It’s pretty clear that marketing automation is no longer just for tech companies. And it’s becoming obvious that it is also not just for medium and large enterprises. But I hadn’t heard of local business adopting marketing automation technologies until just today.
ReachLocal, a local-business marketing behemoth that employs 2,000 employees in 16 countries, announced today that it now has over 1,000 clients for its ReachEdge product — a very basic marketing automation-lite software-as-a-service for local businesses.
And over half of those clients are new to the company.
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ReachLocal, which went public in mid-2010 and currently brings in over half a billion dollars in annual revenue serving just over 24,000 local businesses, provides lead generation, web development, SEO, and other digital marketing services for its clients. Marketing automation, however, is something new the company decided to try out late last year.
“We’ve been really good at generating leads — we draw in five million leads every single month,” the company’s chief product officer, Kris Barton, told me today. “We realized, however, that we’re sending all these leads to our customers … but what happens after that? Are they converting?”
To answer that question — and to improve its customers’ odds — the company created a product it calls ReachEdge. Realizing that its target demographic doesn’t know or, frankly, have the time to care much about marketing technology, it didn’t sell the new product as “marketing automation.” Instead, ReachLocal talked to potential customers about “smart sites.”
However, boiled down, ReachEdge is essentially a very simple, very limited marketing automation system.
The product consists of a custom “smart site” that is optimized for lead generation and capture — AKA inbound marketing — plus an incredibly simplified lead management and scoring system that simply asks local business owners to categorize leads as immediate or long term, and an email marketing platform with definable flows and mini-campaigns. All of which is designed to capture, nurture, and convert leads into customers.
“Our customers’ ultimate goal in life is getting more customers,” Barton says. “Businesses that nurture their leads see up to 45 percent more ROI … and we offer a simple, integrated system that we set up for them.”
While ReachLocal’s focus is completely local, not all local businesses make the cut. The company focuses on established local enterprises that generate between $1 million and $10 million a year — enough to know what they might be missing in the digital marketing world, and not quite enough to hire a high-calibre team to focus on it specifically.
“We don’t go after ‘one-truck-Chuck,'” Barton says humorously.
Clearly, it’s a segment of the market that is reacting positively to marketing automation, even if they’re hearing about it under a name that includes neither marketing nor technology nor automation. That’s impressive, because even as the big enterprises adopt solutions from major players such as Adobe, Microsoft, Salesforce, and Marketo, Main Street is apparently clamoring to be let into the same private party, albeit at a much simpler and less expensive level.
“I think the general trend is that a lot of the technologies that we see start in big business trickle their way down,” Barton told me. “We see that in a lot of our business, and I think we’ll continue to see that.”
There’s clearly a segment of the market that needs this kind of product, which can be either self-service or done for you.
If most traditional marketers don’t know how to go digital, local businesses whose marketing department largely consists of 10 percent of the owner and proprietor’s evenings and weekends will likely be having even greater challenges.
ReachLocal’s product is not high-end. It’s not full-featured. It doesn’t feature even a tenth the power of a Hubspot or an Act-On. But interestingly, in spite of that — or perhaps because of that — it’s hitting a niche among doctors, dentists, mechanics, lawyers, and trades-based businesses such as roofing and carpentry.
And according to Barton, the power of marketing automation quickly becomes clear.
“Once they see it, they go ‘wow.'”
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ReachLocal, Inc.’s (NASDAQ: RLOC) mission is to help small- and medium-sized businesses (SMBs) acquire, maintain and retain customers via the Internet. ReachLocal offers a comprehensive suite of online marketing solutions, including ... read more »
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