InfusionCon 2013: InfusionSoft Keeps Its Focus on Helping Entrepreneurs

I spent part of last week at Infusionsoft’s annual conference, InfusionCon, drinking the Kool-Aid and soaking up the Arizona sun.


Pleasant as the 80 degree temperatures were to a refugee from the still-wintry Northeast, the real warmth at the conference came from 2,300 attendees bubbling with enthusiasm for their entrepreneurial adventures and how Infusionsoft supports them. Keynote speaker Jay Baer captured the mood perfectly when he went “all Oprah” on the crowd by promising them each a free Camaro. (Either he was joking or I registered incorrectly.) The group was indeed drenched in Oprah-style self-empowerment.

As you’ve probably guessed, this isn’t my native habitat. Even though Raab Associates itself is a small business and runs in part on an Infusionsoft-like system (OfficeAutoPilot), I’m a professional manager by training and most of my clients are mid-size and big businesses. What really matters, though, is that Infusionsoft itself remains committed to its small business customers, despite growing to nearly 400 people and $40 million revenue. This consistency is no accident: Infusionsoft managers are quite vocal on their very conscious efforts to build a culture that is committed to helping entrepreneurs and is itself entrepreneurial. It’s a tall order, but there’s some serious missionary zeal at every level, so they might just succeed.

In any event, I did manage to spend most of the conference in my own comfort zone of analyzing Infusionsoft’s business. A long conversation with Chief Marketing Officer Gregg Head provided some interesting tidbits, including:

- the company’s customers fall into three main groups, each roughly one third of the total.  hese are: Internet-enabled business coaches and experts, who are selling books, videos and other products in addition to their personal time; local service providers, such as dentists, home services, and fitness centers; and businesses selling to other small businesses.

- most clients want either to increase sales or free up the owner's time. The latter goal – taking back your life from an all-consuming business – seemed to resonate more than anything with the attendees. Reducing costs is a lower priority.

- Measuring return on investment isn’t much of an issue. Small businesses can see changes in revenue or free time immediately.  Detailed analysis isn't needed.

- Some companies are too small even for Infusionsoft. A client must have a stable revenue base to expand, or be successful enough that the owner is looking for some free time. The average Infusionsoft client has been in business for five years, which means that nearly all were in business for at least several years before purchasing the system.

- Facebook is by far the most important online channel for Infusionsoft customers, in many cases replacing Web sites as the primary online presence. Search engine marketing and blogs are much less important. The primary sources of new customers are still offline: referrals, partners, events, and direct mail. (Incidentally, trendsters, direct mail in general and post cards in particular are hot. But that might be old news. I did receive a message about personalized pizzas today, but am pretty sure it was an April Fools joke.)

And what of Infusionsoft itself? The company did announce its next release at InfusionCon, although by its own admission the changes were incremental enhancements in usability rather than major expansions in function. The main items were more efficient scheduling of personal tasks, a simple way to prepare quotes, and branding templates that automatically deploy style changes across all types of content. Campaigns can also now easily include GroSocial Facebook campaigns (GroSocial being a social marketing firm acquired by Infusionsoft in January.) Modest as these changes are, the company says its users wanted them more than new acquisition channels.

Infusionsoft also announced several non-technical initiatives, again with the goal of making users more productive. These included a set of prebuilt campaigns. including actual content; on-demand training videos integrated with the product, and accelerated expansion of sales and service partner networks. The onboarding process has also been revamped to deliver results in 30 days rather than 60, the main change being that Infusionsoft staff now does more of the actual setup for new clients and spends less time on a conceptual success map.

All these changes confirm what was already obvious: that Infusionsoft’s entrepreneurial customers are a separate breed from the professional marketers who use traditional marketing automation systems. The functional differences between the two sets of systems may be hard to spot, but there’s no mistaking the difference in the services and attitudes that surround them.

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Infusionsoft Bags $54 Million for Small Business Marketing Automation, Spends a Bunch on GroSocial

Infusionsoft today announced it has acquired social lead generation vendor GroSocial. This comes two weeks after Infusionsoft raised $54 million in new funding.

GroSocial is an interesting acquisition: about it three years old, it has about 20 employees and more than 25,000 customers.  Starting price is $30 per month after a 30 day free trial.  The system makes it easy for small business to generate leads through social marketing campaigns and track results.  It will continue to operate independently. The deal makes sense and will help Infusionsoft expand its social media capabilities, which have been limited. (TechCrunch reported rumors that the company paid $25-$30 million for GroSocial alone, but that seems high to me.)

Still, the $54 million investment is the more interesting story.  The sheer amount is impressive; previous funding for Infusionsoft totaled just $17 million. According to CEO Clate Mask, most of the money will be used for acquisitions, product development, and accelerated customer acquisition. He said that the new funds will let Infusionsoft grow at about the same 53% pace as last year, compared with the 45% or so they had planned to grow otherwise.

The investment can be read as validation of Infusionsoft’s strategy of offering unified marketing automation, CRM, and ecommerce exclusively for very small businesses. But that isn’t necessary: the strategy is already validated by Infusionsoft's continued growth, with 2012 revenues of $39 million and plans to triple its employee base to 1,000 in the next three years.

I think it's more useful to learn from Infusionsoft’s experiments with deployment models. The company has alternated between charging an implementation fee and not charging for it – and determined that a paid fee, and the more extensive hand-holding this permits, is more effective at building a long-term business. Implementation services go beyond training to actually setting up initial marketing programs. Naturally, Infusionsoft still strives to make its system as easy as possible to use, but its experience shows that new clients still need extensive help.

This conclusion may strike you as obvious. But there is, at least implicitly, a continued debate within the marketing automation industry between vendors who believe that they can make systems smart enough for new users to run without help, and those who believe human support remains essential. The “smart systems” group aims to build sophisticated technology that can automatically gather information, identify the best response, create the appropriate programs, and present them to marketer for approval. The “human support” group believes this level of automation isn’t practical or desirable, and instead focuses on building service organizations to train marketers and, when necessary, do the work for them. Both groups are rejecting the belief that marketing automation systems can be made simple enough for marketers to do the work themselves with either automated or human help.

That third theory – let’s call it the “ease of use” school – has been the dominant approach of the B2B marketing automation industry for the past few years. I’m tempted to say it has failed, and to cite the well-known statistics showing how few marketers use their systems fully.* But “failure” seems a harsh term for an industry growing at 50% per year. Still, there’s a shared sense among industry vendors that there’s a critical shortage of marketers able to use marketing automation tools effectively and that this is limiting industry growth. I increasingly see companies following the other two theories – smarter systems or greater human support – as a way to overcome this. Infusionsoft’s approach is part of this trend.

I myself have always been partial to the "smart systems" approach.  But that may be just because I like technology.  It's certainly true that more companies are following the human services strategy and reporting good success.  Of course, the services strategy is easier to execute: you just hire some sort people, who are admittedly rare but still easier to find the magical marketing robots.  This makes the strategy more appropriate for small marketing automation vendors who can't afford huge technology investments.  Bigger companies are attracted to the technology-based approach because it lets them limit their services staff, which makes them more attractive to investors.  The big companies can also hedge their bets by building up partner networks to provide services.

So the jury is still out on which approach will prevail -- but I do think that "ease of use" by itself is no longer in contention.


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*Actually, I have trouble laying my hands on the actual statistics. Only study I can find is from Loopfuse in 2011, which found just under 30% of marketing automation users do lead scoring. But I’m pretty sure there are others.

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Infusionsoft Revamps Its Interface, Adds New Campaign Builder, Web Analytics and Lead Scoring

Infusionsoft introduced its latest release earlier this month. This included a full revamp of its customer interface, a new campaign builder and shopping cart, and new capabilities for Web analytics, lead scoring, and lead source reporting.

Stated so plainly, this doesn’t sound like much. But Infusionsoft says it’s the biggest release in company history and I've no reason to doubt.  A new interface and campaign builder are big projects.

Both represent significant improvements over previous Infusionsoft editions. The interface is cleaner, organized around tasks rather than data objects, and lets users customize their menu of top-level functions. The campaign builder now supports branching flows, timers, and multi-step sequences with a smooth drag-and-drop interface. The shopping cart is also significantly more powerful. Lead scoring (nicely executed), Web analytics, and lead source reporting all fill major gaps in the product.

That said, this is still an evolutionary release for Infusionsoft. In part, this is because the company is careful not to overwhelm clients with too many changes. More fundamentally, it reflects Infusionsoft's steady focus on solving the same problem for the same customers: helping businesses with under 25 employees run their marketing, sales and e-commerce more efficiently.  This lets Infusionsoft understand its customers' needs deeply and build systems that meet them.  The company conducted more than 500 interviews in preparing the new release.        

Infusionsoft still has a ways to go.  The new release adds some missing marketing features but doesn’t incorporate social media, blogging, or Web site management. These are common needs for small businesses, so I’d consider them gaps in the product. The system also lacks dynamic content, custom data tables, and sophisticated user rights management – but those are more relevant to larger firms than Infusionsoft’s target customers.  Split testing is also missing – and even though few small businesses do it, I'd argue it belongs in the product, because they should.

Infusionsoft also reported that it continues to grow nicely.  The company now has 8,500 customers, 30,000 users, and expected revenue of $40 million in 2012, up 50% over $26 million in 2011. It is expanding its service offerings, app marketplace, and network of consulting partners – a critical resource for small businesses that often have little in-house marketing talent.  Pricing on the new release remains unchanged, with full-featured versions starting at $299 per month. 

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Marketo Spark Targets Small Business Marketing Automation

Marketo today announced the launch of Spark, a new brand aimed at small and mid-size business. Functionally, Spark is pretty much identical to the standard Marketo system. Exceptions are advanced features including revenue cycle reporting, email deliverability assistance, API access, fine-grained user rights management, and the Sales Insight salesperson application. Most of these aren’t of interest to small business, and several involve additional charges even for Marketo’s regular packages.

So the news here is price. Spark starts at $750 per month with no annual contract, compared with Marketo’s $2,000 per month minimum and annual contract for its full-featured Professional Edition. Marketo has discontinued its $1,200 per month Small Business Edition, which lacked some features now included with Spark.

In other words, this is a price cut. To me, it looks like a reaction to the success of other low cost small business systems, including HubSpot, Act-On Software, and Pardot. (HubSpot and Act-On have similar pricing to Spark, while Pardot runs a bit higher.)  Some of those firms are actually growing at a faster rate than Marketo, although on a smaller base.  Spark should help to blunt their momentum while increasing Marketo's own client total -- a closely watched metric, regardless of the associated revenue per client.

Whether Marketo actually makes any money at Spark's price is questionable. It really depends on the sales and support costs, and Marketo doesn’t appear to have changed how those are delivered to keep them down. Other small business specialists have designed sales and support models that are not as staff-intensive as traditional approaches. By contrast, Marketo is stressing that Spark includes services to help clients take advantage of their systems.

Of course, Marketo could have lowered its entry price without creating a new brand.  So why bother to launch Spark?

One reason may be to avoid cannibalizing sales of its other, higher-priced editions.  But, let’s face it, any sentient buyer will notice that Spark is out there. I think the more important reason is that Spark lets Marketo address small businesses separately from larger companies.  The two groups do have different needs and neither wants a system designed for the other.  Spark lets Marketo position itself as a small business specialist when selling to small businesses, without alienating big-business marketers who would consider a small business system an unsuitable toy. 


This is a delicate game.  For one thing, "small business" means different things to different people.  Small business specialists like Infusionsoft and OfficeAutoPilot actually serve a different market -- one that I label "microbusiness" and put at under $5 million revenue.  Those products have a different configuration from Spark, HubSpot, Pardot, or Act-On.  Specifically, Infusionsoft and OfficeAutoPilot have starting prices around $300 per month and offer built-in shopping carts and CRM.  (Other micro-business specialists like Genoo and MakesBridge also have a sub-$500 monthly price, but no CRM or shopping.)  Although Spark is not aimed at the micro-business market, some people may not recognize the distinction.


Nor it is clear that the Spark brand will be enough let Marketo play in both the small and mid-size business segments ($5 to $500 million revenue, by my definition) and the big business segment (more than $500 million revenue.)   Nearly every other marketing automation vendor focuses on one or the other.  The main exception is HubSpot, which is also trying to add larger clients without losing its small business base -- and facing some positioning challenges of its own.  

Spark also poses a financial challenge.  Marketo has said it will earn around $30 million revenue in 2011, and will have an average of around 1,100 clients.  That comes to about $2,500 per client per month, a figure Marketo has been striving to increase.  A large number of Spark clients at $750 per month would dramatically reduce its average.  The profit margins, if any, will surely be lower as well, again dragging down the corporate average.

Now, this is all interesting stuff, but does it matter to anyone who isn't a Marketo investor?  Probably not.  Spark may push prices a little lower and may put a small crimp in some competitors' growth rates.  It may also give small business marketers another fine set of resource materials to complement those from HubSpot and others.  But the bottom line is that similar capabilities were already available at a similar price point from Marketo and others. Spark just doesn't change much.

 

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LoopFuse Offers Free Marketing Automation System: Another Step Towards Industry Consolidation

Summary: LoopFuse has launched a free entry-level version of its marketing automation system. It's one example of how vendors are now competing to attract new users. Only the winners will survive industry consolidation, which may be here sooner than you think.

LoopFuse today promised to “transform” the marketing automation industry by offering a free version of its system. Although LoopFuse and others already provide free trials, this is indeed different: while most free trials expire after 30 days and often have limited functionality, LoopFuse’s FreeView can be used for as long as you like and provides pretty much the same features as the paid version of the system. The critical constraint is that volume is limited to 2,500 prospect names, 5,000 emails and 100,000 page views per month. In practice, this means that only very small companies will actually be able to use the free system as their primary long-term marketing system.

LoopFuse knows that, of course. When they briefed me last week, they said the main purpose of the new system is really to entice trial among companies just starting with marketing automation. They’ll make their money when users see the value they gain and pay for higher volumes and add-on features.

Personally, I’d argue that the really significant news out of LoopFuse is their newly tiered pricing structure. The entry point of $350 per month (for up to 10,000 prospects with unlimited emails and page views) is much lower than the $1,000 to $2,000 starting price of most full-function marketing automation systems. Prices at higher volumes are also much lower than competitors. This will put substantial pricing pressure on vendors who, in many cases, are already struggling to reach sustainable margins.

Here’s where the free system comes back into play. To make a free product viable, LoopFuse needed to engineer as much cost as possible out of the entire client life cycle. This means it had to be possible for clients to purchase and configure the system, learn how to use it and resolve support issues with next to no involvement by LoopFuse staff. Once this was accomplished, LoopFuse was in a position to charge lower fees to its paying clients as well. Other vendors – notably Pardot – have followed a similar cost-removal strategy. But LoopFuse may have been more focused than anyone else.

This doesn’t mean that LoopFuse’s success is guaranteed. Other vendors have similar price points for the small business market (see my list of demand generation vendors) although I suspect their internal costs are higher.

More important, price is just one factor in picking a system. Features, ease of use, and support from the vendor and business partners are usually (and rightly) the main considerations. The free product should increase the number of companies that try LoopFuse first, which will gain it paying customers down the road. But I think that most buyers will recognize that they are likely to stay with their first system and conduct a careful evaluation before they start.

For evidence that a free entry-level product does not automatically drive out higher priced systems, consider the hosted CRM market. Salesforce.com easily dominates despite the presence of surprisingly capable free products like ZohoCRM and FreeCRM .

Whatever the result for LoopFuse, the new offering is part of a larger pattern within the industry. Marketing automation (more precisely, B2B marketing automation) has now passed beyond the pioneer stage where fundamentally different approaches compete for acceptance. At this point, we all pretty much know what a marketing automation system does and, truth be told, the major systems are functionally quite similar.

Competition now shifts from building a technically better system to surviving the inevitable industry consolidation. This requires finding ways to attract masses of new customers as they enter the market.

LoopFuse’s price-driven approach is one such strategy. But many vendors have recently taken others:

- Eloqua, Silverpop, True Influence and at least one other vendor I can’t name are planning new interfaces that they believe will substantially improve ease of use, which they see as the critical barrier blocking many potential buyers. I’m skeptical that truly radical improvements are possible but am certainly eager to see what they come up with.

- LeadLife has embedded best practice hints throughout its system, another way to support adoption by users who lack marketing automation knowledge.

- Infusionsoft has repositioned itself as “email 2.0” rather than marketing automation. They believe this makes it easier for their target customers (under 25 employees) to see them as the next logical step beyond standard email.

- Genius.com added a new Demand Generation edition that falls between its basic Email Marketing and full-blown Marketing Automation products. This is another way of easing the transition from basic email marketing.

- LeadForce1 launched a solution that uses advanced text analysis to measure user intent, and thus provide much better guidance to salespeople than conventional behavioral analysis. Although their approach is based on superior technology, it's still a way to attract customers by offering radically greater value than competitors.

- Marketo now calls itself a “the revenue cycle management company”, giving equal public weight to lead management, sales insight and analytics. They still haven’t briefed me on this or their features to support large enterprises, but they seem to be seeking larger, more sophisticated clients who will presumably provide higher profit margins. Given how many other vendors are targeting small businesses, this certainly makes sense. But Marketo will also find itself competing with established marketing automation vendors like Aprimo, Neolane and Unica. who are entering this market from a different direction. It will also be competing with Eloqua, Silverpop and, perhaps most dangerously, the Market2Lead technology recently purchased by Oracle.

The Market2Lead-Oracle deal raises the other major question facing marketing automation vendors: what role CRM vendors will play? In addition to Oracle, CDC Software (owner of Pivotal CRM and MarketFirst) recently invested in Marketbright.

Of course, the really big question is whether Salesforce.com will make a similar move. There have been off-and-on rumors along those lines for months, followed by stout (if not necessarily credible) denial from Salesforce.com that it has any interest in that direction. I’ve tended to take them at their word, but Oracle and Salesforce.com are blood rivals, so Oracle’s move could easily prompt a Salesforce.com reaction.

Oddly enough, no seems to consider whether Microsoft will enter the game. That's surely a possibility, and would move towards a certainty if its two big on-demand CRM rivals both added marketing automation products. We might even see Google and Intuit participate: both already sell to small business marketers.

My fundamental conclusion is that the B2B marketing automation industry is about to enter the long-predicted stage of vendor consolidation, and that this will move quite quickly. The survivors will serve particular market segments: primarily small vs. large businesses, plus possibly some vertical industry specialization. The window for new entrants is rapidly closing, so any new player will need a major differentiator that creates a clear advantage and distinct identity.

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Infusionsoft Pushes the Right Buttons for Small Business Marketing

Summary: Infusionsoft knows exactly how to sell marketing automation to small business: promise more revenue, less work, strong support and a low price. The system is designed for entrepreneurs, not full-time marketers.

Since marketing automation for small business was on my mind last week, I checked in with the good folks at Infusionsoft, whose 15,000 customers make them leaders in the field. I ended up chatting with Scott Martineau, company founder and VP Product Management. It was a helpful conversation for a few reasons.

It solidified my understanding that Infusionsoft is aimed at REALLY small companies – typically four or five employees, and very rarely more than 25. Typical clients are selling business services such as training or consumer services such as landscaping, dry cleaning, legal help and niche publishing. Those companies have no dedicated marketing staff and often no specialized sales person. This makes them significantly smaller than buyers of most of the systems I write about – which is something to bear in mind when looking at how Infusionsoft does things.

It showed that Infusionsoft has mastered the art of a clear, simple value proposition: “Fix Your Follow-up, Double Your Sales. Guaranteed.” Um, any questions? That particular headline is inside their site, but the one on the main page (“One ‘Killer App’ to Grow Your Business Fast”) makes a similar promise about growth.

(As to the guarantee itself, the company Web site says “When you use Infusionsoft to fix your follow-up with prospects and customers, you will double your sales. If after 12 months you have not doubled your sales and you’re not confident with the progress you’re making, you can cancel the software and we’ll refund half of your first year’s subscription fees.” Although there were originally some conditions on the guarantee, the company removed them all last month.)

As Infusionsoft’s main headline reinforces, small businesses want as few systems as possible. Martineau said that Infusionsoft typically replaces separate CRM, email, shopping cart and possibly affiliate tracking systems. But this is where it’s worth remembering that Infusionsoft is working with very small businesses: larger firms might have greater need for separate systems.

Even Infusionsoft doesn’t attempt to do everything. It doesn’t run the company Web site (which most small businesses have someone else do for them) or provide accounting (a market dominated by Intuit QuickBooks).

Nor, more surprisingly, does Infusionsoft provide inbound marketing (search engine optimization, paid search tracking, Web analytics, detailed activity tracking, blogging, etc.) features to help generate initial Web leads. I can think of a few possible explanations: Infusionsoft clients don’t do much inbound marketing, or they let their Webmasters do it for them, or they are happy with free tools like Google Analytics. Marketers at larger companies may be more demanding. Martineau said his main priorities are elsewhere, in better email and general ease of use.

Small businesses need marketing support. Infusionsoft’s original solution was personal set-up assistance funded by a $2,500 to $5,000 implementation fee. But of course the fee itself was a barrier to sales. Infusionsoft has therefore invested heavily in making its system even easier to use and in providing extensive self-help features such as video tutorials. With those in place, it last month stopped charging the set-up fees.

The capstone of Infusionsoft’s self-help is the Campaign Launchpad, which is worth a look no matter where you work. Launchpad leads users from general questions about their marketing goals to specific instructions and materials for predesigned Infusionsoft campaigns. It won't replace a real marketing consultant, since it can’t analyze whether you’ve made sound decisions. But it’s an excellent resource for people who need help in getting started. The Launchpad is open to everyone, not just Infusionsoft users.

Many small businesses will pay for help when the value is clear. For them, Infusionsoft has developed an array of small-ticket service options, such as a $299 “data transition service” to import existing customer lists. This lets business owners purchase exactly what they feel they need. Martineau said he expects about half of Infusionsoft’s new customers will eventually purchase some sort of paid service.

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Infusionsoft: Impressive Marketing Power for a Very Low Price

Two economists are walking on the street. One looks down and sees a $100 bill. He points it out to the other, who says, “It must be counterfeit. If that were a real $100 bill, someone would have already picked it up.”

The point of the story, other than showing why economists are poor comedians, is that the market is not always perfectly efficient. I suppose no one needs reminding of that in today’s economic situation. But most of us still assume there is a reasonable relationship between price and value. This is why it’s hard to imagine that low-priced software can deliver similar performance to mainstream products.

Now we come to Infusionsoft, which offers marketing automation, CRM and ecommerce for as little as $199 per month. Like a free breakfast at Denny’s, that sounds too good to be true. But the company has been around since 2001 and has thousands of customers, so there must be something to it. At least it’s worth a closer look.

I took that look last week and came away impressed. The company’s marketing is tightly targeted at very small businesses (under 25 employees) but its marketing features are competitive with demand generation products aimed at much larger firms. Three of the five core demand generation functions are clearly there: outbound email, Web forms, and lead nurturing campaigns. Of the other two, lead scoring is primitive at best (I only saw an ability to apply segment tags, which I suppose is all you really need; the company says lead scoring is available “but we don’t advertise it because we haven’t made it easy enough within the software yet”). The fifith core function, integration with Salesforce.com, is not provided because Infusionsoft has its own sales automation capabilities. If you really wanted it, the system does provide an API that would let someone with the right skills set it up.

If advanced lead scoring or Salesforce.com integration are show stoppers for you, then read no further. If not, the marketing automation functions in Infusionsoft are worth considering. Although I mentioned only email campaigns before, users can in fact import lists and then execute email, fax and voice broadcast from within Infusionsoft, or extract lists for direct mail, call center or other external vendors. Simple telemarketing could also be handled within the system using its CRM features. The system includes an email builder with the usual features such as personalization and required “unsubscribe” links. Infusionsoft enforces double opt-in email procedures, monitors its clients results closely, and has a ‘three strikes” policy to educate and if necessary remove clients who violate the rules.

Users can create landing pages and forms within the system, although they must load the HTML onto their own Web sites since Infusionsoft doesn’t host them. This differs from other demand generation vendors, who nearly always host those pages themselves. The practical impact is nil, since the Infusionsoft forms do post data to the client's Infusionsoft-hosted marketing database. I suspect the difference reflects the small-company orientation of Infusionsoft: while marketing departments in larger companies want to be independent of their Web team, Infusionsoft clients probably don't have a Web team separate from marketing (if they have a Web team at all).

Users can also specify the activities that follow submission of a form or other customer interaction. This is where the real power of Infusionsoft shines through. The activities can include assigning the lead to a sequence of follow up messages, assigning it a tag for later segmentation, or sending it to a salesperson or affiliate, either directly or through a round robin distribution. Different answers on Web forms can be linked to different sequences, and users can add filters that determine whether these actions take place. Subsequent events can add leads to new sequences and remove them from existing ones, thereby adjusting to customer behavior.

The result is enough fine-grained control over lead treatment to satisfy all but the most demanding marketers. To me, this is the essence of a lead nurturing system and probably the critical feature of demand generation in general. After all, any email client can send an email and any Web system can put up a landing page. It’s the multi-step, behavior-dependent campaign logic that’s otherwise hard to come by.

That said, the campaign manager you’re getting here is not as polished as the best mainstream demand generation systems. To that extent, at least, you get what you pay for. There’s no flow chart to visualize campaign flows and no easy way to do split testing. Nor is there branching within a sequence, although you could achieve the same effect by having one sequence feed into several other sequences with different entry conditions.

(Side note: Infusionsoft has a public ideas forum for users to suggest and vote on enhancements. Split testing currently ranks number five, behind four refinements to the ecommerce features. This probably means that most users find the marketing features relatively adequate, at least compared with the ecommerce capabilities which definitely looked much less mature. The public forum itself certainly shows a healthy attitude by Infusionsoft towards its own customers. The company also has excellent online documentation and an active user forum for questions and answers.)

On the other hand, Infusionsoft actually does a better job than some demand generation systems of tracking marketing costs. Users can attach a fixed cost and per-response cost to each lead source, which can be an outbound marketing campaign or an inbound source such as Web ads, trade shows, or traditional advertising. Users can also attach a piece cost to each message in a sequence. Revenue for individual customers can be captured with the shopping cart or from opportunities in the CRM system.

This information is presented in a variety of standard reports, although, perplexingly, I couldn’t find one that related the cost of a campaign to the revenue from its respondents. Reports do track response rates, conversion rates, and movement of opportunities through stages in the sales funnel. Standard reports can be run against user-specified date ranges and sometimes against user-specified customer segments. Users can’t create their own reports within the system, but can export their data to analyze elsewhere.

User rights (i.e., which users can do what) are actually more fine-grained in Infusionsoft than in many demand generation systems. Infusionsoft needs the control because it will be used by people throughout the company than a typical marketing system. Infusionsoft also includes contact management and project workflow features, such as tracking tasks and appointments, that aren’t found in most demand generation products.

Infusionsoft pricing starts at $199 per month for a system limited to 10,000 leads and 25,000 emails per month. This version has pretty much all the features needed for demand generation. Going to $299 per month adds ecommerce, sales automation, affiliate management and the API. Even people who don’t need those features might pay the extra money just to move the volume limits to 100,000 leads and 100,000 emails and go from two to four users. $499 per month buys the same features but higher volumes and one more seat. Clients can also add seats for $59 for the base version or $79 per month for the higher two. Implementation costs range from $1,999 to $5,999 depending on the version. [Note: in July 2009, Infusionsoft dropped its implementation fees. Other prices were unchanged.]

Any way you slice it, Infusionsoft would be a tremendous value for a marketing department that could use it instead of a mainstream demand generation system. That’s not to say the choice is a slam-dunk: you may need some of the missing features, and there are other demand generation products that also underprice the mainstream vendors (see last week’s post). Still, if money is tight and your needs are limited, Infusionsoft is certainly an option to consider.

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