Marketing Automation — Too good to be true?

tl;dr — Marketing Automation is costing you money with low conversion rates. A manual sales process with pre-written content is the perfect balance of minimal work + maximum conversion. ACCESS THE LIBRARY >

The promise of a marketing automation system is strong. Never worry about marketing again. Set it and forget it. Leads are automatically nurtured and converted into customers. You only need 2 or 3 new customers for the software to pay for itself.

And these promises are all true — at scale.

Many brick-and-mortar and boutique businesses simply don’t capture enough leads for Marketing Automation to make sense. In fact, I would argue that a false sense of security results in more lost customers than new customers.

But exactly how much scale are we talking about here? Let’s look at the numbers using data for 2021.

Automation by the numbers

According to Campaign Monitor’s annual report the average email open rate for the health and fitness industry is 22%. And of those emails that actually get opened the click-through rate is about 3%.

What do these numbers mean?

Out of every 100 leads you get from your website that are started on an automated campaign, 3 of those leads will click on a link in that email.

And — if these leads are not existing customers — the conversion rate is about 1%.

A 1-3% conversion rate is bad unless you are an online company where you are funneling thousands or even millions of leads through a sales process.

Now, a 1% conversion rate isn’t all that bad in the world of marketing automation. Keep in mind, marketing automation was initially designed as an e-commerce tool. Online companies selling a product or software will market to tens of thousands — even millions — of leads on a daily basis.

Do your numbers add up?

Many boutique businesses and micro-gyms we survey tell us that 10-20 new customers per month would be great. And that seems to be a sustainable rate of growth to maintain retention of existing customers.

In order for a marketing automation platform to deliver on this promise, you would need to capture anywhere between 1,000-2,000 new leads each month! To capture that many leads you would need to a) live in a large metropolitan area AND b) invent a really compelling offer each month.

But what about Text Messaging?

Text Message automation is the latest trend in marketing automation. And the numbers are strong — SMS automation boasts strong open rates; often times nearing 100%.

Email inbox filters have become sophisticated enough to push unwanted emails into a “Promotions” tab. But many text messaging applications have been slower to enact the same level of filtering. It seems that most leads are OK with an unread email notification but are less likely to leave a text message unread. This is why we’re seeing much higher open rates. But the conversion rates tell a different story.

Conversion rates on text message automation still remain around 1% on the low end and 9% on the high end. In either case, it seems unlikely that brick-and-mortar membership based businesses will generate the number of leads necessary to have any real impact on their business.

Solution — be automatically authentic, not automated.

After running tens of thousands of tests working to crack the code on sales, we’ve arrived at a solution that allows for the peace of mind of automation without expensive software. Automated sales with enticing offers.

You’re in the relationship business. So why are you leaving your relationship-building in the hands of an unmonitored software system?

Instead of taking the “click and pray” approach to marketing your nest-egg, we recommend that you create a sales system with a personal touch that runs on autopilot.

It doesn’t need to be complicated or high-tech. Heck, it can even be as simple as a spreadsheet that is printed every Monday with all the new leads from the previous week. Then, you split that list amongst your staff and everyone is in charge of sending a text message, email, funny gif, or a phone call to everyone on the list. Make a game out of it and give out prizes to the team member with the most intro sessions scheduled.

The bottom line

Marketing automation and text message marketing is a great solution when it comes to purchasing a pair of jeans or a funny coffee mug. It’s not so great when it comes to selling complete lifestyle change. And you simply won’t get the volume of leads to justify the high cost of these systems.

Instead, we recommend you start with consistent monthly marketing campaigns with a compelling offer (321Go clients receive a new one each month!). Then, build a sales system that includes your whole team and regularly scheduled contact points. There’s a reason that your large national competitors like Orangetheory and F-45 opt for this strategy over automation — because it’s proven to work for businesses like yours.

Get access to the entire library of follow-up campaigns

We've organized the highest-converting follow-up messages tested across dozens of business like yours. Click the link to download the files and save yourself hundreds of hours of writing and testing. Simply copy & paste!



ACCESS THE LIBRARY >

Updated on: 17/02/2022