The Problem With Scale: Inbound vs. Outbound Marketing
For the past ten years, inbound marketing has dominated the attention—and the budgets—of marketing and sales teams at B2B organizations. It’s not difficult to see how inbound became the belle of the marketing ball: prominent vendors like Hubspot and Marketo have been incredibly vocal about the benefits of inbound marketing as compared to outbound.
However, while inbound certainly does have its place in the marketing ecosystem, B2B organizations that buy into the hype and focus their marketing strategies exclusively on inbound channels make a critical error. When it comes to growth, inbound isn’t nearly as cost-effective or scalable as it’s touted to be.
Several common misconceptions plague the inbound vs. outbound marketing debate. Below, we examine why B2B organizations should incorporate outbound tactics as an essential piece of their growth strategies.
The precise mixture varies depending on industry, average deal size, and more, but a sustainable, scalable, and predictable marketing strategy should contain complementary elements of outbound and inbound.
Inbound vs. Outbound Marketing Misconceptions
A common critique of outbound marketing is that it utilizes outdated techniques that are “interruption based,” or disrupt customers as they are in the process of going about their days — for example, a cold call.
Inbound, by contrast, is believed to be more seamless, pulling already interested customers along an inevitable path to purchase via a company’s website, various marketing materials, and potentially an organic conversation with a sales representative.
On top of the perception that outbound is old technology is the idea that it is more expensive than inbound, given that it involves investment in outreach such as ad buys, website development, email campaigns, and more. This is a view that has been encouraged by vendors who have a vested interest in the success of inbound. As an example, take this excerpt from a Marketing Stream blog post:
“It’s generally accepted that outbound marketing is, well, out. It’s the old way of doing business. It’s not cost-effective, it takes too long, and the lead qualification process is intrusive and most customers find it off-putting. It was bad enough when telemarketers were calling at dinner, but now they have your cell phone number?” [Marketing Stream]
In the past, these assumptions about outbound might have been more understandable. Outbound does after all, hail from a more traditional outreach background than inbound. But equating the outbound of today with the outbound of yesterday is a mistake—and these assumptions are based on an obsolete understanding of what outbound marketing is, how it is applied, and the results it drives.
Stereotypes about the character of modern inbound and outbound marketing are largely based on skewed or outmoded information, as we will discuss below.
The Problem With Inbound
The fundamental problem with characterizing inbound as the end-all be-all of B2B marketing strategy is that inbound tactics simply don’t offer the best results for B2B companies that are growing and scaling at a rapid pace.
By nature, inbound will only address a limited segment of a company’s total addressable market. Even the largest brands do not have 100% market awareness. Inbound marketing disproportionately favors warm leads over leads that fit a company’s buyer personas.
The most profitable segments of a B2B company’s market may not be the most engaged. Inbound leads are frequently warm, but unqualified. Many B2B companies have hard costs built into customer acquisition, for example, by offering a loss-leader during the onboarding process. It can be expensive to bring on a new customer — especially if they are not a good fit. Attracting low-quality leads through inbound channels requires additional layers of qualification, often by a well-paid sales rep, or can result in a higher rate of churn.
Additionally, inbound strategy necessitates the consistent production of content that prospects can engage with (blog posts, landing pages, PDFs, the list goes on). For rapidly growing B2B companies, building a scalable inbound engine is no small feat, particularly when they have limited resources or budget.
“Campaigns require a constant time investment to produce content that is of sufficient quality to be useful. The efficacy on an inbound marketing campaign only becomes evident three months after the campaign is established, and results may be more difficult to measure.” [MatchCraft]
Viewed in this light, the cost of inbound in aggregate—building a strategy around each individual piece of content, creating it, deploying it, and managing it—is more expensive than it initially appears. The creation of high-quality content compounds with volume.
Since the results of inbound are not immediate, it is not easy to pivot on messaging or strategy. Managing high volume inbound channels can be like steering an ocean liner. Long inbound timelines are also subject to seasonal fluctuations and other factors that can impact lead volume. Predictability is not a strength of inbound marketing.
For B2B companies who are looking to grow and expand rapidly, inbound marketing alone simply can’t keep up with the pace of business.
The New Outbound Marketing
Equating the outbound marketing of today with the interruption-based outbound marketing of ten years ago is entirely inaccurate. Technology has now elevated outbound marketing into a highly targeted, personalized, scalable, predictable, and cost-effective channel.
Outbound email is a perfect example.
“[Outbound email] used to consist primarily of large scale, one-off email blasts, but now the technology has moved to the point where marketers can hyper-target small subsets and even individuals with very focused content tailored to their specific interests,” Steven Coufal, Senior Media Relations Specialist at Gartner, recently told Kissmetrics.
“Say a prospect signs up for your email list and you begin to track them,” Steven explains. “Your marketing software scans their social media accounts to learn they are a female, in the 24-39 age range, a working-professional, living in London. It recognizes that she’s in the target demographic for your company’s new line of trench coats. She then gets opted into a specific email stream that promotes the styles and options known to be popular with her demographic.”
This ability to segment and target when conducting outreach means that outbound can actually be more personalized that inbound alone, particularly when it’s used through channels like email. The potential for personalization and targeting is only limited by the quality of your lead data.
A key benefit of outbound is that it enables companies to reach out to customer segments who may not yet be informed about their brand, but are a highly lucrative segment of the market. And since marketers can control how many customers are being targeted with each round of outreach, it’s also far more predictable and scalable than inbound as well. The number of leads a B2B team needs is simply a function of the conversion rate at each step of the funnel.
The most successful sales and marketing teams (even those who are actually selling inbound technology themselves) rely on outbound for growth:
“Even Hubspot, the leader in the space, utilizes outbound marketing strategies towards the end of the sales funnel to close sales. While the sales team relies on potential customers to sign up for their newsletter and create a free trial account, they will also remain in contact and will call the potential customer to persuade them to sign up for their marketing or sales software.” [MatchCraft]
For its part, inbound has obvious benefits—chief among them directing warm leads into the sales funnel and high conversion rates to demo, trial, or purchase, given that trust with customers has already been established.
For many B2B companies, the inbound portion of the puzzle has been taken care of—it’s a well-crafted outbound strategy that’s the crucial missing piece for scalable growth.