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Inbound Marketing

Inbound Marketing and its opposite Outbound Marketing have various meanings depending on the context.

    One pair of definitions are:

        Inbound marketing is a marketing strategy that focuses on getting found by customers. This sense is related to relationship marketing and Seth Godin's idea of permission marketing. David Meerman Scott recommends that marketers "earn their way in" (via publishing helpful information on a blog etc.) in contrast to outbound marketing where they used to have to "buy, beg, or bug their way in" (via paid advertisements, issuing press releases in the hope they get picked up by the trade press, or paying commissioned sales people, respectively). Brian Halligan, cofounder and CEO of HubSpot, claims he coined the usage of the term in this sense.

        Antonym for this usage: Traditional marketing (outbound marketing) is a marketing strategy that focuses on finding customers by building brand awareness through advertising and promotion. In contrast to "permission marketing," a pejorative term for this type of marketing is "interruption marketing."
    An older pair of definitions are:

        Inbound marketing is market research. In contrast to the above, pieces of information about customer needs and interests, not customers themselves, flow into the company. Knowledge of customer needs drives future company offerings, and product or service capability. This sense is related to the term product management (product ownership in Scrum). Peter Drucker believed this to be the quintessence of marketing.

        Antonym for this usage: Outbound marketing is marketing communications. In this sense, information about finished product capability flows out to prospective customers who have a need for it. This sense is related to the term product marketing.

Inbound vs. outbound marketing

Brian Halligan, CEO & Founder of HubSpot, coined the term inbound marketing, in the newer of the two senses. Inbound marketing involves getting found by potential customers through search (opposite of Outbound Marketing). The shift from outbound to inbound marketing has led to new mediums of outreach to the public. Outbound marketing, also referred to as “old marketing” or traditional marketing, targets a broad audience using print ads, television ads, telemarketing/cold calls, direct mail/e-mail, etc. Inbound marketing, or “new marketing” and modern marketing, is a response to the recent change in consumer behavior. People are more in control of what information they receive and how. Rather than interrupting people to get their attention with emails, cold calls, commercials, etc. (outbound marketing), inbound marketing relies on the principle that visitors find and come to you. In outbound marketing, the company is in control. Using inbound marketing, the customer is in control.

Halligan describes why outbound marketing techniques are becoming less effective:

    “Your average human today is inundated with over 2000 outbound marketing interruptions per day and is figuring out more and more creative ways to block them out, including caller ID, spam filtering, TiVo, and Sirius satellite radio. Second, the cost of coordination around learning about something new or shopping for something new using the internet (search engines, blogs, and social media sites) is now much lower than going to a seminar at the Marriott or flying to a trade show in Las Vegas.”

        - Brian Halligan, HubSpot

Types of inbound marketing

Inbound marketing mediums are broken down into three categories:

    Content (Blogs, videos, white papers, eBooks, etc.)
    SEO (Search Engine Optimization and keyword analysis)
    Social media (Twitter, Linked In, Facebook, etc.)

The most successful inbound marketing campaigns contain all three key components First, inbound marketing content is created and published using the medium of choice (blog, video, white paper, eBook, etc.). Second, Search Engine Optimization increases the rank of the content and makes it more accessible. Third, social media media(Twitter, Facebook, LinkedIn, etc.) continue to spread the content.

Content (Blogs, videos, white papers, eBooks, etc.)

Content is the substance of an inbound marketing campaign. This form of inbound marketing refers to information or tools that attract potential customers to the business or site Some examples of content-publishing sites for inbound marketing purposes include:

    Blogs: Blogger, WordPress, ExpressionEngine, LiveJournal, OpenDiary, TypePad, Vox, Xanga
    Videos: YouTube, Dailymotion, Metacafe
    White Papers: WhitePaperSource, The Direct Marketing Association (DMA)
    EBooks: eBooks, NetLibrary

SEO (Search Engine Optimization & keyword analysis)

Search Engine Optimization (SEO) is the process of improving the visibility of a web site in search engines. SEO considers how search engines work and what people are searching for. In inbound marketing, SEO allows companies to be found more. Most consumers begin their buying process by using a search engine (Google, Bing, Yahoo!, Ask, AOL Search, etc.). Search engine optimization is the practice of building up a web site to maximize its ranking in search engines results.

Social media (Twitter, LinkedIn, Facebook, etc.)

The term “social media” does not have one universal definition. Andreas Kaplan and Michael Haenlein define social media as “a group of Internet-based applications that build on the ideological and technological foundations of Web 2.0 and that allow the creation and exchange of user-generated content.”

In inbound marketing, social media channels increase the impact of the content.

Benefits of inbound marketing

In an economic recession, inbound marketing is a more efficient way of allocating money than outbound marketing Brian Halligan, CEO of HubSpot and initiator of “inbound marketing”, divides the benefits of inbound marketing into two main categories: cost effectiveness and better targeting.

Cost effectiveness

In 2001, the Dow Jones Industrial Average depicts businesses shifting marketing dollars into search engine advertising, or pay-per-click advertising, in response to an economic recession. In 2008, another economic recession began. In response, businesses again began shifting money out of expensive paid search advertising into inbound marketing.

Inbound marketing costs less than outbound marketing. Outbound marketing becomes expensive since companies use money to buy advertisements or e-mail lists, rent booths at trade shows, etc. Most content of inbound marketing is created and generated on web sites that are free of charge, such as Twitter, LinkedIn or Facebook.

The cost effectiveness of the shift from outbound to inbound marketing can be measured using a Return on Investment (ROI). HubSpot, an inbound marketing software company, conducted a 2010 study titled “The State of Inbound Marketing”. This study analyzed data from businesses about what types of marketing programs deliver the best return on investment. HubSpot’s major finding was that inbound marketing focused businesses have a 60% lower cost per lead – less money is utilized to produce more results.

In January 2010, another analysis of inbound marketing was conducted by an M.I.T. Sloan School of Management graduate student. Melissa DiBella, class of 2010, conducted independent research into the return on investment of companies using HubSpot software for inbound marketing purposes. The complete report of “Return on Investment from Inbound Marketing through Implementing HubSpot Software” can be viewed online.

Better targeting

Outbound marketing techniques target a broad audience. Instead of identifying a target audience, companies using outbound marketing reach out to all consumers. As a result, statistics show only 1-3% of all targeted consumers respond – 97% of all marketing efforts go to waste. Inbound marketing only targets individuals who self-qualify themselves by demonstrating an interest in your content.

Technical Terms

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