Small and Medium Businesses (SMBs) and their channel partners are benefiting from adoption of Marketing Automation tools and applications, according to one of our recent surveys. SMBs have embraced Cloud-based Services, including Marketing Automation, in large numbers to control costs and stay competitive. The ability to leverage robust offsite infrastructure, systems software, applications software licenses, upgrades and maintenance services as a monthly subscription bundle allows companies, and especially SMBs, to tackle much more complex competitive challenges than in the past.
What are SMBs doing with Marketing Automation?
With Marketing Automation point solutions and add-on modules, SMBs are able to add very powerful communications, filtering, data management and workflow components to the base CRM system; enabling more efficient sales process management. For many SMBs, especially at the lower end of the spectrum, sales lead management is done on spreadsheets with a move to a CRM system when the firm gets to the point where there are three or more staff working sales and marketing roles. Ultimately the core functions of lead generation, opportunity conversion and lifecycle customer relationship management remain at the center of marketing objectives and are the focus of automation. Substantial improvements of any of these areas can offer big dividends to companies in terms of ROMI.
Eighty Percent Satisfaction Level
Our survey revealed consistent praise from the ~80% of “satisfied and very satisfied” SMBs, who reported better demand generation, lead management, improved ROMI, better customer targeting and communication and several other benefits that help bring more structure and better capabilities to small organizations.
Benefits Differ by Company Size
As companies deployed Marketing Automation solutions, the benefits they realized were slightly different: all saw a broad variety of benefits but both small and medium businesses reported relatively more benefit in specific areas. For example, as seen in the chart below that Small Business reported “More Leads” by 18%, and “Shorter Sales Cycles” 12% respectively, compared to what medium companies stated. Small companies also reported relatively “Better Lead Quality”, “Lower Sales Costs”, and “Improved Personalization and Targeted Messaging”. Medium Businesses said they saw better productivity through identification of “Sales-Ready Leads”, “better understanding of prospect behavior”, “Better Campaign Reporting”, etc.
Generally it appears the results reported by the Small Business are more likely to cover basic issues involved in getting a sales process up and running, while the Medium Business results seem to revolve around improving an existing process, improving collaboration and process integration.
The important takeaways here are that 1) there is an increasingly high level of adoption of Cloud Services by SMBs, 2) the Cloud model is working for them, and 3) the benefits are tangible and supported by an ~80% level of satisfaction.
We will continue to share results from recent surveys covering several important topics for SMBs and Channel partners.
Davis Blair
Techaisle
Techaisle Blog
Intuit today announced it has entered into a definitive agreement to purchase Demandforce for approximately US$423 million. Demandforce has been primarily focused on SMB segment offering products and services to help SMBs navigate and thrive in connected economy by automating their marketing and customer communications, building and maintaining a strong online reputation and raising their profile with their local consumers.
Speaking on the acquisition, Kiran Patel, EVP and General Manager, Intuit Small Business Group said, “Demandforce sits at the sweet spot of Intuit’s SMB customer base and is consistent with our goal to help our customers save time and make money. With a compelling customer value proposition, SaaS model and high growth profile, Demandforce will provide opportunities to grow Intuit’s customer base and revenue per customer over time.”
Analyst Speak
Intuit is continuing to build its capabilities in cloud application areas focused on alleviating the pain points of small businesses. Based on surveys conducted by Techaisle over the last 3 years, improving sales and marketing has shown up consistently as the top business pain point of small businesses. Moreover small businesses are increasingly struggling to grow their revenues, retaining and positively connecting with their customers in a virtual world. Techaisle survey data shows that nearly 45 percent of small businesses are not sure how social networking tools can help promote their business. 68 percent of small businesses mention that “their business success depends upon a strong relationship with the customer, providing goods and services highly customized to their needs and being responsive to their demands”. These same small businesses are gravitating towards social media campaigns (48 percent), email marketing initiatives (68 percent) to generate new customer leads and maintain existing ones.
Demandforce acquisition certainly helps Intuit in extending its existing offering of website services. It rounds off the full suite from “get found” to “increase exposure” to “extend communications” to “consolidate presence”.
Beyond the capabilities of Demandforce, the acquisition brings into Intuit’s fold many different small business vertical industry solutions. These verticals are typically ignored or only addressed by web-hosting providers. They constitute a very large part of the SMB universe but with a dichotomous adoption of technology. For example, salons and spas use very limited technology but still want to increase their customer base beyond the usual “word-of-mouth”. On the other hand wealth management businesses use advanced and emerging technologies but strongly desire customer expansion, communication nurturing, feedback mechanism and certified reviews to positively impact their business.
Success of the acquisition will be dependent upon Intuit’s ability to integrate Demandforce with its web services, back-end systems such as Quickbooks and cross-sell across both Demandforce and Intuit customers.
It is a move in the right direction.
Anurag Agrawal
Techaisle
IT projects are notorious for running over budget and time frames. This is especially true for implementation of new technologies, whether on-premise or in the cloud. Therefore, SMBs should carefully plan for the deployment of new cloud solutions.
Develop a project plan with measurable milestones and assign authority and accountability to specific individuals
While this may seem too obvious to even mention, many SMBs don’t pen down specific detailed project plans for cloud deployment. While the cloud vendor is responsible for hosting the hardware and software on behalf of the customers, SMBs need to understand what specific steps need to be taken – both for developing/customizing new services and for migrating on-premise solutions to the web. This includes all the steps starting with stating the objectives, specifying the requirements, prototyping, testing, training the users and final deployment, with criteria for successful deployment being clearly defined. Some cloud vendors have standard plans for standard services and help SMBs customize these plans for custom service development and deployment.
Measure the actual progress against the plan
This requires working with the vendor’s staff to ensure that actual progress meets the specified milestones and the project is not going over-budget or time schedules.
Take corrective action when actual progress deviates from the plan
Taking corrective action becomes much easier if the original plan provides the required authority to relevant individuals to implement the plan and these individuals can be held accountable for their results.
Test the new service to ensure it performs according to expectations
Even the most experienced cloud provider or developer cannot ensure that the new service is 100% error-free. It is important to test the service not only to ensure that it works error-free but also provides full intended functionality so that the business can realize the full benefits of the service and justify its investment.
Provide training to the end-users to use the new services
It is often very difficult to get end-users to dedicate the required time for training as many end-users perceive it as a distraction from their regular duties. However, lack of training can result in under-utilization of all the functionalities of the new service.
There are some key lessons to learn from those SMBs that have gone through not one but several deployment cycles. Selection of right vendor is not only important but imperative to have a smooth and uneventful deployment.
Tavishi Agrawal
Techaisle
Since the emergence of the Internet in early 90s, experts have been predicting the use of software applications over the Internet, whereby users did not need to install any applications software and servers on their own premises. Instead, they could simply connect to the Internet and access their applications and data from their service providers, much like the telephone, where all the telephony networks and infrastructure are installed at the telephone company’s operating centers and users only need to buy a phone to use all the telephone-related services they need.
The concept was particularly appealing for small and medium businesses (SMBs) that did not have adequate financial and technical resources or the scale of operations required to install the required IT infrastructure in-house. Indeed, up until recently, many SMBs found themselves at a disadvantage in competing with large companies, which implemented the new (and often resource-intensive) complex applications to improve their productivity, develop new products and services better and faster, and provide superior customer service.
In recent years, however, the playing field has begun to be leveled with the emergence of cloud computing, whereby the servers, applications and networking equipment are installed at an external hosting company and users can use the applications they need using any device they want (e.g. desktops, notebooks, tablets, smartphones) without incurring any large capital expenditures upfront, paying for the use of applications on an as-needed basis. One of the most famous examples of such cloud computing is the CRM application offered by Salesforce.com, the single largest pure play cloud computing vendor in the world. While large companies spent tens, or even hundreds of thousands of dollars to install, maintain and periodically upgrade their CRM applications from large vendors like Oracle and SAP to serve their customers, SMBs can now acquire similar capabilities by paying a few dollars a month per user.
Several changes have taken place in recent years and now the stars seem to be finally all aligned for a rapid and sustained growth of cloud-based solutions. Enter cloud computing accelerated by mobility and the work from anywhere and anytime culture.
The New Economy and Increased Demand from SMBs
The dramatic shock to the global economy in 2008 had a multifold effect on the decision making of businesses. With sharp drop in revenues and profits and decreased availability of credit, SMBs found themselves starved of the capital they required to invest for in-house IT infrastructures to meet their increasing IT needs to improve their employee productivity, develop new products and services and provide higher levels of customer service to compete in the globalized economy. With the global economy unlikely to recover anytime soon and resume its long-term growth of earlier years, SMBs have become quite averse to make large capital investments and prefer to pay on an as-needed basis. Cloud computing meets this need of the SMBs by converting capital expenditures into operating expenditures.
Increased Employee Mobility
A second factor that has increased the demand for cloud solutions is the increasing mobility among SMB employees and their need to be able to access their applications anytime from anywhere using any device (e.g. desktops, notebooks, tablets, and smartphones). Cloud solution providers have developed new capabilities in recent years that allow SMB employees to do precisely that. Applications and data can be accessed over fixed and wireless connections and they adapt the data views automatically depending upon the access devices being used by the mobile workers.
Technological Developments
Cloud computing is also being enabled by the fact that new applications are increasingly being developed with Internet delivery in mind rather than just adapting the older client-server technologies for the Internet. A key element of this new trend is the evolution of integration platforms that allow users to integrate the web-based and on-premise applications to work together and exchange data on an as-needed basis automatically. Over time, this will allow SMBs to have multiple applications that work seamlessly like a single system without SMBs having to be concerned about transferring the data accurately and quickly for use by different applications thereby reducing their needs for internal IT skills.
Cloud computing is also becoming more economical by the increasing use of virtualization, which allows use of fewer servers to serve the needs of multiple SMB customers. Virtualization also allows for greater security, backup & recovery and higher levels of IT availability, which have become increasingly important for SMBs with their increasing reliance on IT.
Development of the Cloud Computing Ecosystem
Finally, a more complete ecosystem is evolving, consisting of cloud solution developers (e.g. Salesforce.com, Netsuite, Taleo, Concur) , infrastructure providers (e.g. Dell, IBM, Cisco, HP, etc.), hosting companies (e.g. Equinix, Savvis, Rackspace) as well as local channel partners that collectively have the capability to develop and deliver cloud-based solutions to the large number of SMBs spread out all over their markets. Furthermore, collectively they have the financial & technical resources and credibility to convince SMBs to adopt the new technologies.
Tavishi Agrawal
Techaisle
