The 2011 State of Inbound Marketing

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The Hubspot's 2011 report was based on responses from over 600 professionals.

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  • 1. www.HubSpot.comThe 2011 State ofInbound MarketingFebruary 2011Tweet This!

2. THE STATE OF INBOUND MARKETINGContentsIntroduction ............................................................................................................................................ 3The State of Marketing Costs & Budgets ............................................................................................... 4Inbound Channels Convert Leads into Customers ............................................................................... 10Whats Important to Marketers? ........................................................................................................... 13Conclusion and Additional Resources.................................................................................................. 16Appendix.............................................................................................................................................. 17HubSpot.com 2 3. THE STATE OF INBOUND MARKETINGIntroductionSummaryThis report is based on a January 2011 survey of 644 professionals familiar with their businessmarketing strategy.1 The key takeaways are: Inbound marketing channels are maintaining their low-cost advantage: Inbound marketing-dominated organizations experience a cost per lead 62% lower than outbound marketing-dominated organizations. The gap between spending on inbound vs. outbound continues to widen: In 2009, inbound marketing had a 9% greater share of the lead generation budget; in 2011 its share was 17% greater. Blogs and social media channels are generating real customers: 57% of companies using blogs reported that they acquired customers from leads generated directly from their blog. More and more business are blogging: Businesses are now in the minority if they do not blog. From 2009 to 2011 the percentage of businesses with a blog grew from 48% to 65%. Businesses are increasingly aware their blog is highly valuable: 85% of businesses rated their company blogs as useful, important or critical; a whopping 27% rated their company blog as critical to their business.Overview of Inbound MarketingThis report is designed to help businesses and marketers understand the current usage and results ofinbound marketing. Inbound marketing is a set of marketing strategies and techniques focused onpulling relevant prospects and customers towards a business and its products. Inbound marketing isbecoming widely accepted because it complements the way buyers make purchasing decisionstodaythey are using the Internet to learn about the products and services that best meet their needs.Inbound marketers offer their audiences useful information and tools to attract these people totheir site, while also interacting and developing relationships with individuals on the Web. Inboundmarketing tools include blogging, content publishing, search engine optimization and social media.Inbound marketing contrasts with traditional outbound marketing, in which businesses push theirmessages at consumers. With techniques that include direct mail, telemarketing and trade shows,outbound marketing has become less effective over time as buyers have behaviorally andtechnologically (e.g., TIVO, spam filters, do-not-call lists) tuned these interruptive campaigns out.1For more information about the survey please see the appendix.HubSpot.com 3 4. THE STATE OF INBOUND MARKETINGThe State of Marketing Costs & BudgetsInbound Consistently Delivers a Cost per Lead Dramatically Lower Than OutboundSurvey participants were asked to report the distribution of their spending and their average cost perlead. Respondents who spend more than 50% of their lead generation budget on inbound marketingchannels report a significantly lower cost per sales lead than those who spend 50% or more of theirbudgets on outbound marketing channels: In 2011, the average cost per lead for outbound-dominated businesses was $373, whileinbound businesses reported their leads cost on average $143. Inbound marketing-dominated organizations experience a 62% lower cost per leadthan outbound marketing dominated organizations.This finding is remarkably consistent from year to year. The previous study showed strikingly similarresults: the 2010 survey showed that inbound marketing-centric organizations experienced a 60% lowercost per lead.Average Cost Per LeadInbound vs. Outbound$400 $373 $332 62% Lower Cost per Lead Avg. Cost per Lead$200 $134 $143Outbound MarketingDominatedInbound MarketingDominated$0 2010 2011 HubSpot.com 4 5. THE STATE OF INBOUND MARKETINGThree Out of Four Inbound Channels Cost Less than Any Outbound ChannelWhen asked to classify each lead generation category as below average cost, near average cost, orabove average cost, businesses consistently ranked inbound marketing channels as having costslower than outbound channels. PPC was the only inbound channel that was ranked among theoutbound channels.Blogs, social media and organic search maintained the top slots as least expensive.Blogs had the highest instance of being reported as Below Average Cost: 55% of companies who blog indicated leads from this channel were Below Average Cost.Trade shows, PPC, direct mail and telemarketing were most frequently ranked as more expensive. Below Average Cost per Lead,% Respondents by Lead Channel 60% Majority reported blog leads are cheaper.Outbound% of RespondentsInbound 40% 55%47% 20% 39%36%33%27% 19% 0%BlogsSocial MediaSEOTelemarketing Direct Mail PPC Trade (Organic (Paid Showssearch)search) Above Average Cost per Lead,% Respondents by Lead Channel Trade Shows were most frequentlyOutbound 40% % of Respondents reported as more expensive than average Inbound Channle47% 20%29% 27%21% 13% 13% 9% 0% Trade ShowsPPC Direct Mail Telemarketing SEO Social MediaBlogs(Paid (Organic search) search) HubSpot.com 5 6. THE STATE OF INBOUND MARKETINGThe Majority of Businesses Are Increasing Their Inbound Marketing BudgetsHow does your 2011 Inbound Marketing budget compare to your 2010 budget? the survey asked. Ifyour 2011 inbound marketing budget changed from your 2010 budget, what drove that decision? Theanswers to these questions show that the majority of businesses are consistently increasing inboundmarketing budgets: 54% of those surveyed are increasing their inbound marketing budgets. 89% are either maintaining or increasing their inbound marketing budgets. This increase was observed two years in row. Among the 54% of respondents with increased inbound marketing budgets, the most commonly cited reason was past success with inbound marketing. The majority of businesses attributed their decreasing budgets to the economic conditions (71%) or a change in management (15%).How does your Inbound Marketing budget for the current year 60%compare to your budget for the previous year? Majority reported increases in inbound% of Respondents 40% budgets two years in a row. 2010 2011 51%54% 20%37% 35%12%11%0%HigherNo Change Lower Why Businesses are IncreasingWhy Businesses are DecreasingInbound Budgets Inbound Budgets Past Success50% Economy71% with InboundChange in Other 21%15% ManagementEconomy 15% Other 11% Change inPast Success 14%3%Managementwith Outbound Past Success Past Success 0% 0% with Outboundwith Inbound 0%20%40% 0%25%50% % of Respondents% of Respondents HubSpot.com6 7. THE STATE OF INBOUND MARKETINGDistribution of Budgets Continues to Shift To Inbound ChannelsWe asked survey respondents what percentage of their lead generation budgets would be spent oneach of 9 marketing channels: direct mail, telemarketing, trade shows, email marketing, PPC(paid search / AdWords), SEO (organic / natural search), social media, blogs, and other. Thosenine channels were grouped as follows (email marketing can be used both as an inbound and anoutbound marketing tool so it was not classified):OUTBOUNDNOTINBOUND CHANNELSCHANNELS CLASSIFIEDPPCDirect MailEmail Marketing SEO TelemarketingOtherSocial Media Trade Shows BlogsThe results show that: The average portion of budget dedicated to inbound increased from 38% to 41% from 2009to 2011. The net effect is that the gap continues to widen - inbound marketing had a 9% greatershare of the lead generation budget in 2009 in comparison to a 17% greater share in2011.Lead Generation BudgetAverage Distribution, 2009 v. 2011 40% 9% gap17% gapOutboundInboundAvg % of Budget 20%41%38% 29% 24% 0% 20092011 HubSpot.com 7 8. THE STATE OF INBOUND MARKETINGA more granular view of the data shows that:Marketers are allocating more of their lead generation budgets to social media and company blogs.The average budget spent on company blogs and social media increased from 9% in 2009 to 17% in 2011.Marketers are decreasing the portion spent on PPC, direct mail and telemarketing. Inbound Lead Generation BudgetAverage Distribution, 2009-2011 50% 40% PPC10%Avg % of Budget 11% SEO (organic 30% 16% search)13%Blogs & Social 20% 13% Media 13% 10%18% 15% 9% 0% 20092010 2011 Outbound Lead Generation BudgetAverage Distribution, 2009-2011 40% Avg % of Budget Telemarketing 10% 5%Trade Shows 20% 6% Direct Mail 11% 11%13% 9%7%6% 0% 2009 20102011HubSpot.com 8 9. THE STATE OF INBOUND MARKETINGSmall Companies Continue to Spend More of Their Budgets on Inbound MarketingIn a continuation of a trend identified in previous reports, small businesses are attempting to level theplaying field by focusing on lower-cost inbound lead generation techniques. In 2011, small businesses (1 to 5 employees) plan to spend 49% of their lead generation budgets on inbound marketing. In comparison, medium-to-large businesses (50 or more employees) only plan to spend 36% of their lead generation budgets on inbound marketing. Small business are only giving 10% of their budget to outbound, while medium-to-large business are allocating 28% of their budget to outbound channels. Small businesses plan to spend dramatically more of their budgets on social media and blogs. Medium-to-large businesses plan to spend more of their budgets on outbound methods, including trade shows, direct mail and telemarketing.Avg. Distribution of Lead Generation Budgets Small vs. Medium to Large Businesses20%19% 16% 17% 1 to 5 Employees Over 50 Employees 13% 13%Avg % of Budget 12%10% 10%10%8% 6%7%4%3% 3%3%3%0%Social Media SEO BlogsEmailTrade Shows PPC Direct Mail Telemarketing (OrganicMarketing (Paid Search)Search)HubSpot.com9 10. THE STATE OF INBOUND MARKETINGInbound Channels Convert Leads into CustomersSocial Media and Blogs Generate Real CustomersThe use of social media and company blogs as marketing tools not only gets your company betterbrand exposure, but it also generates leads that result in real customer acquisition. 57% of those using company blogs have acquired a customer from a blog-generated lead; this is an increase of 11 percentage points since 2010. Similarly, 57% of companies using LinkedIn have acquired a customer from that channel. Facebook and Twitter users reported customer acquisition rates of 48% and 42%, respectively.Customer Acquisition by Channel 60% 57%57%46% 48% 44% 41%41%42%% of Channel 40% Users who Acquired a 2010 CustomerThrough that2011 20%Channel0%Company Blog LinkedInFacebookTwitterCustomer Acquisition through Blogs is Directly Related to Frequency of PostsIf your blog is underutilized, you are leaving customers on the table. The 2011 survey shows a directcorrelation between blog post frequency and new customers acquired. Blog Post Frequency vs. Customer Acquisition 100% 89%76% 78% 72% % of BlogUsers who Acquired49%a customer50%through33% their blog0%Less Than Monthly Weekly2-3 Times DailyMultiple Monthly a WeekTimes a DayFrequency of Blog Posts HubSpot.com 10 11. THE STATE OF INBOUND MARKETINGMost Company Blogs Publish at Least WeeklyDespite the evidence showing that increased blogging correlates with increased customer acquisition,blogging frequency remained relatively steady between 2009 and 2011. In 2011, 71% of respondents indicated they blog at least weekly. Frequency of Blog Posts2009 v. 2011 80%200962% 61% 60%2011% of Repsondents 40%29% 23% 20%15%10% 0% DailyWeeklyMonthly or lessFacebook Is More Effective for B2C; LinkedIn Is More Effective for B2BThe effectiveness of a particular social media channel depends upon the type of business. While bothB2B and B2C companies are able to acquire customers through any of the four channels surveyed,Facebook is clearly more effective for B2C businesses and LinkedIn is clearly more effective for B2Bbusinesses. Both business types found similar and relatively high success with customer acquisitionthrough a company blog. Customer Acquisition by Channel B2B v. B2C 80% B2B67%B2C 61% 63% 60% 55%53%% of Channel Users who41% Acquired a39%39% 40%CustomerThroughthat Channel 20% 0% LinkedInCompany Blog Facebook Twitter HubSpot.com 11 12. THE STATE OF INBOUND MARKETINGChannel Effectiveness by IndustryA deeper dive into the customer acquisition results shows how the effectiveness of blogs, Twitter,Facebook and LinkedIn varies by industry. The major takeaways from this data include: Higher Education, Professional Services & Consulting, and Software & Biotech found bloggingwas highly effective. All of those industries had over 50% of respondents indicating customeracquisition through their blog. The Retail industry experienced the most success through Facebook and Twitter. Communications & Media, Banking/Insurance/Financial Services, Manufacturing, ProfessionalServices & Consulting, and Technology Hardware found LinkedIn was highly effective. Customer Acquisition by Channel by Industry61%Banking/Insurance/Financial Services66% Communications/Media LinkedIn Twitter Higher Education 72% Facebook Blog60%Manufacturing 59%Professional Services/Consulting 58% Retail/Wholesale 80%50% Technology (Hardware)Technology (Software/Biotech) 58% 0%20%40%60%80% 100%% of Channel Users who Acquired a Customer Through that Channel HubSpot.com12 13. THE STATE OF INBOUND MARKETINGWhats Important to Marketers?Inbound Marketing Channels Continue to Grow in ImportanceBased on the data regarding customer acquisition and lower average costs for inbound marketing, it isnot surprising that inbound marketing channels continue to grow in importance. Looking at the last sixmonths:62% of businesses rated social media as being more important.Social media and SEO were the channels most frequently reported as MORE important.Direct mail was the channel most frequently cited as LESS important.Businesses rated every outbound channel as LESS important than any inbound channel. Which sources of leads have become MORE important to you over the last six months?70% 62%60%51%Outbound % of Respondents50% 38%Inbound40%30% 22%20%16%11%10%10%0%Social Media SEO BlogsPPC Trade Shows Telemarketing Direct Mail (Organic (Paid search)search) Which sources of leads have become LESS important to you over the last six months?60% 50%50%Outbound % of Respondents38%40% Inbound33%30% 25%20% 12%10...