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What is Marketing Automation?

March 15, 20171 min read
What is Marketing Automation?
Much as the term implies, marketing automation is a system to nurture leads and turn them into customers through a pre-determined set of processes. HubSpot describes marketing automation at its best as: “software and tactics that allow companies to buy and sell like Amazon — that is, to nurture prospects with highly personalized, useful content that helps convert prospects to customers and turn customers into delighted customers” but warns that “companies that implement complicated automation programs without a reliable source of organic leads find that their investment has little impact on revenue.” Even though marketing automation is a tool which many business owners struggle to understand the ROI of, or implement effectively, many businesses large and small benefit from its use — however, this tool likely requires additional education to manage effectively and can often take up significant time. If poorly managed, marketing automation will: at best, be ineffective — and at the worst, can actually hurt your brand. Examples of the types of clients which often see success with this digital marketing tool: most businesses large and small can benefit from properly managed marketing automation

Explore a website growth scenario

Change the assumptions to see how traffic and inquiries affect the estimated lifetime revenue of customers acquired in one month. The starting values are examples. This calculator does not measure lost revenue or predict what a redesign will achieve.

Use the same monthly period for visitors and leads.

Use distinct inquiries attributable to those visitors.

Your own estimate of the share that fits your business.

Use your observed rate or label it as an assumption.

Revenue across the customer relationship, before costs.

A scenario you choose, not a prediction from Stoute.

For example, adding 1 point changes a 2% conversion rate to 3%.

One month’s acquired customers

Customers under current assumptions
3.0
Customers in your scenario
3.0
Current cohort’s estimated lifetime revenue
$3,000
Scenario cohort’s estimated lifetime revenue
$3,000
Difference across those customers’ lifetimes
$0

Visitor-to-lead rate: 2.0% → 2.0%. Scenario conversion is limited to 0–100%. Fractional customers represent an average, not a literal customer count.

These amounts are gross lifetime revenue, not monthly cash flow, profit, or return on investment. The model holds qualification, close rate, and customer value constant. It excludes project costs, advertising, delivery costs, and payment timing.

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