In the 1980’s, database marketing came onto the scene and changed the game. Within the first decade that the very first contact databases emerged, leading enterprise companies were already sending mass email campaigns, segmenting their lists, and implementing BANT (Budget, Authority, Need, Timeline) scoring. By 1988, Shaw and Stone had coined the term “database marketing,” and the signal was clear: modern marketing had arrived.
Over the next twenty years, marketing automation vendors boomed; persona-based lead nurturing flourished; content became king; marketing operations became a career path; and we were converting leads through the inbound funnel.
But then we reached the breaking point.
Just like centralized data changed the game in the 80’s, we’re now in a new era in marketing, one that’s changing the very core of what it means to be a marketer: relevancy is the new holy grail.
Why Lead Nurturing as We Know it is Coming to An End
“The funnel is dead.” -David Edelman and Francesco Banfi, McKinsey & Co, 2014
As contact data has become more accessible and marketing automation systems easier to use, consumers are flooded with more and more communication to the point of overload.
According to Epsilon, email click-through rates have decreased by over 40% since 2010, and now most industries see an average click-through rate between 2% to 3%. Omni-channel marketing isn’t necessarily helping. An Infolinks report states that only 2.8% of internet users feel like the display ads they see are relevant. No wonder click-through rates have fallen by 98% in the last two decades.
But something even more fundamental is happening. As a buyer’s budget is increasingly tightened and more scrutiny is placed on ROI, the buying cycle has lengthened and more executives are looped into the decision making process. Add to this a shift towards decentralized corporate structure, globalization, stricter privacy laws, new media sources for information, and less predictability in almost every industry.
What this means is that the buying process is no longer linear . . . or a funnel or a wheel or any other neat, geometric analogy. Instead, the modern buying cycle is an amoeba, constantly altering its shape, extending and retracting, feeling its way around the landscape and crawling haphazardly towards a purchase decision.
Now try to create a ten-touch cadence of emails to match that process.
Lead nurturing as we know it is coming to an end. No longer can we build a comprehensive set of emails, ads, and mailers to drive leads through the buyer’s journey. The days of set-it-and-forget-it or even of A/B testing one variable at a time are behind us.
Instead, we must anticipate our buyer’s needs, the questions they’ll ask, and the research they’ll find interesting, and be prepared to respond when they take the first step. In short, we need to get so far ahead of the buying cycle that it’s not even a buying cycle–it’s a conversation.
However, a different way of engaging with our customers requires a different way of understanding them.
A Different Type of Data
What does the profile of a lead look like?
Today, it includes their name and contact information, job title, location, and firmographic information such as company size, industry, revenue, and perhaps more specific information like the technologies in their stack or their most recent funding round.
But this view of your leads is becoming outdated. Instead, challenge yourself to think of a lead profile as a series of actions across their entire online and offline experience: the influencer they followed on Twitter, the question they posted on Quora, the roadshow they attended, the follow-up email they opened, and the web page they visited three days later. These actions provide you clues about leads’ purchase intent.
As Lisa Gevelber, VP of Marketing at Google, wrote in the New York Times, “intent is more important than identity.”
That’s not to say that marketers should stop qualifying leads and accounts based on demographic and firmographic information. On the contrary, data enrichment and predictive analytics solutions together have made identifying your total addressable and best-fit market incredibly easy, accurate, and up-to-date. But once you have a list of known contacts, following their journey is a lot more effective than forcing them into yours.
In July of last year, we had generated a lead I’ll call “Peter” who was the Executive Vice President of Marketing at a global outsourcing agency. His company was a good fit for our business, and Peter was the perfect contact. At first, we sent him through our nurture track tailored for agencies, but after six weeks, he never opened an email. Then, with data enrichment, we found out he was using Pardot for marketing automation. We started sending him content around our integrations with Pardot and Salesforce, and although he opened some of these emails, he never clicked, responded, or visited our website.
Then, almost a year later, Peter started following @SASsoftware, an analytics platform, on Twitter. This triggered an automated campaign to send him our blog post on how to evaluate predictive analytics vendors. It just so happened that Peter had followed @SASsoftware precisely because he was evaluating analytics vendors, including predictive vendors. As such, he clicked on the email, read the blog, and responded to our subsequent outreach. Peter eventually became a sales opportunity and, as of last month, a new customer of Socedo.
While processes and roles on the marketing team will have to change, being able to capture intent data from both first- and third-party sources will be the first step towards success in the Relevancy Era.
2017 and Beyond
In a recent study from Demand Gen Report, the top three reasons why B2B buyers chose a winning vendor were timeliness, industry knowledge, and relevancy, respectively. Additionally, the single most influential aspect of any vendor’s website is “relevant content that speaks directly to [my] company.”
At Socedo, we’ve tried a few approaches to segmentation for our own marketing and found that the leads who show intent in our space (based on their actions on social media) are 45% more likely to convert into sales opportunities.
Josh Sutton, a Senior Sales Development Representative at DiscoverOrg, uses a combination of behavioral and demographic information to send hyper-relevant emails. His emails see an average 80% engagement rate and 60% reply rate.
There’s no doubt that relevancy is already here, but we also have a long way to go. We need to focus on only our best-fit buyers, enable each member of our teams to make data-driven decisions in real-time, and equip ourselves with technology that can bridge the gap between personalization and limited resources.
And most of all, we need to stop putting ten emails in a row and calling it demand generation.
I’ll leave you with three of my own predictions for the Relevancy Era:
- Fixed lead nurturing tracks will be dead within two years. Instead, marketing automation systems will need to be flexible, so communication can be ad hoc while still at scale.
- Marketing is becoming a responsive role, in which it’s our job to prepare for the right conversations, then wait for our buyers to speak first.
- ROI will surge for the companies who get it right. With each message more relevant and valuable, we can send fewer messages while increasing conversions.
I hope you’re as excited as I am for the new era of marketing. Armed with a combination of first-party and third-party intent data, I’m on a mission to end irrelevant communication. Let’s do it together.