The advent of technology has truly made life easier. The need for speed in businesses has never been greater especially in this modern era of Technological innovation. Organizations are constantly looking for new approaches to marketing that saves time and delivers the result.
Marketing Automation refers to software platforms and technologies designed for marketing departments and organizations to more effectively market multiple channels online. For instance; Email marketing, Customer Intelligence, Campaign Management and so on. The use of a marketing automation platform is to streamline sales and marketing organizations by replacing repetitive manual processes with automated solutions. Marketing automation is a platform that marketers use to plan, coordinate, manage and measure all their marketing campaigns, both online and offline. Some examples of marketing automation technology include; Marketo which focuses on account-based marketing, Eloqua, Adobe Campaign, IBM UNICA, Act-On, HubSpot and a host of others.
In the same way, Credit Unions are a member-owned financial, non-profit cooperative, controlled by its members and operated on the principle of people helping people, providing its members with credit at competitive rates as well as other financial services. According to the Credit Union National Association, there were just over 114 million Credit Union members as at Mach, 2018 which was a 17% increase as at 2013, with 93 million credit union members.
Over the years, credit unions face growing competition. As at March 2015, credit unions assets are $1.17 trillion which is 5.5% growth within a year. In fact, the top four banks in the U.S is larger than the entire Credit Union industry. This colossal difference in scale and resources looms as a massive competition for Credit Unions. However, the productivity rates of Credit unions can be heightened with the effective use of Marketing automation technologies. According to the Demand Gen Report, marketing automation boosts sales productivity by 14.5% and reduces the reduction in marketing overhead by 12.2%. However, there has been an argument that credit unions have fewer resources compared to banks and therefore cannot really afford to spend so much on IT. The subject of this piece of writing is to balance the scale on whether or not credit unions should invest in marketing automation technologies.
Pros of Marketing Automation Technology
According to a study conducted in 2017 by Act-On and Econsultancy, 53% of B2B firms have already automated in some capacity and about 37% say they plan to make use of automation in the nearest future. Marketing automation technology offers a lot of benefits.
1. Marketing Automation saves time
That is, you just “set it and forget it”. It makes marketing more convenient as you can just create multiple campaigns and posts ahead of time and schedule a date and time in the future. For instance, one could create an entire month of Facebook posts and set them to post throughout the month. According to Regalix’s 2015 state of B2B Marketing Automation Survey, 73% of marketers said marketing automation increases efficiency while 38% say it helps to shorten the sales cycle. Therefore, one can say that it aids consistency considering how difficult it would be if one were to do it manually.
2. Marketing Automation is cost effective
Credit unions by nature are non-profit corporations. This means that they can’t afford to spend much on so many staffs compared to a bank. Therefore, effective use of marketing automation technology reduces the costs to be spent on staff by simply automating several tasks that would ordinarily require the services of people, thereby saving money.
Most organizations in the 2017 State of Financial Marketing Survey indicated an inability to effectively measure the results of marketing efforts. This is because in most cases, the same people who determine prospect lists are also assigned the role of measuring results. It is too much work. Marketing automation tracks the effectiveness of all marketing communication across the entire prospect universe and across all touch points.
3. Marketing Automation enhances the relationship with the customer
According to the Digital Banking Report, 2018, around 61% of retail banks will be working on making customer relationships better, closely followed by the implementation of Artificial Intelligence and cognitive computing at 57%. The primary objective for retail banks as well as credit unions is not just to get a consumer to open an account with them but about engaging them enough to up-sell and cross-sell other retail products like debit cards, credit cards, loans and so on. All these purchases must be made in order for a long-term relationship with the customer to be established.
In order to facilitate this customer activation process, regular engagement is necessary. According to statistics, the percentage of the US population that is served by credit unions has increased from 33% in 2007 to 43.7% of the population which is equivalent to 100 million members as at 2007. This growth in membership has made communication more difficult. According to research, consumers complain about the lack of information flowing back from their loan officers and real estate agents.
Marketing automation technology allows one to send behavioral triggered Emails. That is these highly tailored campaigns are sent to customers automatically based on their behaviors. For instance, signing up emails, browsing through certain products and so on. In essence, Marketing automation delivers the right message at the right time, thereby removing friction for customer relationship. Marketing automation makes light work of retention and loyalty strategies, increasing customer lifetime value.
4. Marketing automation makes lead nurturing easier
According to research, organizations who use marketing automation technology see a 451% increase in qualified leads. Among those organizations, 91% rank marketing automation as very important to their marketing success. This success is attributed to lead generation by marketing automation technologies. These leads may include a visitor going through products of the company’s website or subscribing to website updates. These leads can be converted to customers if followed up. According to Invesco, companies that only employ lead generation lose 80% of leads, while companies that have a well-executed lead nurturing strategies in pace tend to spend 33% less while generating 50% more sales.
However, once a lead becomes a customer, nurturing doesn’t stop there, in fact, a new kind of nurturing begins to make way for additional product sales. For instance, when a new customer opens an account with a credit union, organizations can do some things to constructively build a more personalized relationship with them. This includes;
- Developing email campaigns based on birthdays and anniversaries
- Analyzing customer and member profiles, behavior, purchase history to create a pipeline forecasting the next steps; I.E; predictive customer analysis
- Automating alerts for transactional messages through SMS and emails
- Creating social media campaigns and tracking all social interactions etc.
Another benefit of marketing automation technology is the ability to create landing pages. Landing pages are purposefully isolated from your website to allow the visitor to focus on a particular offer or piece of information. As you begin to introduce your new 20-year-old client to the benefits of student loan consolidation, you can guide them a student loan specific landing page. There they will not find home equity banner ads or branch locations and ATMs, simply information on the benefits of student loan consolidation.
Cons of Marketing Automation Technology
However, over the years if marketing professionals have learned one thing, it is that marketing automation is a tool in itself. It is simply a means to an end, and that while it offers so many benefits, some challenges are involved.
1. Marketing Automation can be expensive
Credit Unions by nature are non-profit corporations. That is Credit Unions have fewer resources compared to banks and therefore cannot afford to spend much on IT. The fees and payment setup will vary, but marketing automation is not free. Some full-fledged marketing automation solutions can exceed thousands of dollars each month.
As earlier alluded above, marketing automation technology is a time saver. However, because of the complexity and sophistication surrounding automation technologies, they require some time to set up. One might be surprised how many marketing professionals invest so much in a marketing automation platform, only to let it sit on the shelf because they “don’t have the time” to set it up.
Marketing automation technology is both an art and a science. Marketing automation platforms are sophisticated solutions, therefore inexperienced users can end up finding themselves swimming in too many campaigns, audience segments, and many reports. An ugly consequence of this is over-messaging. According to research, the average consumer is hit with over 5,000 marketing messages every day.
Since marketing Automation technologies are armed with the power of automated messaging, some Marketing teams tend to go overboard and aggravate prospects by communicating too frequently. Marketing professionals have opined that marketing touchpoints need to be timed strategically, not seldom, not so frequently, but enough to keep your brand top of mind to avoid annoying recipients into hitting the unsubscribe button.
3. Marketing Automation platforms are sophisticated
One of the more serious disadvantages for credit unions is that these marketing automation platforms hardly come with the capability to interface easily with typical credit union data schemas. For instance, a large generic platform may allow up to 1,000 custom data field, which sounds like enough until one realizes that a typical credit union member may have up to three credit cards, two auto loans and three old loans that have been satisfied and an old mortgage. The consequence of this is that the marketing automation platform will let too much data fall through and render trigger marketing less effective.
4. Marketing Automation requires a lot of time to set up
Furthermore, while it is true that the implementation of marketing automation helps to save money by reducing the number of staffs (marketing team) by replacing repetitive manual processes with automated solutions, it is only a long-term advantage.
As earlier stated, marketing automation is a sophisticated tool which requires experts to set up and operate, and have very long implementation timelines as each interface of the company’s other information must be built individually. Marketing automation technologies lack pre-built synchronization because they are so customizable, they require the company to begin with a blank canvas. This means in order to get the most out of the system, it is necessary to hire a consultant.
Switching to an automated system is a double-edged sword. Advantages include more efficiency, less opportunity for human errors or mistakes, and overall lower operations costs. The disadvantages, on the other hand, are not so apparent. For instance, the cost of marketing automation technologies. But what most people fail to realize is that the more we rely on automation technology, the less the need for humans to perform tasks. This leads to unemployment, therefore, contributing to a failing economy. Also, as we shift more to a more self-serving virtual environment, the more secluded consumers feel and may eventually lose sight of the necessity of human interaction. As D.B Hurley opined;
“It is clear that the market is flush with opportunity and that marketing automation will continue to play an ever more vital role in growing businesses and organizations. The power of the concept is immense, the results are remarkable, and the service has left much to be desired. Software giants will not and cannot continue to do as they please while getting rich on your revenue. So, choose wisely and remember what faults to look out for in a marketing automation service provider”
Furthermore, there are potential risks that automation technology will ultimately subjugate rather than serve humankind. The risks include the possibility that privacy of humans will be invaded by vast computer data networks, and that society will become dependent on automation for its economic well-being. These dangers aside, automation technology, if used wisely and effectively, can yield substantial opportunities for the future. There is an opportunity for future automation technologies to provide a growing social and economic environment in which humans can enjoy a higher standard of living and a better way of life.