Marketing Insights

Is Inbound Marketing All You Need?
by G. David Dodd, Principal Point Balance • The use of inbound marketing techniques, such as search marketing, blogs, and social media marketing, is growing at an explosive rate. Some pundits even contend that inbound marketing should replace most, if not all, traditional outbound marketing activities. This article discusses why most companies need both inbound and outbound marketing to maximize marketing results. •

One of the hot topics in marketing circles today is inbound marketing. Inbound marketing refers to marketing techniques that are designed to attract or “pull” potential customers toward a business. As currently practiced, inbound marketing is primarily online marketing. Companies engage in inbound marketing by publishing informative or entertaining content in a variety of online venues and by making that content easy for potential customers to find and share with friends and colleagues. The primary inbound marketing channels are websites, blogs, and social networking sites. Important inbound marketing tools include search engine optimization, paid search, and content syndication. The alternative to inbound marketing is appropriately called outbound marketing. Outbound marketing works by broadcasting or otherwise “pushing” unsolicited marketing and promotional messages to a more or less defined target audience. Therefore, outbound marketing includes most “traditional” marketing channels and tactics such as TV and radio ads, print ads, direct mail and telemarketing. The use of inbound marketing is growing at an explosive rate, and this rapid growth is likely to continue for the foreseeable future. • eMarketer estimates that 34% of all US companies are using blogs for marketing purposes in 2010, up from just 16% in 2007, and this percentage will increase to 48% of all companies in 2012. (eMarketer, August 2010)

Copyright © 2010 by G. David Dodd All rights reserved.

1

Marketing Insights
• By 2015, spending on social media marketing will account for almost 18% of total marketing budgets, up from about 6% in 2010, according to The CMO Survey cosponsored by The Fuqua School of Business at Duke University and the American Marketing Association. Forrester Research has estimated that spending on social media marketing will grow at a 34% compound annual growth rate between 2009 and 2014 and that spending on search marketing will grow at a 15% annual rate over the same period. (US Interactive Marketing Forecast, 2009 To 2014, Forrester Research, 2009) •

Inbound marketing is growing because it compliments the way today’s buyers make Inbound marketing is purchasing decisions. Proponents of inbound growing because it marketing contend that the Internet has compliments the way fundamentally changed how both consumers and today’s empowered, selfbusiness buyers seek and gather information about directed buyers make products and services. Because of the Internet, purchasing decisions. potential buyers have easy access to a wealth of information about almost every conceivable product and service, and they’ve become convinced they can find whatever information they need, whenever they need it, on their terms. These empowered buyers pay little attention to unsolicited marketing messages, and therefore all forms of outbound or “interruption” marketing are losing effectiveness. Inbound marketing, on the other hand, is a highly effective way to communicate with these “self-directed” buyers. Companies are also turning to inbound marketing because it’s more cost effective than most forms of traditional outbound marketing. The State of Inbound Marketing 2010 survey conducted by HubSpot found that businesses spending 50% or more of their total marketing budget on inbound marketing activities spent 60% less per sales lead than businesses spending more than half of their marketing budget on outbound marketing activities and channels. If inbound marketing is more effective and less costly than outbound marketing, you may be asking yourself: Do we still need outbound marketing? Should we eliminate or significantly reduce our outbound marketing activities and shift most or all of our marketing resources to inbound marketing tactics and channels?

Copyright © 2010 by G. David Dodd All rights reserved.

2

Marketing Insights
For now at least, we believe that most companies need both inbound and outbound marketing to maximize the effectiveness and productivity of their marketing efforts. No one doubts that online communication channels are here to stay, and they will be even more pervasive in the future. As the use of the Internet continues to grow, inbound marketing will become increasingly critical to business success. Even today, most companies should be devoting a significant portion of their total marketing budget to inbound marketing activities. We also contend, however, that outbound Outbound marketing still marketing still performs several important functions in most companies’ marketing efforts. For example, performs some marketing B2B companies rely heavily on outbound marketing jobs better than inbound communications to drive lead nurturing programs. marketing—lead nurturing, Most lead nurturing communications are outbound ecommunicating with mail messages that are sent on a time-based existing customers, and schedule or in response to certain behaviors of the communicating with the prospect. Lead nurturing has become an essential “offline” customer. part of B2B marketing because potential buyers are becoming leads long before they are ready to talk to a salesperson, much less make a purchase. Lead nurturing is designed to keep a company engaged with these prospects until they are ready to buy. Although lead nurturing combines elements of both inbound and outbound marketing, it would be far less effective without the outbound components. In addition, both B2B and B2C companies use outbound marketing methods to communicate information and offers to existing customers regarding new products, product upgrades, and complimentary products or services. Again, this can be done using inbound marketing techniques, but most marketers we know are not comfortable relying exclusively on inbound marketing to perform these high-value marketing jobs. The examples just described involve marketing to an individual who has an existing relationship with the company that is sending the marketing message. In addition, these types of marketing programs usually involve individuals who have “opted-in” to receive marketing messages. Clearly, these circumstances enhance the effectiveness of outbound marketing tactics. But outbound marketing techniques can also be important even when no relationship or permission exists. Those of us who use the Internet regularly to communicate with others, research products or services, and make purchases tend to assume that most other people exhibit the same behaviors. We can easily forget that, even today, many potential customers do not use the Web regularly or extensively. For example, consider
Copyright © 2010 by G. David Dodd All rights reserved.

3

Marketing Insights
the following findings from The Digital Future Report 2010 by the University of Southern California’s Annenberg School for Communication & Journalism. • • Eighty-two percent of Americans use the Internet (but 18% do not). Nineteen percent of Americans between 46 and 55 years of age do not use the Internet, and 15% of Americans between 36 and 45 are not Internet users. Only 58% of Internet users said they visit social networking sites once a week or more. •

So, what is the bottom line for marketers? First, inbound marketing is already important for many companies, and it will become even more important in the future. If you don’t already have an inbound marketing program, you need to consider beginning one. Second, outbound marketing remains an important marketing tool for most companies. It still performs some marketing jobs more effectively than inbound marketing alone, and it still has the ability to create engagement with some potential customers that inbound marketing will not reach. There may come a time when most companies can rely exclusively on inbound marketing, but for now, a balance of inbound and outbound marketing will produce the best results. If you’d like to discuss how inbound and outbound marketing can be combined to boost the performance of your company, contact G. David Dodd at 931-707-5105 or by e-mail at ddodd@pointbalance.com.

Copyright © 2010 by G. David Dodd All rights reserved.

4

Sign up to vote on this title
UsefulNot useful