Marketing Automation to Hit $1.9 Billion by 2020
Money is flowing into marketing automation software.
Marketers pumped some serious cash into marketing automation software (MAS) sector last year. Should the current trajectory continue, automation will be a $1.9 billion industry within the next six years, according to analysis from growth and partnership company Frost & Sullivan.
“We are out of the proof of concept mode. Case studies prove the real benefits of using [MAS].” says Frost & Sullivan analyst Hiral Jasani.
The report, titled Global Marketing Automation Software Market, notes that MAS vendors tallied revenues of $550 million in 2013 with providers Eloqua, Marketo, and Silverpop contributing nearly half of last year's $550 million revenue for the sector. Additionally, more than 80% of MAS activity was concentrated in the U.S.
So why exactly is this sector slated for more than 300% growth over the next six years? “Targeting, targeting, targeting!” Jasani says. “Automation makes marketers smarter and more efficient. Personalized customer interactions increase the chances of them making a purchase.”
Though traditionally confined to the tech and B2B verticals, marketing automation adaptation is rapidly spilling over into other industries, particularly education, entertainment, financial services, healthcare, retail, and manufacturing, according to the analysis.
As automation software continues to gain popularity, it will become essential for marketers to streamline their internal communications or risk wasting precious marketing budget dollars. “The trouble is marketers don't always have fresh content for their campaigns to sustain top of mind brand awareness,” Jasani explains. “This needs collaboration with other teams… so that they can identify material that marketers can send out in their campaigns. Updated content libraries and knowledge sharing is important for marketers to fully utilize MAS.”
Projected growth aside, automation still floats on the fringes of many marketers' minds. ““I think MAS still has a long way to go before it is adopted by the masses,” Jasani notes. Indeed, automation programs have penetrated fewer than 5% of small and medium-sized businesses. Alternative email marketing tools and services like Google Analytics are easier to use in general, and completely free besides. As the old saying goes, however, you get what you pay for. “Marketers are definitely getting used to the idea of using technology to their advantage,” Jasani notes. “Once we are over the talent shortage, I think MAS will be widely used in conjunction with predictive analytics to identify the next best offer or next best deal.,”Still, MAS has a bright future, with international growth already trending up, according to the analysis. “Vendors expanding their partner ecosystem in UK, Australia, Germany, Ireland, Sweden, Singapore and Hong Kong are fueling global growth. UK and Australia are hot markets due to high customer demand,” Jasani posits.