Online marketing is flexing its muscles. Every day, marketers move more of their budgets from traditional outlets to new, innovative online channels.

Online marketing offers unheard-of control and access to marketing data, including the ability to track website visits, monitor traffic patterns, control costs, and target potential customers more effectively.

In the software industry, that trend is especially relevant because customers are well acquainted with using the Internet to research new products and services. They expect instant gratification and easy access to information.

An integrated online-marketing strategy provides a good conduit, but too many companies are underutilizing that approach.

The Evolution of Online Marketing

Online marketing is nothing new for software marketers. It's only natural that the software industry and computer-software users migrated to the Internet early on. So although the idea of online marketing isn't new, how software is marketed online continues to evolve.

Initially, online marketing meant being able to request a demo CD of a software product from a website or via email. As broadband connections became ubiquitous, the trend shifted to include software downloads as well. Unfortunately, that is where the growth of online marketing for software trials has stopped for too many companies.

The next evolution in online marketing is the online software demo, which is delivered on demand through a customer's Web browser.

Online demos are more affordable than downloads or CDs. That's because users are paying for hosting and not for gigabyte after gigabyte of download bandwidth or for a fulfillment house to mail CDs.

They're also more flexible. Online media can be shaped and constructed to target a specific audience, personalize messages, track where visitors go and what they do, and even adjust itself on the fly and predict customer behavior.

Compare the power of online marketing to 20th-century technologies such as demo CDs or downloads. Can you be sure the CD was delivered? Did the lengthy download finish? Was the software properly used, or even installed?

With an online demo, software companies know which leads used the demo, how long they participated, and which parts of the demo software they accessed. That kind of detail can't be matched by traditional, static marketing.

It's no coincidence that Forrester Research predicts that online marketing will increase over the next five years from 12% to 21% in advertising spend, reaching $55 billion annually in the United States, even as overall ad budgets decline.

That percentage may increase even more for software marketers, whose customers are Internet-savvy and used to quickly finding the information they need.

With its ability to take potential customers from search engine to full-fledged demo within seconds, online marketing and online software demos are poised to make up a large portion of software marketers' budgets.

Gather Data to Personalize the Experience

Online marketing allows software marketers to accomplish two important objectives simultaneously:

  1. Gather as much data about the potential customer as possible in the least-intrusive manner
  2. Personalize the customer's online experience to fully meet the customer's needs and expectations

A common mistake that software marketers make is failing to take advantage of their technology to fully personalize the customer's experience.

Because you know who is visiting your website and how those users arrived there—even whether they searched for your branded keywords or a competitor's—software marketers can dynamically adjust how their website and demos interact with the customer, and even change their qualification requirements.

Within an online demo, marketers can track how long a potential customer spent trying out the software and which features were used, and can interact with the customer in real time via live chat or a timely phone call.

Studies show that personalized marketing yields higher conversion rates.

Remember: Marketing is all about matching the message with the audience. If you can effectively communicate that your product or service solves your customer's problem, the sale is practically in the bag.

Lists of product features are meaningless if a website fails to explain clearly how the product will address the customer's needs.

Too many marketers treat their efforts like they're wildly firing a shotgun at a flock of ducks, hoping to wing one or two. Instead, marketers should use the information that online marketing can provide to focus their messages to fit the customer.

And although online marketing can customize messages on a micro level, the data accumulated over time also allows marketers to customize messages for broader, macro-level "buckets" of potential customers who share common characteristics.

If they use online marketing effectively, software marketers will be firing not blindly but with practiced precision—making better use of their marketing dollars.

Synergistic Marketing

But online demos alone won't provide software marketers the results they need to stay competitive. The best marketing campaigns are comprehensive, incorporating a variety of strategies, even traditional methods, to capture leads and convert them into customers.

Failing to integrate marketing efforts is the most common mistake that software marketers make. If a software company is using an online demo, then all the company's marketing programs should be pushing potential leads to that demo. Those programs can include email, lead nurturing, pay-per-click, social media, public relations, search-engine optimization, and other methods.

Creating multiple touch points reinforces the company's branding and strengthens the other elements in the marketing strategy, leading to a greater chance of conversions.

Indeed, online-marketing programs can deliver much-higher conversion rates than the typical 1% to 2% generated from a traditional marketing program. Also, the return on investment is typically higher because online marketing is less expensive than traditional methods.

Harness the Full Potential of Online Marketing

Once a novelty, online marketing is now an expectation. Companies that don't provide clear, concise, and easy-to-access product information alongside effective lead-capture systems will lose sales.

It's not enough to just be online. It's more important for companies to refine their online presence to maximize their conversion potential. Through efficient, integrated strategies, online marketers can squeeze out the extra percent or two they need to keep their companies ahead of the competition.

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The Surprising Evolution of Online Marketing in Software Sales

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Jayson Gehri is director of marketing and client relations at Runaware, Inc. (, a global leader in online demos and software marketing.