The 2011 State of Inbound Marketing

www.HubSpot.com

The 2011 State of
Inbound Marketing

February 2011

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THE STATE OF INBOUND MARKETING

Contents
Introduction ............................................................................................................................................ 3
The State of Marketing Costs & Budgets ............................................................................................... 4
Inbound Channels Convert Leads into Customers ............................................................................... 10
What‘s Important to Marketers? ........................................................................................................... 13
Conclusion and Additional Resources.................................................................................................. 16
Appendix.............................................................................................................................................. 17

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Introduction
Summary
This report is based on a January 2011 survey of 644 professionals familiar with their business‘
marketing 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 Marketing
This report is designed to help businesses and marketers understand the current usage and results of
inbound marketing. Inbound marketing is a set of marketing strategies and techniques focused on
pulling relevant prospects and customers towards a business and its products. Inbound marketing is
becoming widely accepted because it complements the way buyers make purchasing decisions
today—they 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 to
their site, while also interacting and developing relationships with individuals on the Web. Inbound
marketing tools include blogging, content publishing, search engine optimization and social media.

Inbound marketing contrasts with traditional outbound marketing, in which businesses push their
messages at consumers. With techniques that include direct mail, telemarketing and trade shows,
outbound marketing has become less effective over time as buyers have behaviorally and
technologically (e.g., TIVO, spam filters, ‗do-not-call‘ lists) tuned these interruptive campaigns out.

1
For more information about the survey please see the appendix.

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The State of Marketing Costs & Budgets
Inbound Consistently Delivers a Cost per Lead Dramatically Lower Than Outbound
Survey participants were asked to report the distribution of their spending and their average cost per
lead. Respondents who spend more than 50% of their lead generation budget on inbound marketing
channels report a significantly lower cost per sales lead than those who spend 50% or more of their
budgets on outbound marketing channels:

 In 2011, the average cost per lead for outbound-dominated businesses was $373, while
inbound businesses reported their leads cost on average $143.
 Inbound marketing-dominated organizations experience a 62% lower cost per lead
than outbound marketing dominated organizations.

This finding is remarkably consistent from year to year. The previous study showed strikingly similar
results: the 2010 survey showed that inbound marketing-centric organizations experienced a 60% lower
cost per lead.

Average Cost Per Lead
Inbound vs. Outbound

$400 $373
$332

62% Lower Cost per Lead
Avg. Cost per Lead

$200

$134 $143 Outbound Marketing
Dominated
Inbound Marketing
Dominated

$0
2010 2011

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Three Out of Four Inbound Channels Cost Less than Any Outbound Channel
When asked to classify each lead generation category as ―below average cost,‖ ―near average cost,‖ or
―above average cost,‖ businesses consistently ranked inbound marketing channels as having costs
lower than outbound channels. PPC was the only inbound channel that was ranked among the
outbound 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 Respondents

Inbound
40%

55%
47%
20% 39% 36% 33%
27%
19%

0%
Blogs Social Media SEO Telemarketing Direct Mail PPC Trade
(Organic (Paid Shows
search) search)

Above Average Cost per Lead,
% Respondents by Lead Channel

Trade Shows were most frequently Outbound
40%
% of Respondents

reported as more expensive than average Inbound
Channle

47%
20%
29% 27%
21%
13% 13%
9%
0%
Trade Shows PPC Direct Mail Telemarketing SEO Social Media Blogs
(Paid (Organic
search) search)

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The Majority of Businesses Are Increasing Their Inbound Marketing Budgets
―How does your 2011 Inbound Marketing budget compare to your 2010 budget?‖ the survey asked. ―If
your 2011 inbound marketing budget changed from your 2010 budget, what drove that decision?‖ The
answers to these questions show that the majority of businesses are consistently increasing inbound
marketing 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%
Higher No Change Lower

Why Businesses are Increasing Why Businesses are Decreasing
Inbound Budgets Inbound Budgets
Past Success
50% Economy 71%
with Inbound

Change in
Other 21% 15%
Management

Economy 15% Other 11%

Change in Past Success
14% 3%
Management with Outbound

Past Success Past Success
0% 0%
with Outbound with Inbound

0% 20% 40% 0% 25% 50%
% of Respondents % of Respondents

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Distribution of Budgets Continues to Shift To Inbound Channels
We asked survey respondents what percentage of their lead generation budgets would be spent on
each of 9 marketing channels: ―direct mail,‖ ―telemarketing,‖ ―trade shows,‖ ―email marketing,‖ ―PPC
(paid search / AdWords),‖ ―SEO (organic / natural search),‖ ―social media,‖ ―blogs,‖ and ―other.‖ Those
nine channels were grouped as follows (email marketing can be used both as an inbound and an
outbound marketing tool so it was not classified):

OUTBOUND NOT
INBOUND CHANNELS CHANNELS CLASSIFIED

PPC Direct Mail Email Marketing

SEO Telemarketing Other

Social Media Trade Shows

Blogs

The results show that:

 The average portion of budget dedicated to inbound increased from 38% to 41% from 2009
to 2011.
 The net effect is that the gap continues to widen - inbound marketing had a 9% greater
share of the lead generation budget in 2009 in comparison to a 17% greater share in
2011.

Lead Generation Budget
Average Distribution, 2009 v. 2011
40%

9% gap 17% gap Outbound
Inbound
Avg % of Budget

20% 41%
38%
29%
24%

0%
2009 2011

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A 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 Budget
Average Distribution, 2009-2011
50%

40% PPC
10%
Avg % of Budget

11% SEO (organic
30% 16% search)
13% Blogs & Social
20% 13% Media
13%
10% 18%
15%
9%
0%
2009 2010 2011

Outbound Lead Generation Budget
Average Distribution, 2009-2011
40%
Avg % of Budget

Telemarketing
10%
5% Trade Shows
20% 6%
Direct Mail

11% 11% 13%

9% 7% 6%
0%
2009 2010 2011

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Small Companies Continue to Spend More of Their Budgets on Inbound Marketing
In a continuation of a trend identified in previous reports, small businesses are attempting to level the
playing 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 Businesses
20% 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 Blogs Email Trade Shows PPC Direct Mail Telemarketing
(Organic Marketing (Paid Search)
Search)

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Inbound Channels Convert Leads into Customers
Social Media and Blogs Generate Real Customers
The use of social media and company blogs as marketing tools not only gets your company better
brand 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
Customer
Through that 2011
20%
Channel

0%
Company Blog LinkedIn Facebook Twitter

Customer Acquisition through Blogs is Directly Related to Frequency of Posts
If your blog is underutilized, you are leaving customers on the table. The 2011 survey shows a direct
correlation between blog post frequency and new customers acquired.

Blog Post Frequency vs. Customer Acquisition
100% 89%
76% 78%
72%
% of BlogUsers
who Acquired 49%
a customer 50%
through 33%
their blog

0%
Less Than Monthly Weekly 2-3 Times Daily Multiple
Monthly a Week Times a
Day
Frequency of Blog Posts

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Most Company Blogs Publish at Least Weekly
Despite 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 Posts
2009 v. 2011
80%
2009
62% 61%
60% 2011
% of Repsondents

40%
29%
23%
20% 15%
10%

0%
Daily Weekly Monthly or less

Facebook Is More Effective for B2C; LinkedIn Is More Effective for B2B
The effectiveness of a particular social media channel depends upon the type of business. While both
B2B 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 B2B
businesses. Both business types found similar and relatively high success with customer acquisition
through a company blog.

B2B v. B2C
80% B2B
67% B2C
61% 63%
60% 55% 53%
% of Channel
Users who 41%
Acquired a 39% 39%
40%
Customer
Through
that Channel
20%

0%
LinkedIn Company Blog Facebook Twitter

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Channel Effectiveness by Industry
A 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 blogging
was highly effective. All of those industries had over 50% of respondents indicating customer
acquisition through their blog.
 The Retail industry experienced the most success through Facebook and Twitter.
 Communications & Media, Banking/Insurance/Financial Services, Manufacturing, Professional
Services & Consulting, and Technology Hardware found LinkedIn was highly effective.

by Industry

61%
Banking/Insurance/Financial Services

66%
Communications/Media

LinkedIn
Twitter
Higher Education 72%
Facebook
Blog
60%
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

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What’s Important to Marketers?
Inbound Marketing Channels Continue to Grow in Importance
Based on the data regarding customer acquisition and lower average costs for inbound marketing, it is
not surprising that inbound marketing channels continue to grow in importance. Looking at the last six
months:

 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 Respondents

50%
38% Inbound
40%

30%
22%
20% 16%
11% 10%
10%

0%
Social Media SEO Blogs PPC 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 Respondents

38%
40% Inbound
33%
30% 25%

20%
12%
10%
10% 7%

0%
Direct Mail Trade Telemarketing PPC Blogs SEO Social Media
Shows (Paid (Organic
search) search)

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Blogs Remain Most Important Social Media Channel
Survey respondents were asked to indicate if their
business publishes a blog. From 2009 to 2011, the Do you publish a company blog?
volume of respondents indicating that their 100%
company publishes a blog has shown rapid
35%

% of Repsondents
39%
growth: 52%

 From 2009 to 2011, the percentage of 50% No
respondents with a company blog grew 61% 65% Yes
48%
from 48% to 65%.
 On the flip side, the likelihood of a not 0%
having a blog has been reduced from 52% 2009 2010 2011
to 35%.

Respondents were also asked to rank the services that they use as ―critical,‖ ―important,‖ or ―useful.‖
The results indicate:

 A whopping 27% of users rated their company blog as “critical” to their business.
 85% of users rated company blogs as “useful” or better.
 LinkedIn, YouTube, Facebook and Twitter were considered ―useful‖ or better by over 60%.
 In contrast, MySpace, StumbleUpon, Digg and Flickr all had user bases where over 70%
considered the channel only ―somewhat useful‖ or ―not useful.‖

How important are these services to your business?

27% reported their blog was “Critical”.

Company Blog 27% 35% 23%

LinkedIn 16% 34% 21%

YouTube 14% 30% 28%

Facebook 18% 26% 23% Critical

Twitter 14% 25% 25% Important

Flickr Useful

Digg Somewhat Useful

StumbleUpon Not Useful

MySpace

0% 20% 40% 60% 80% 100%
% of Users

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Company Blogs, YouTube, Facebook and Twitter Increasingly Valued by Businesses
The results of both the 2009 and 2011 studies reveal that certain channels are gaining importance over
time. The graph below shows the percentage of users who rated the channel as either ―critical‖ or
―important‖ in 2009 and 2011.

The results of this comparison show:

 Company blogs are increasingly valued. The blog is the channel most frequently
reported as critical or important, both in 2009 and 2011.
 YouTube, Facebook, and Twitter are also increasingly important. Facebook and Twitter gained
an additional 18%, and YouTube gained 20%.
 Flickr, Digg, StumbleUpon, and MySpace had reduced importance.

% Respondents indicating Channel was Critical or Important
2009 vs. 2011

Gaining Importance

62%
60%
52%
2009
% of Repsondents

44% 44%
2011
38%
40%

26% 24% 25%
21% 21%
20%
14% 13%
11% 9%
6%
4%

0%
Company YouTube Facebook Twitter Flickr Digg StumbleUpon MySpace
Blog

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Conclusion and Additional Resources

Traditional outbound marketing techniques – including direct mail, print advertising and telemarketing –
are becoming less effective. Buyers are not only finding ways to tune these messages out, but more
importantly, they now have the capability to evaluate the products and services they need on their own.

As a result, businesses are transforming their marketing efforts to focus more on inbound programs that
allow customers to find them. The State of Inbound Marketing report shows that businesses that more
aggressively practice this are capturing leads more effectively. Given the digital nature of inbound
marketing, the marginal cost per customer acquisition is typically close to zero, meaning that as buyers
continue to shift how they make purchasing, the cost per lead for a given business will continue to
decrease.

While it is clear that businesses are gravitating towards inbound marketing, some are moving more
aggressively than others. Those who move first are more likely to reap the tremendous business
benefits of this new era of marketing.

If you are interested in learning more about inbound
marketing and how to combine blogging, SEO and social
media for results, try HubSpot‘s free 30-day trial!

http://www.hubspot.com/free-trial

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Appendix
We asked respondents to name the best and worst marketing programs they‘ve executed to drive leads
and sales over the past year. Represented below are their answers in a word cloud.

Best Things People Did in Marketing Last Year:

Worst Things People Did in Marketing Last Year:

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Respondent Profiles
The State of Inbound Marketing report is based on surveys conducted in early 2009, 2010, and 2011.
The 2011 results are based on responses from 644 professionals who were familiar with their business‘
marketing strategy. These professionals included marketers, business owners, entrepreneurs, and
executives at companies of various sizes. 76% of these professionals worked in business-to-business
companies and the range of industries varied greatly. Industries represented in the sample included
Retail, Technology, Professional Services & Consulting, Banking/Insurance/Financial Services and
Communications & Media among others.

How many full-time employees does your My business primarily sells to other
company have? businesses (B2B) or consumers
(B2C)

201 or more B2C
17% 24%
1 to 5
39%
51 to 200
15%

B2B
26 to 50 11 to 25 6 to 10 76%
8% 12% 9%

What industry best describes your company? What best describes your role?

Other Technology Business
27% 19% Owner /
Retail / Partner
Wholesale 33%
6% Marketing
50%
Banking /
Insurance / Professional
Financial Communicati Services /
Services ons / Media Consulting
4% 14% 30%
Other
CEO /
8%
Executive
9%

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Sample Questions Asked
The survey was designed to collect data on the marketing practices and results for a wide range of
businesses. This is the third consecutive year in which this survey has been conducted. Respondents
were asked a series of questions related to their business‘ marketing programs the results they have
seen. Most of the questions fell within three categories:

- Marketing budget and sources of leads, including:
o What percent of your sales leads come from each of your lead channels?
o What percent of your lead generation budget do you spend on each of your lead
channels?
o Estimate the cost per lead for each of your lead channels.
- Trends in ―importance‖ and ―usefulness‖ of marketing channels and leads, including:
o Which sources of leads have become MORE important to you over last six months?
o Which sources of leads have become LESS important to you over last six months?
o How useful are social media sources to your business?
- Focus on blogs and social media
o Do you publish a blog?
o How often do you publish a post?
o Have you ever acquired a customer from the following social media / blog channels?

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The 2011 State of Inbound Marketing

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