giza, Luxor, Aswan and Abu Simbel, amazing food and priceless memories.

Looks like the stars are in alignment.

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One of our competitors (who shall remain unnamed) recently announced that they raised $25M. This on top of $32M raised earlier. They have around 700 customers now.

Let’s assume for a moment that they actually need this latest investment. Then, it would seem they needed $32M of investment to get to 700 customers, which works out to over $45,000 per customer.

Starting much later than they did, we have over 160 customers and it took us just $2.5M to get here. This works out to a little over $1,500 per customer. Comparable functionality, since we have competitive wins against them.

Go figure!

So if you are a customer of a marketing automation vendor that has raised far too much money, you can bet that you are overpaying. After all, your vendor’s investors need a big return on their expensive investment.

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