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Difference between Outbound and Inbound Marketing

Difference between Outbound and Inbound Marketing

Marketing is about spreading awareness of what a company is offering to the public with the goal of making a profit. It involves advertising, selling, and delivering products or services to the people. (1)

Just a few decades ago, there was only one type of marketing and it is what is now known as outbound marketing. As the use of the internet became more popular and widespread, a new form of promotion has emerged: inbound marketing.

Outbound Marketing

What is now considered the traditional form of marketing, outbound marketing generally includes TV and radio advertising, print advertising, direct mail, outdoor marketing, as well as telemarketing. It usually involves the use of mass media tools to drive messages and information about products to the public. (2)

Outbound marketing is also known as interruption marketing, such as when commercials interrupt TV programs or cold calls and door to door salesmen interrupt what people are doing at the moment in order to present their sales pitch. (3)

It may be mostly traditional but outbound marketing has also found a way to take advantage of the digital age through pay-per-click or PPC ads and email blasts.

While this type of marketing succeeded in the past, mainly because people didn’t have a choice, employing outbound marketing alone is no longer as effective now that consumers have the power to control the advertisements, if any, they want to see.
What makes outbound marketing work?  The greatest strength of this strategy is its capacity to reach a large number of people in a short span of time, which creates immediate awareness of the product or service that can catapult a business into success. (4)

Unfortunately, there are drawbacks, several of which stem from outbound marketing’s biggest advantage.

The success of promoting a product or service through outbound marketing depends on the cost of investment. Spending more money on advertising means the information can reach more people, which could translate to bigger profits. To sustain revenue growth, continued investment need to be made.

Also, since outbound promotions reach a wide range of audience, it is less geared towards the target market, which increases conversion costs per customer. The high price tag involved may be too much for small businesses, which is why only companies with big advertising budgets can compete.

Perhaps the biggest disadvantage of outbound marketing lies in its disruptive nature, making it disliked by many. This is precisely the reason why Netflix and AdBlock are quite popular. (5)

Inbound Marketing

Inbound marketing is a strategy that takes​ the buying practices of the modern consumer into account. On average, a present-day buyer researches a product or service on their own before contacting the company that sells the product or provides the service. It’s a more targeted promotional strategy because the consumer is actively in the market for the product or service. (6)

Where outbound marketing is interruptive, inbound marketing is permissive since it gives the potential buyer the chance to allow companies to promote their products or service, albeit in a more indirect way. Inbound marketing is largely internet based so it involves search engines, social media, blogging, email marketing, SEO, content creation, and others.

A two-way interaction between the company and the public is one of the many benefits of inbound marketing. For instance, the customer can post a question in the form of a comment on a blog post about how to take care of a company’s product. The company responds, which creates a dialog between the parties. As a result, the customer becomes invested and engaged, paving the way for a lasting business relationship.

Having relatively low promotional costs​ is another advantage of inbound marketing and compared to outbound marketing, this sort of investment is much more manageable even for startups and small businesses. And because of the low spending, the return is high. Blogging, for instance, can yield as much as 13 times increased ROI over a period of one year, according to Hubspot’s state of inbound report in 2014. Moreover, BRB marketers who take advantage of blogging generate 67% more leads per month than those who do not. (7)

Providing value is probably the biggest advantage of using inbound marketing. Going back to the example of blogging, a company can post educational articles that both existing and potential customers can benefit from. Because this type of posts are often non-promotional, they can easily draw in the target audience, especially the ones that do not appreciate outright sales pitches.

Inbound marketing, however, is not without disadvantages. For one, the results of this promotional strategy is slower compared to that of outbound marketing. There is also the important consideration of having a manager or a team of people who have the knowledge and expertise in SEO, content writing, Web design, social media, and other aspects related to generating traffic. This may prove to be expensive for start ups as well as small businesses. And while inbound promotional activities are easy to employ once the company knows what it’s doing, inbound marketing can be costly because the returns are not be readily apparent. (8)

Factors to consider when developing a company’s marketing strategies: (9)

Target market

A company whose products and services target older customers will do well to invest in their outbound marketing strategies since the older generation are more comfortable with TV, radio, as well as print ads. Likewise, outbound marketing is more effective in transactions that involve big ticket or higher-end products as well as in business to business marketing.

Brand image

Cold calling, repetitive TV ads, and similar pushy sales tactics can be effective in putting the company in the forefront of consumer’s minds. Unfortunately, the image of the brand is not always held in positive regard and this could have a long-term effect that are could hurt the company’s bottom line.

Company goals

Inbound marketing is a good long-term strategy but on its own, it will not increase business dramatically in the first few months. On the other hand, outbound marketing can reach a million people in a few short weeks but with diminishing return.

Which strategy is best?

Many factors need to be considered but for the most part, the best promotional strategy is a combination of both outbound and inbound marketing. (10) (11) Potential buyers​ need to know about a company first before searching for information about its products or services. This is where outbound marketing comes into play. Once knowledge of the company as well as its potential to solve the consumer’s problems reaches the public, a business relationship through inbound marketing could develop. Good marketers will find the right combination of both strategies that is a fit for a particular company.

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1 Comment

  1. Thanks for the article! There is a fundamental difference between them. Both types of call centers are good for their own purposes!

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