What are the most compelling developments and trends shaping the future of digital communication? We’ve gathered insights from industry experts on the transformative landscape of email marketing and marketing automation. As technology advances at an incredible pace, the potential for profit and growth becomes clearer, as do the challenges that lie ahead.
“Hyper-Personalization” is Becoming a Reality
Email platforms are evolving into comprehensive omnichannel marketing suites, offering diverse cross-channel functionalities to map and nurture individual customer journeys. The ability to integrate all relevant channels empowers marketers to implement seamless omnichannel automation. This integrated messaging will be driven by detailed subscriber profiles, enriched with valuable cross-channel information.
Sophisticated customer intelligence capabilities will also facilitate advanced segmentations and performance comparisons between actual and target outcomes. This is where the buzzword of “hyper-personalization” will truly come to life. In essence, state-of-the-art omnichannel marketing will make communication profoundly more relevant: delivering the right content to the right person at the right time through the right channel.
Guidance for Triggered Marketing Sequences is a Necessity
There’s a significant need for more direction from service providers on how to create effective automated sequences. Surveys consistently show surprisingly limited adoption of behavioral, event-triggered email sequences, regardless of what they’re called.
ESPs ( Email Service Providers) must offer solutions that guide users to optimize their email usage and provide recommendations based on best practices. It’s no longer enough to merely offer a drag-and-drop editor for defining rules and sequences; more comprehensive guidance is essential, whether through robust help systems or integrated recommendations within the service itself.
Consumer Expectations Drive Marketing Automation Technology Vendors
Evolving consumer expectations regarding brand communication are compelling marketing automation technology vendors to integrate real-time messaging apps like WhatsApp, Facebook Messenger, WeChat, and Instagram. We’ll also witness increased activity around one-to-one targeting solutions that deliver personalized advertising based on on-site and off-site behavior, CRM data, or transactional customer history. Finally, vendors will increasingly integrate content marketing platform functionalities to support the growing content marketing operations teams within enterprises.
Email Marketing and Marketing Automation are Converging
Email marketing and marketing automation systems will continue to converge, blurring the lines as their functionalities increasingly overlap. In essence, they are adopting each other’s most effective ideas.
Research into 111 vendors revealed that ESPs are incorporating sophisticated features previously exclusive to Marketing Automation platforms. What was once labeled as “email marketing only” now often includes the ability to send behavior and data-driven emails, with 57% offering a scoring mechanism to act on user engagement. Meanwhile, Marketing Automation systems are enhancing the usability of their campaign management and email marketing features, or acquiring platforms that already possess them.
While “email marketing” is a relatively clear term, “marketing automation” remains less defined. Ultimately, a software platform is a combination of functionalities, leading vendors to interpret it based on their feature sets and marketers to define it by their needs, often resulting in amusingly complex discussions.
Personalization Will Be the Overarching Trend
Personalization is a major trend currently, extending far beyond simply adding a person’s name (though that remains an important element). Research from Venturebeat Insight indicates that personalizing emails significantly impacts both the reader’s experience and the marketer’s results.
Sending a coupon that has already expired by the time it’s read is not only inefficient but also creates a negative impression. The market is moving towards replacing such static content with dynamically relevant content every time an email is opened.
The New Focus on Optimization Marks a Huge Industry Movement
Significant time has been dedicated to operational developments like trigger campaigns, automated workflows, and even semi-personalized content (often driven by static decision trees, a strategy with inherent flaws).
However, far less effort has focused on optimizing *what* is sent out, rather than just *how* it’s sent. This is poised to change dramatically. Companies such as Phrasee, MovableInk, KickDynamic, and LiveIntent are spearheading this shift by concentrating on optimizing the “what,” signaling a significant movement within the industry.
— Phrasee
Easier Multi-Channel Multi-Touch Campaigns Through Better UI
Platforms are expected to become progressively easier to use across multiple channels, thanks to more seamless User Interfaces. We anticipate a smooth operational transition, making the mapping and implementation of multi-channel, multi-touch campaigns more common and robust.
The Value of Marketing Tools & Strategic Focus
The technological advancement of marketing tools offers immense value to modern marketers. The ability to collect, analyze, and segment data to provide customized experiences for your audience unlocks a new world of opportunities. However, recent research by Ascend2 and its partners highlights two critical issues.
Firstly, 59% of marketers are only utilizing a limited portion of the marketing automation tools available to them. This is akin to using a smartphone solely for calls, neglecting apps, email, and instant messaging. Moving forward, marketers will grow more comfortable with their tools, leading to increased program effectiveness.
Secondly, there’s a growing emphasis on strategy. The Marketing Automation Strategy Survey indicates that the most challenging obstacle to marketing automation success is the absence of an effective strategy. Marketers must recognize that tools alone won’t improve performance; success hinges on the strategy developed to find, engage, and convert their audience. Therefore, marketers need to allocate more time to strategy and invest in their human resources, both internally (staff training) and externally (agencies).
— Ascend2
Widespread Integration of Machine Learning
We anticipate a broader integration of machine learning, specifically to construct predictive models that assist marketers in identifying the optimal message for each individual. This will extend beyond merely ranking the likelihood of a response to a particular email, to actively selecting the best content to insert.
The outcome will be an increase in the effectiveness of “batch and blast” emails, without requiring the complex, branching workflows typically provided by marketing automation. This degree of targeting typically yields response rates anywhere from two to ten times higher compared to sending the same message to everyone.
The Future of the Email Marketing and Automation Market
The broader market significantly influences the ecosystem. Looking ahead, one of the most intriguing aspects is the anticipated evolution within the arena where software vendors, suppliers, and agencies intersect.
“Functional Chunks” as the Next Step in Modular Evolution
On the emailvendorselection site, we meticulously track various functional marketing software additions and updates. While not every update makes it to the site, a clear divergence is evident: some SaaS suppliers are striving to keep pace, while others are not investing as heavily in development. I believe the latter will be severely outpaced within a year or two, if they haven’t been already.
A particularly fascinating development is what I term “functional chunks” — pieces of functionality that can be seamlessly integrated with any software. Examples include an email relay service, a standalone drag-and-drop email composition engine, or separate analytics, remarketing, or reporting capabilities. Think of them as Lego blocks, empowering other applications or startups to rapidly expand functionality without the need to develop everything in-house.
Effective Experiences as a Starting Point
Over the past three years, we’ve observed broad trends in creating effective mobile designs and marketing automation. I advocate for a shift towards a more customer-centric view of email marketing, integrating it as a vital component of a broader customer experience and journey, rather than treating it as an isolated channel. Just as we now discuss building digital experiences instead of merely desktop and mobile website design, email marketing should be perceived as part of that holistic customer experience, not just an automation process. This means moving beyond questions like response rates and sales figures, to evaluating the effectiveness of the experience itself and exploring how to measure and research it.
Mid-Market Platforms are Proving Themselves as Big Game Hunters
Recent shifts in the email ecosystem have begun to transform the market. While many clients continue to use platforms now part of larger cloud entities (such as Oracle, SFMC, IBM), we also observe a movement towards data-centric companies like Experian, Epsilon, and Acxiom, as well as more advanced mid-market platforms.
Significant activity is evident across the mid-market platform spectrum, both in product development and in attracting up-market clients. It’s clear that many mid-market platforms are demonstrating considerable success in capturing larger accounts.
Smooth Third-Party Data Enhancement
It will become substantially easier to import third-party data to enrich a marketer’s own first-party customer information. Achieving this requires ecosystem-wide changes as email systems and data vendors build seamless integrations with each other.
Specifically, email systems must be capable of exposing selected user data (such as email address, name, postal address, and potentially device IDs) for matching, while data vendors must be able to ingest and match against this data. This implies considerable new standardization across both sides. Other ecosystem players will also become involved, including identity association vendors, particularly companies that link devices to individuals (circumventing the increasing limitations of browser cookies). Data vendors will expand beyond traditional demographics to incorporate intent data based on user behavior and media consumption. New data sources, including ad exchanges and social networks, will also emerge.
The Biggest Players Will Take the Spoils, No Power Shifts Yet
No significant changes are anticipated in the email marketing ecosystem in the immediate future. While dozens of new players will enter the market, some offering intelligent, predictive, and personalized solutions that capture attention, this won’t alter the fact that solutions with the largest market share will continue to dominate. We’ve witnessed substantial acquisitions and funding in the email marketing space recently, a trend likely to persist. However, the market is not yet poised for a major power shift.
Four Core Service Layers That Will Make the Difference
Successful vendors and customers who engage across four core service layers will achieve stability and superior performance. These essential layers are: 1.) Best practices focused on achieving distinct, quantifiable business objectives; 2.) Sufficient personal training and coaching on how to meet those objectives using the platform; 3.) An offer to execute on their behalf; and 4.) A platform capable of delivering all of this as a standalone solution, with robust integration capabilities with other cloud applications.
This framework is expected to remain valid for the majority of customers and vendors for some time, with potential shifts as the landscape evolves.
Innovation Comes from Outside the Feature-Set Arms Race
Marketing Automation companies, often formerly referred to as ESPs, are locked in a relentless feature-set arms race. However, their core functionality largely remains constant, focusing on the operational efficiency of email marketing (or landing pages, social media, etc.).
This creates a significant opportunity for ESP-agnostic innovators to deliver rich feature sets that ESPs either cannot develop internally or develop in a way that is inextricably tied to their own technology stack.
— Phrasee
Consolidation and the Rise of Specialist Third-Party Services
The email marketing world has witnessed continuous mergers and acquisitions in recent years, primarily aimed at accelerating growth and creating synergies within and beyond the email marketing domain. Some prominent names have been integrated into larger platforms or have shifted their business focus.
Concurrently, the last two to three years have seen the emergence of numerous specialized third-party services across various areas of the email ecosystem. Their expertise spans deliverability, testing, live content, remarketing, predictive analytics, email advertising, and customer intelligence. This has been a crucial and exciting development, and there appears to be ample room for most of these specialists. At the same time, a consolidation trend might also be underway in this segment. In parallel, agencies are increasingly adopting the omnichannel marketing approach pioneered by Email Service Providers.
Enterprise Supplier-Agency Model Needed for Digital Transformation
The marketing technology market is experiencing massive growth, with new entrants appearing daily. Digital marketing is becoming increasingly complex, offering marketers more and more options. Furthermore, content marketing as a discipline is gaining greater attention from decision-makers, leading to an explosion in content creation.
Unfortunately, companies often implement digital marketing, content marketing, and related marketing technology platforms incorrectly. This can stem from a lack of skills or knowledge within marketing teams, but also from agencies and suppliers underperforming in terms of advice or delivery.
Consequently, we will see a continuation of the trend where enterprises increasingly build a supplier and agency model consisting of many smaller, specialized, niche expertise companies to support their digital transformation journeys.