Oct 4, 2013 1:28:00 PM
The climate of the marketing world is changing rapidly. The traditional marketing methods of old are losing ground to the fanfare and excitement of inbound marketing. Why? And can the two work together? Will inbound eventually replace outbound entirely?
To know the answers, we need to begin by looking at how we arrived where we are.
It Began With a Shift of Information
In decades past, consumers suffered on account of information asymmetry. Businesses had all the details on their products and sales teams were a first point of contact for potential customers in need of information.
Information could be “pushed” upon consumers through advertising, and though consumers could remain skeptical, the formula was all but guaranteed: Spend $10k on ads, see more than $10k in returns.
The advent of the internet marked the end of this asymmetry. People can now gather their own information, field countless opinions and make more educated decisions. They have little need to contact sales – in fact, on average, 57% of the buying process is already finished by the time sales is contacted.
Surprisingly, 90% of all media interactions are screen based, with Americans spending an average of 4.4 hours per day in front of screens; that’s a marked shift away from television, radio and other marketing mediums.
Customers are active in seeking out businesses and vetting them based on what they learn. There’s no “pushing” involved.
Sharing Made Fast, Easy and Ever-Present
The way consumers shared information in the past was far more limited as well, both in expediency and reach. Word of mouth was limited to in-person conversations and spread slowly. At best, a consumer could publish their experiences through a print media outlet and hope to be heard.
Now, social media allows consumers to provide immediate feedback and reach an audience of potential millions. Those reviews and shared experiences live on in perpetuity, stored online where they can influence the purchasing decisions of others whom the sharer has never even met, years after their initial creation.
In fact, as of 2013, 92% of consumers say they trust recommendations from people they know, while 70% say they trust consumer opinions posted online.
No longer is it “buyer beware”, but “seller beware” – your reputation is on display at all times, for better or worse. Mistreat customers, and the world will know.
Outbound Marketing Success has Suffered
As the gap in information between buyers and sellers has essentially vanished, consumers have changed the way they buy products and find information.
They no longer want to be “sold to” and have little appetite for intrusive or interruptive advertising; the kind of marketing that outbound relies on for success.
It should come as no surprise, then, that outbound’s success has dwindled in recent years:
44% of direct mail is never opened
86% of television viewers skip advertisements
200 Million Americans are on do-not-call lists.
The number of calls required by telemarketers to make one qualified contact has leapt from just 6 in 2006 to over 41 in 2013.
But it’s not just about the messages reaching their audience, it’s about driving results when they get there. Less than 50% of consumers trust ads from radio (42%), newspapers(46%), billboards (46%) or magazines (47%).
Consumer attention is forsaking traditional advertising, and they’re taking their trust along with it.
Meanwhile, Inbound is Soaring
If consumers no longer want to be sold to, what do they want instead?
To be entertained, engaged and helped. Because they hold the power of information, their needs have now shifted. They want to know your brand is trustworthy, they gravitate to brands that make their lives easier and they have little to no tolerance for bad user experiences.
Inbound marketing puts the customer at the center, aligning content with the buying cycle to deliver information at every stage.
And it works.
U.S. inbound marketers spending more than $25K per year saved $14 dollars for every new customer acquired vs. those relying on outbound strategies -- $254 vs. $268.
93% of companies using inbound marketing increased their lead generation numbers, while according to Hubspot, Inbound marketing grew by 50% for the third straight year in a row and nearly 60% of marketers (and 73% of marketing agencies) have made inbound a part of their efforts. 48% of those marketers planned to increase their budgets for inbound marketing in 2013.
And while marketing agencies are reporting lower numbers or even negative ROI from traditional advertising, more than half of marketing agencies (51%) reported positive ROI for their inbound marketing efforts in 2013.
Consumers Aren’t Ignoring Inbound
With inbound, customers are tuned in. 70% of consumers admitted they’d rather get to know a brand through articles, not ads, and 68% of consumers said they had spent time reading content from a brand they were interested in.
Unlike the paltry trust metrics for outbound tactics, over 57% of consumers said they trusted editorial content, 90% of consumers said they found customized content from brands useful, while 61% said viewing branded content makes them more likely to buy.
But perhaps the most telling statistic is that 78% of consumers believe that companies offering value-added content are interested in building positive relationships.
Inbound is Accessible
Perhaps the greatest advantage to inbound is the accessibility. Companies like HubSpot have made it easier to track, measure and improve inbound marketing efforts, while a surge of qualified SEO services and online marketing professionals have emerged.
Will Inbound Completely Replace Outbound?
Despite all that we’ve stated, the answer to this question is no. Outbound marketing still has a crucial role to play in generating awareness, while inbound marketing helps to make businesses memorable and establish them as a customer’s preference.
There’s no question that in the long-term, inbound should gradually come to represent a greater proportion of a business’ marketing spend.
But how people go about outbound marketing is changing. Interruptive methods that frustrate consumers, such as telemarketing, are losing their grip.
It IS possible to add value through advertising and traditional marketing; TV commercials can be entertaining (and will be shared through inbound channels!), billboards still introduce brands to unknowing customers and outbound is still a powerful means of first introduction to consumers.
The difference lies in that outbound alone is no longer enough. Consumers are evaluating their entire experience with a brand, not just the marketing. Where outbound can make an introduction, inbound must deliver recurring value. Your customer service must satisfy the promises made by both marketing channels, or it’s all a wash.
While it may feel like a platitude, “build a great brand” is really the unification of marketing and service and it’s exactly what you need to be doing to succeed.
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