Constant Contact Adds Social CRM: Should Marketing Automation Vendors Be Worried?


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Small-business email provider Constant Contact yesterday announced the acquisition of “social CRM”* vendor Bantam Live. This is a major expansion for Constant Contact, placing it more squarely into competition with CRM and marketing automation vendors. As I’ve noted previously, small businesses are particularly likely to adopt a single platform for all of their marketing and customer management needs because the inefficiencies of multiple platforms are so obvious and painful in a small organization.

Email vendors like Constant Contact are especially well positioned to grab this business because they are one of first technologies that businesses adopt. (Other entry points: accounting software like Intuit Quickbooks, email clients like Microsoft Outlook, personal productivity suites like Microsoft Office, Web hosting companies like GoDaddy, and of course CRM like As a point of reference, Constant Contact says it is used by more than 400,000 organizations, compared with maybe 10,000 for all marketing automation systems combined. The company expects more than $200 million in revenue in 2011, which about equals my estimate for 2010 revenues for all B2B marketing automation. And Constant Contact is just one of many small business email providers.

I’ve been meaning for some time to write a post about the small business sector of the marketing automation industry, because I really see it as very distinct from marketing automation for mid-size and large businesses. But this Constant Contact announcement underscores one the major points I had in mind: that the low number of current marketing automation installations in this field doesn’t mean it’s a wide open market. Rather, it means that there are plenty of other partial solutions in place at most firms. Expanding the solutions to offer reasonably complete marketing automation just isn’t that hard, technically. And any vendor who does this has a major advantage because they can sell marketing automation as a product extension to their existing clients.

Finding a way to displace these existing vendors is the real challenge for small business marketing automation systems, since small businesses are not likely to add a new system without getting rid of an old one. The other big issue is that the existing solutions often cost only a few dollars per month (for example, Constant Contact averages under $50 per month per client). This means the $300 per month of even the cheapest marketing automation systems is a big increase that many small businesses will not be willing to pay.

* I put “social CRM” in quotation marks because I personally am not quite sure what it really means. According to their Web site, Bantam Live offers the usual sales automation functions (contact management, profile management, pipeline management, sales analytics, calendar sharing, file sharing, workgroups) plus a bucket of social media capabilities including social search, network feeds, messaging, discussions and collaborative workflow.

Republished with author's permission from original post.


  1. David, I think this is just the beginning of “socializing” all kinds of solutions for large and small businesses.

    Small businesses especially can’t afford to piece together several “best of breed” solutions. The market could consolidate around email marketing vendors as you suggest, but personally I think the small biz accounting vendors like Intuit (online version) could evolve to offer a full integrated business suite – including SFA, marketing automation and social capabilities.

    In the small biz camp, InfusionSoft has done a nice job pulling together a multi-function solution around the email marketing core, but I’m not sure when/if social capabilities will be added.

    Of course, it might just be that “social CRM” is not really what small business managers need. Just a thought.

  2. Bob,

    Funny you should mention Intuit. I always think of them as very strong candidate to play the role you suggest. But they already offer Web site hosting and haven’t made much headway there (so far as I know — maybe they have more accounts than I realize). I’m guessing that Intuit’s primary channel are accountants, who just don’t get involved in their clients’ marketing activities.

    Although “social CRM” is a hot buzzword at the moment, I’m sure that social will be folded into “normal” CRM and/or normal marketing pretty quickly. It’s only separate now because it’s new.


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