Dell To Resell Pardot Marketing Automation

Dell announced today that it has added  Pardot  marketing automation to its list of Dell Cloud Business Software applications.  Other products in the suite include Salesforce.com for sales automation and customer service, Adobe EchoSign for e-signatures, AppExtremes Conga Composer for proposal creation, Dell’s own Boomi for application integration, and a Dell-built analytics platform.  That is some pretty good company to keep.

Beyond the Pardot system itself, the Dell offering includes pre-built integration with the other Dell products and with Microsoft Dynamics CRM, and fixed-price implementation packages (from free to $5,000) including training, campaign development, site search setup, CRM integration, and Google AdWords integration.  The Pardot system costs from $1,000 to $3,000 per month depending on the email volume, file size, and numbers of forms, landing pages, programs, and automation rules.  This is the same as Pardot’s direct-sold prices.  Dell also offers a 30 day free trial of Pardot.

The details of the deal are probably less important than its potential for market penetration.  Dell hasn’t been on my list of potential entrants into the marketing automation space, but it certainly has a huge presence among small and mid-size businesses.  This gives it the capability to add thousands of clients to Pardot’s existing base, which has just recently passed 1,000.  Like Intuit’s acquisition last month of local marketing vendor Demandforce,  a well-executed rollout could quickly establish a firm whose market share dwarfs existing competitors.  In some ways, the Dell/Pardot deal is even more interesting than Intuit/Demandforce, because it touches the small to mid-size businesses that form the core of the B2B marketing automation client base.  Intuit/Demandforce will serve many micro-businesses, while other recent deals (FICO/Entiera and Experian/Conversen) are aimed at larger, business-to-consumer marketers.

This doesn't mean an effective Dell/Pardot rollout is guaranteed.  These sorts of relationships often fizzle quickly, typically because the larger company’s sales force can’t be bothered to sell the new partner’s product.  That seems a bit less likely to happen in this case, since Dell’s cloud business group offers just a handful of applications and Dell has traditionally been a very effective marketer – although its recent performance has been spotty.

Whatever the result of this particular deal, it is more evidence that the B2B marketing automation industry is rapidly approaching consolidation.  As deep-pocketed outside companies become active, they battle each other on a grand scale and little firms get crushed almost accidentally.  It may be some time before a single victor emerges – if ever – but it’s hard to imagine many of today’s small companies remaining successful as elephants stampede all around them.

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3 Ways to Connect Marketing Activity to Revenue

Discussions of revenue attribution often remind me of the famous recipe* that begins “First, catch your hare”.  Specifically, they assume that marketers know which marketing-generated lead is associated with each bit of revenue, and then go on like medieval theologians to debate how credit should be shared among promotions to that lead.  The missing hare is that marketers often can’t link leads to revenue in the first place.

The issues will be painfully familiar to anyone who’s ever tried this. For those who haven’t, let’s start with the mechanics.  In most configurations, leads are created in marketing automation and later transferred to Sales, which creates an opportunity that eventually becomes a closed sale with revenue attached.  If all goes smoothly, the original marketing campaign and marketing-generated lead are named on the opportunity to provide the lead-to-revenue connection. 

But – spoiler alert! – things don’t always go smoothly.  When Sales creates the opportunity, it often links it to a contact record other than the original marketing lead.  Perhaps the salesperson was already working with someone else, perhaps the marketing lead wasn’t the real decision maker, or perhaps Sales just doesn’t want to give acknowledge Marketing’s contribution.  The original marketing campaign is often lost for similar reasons.


All those beautiful attribution recipes are moot if you don’t know which lead is linked to which revenue.  So let’s put down the cooking pots and go hare hunting.



The first approach is simply to get Sales to retain the marketing information when it creates the opportunity.  Let’s not dismiss this out of hand – yes, salespeople can be uncooperative, but appropriate training and management support can convince them it’s important to retain the information.  So it’s worth a try.

But let’s say you don’t have time to wait for better data or can’t get Sales to do what you need.  Now you’ll need to work a bit harder with the data on hand. 

One approach is to look for matches at the account level: build a list of marketing-generated leads, find the accounts associated with them, find the revenues associated with those accounts, and assume there’s a connection.  This could hugely overstate marketing-related revenue, since it potentially takes credit for sales that had nothing to do with marketing activity.  So you’ll probably want to put some parameters on the matches such as only including accounts with no pre-existing contacts, leads that Sales followed up on, and opportunities created soon after the marketing lead was submitted.  Setting these rules may take some serious discussion between Sales and Marketing, but that’s a good thing.

Unfortunately, there’s no guarantee that Sales will retain the leads sent by marketing or attach them to the correct accounts.  Nor is it certain that the companies listed in the marketing automation system will match the accounts listed by Sales.  In this case, you may need to build an even looser relationship, looking at company names in both systems – or even ignoring the Sales system altogether and taking data from accounting records.  Because the same company may be listed differently in different systems, this sort of matching requires either knowledgeable people or comprehensive reference databases that can make the non-obvious connections.  Fortunately, this is a well understood problem and plenty of resources are available to help.

Company-to-company matching casts an even wider net than lead-to-account matching, so it’s correspondingly harder to give marketing credit for every connection.  But you can rate how likely it was that marketing played a role in a given opportunity by looking at factors like timing, pre-existing relationships, and amount of marketing activity.  This could translate into allocating a fraction of the revenue to marketing, ultimately a more realistic, if less satisfying, approach than taking full credit for some deals and no credit for others. 

If fractional allocation strikes you as too complicated, you can also start with a much simpler question: did companies that interacted with marketing programs show more sales than similar companies that didn’t interact with marketing programs?  You won’t be able to prove that any particular contact generated any particular deal, but a strong correlation between marketing programs and revenue growth is good evidence that marketing had an impact.  Once you’ve captured that hare, you can think about the details of how you’ll cook it.

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*Jugged Hare in Hannah Grasse’s The Art of Cookery Made Plain and Easy, although it apparently  doesn’t include the “catch your hare” part.

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Salesforce.com and Oracle Buy Social Marketing Systems: Not the End of Marketing As We Know It

Salesforce.com yesterday announced agreement to buy social media publishing vendor Buddy Media for $689 million, thereby adding another big fluffy piece to its “marketing cloud”. Oracle followed suit this morning  with an acquisition of social media monitoring and semantic analysis vendor Collective Intellect. This followed Oracle’s $300 million acquisition last month  of social publishing system Vitrue. Just for symmetry, it’s worth pointing out that Salesforce.com acquired its own social monitoring system, Radian6, in March 2011.

What are marketers to make of all this activity, not to mention Marketo’s acquisition in April  of social marketing vendor Cloud Factory? Is this the death of marketing as we know it?

In a word, no. Social media are certainly a new way to hear what buyers are saying and send them marketing messages. But only the most besotted booster would argue that it will replace, rather than supplement, traditional methods. Every serious marketer already recognizes this, so I’m not even being boldly contrarian by saying it out loud.

The more interesting question is whether social media can be the foundation of a company’s marketing infrastructure. Both Marketo and Oracle already offer robust marketing platforms, so they presumably see social media as a supplement rather than a replacement. (It’s possible that Marketo hopes to reinvent itself as a social media specialist, which is surely more attractive to investors than marketing automation. The key positions taken by Cloud Factory executives might even support the theory.  But Marketo hasn’t hinted at this approach.)

Salesforce.com is another story.  They’ve always avoided traditional marketing automation, so perhaps they feel a complete “marketing cloud” can be built without it.

The gaps in this approach are obvious to anyone familiar with standard marketing automation systems: no Web behavior tracking, no multi-step nurture campaigns, no marketing resource management. But Salesforce.com could close those gaps by gradually extending its existing products. This might actually be easier than acquiring a separate marketing automation system and shoe horning it into other Salesforce.com components.

One thing I don’t see is social media systems themselves expanding to be marketing automation platforms. So far as I know, the data structures within the social media systems are simple contact profiles – little more than flat files – which can’t easily be extended to store and analyze detailed activity histories across multiple channels. Nor does a standard social media publishing or monitoring platform have the multi-step, branching campaign flows that are the heart of marketing automation. It’s probably easier to add social marketing functions to a marketing automation platform than the other way around. Indeed, many marketing automation vendors have already started.

So, back to the original question: what do these acquisitions mean? I’d say they’re good news for marketers, who will increasingly find social marketing functions available within core marketing platforms, ending the need to integrate separate products. The acquisitions are more problematic for marketing automation vendors, who now need to build, buy, or connect with social marketing systems to remain competitive. This will make it still harder for smaller vendors to compete, hastening the industry consolidation we all know is coming anyway. Nothing boldly contrarian about that prediction either, but it’s still worth bearing in mind.

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Social and Mobile Features Head the List of New Marketing Automation Capabilities

I’m getting ready for the next edition of the B2B Marketing Automation Vendor Selection Tool (VEST). This is based on nearly 200 questions to vendors, mostly about product features. The first step in the process is to update the list of questions. This is based on a review of recent vendor announcements plus my own feeling for what’s important. What emerges is an interesting portrait of industry trends in product development.

You won’t be surprised to learn that most of the changes involve social and mobile marketing, today's two hottest areas in marketing in general. We’ll get back to those in a bit. But first, I’d argue the single most important result is just how few changes there really were. B2B marketing automation is far from mature in terms of market penetration, but the mix of product features is pretty well set. Most of vendor announcements I reviewed were about common features that particular vendors had been lacking or were enhancing.  Social and mobile are the exceptions, but both are still very small contributors to most B2B marketing programs. I saw much more activity around features that were new last year, such as dynamic content and integration with Webinar systems and with Microsoft Dynamics CRM.

So exactly what new social and mobile features are now on my list? The previous report already included basic social capabilities including sharing marketing content to social media, tracking responses generated from social media, and monitoring social media activity. The new VEST expands that list to include:

- track social media influence: individual-level tracking mechanism that can identify the number of times a recipient has shared a promotion to social media and the number of responses generated the shared promotions. This information is part of the contact profile of the individual.

- create social media posts: deliver messages through social media, such as Twitter posts and Facebook updates. These messages can be created and then scheduled for future delivery.

- create social forms: create forms that are delivered within a third-party social media system such as Facebook.

- create social promotions: create social promotions such as contests, polls, ratings, etc.

- social sign-on and data capture: recipients can register using third-party social credentials, such as their Facebook ID. This gives access to information stored within the third-party social media system and allows communication through that system.

- build social profile: capture information about a specified individual by searching public information across multiple social media systems. This information includes social media handles and social activity such as posts, comments, and questions answered. The information is added to the individual profile and activity history.

The broad range of these features represents both a maturation of B2B social marketing and uncertainty about what will ultimately prove useful. We can expect more social features in the near future, although I suspect some will later be abandoned when it turns out they’re not especially effective in a B2B context.

On to mobile.  My previous list of mobile features was limited to text messaging. I’ve expanded that to add:

- mobile formats: generate Web and email versions in formats tailored to delivery on mobile devices such as smartphones and tablets.

- mobile CRM: salespeople can access the system on mobile platforms such as smartphones and tablets.

- mobile reporting: users can access reports on mobile platforms such as smartphones and tablets.

- mobile administration: users can set up campaigns and create content on mobile platforms such as smartphones and tablets.

Only the first of these, mobile formats, is about delivering marketing messages. The others are all about marketers and salespeople accessing the system on their own mobile devices. That’s clearly the current focus on mobile marketing automation, although it’s safe to expect more mobile marketing in the future – such as location-based promotions, which are notably absent so far.

I also added three entries in other categories. These were:

- app marketplace: the vendor has a formal app marketplace that lets third party applications connect to its product without custom integration.

- real time recommendations: rules and/or predictive models can recommend the best treatment for a customer as an interaction takes place within system-managed content such as a Web page.

- real time interactions: rules and/or predictive models can recommend the best treatment for a customer as an interaction takes place within an external platform such as a call center or Web site. This requires features to collect information about the interaction from the external platform, to match this information against the system's own database of contacts profiles and history, to make recommendation using the available information, and to deliver the recommendation to the external platform. .

These features all expand the scope of B2B marketing automation, mostly be connecting it with other systems. In one sense that's the opposite of the previous new entries, which were about adding features to marketing automation itself.  But both approaches aim to place marketing automation at the center of a company’s customer management infrastructure. Since other products, including CRM and Web sites, are also reaching for that position, we’ll see how widely these features get adopted. My sense is they’ll be more successful at small companies, where the labor savings of a unified system are most important because technology resources are most constrained.

None of the features I’ve added are currently available in more than a handful of systems.  Some may not yet be present in any. Few marketers this year will choose a system primarily because these particular features are present.  But we'll find over time which are really important.

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6 Key Marketing Measures That Don't Include Revenue

Ask most marketers how they measure performance, and they’ll tell you they look at results: incremental revenue or return on investment if they’re available, or response rates if they're not. Industry experts take a similar approach, focusing largely on the need for better revenue measures. The situation – and barely concealed frustration – is captured perfectly in the headline from a recent Forrester Consulting study sponsored by Silverpop: “Response Metrics Are Used To Evaluate Success, Leaving Customer Or Business Impact Metrics Largely Ignored”.

I agree that revenue is important, but humbly suggest that there’s more to marketing measurement than ROI. Marketers need several types of information – and shouldn’t let the quest for performance measures prevent them from meeting other requirements.

Here are six non-value measures that marketers should build into their reporting systems.

• Benchmarks. Sure, marketing’s job is to generate revenue, but is generating $1 million good or bad? The only way to know is by placing the number in context, which could be this year’s marketing plan or last year’s actual results. Even if marketers can’t measure revenue, they can  set benchmarks for metrics like number of leads generated, funnel conversion rates, or cost per order. In fact, measuring components that contribute to results gives better insights into marketing performance than reporting on the results themselves. For this reason, marketers who can’t directly measure marketing-generated revenue should think twice before creating complex indirect estimates that are hard to understand and have limited credibility. The money would probably be better spent on reports that provide a clearer picture of what’s actually happening.

• Projections. Past results are interesting but the future is more important. Again, the real need is to understand the factors that determine future results, such as response rates and funnel velocity. Changes in these can give early warning of risks and opportunities.  The trick is to distinguish real trends from random variations, so marketers react quickly without chasing too many false alarms.

• Operations. It’s easy to make mistakes in setting up a marketing program, especially one with multiple stages, lead scoring models, and decision rules. Even careful testing can’t always capture all program steps or contingencies. Marketers need reports on the number of people in each program stage and receiving each message, and they need a model that lets them know whether those numbers are reasonable. Reports should show both program-to-date and weekly or daily results: cumulative data show major errors such as bad program logic, and short-term results capture small problems, such as a missed processing step, that could get lost in a program-to-date aggregate.

• Exceptions. Projections and benchmarks put data in context, but marketers don't have time to comb through every figure.  They need exception reports to highlight the most important variations, both positive and negative.  Marketers also need tools to drill into the exceptions so they can understand what happened and identify new opportunities.

• Testing.  Formal tests are the most certain way to understand the impact of marketing projects, but they often require special reporting tools such as ways to compare results for different customer groups over time.  Incremental revenue is the ultimate measure for test evaluation, but often other metrics such as response rates or velocity are easier to capture and more directly relevant.  Reaping the full benefit of tests also requires systems to distribute results and catalog findings for future reference.

• Strategic Goals. Marketing plans should be based on corporate strategy, but long-term goals fade into the background once marketers start making tactical choices based on day-to-day results. The reporting system should provide direct measures of strategic objectives – things like penetration of new market segments and exploration of new channels – so marketers can see the cumulative impact of deviations from the original plans. Many strategic goals, such as process change, staff training, and systems deployment, are not measured in revenue at all.

The types of measures I’ve just described don’t replace revenue and ROI reporting.  Rather, they meet needs that revenue reports alone cannot. Ideally, all these types of information will be combined in a marketing dashboard that provides a quick overview of critical information and allows drilling into details when necessary. Marketers should realize that the contents of this dashboard will change over time as their focus shifts to different programs and strategic goals. They should also recognize that good reporting will generate new questions as it uncovers risks and opportunities that would otherwise have gone undetected.  The system should make those questions easier to answer, but marketers shouldn't expect their total work to decrease.  What they can expect is that better reporting will increase the value created by their efforts: yet another new metric, Return on Reporting, should go up.

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Experian Buys Conversen Marketing Automation to Strengthen Its Offerings

Experian Marketing Services yesterday announced its acquisition
 of marketing automation vendor Conversen. This is the third marketing automation acquisition in the past month, following Intuit’s purchase of Demandforce and FICO’s purchase of Entiera.

Conversen is somewhat similar to Entiera in offering sophisticated multi-step campaigns, although its main differentiator is multi-channel dynamic content that makes it relatively easy to deliver different messages to different segments across multiple channels. See my review from February 2010 for a more detailed explanation. But while Entiera was selling directly to marketers, Conversen's clients were mostly ad agencies and marketing service providers who offered it to their own customers. When I last spoke with Conversen about a year ago, they had more than 35 partners with more than 150 end clients. That’s a respectable installed base for this type of product.

Experian’s stated rationale for the acquisition is to allow more sophisticated cross channel marketing dialogues than its existing tools provided. The transaction is part of a larger drive for Experian to revitalize its Marketing Services group, which has been investing in new people and technologies over the past couple of years.

Like the Entiera acquisition, the Conversen deal removes another independent player from the ranks of large scale consumer marketing automation systems. Marketing service providers looking for a system to license will be particularly unhappy, since they already had few choices and won't like licensing from a competitor. Experian hasn’t said it will withdraw Conversen from existing partners, but its main goal is clearly to use the system for its own massive client base.

Conversen will be a key component in a larger digital marketing suite from Experian. If there’s a real trend in the recent acquisitions, it’s that a handful of large companies are building digital marketing suites and either offering them as software (IBM, Teradata, SAS, Oracle, SAP) or combined with marketing services (FICO, Experian, maybe Harte-Hanks). I’ve argued forever that big integrated suites will ultimately swamp products that specialize in one field such as email, Web content management, or online advertising. The scope of the suites makes it hard for specialists to compete, especially as ever-tighter integration becomes necessary to meet customer expectations for seamless service across channels. Experian, which already has huge businesses in online advertising, email and social marketing, is one of the few service vendors with the resources to build and update its own systems rather than purchasing from third-party vendors.

As someone who views things mostly from a marketers’ perspective, I'm not thrilled at this development. Fewer competitors make it harder for buyers to get a good deal and big suites tend to be less innovative than small specialists. Of course, there are still plenty of small marketing automation vendors, but the gorillas will make attract many of their clients and scare away potential investors. It’s probably no coincidence that the recent acquisitions have been small companies, not the better known marketing automation players: the buyers have wanted technology, which is hard to develop, more than market position, which they already have. Nor is it surprising that acquisitions have been consumer marketing systems rather than B2B marketing automation: there’s ultimately more money in consumer marketing and the vicious dogfight in B2B marketing automation in the past few years has made profitability almost impossible for anyone. There’s little reason for an outsider to buy in such an unpleasant neighborhood.

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FICO Buys Entiera Marketing Automation: Another Independent Option Gone

Three weeks ago, Intuit shook up the low end of the marketing automation universe by purchasing small business marketing shooting star Demandforce. Last week the action shifted to the high end, where FICO announced its purchase of Entiera, one of the few remaining enterprise class products.

FICO, the company formerly known as Fair Isaac and originator of the influential FICO credit score, first dipped its toe into marketing automation services and software when it acquired DynaMark in 1992. Since then, the company has continued to grow its marketing offerings, through acquisition and internal development.  But it sell these largely as add-ons to its core predictive analytics products. FICO statements make clear that Entiera will continue this strategy, both by providing new capabilities for event-triggered to existing clients and by making the full set of FICO products available to smaller companies.

FICO’s backing will certainly allow Entiera to sell to more companies. But, in sharp contrast to the Intuit/Demandforce deal, I see this acquisition as shrinking rather than increasing competition in the relevant market segment. Entiera was one of the few independent vendors still chasing the business of mid-size and enterprise marketing automation buyers. This group had already been reduced with the acquisition of Alterian by SDL last December and of SmartFocus by eMailVision the previous April. Of the firms on my list of B2C options from last September, only a handful (Neolane, Decision Software Inc, RedPoint and ClickSquared are primarily selling marketing automation software. The others are either more oriented to email services (ExactTarget, and I should add Responsys and Silverpop) or have minimal industry presence (MarketingPilot, Pitney Bowes' Portrait Software, Conversen, SmartSource Online, etc.).

In theory, FICO could finance a significant expansion of Entiera’s independent business. With $620 million in 2011 revenue and over $100 million operating cash flow, the company could certainly afford it. But marketing services are clearly just a sideline for FICO. So it’s likely they’ll use Entiera’s technology to support sales of their core analytical products to current customers and perhaps to deliver them more cost-effectively to new customers. That’s great for FICO and for Entiera’s founders. But in a segment where most of the major products are already owned by giant corporations (IBM, Teradata, SAS), marketers now have one less young vendor hungry for their business.

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