4 Steps to Revenue Centric Marketing.
If you read my previous post about why leads should not be your goal, this post will guide you through the necessary steps I take to help a company reach their revenue centric marketing goals:
1 - Define your ideal customer. What are the measurements that make them ideal: lifetime value, low cost of acquisition, low cost of ongoing maintenance, initial order value, upsell opportunities, average time to close? The entire organization needs to agree on what is ideal because what might be ideal in the sales process is not always ideal to customer success and support. Understanding where your product is today and where it is going also helps you identify the ideal customer. Just because they are ideal today does not mean they are ideal for the direction the business is headed.
2 - Profile your ideal customer. Dig in deep. If you had 100 more of your favorite customer, what does this look like for your business? Where does your ideal customer hang-out, who influences them, what motivates them, what are their pain points? What do they love about your business and why? There is some psychology that goes into profiling your ideal customer. What motivates a 26 year old male to take action is, in most cases, very different that what motivates a 36 year old mother of 3, even when it comes to how they make business decisions. Identifying and defining detailed personas (no more than 3-4) will help to get you in the head of your buyer.
Companies who exceed lead and revenue goals are 4 times as likely to use Personas for demand generation than those who missed lead and revenue goals. (source)
3 - Build a plan to reach your ideal customer. Define their customer journey and determine the elements needed to meet them at the different points in their journey. Your marketing plan should outline what each stage in this journey looks like and include where you will reach them and what you will reach them with. From unaware to decision you need to hold their hand through the journey, if you don’t your competitor can step in and take them down another path at any point.
3B - You may have the perfect methods to reach your ideal customer but the biggest mistake I see companies make is delivering the wrong content at the wrong time. Design a content plan that is based on your buyer journey. While we live in an instantaneous world where we want a buyer to commit on our time-line, that is not reality. There are stages in a buyer’s journey that lead to a decision to buy. Asking for the sale before a decision stage is like asking for someone’s hand in marriage before the first date.
4 - Measure. Evaluate. Shift Accordingly. Once you’ve defined the audience, the reality is reaching them with the right message at the right time is not always easy. Some of this takes the 3Ts (time, trial and testing). But by starting out with the measurements that matter the most to the businesses you can have a baseline for measurement, evaluate as you go and make changes as needed. You can react quickly if you know what KPIs matter most. For example, if your CAC (customer acquisition cost) is the number one priority of the organization you set a specific CAC goal. If some of your marketing efforts have a higher CAC you cut there and invest in other areas with lower CAC. However, while CAC should always be a consideration, some companies are in high growth mode and willing to invest more in acquiring customers short-term as long as the churn is low and potential LTV remains high. Once you do acquire new customers marketing;s involvement in the customer journey can’t just halt. To really maximize the relationships you are acquiring, the customer experience needs to remain consistent, proactive and tie back to the original marketing KPIs. If marketing doesn’t understand what is happening short-term and long-term with the customers they help to acquire, the puzzle will be incomplete and marketing can’t and won’t optimize efforts.
Recognizing there is a lot of work that goes into each of these steps, the biggest hurdle is making sure everyone is on the same page about what is important to the business - - the entire business. Marketing is not a silo department that is responsible for bringing in leads. Marketing is central to the conversations on how to execute and reach revenue goals across the entire organization.
with contribution from Ryan Andrew
This is seriously the worst marketing measurement a SaaS company can put in front of a marketer. My typical response, "If all you want is leads I can buy you some leads." If an agency is telling you they can get you 4X leads in 6 months without asking you some very tough questions, don’t hire them - RUN!
I have written about this topic before but it amazes me that I still get asked if I can increase leads. Luckily I know what a company really wants when they ask this. By now smart businesses know a real marketer wants to participate in a serious ROI conversation. A real B2B marketer understands that putting junk in the top of the funnel results in junk across all areas of the business.
A company recently asked me to generate more leads for them but after looking in their CRM I realized they had a large number of leads just sitting there. When I dug further asking why they wanted more of the same with a conversion ratio of less than 10% their response was, well we did not do a good job at following up on those leads. So, their problem wasn’t generating more leads, their problem was converting the leads they already had. Just putting more leads at the top of a broken funnel was going to result in more of the same.
79% of leads never convert into sales due to poor performance, nurturing, and/or engagement. (Source)
If your marketing effort is entirely focused on growing leads 4X without consideration for how you will nurture and convert these leads or how you will keep, maintain and even grow your customer relationships, you will continue to need to grow your leads 4X time and time again just to maintain revenue. Are you leaving the biggest potential source of revenue out of the conversation?
If a typical SaaS business loses 2-3% of their customers each month to churn, they must grow by at least 27%-43% annually to maintain the same revenue. (Source)
I have worked with 3 companies in the last 2 years that did not have a single initiative for customer marketing. In fact, once the customer was onboarded there was little to no proactive communication. If customers are considered a support problem vs. a revenue opportunity and not a big part of your marketing plan, I guarantee you are leaving money on the table.
Loyal customers are worth up to 10x as much as their first purchase, on average. (Source)
So what should you be discussing with you marketing team/agency if it isn’t leads? This depends on what is important to your business right now. In some cases, it may make sense to have a higher CAC (customer acquisition cost) and focus on creating a strong plan to maximize LTV (life-time value), in which case, customer delight and expansion marketing should be at the top of your list. Or, you might be in high growth mode in which case you want to acquire as many customers as you can at the lowest CAC while still maintaining a certain churn rate. So understanding how to reach your ideal customer while still avoiding the noise and costly marketing channels should be your focus. Driving 4X leads should only come into the conversation if you have a solid funnel process that is already hitting all your goal metrics and you are ready to scale this process with more volume.
with contribution from Ryan Andrew
There are a number of articles that claim it’s imperative to define finite targeting tactics to reach your target market, that aiming for the bullseye is essential in reaching new customers. I’m going to go out on a limb and say many marketers that aim at the bullseye may miss the mark all together. Let me be clear, I’m not saying you shouldn’t have a clear target market. Rather, I am saying you don’t always have to aim right at the bullseye to reach your audience or to meet your goals. In fact, some of your low-hanging fruit might not be sitting in your bullseye at all.
Let’s start by saying I am looking at the bullseye as where you reach your audience, not as the definition of the audience itself. Here are 8 reasons to expand your marketing efforts to include the areas around the bullseye:
Special tip for those marketing to small business. People who make buying decisions in small businesses often have a very different mindset than those responsible for enterprise purchases. It’s not uncommon for them to think more like a consumer even when making a business purchase, so using consumer oriented methods of marketing are often much more effective. It’s ok to target small business decision-makers in a much more casual, social setting. Think about the places they hang out in their personal lives and deliver business messages in those locations that are aimed at improving their overall lifestyle.
For 2017, I challenge marketers to get out of their comfort zones and look outside their bullseye to see what new opportunities they can find to engage prospective customers. I’d love to hear your stories about ways you reach your target market outside your sweet spot.
Written By KC Cox
With Contribution from Triniti Burton
I have lost count how many times I have reviewed the different marketing automation systems in the marketplace. You would think I would have a favorite by now, but my personal favorite does not mean it is right for the business I am working with. I have reviewed these systems from all angles for a variety of clients, and each time I am surprised at the outcome. As many times as I have tried to lay out the pros and cons of each solution side-by-side, the truth is they all go about doing things in such a different manner, it makes it nearly impossible to compare apples to apples. Couple that with the different needs and capabilities of the organization, and it is nearly impossible to come up with a clear favorite. Lastly, they are always changing and improving, so what was once a con of one is now a selling feature.
In fact, I now do a full review each and every time I have a client that needs marketing automation, because I am always looking at it from the client’s short-term and long-term needs.
Here are the first steps I take to begin to narrow the field:
Of course, there are specific requirements all companies have when looking at marketing automation, but selecting the right system is not always just about functionality. I have heard time and time again about companies who select a vendor and a year later say they use less than 20% of the features. This is because they didn’t have a clear plan for how they wanted to adapt their automation system, making it impossible to select their vendor accordingly. So if you are looking at Marketo, Pardot, Act-on, Infusionsoft, Hubspot… and we all know the list goes on, start by mapping out your company's goals, technology readiness, data condition and content capabilities. For some it is hard to resist diving right into the pool with one of the market leaders - but they may not be the right solution for you, right now!
Written by: KC Cox
With Contribution from Kate Athmer
I have been a part of a lot of start-up companies and the ones who have seen the most success get this principal and live it at at the core of everything they do.
Even though I have seen a few companies live this out, it wasn’t until I heard my absolute favorite Ted Talk that I kept this in mind every single time I go to help a company with their messaging. It is not mind blowing because it is a new concept but it is the number one thing most companies will forget as they build marketing content.
“People don’t buy what you do; they buy why you do it”
Now that you have this mind set you would think it is easy, right? Think why! Think why! Think why! Not as easy as it sounds. The key is to get the heart of your company. What are you passionate about? What gets you up every morning to do what you do? Are the leaders in our organization driving the “We believe….” “We love…” “We are driven by…” If you walk around your entire company right now and ask everyone from accounting to sales what it is your company passionate about, would the answer be the same across your organization? Some companies spend thousands on brand agencies to help the develop this exact message and it ends up on a plaque in the lobby but does it drive your business?
I had the pleasure of working for Infusionsoft in the early days where the brand promise became about the dream of every employee. As a matter of fact, every employee was not only asked to memorize the Dream, Vision, Purpose and Mission (see below) we were asked to carry it out in everything we did.
Dream: Revolutionize the way small businesses grow.
Vision: Infusion will be the sales and marketing software program small businesses use to grow their companies quickly and profitably.
Purpose: Liberate and empower small businesses and their employees so they can enjoy doing business, wow their customers and better serve their families and communities
Mission: To create the leading sales and marketing software program for small business that is easy to use and powerful enough to turn small businesses into big businesses.
When you answer the WHY (Liberate and empower small business and their employees so they can enjoy doing business, wow their customers and better serve their families and communities) you can build on your DREAM ( Revolutionize the way small businesses grow) and easily and more clearly:
Let me first explain, yes I believe a content marketing strategy can be and should be tied to revenues. The growth of content production continues to boom, with 70% of B2B marketers creating more content than years past. However, only 9% of companies believe their content is highly-effective. In order to know if you content is effective you must measure the value of the content against your returns. The key is to plan it that way from the beginning so here is a step-by-step guide on how to make your content drive revenues:
Step 1 - Understand your company objectives. Your marketing programs are only as good as your ability to tie the results to your overarching goals. Your content plan should be a direct reflection of who you are trying to reach and what you want them to know about you.
Step 2 - Define your personas and build a story for each one of them. Hint, if you can create a theme around your story that can be shared across your content, it makes it much easier to unify the message and the look and feel.
Contact Me to see an example of a cohesive marketing story.
Step 3 - Define the materials (content pieces) you need to help you tell the story. It is helpful to go back to your personas and build a map of what you will need for each at each stage in the lead/sales lifecycle by persona.
Contact Me to see an example of a persona based content plan.
Step 4 - Look at all of your placement and delivery opportunities by lifecycle stage. Remember, early stage viewers may not even know they are interested so capturing their attention quickly and drawing them in, in a matter of seconds is critical. And, make it easy for viewers to “spread the word.” Make it easy for people to share your content. Shared content is three times more likely to get read.
Step 5 - Look for ways to re-purpose content across multiple channels. Don’t just publish a blog post and hope people find it. Share your blog post across social media channels with partners, and advertise content to the appropriate audience.
Step 6 - Make your content evergreen by removing dates and allowing it take a life of its own over time. Link new content to older content to reinvigorate it.
Step 7 - Balance the give and take. Content is designed to be educational and in the early stages you need to give more than you take but as you move through the lifecycle you can begin to ask for something (information) in exchange. The further you go in the lifecycle and the more they engage, the more information you can request.
Step 8 - Track! Track! Track! Only 21% of companies say they are successfully tracking their content programs. Going back to beginning where I mentioned only 9% of companies believe their content plan is highly effective, this is because most companies are still not tracking their content through to the customer value. At a bare minimum you should be tracking:
Visitors to all content pieces
Where are the visitors coming from?
What are they doing next?
With the right technology you should also be tracking all the leads collected by content piece and call to action.
With marketing automation and CRM you should also be able to track: Original lead source, campaigns across the lifecycle (influencing campaigns), support materials viewed, won/lost opportunities by campaign and revenue against cost of the campaign.
Is your marketing and sales process creating ghost leads?
You should absolutely be afraid of ghosts. They are costing you money and there is no reason they should exists. What is a ghost lead? A ghost lead is a lead you have collected that gets lost in the process somewhere, somehow and does not get the attention it needs to move it through the funnel.
There are a number of reasons and places a ghost lead can sneak up on you. Let’s take each stage in the funnel and look at how a ghost lead appears.
Some ghost leads never even make it into the database. If you do not have a consistent process for collecting, inputting and segmenting your leads from ALL of your channels you might have ghost leads sitting in the desk draw of a sales rep. or in someone’s inbox. This happens a lot at trade shows. Even with the lead scan devices you get back from a whirlwind conference and you are on to the next big thing and the leads never make it into the database. Or worse yet, leads did not get scanned and you have a stack of business cards sitting on someone’s desk waiting to be entered. You just paid thousands of dollars to create a stack of ghost leads.
While the above scenario is just lazy and should be easy to solve, the next stage in the funnel is where most unfortunate ghost leads occur. Let’s say those leads do get entered. There are three different paths these leads often take: 1) you send each of them an email introducing yourself starting with “we met you at…” 2) you divide them up and have your sales team start calling or 3) you have a marketing automation system and you put them into a campaign that starts a sequence of emails. If you are a little more advanced you may email and call. However, only a handful of these leads end up in the funnel. What happens to the rest? Before we get into that, let’s take a look at the next stage.
Now you have followed up on the leads. Your sales guys have even called a few times and left messages. Your emails have gone out and you have done your best to get the leads to raise their hands - - but have you? What happens to these leads at this point?
Just because they did not interact with you immediately does not mean there is no hope to ever convert these leads into opportunities. As marketers it is our job to follow-up. It is also our job to learn more about them to further qualify them for sales. Here are the steps to take to get rid of the ghost leads:
1 - Make sure every lead makes it into your database. No excuses, make this a top priority.
2 - Use as much of the data as you can to follow-up with the leads immediately with as relevant as a mesage as possible.
3 - Over time, work to gather more data on the leads you obtained, either through third party append services, manually through LInkedin or by asking the lead via progressive profiling forms. You can also learn more about the lead through their behaviors. What actions are the taking when you reach out?
4 - Use the data to get more and more relevant to your audience and to segment those who meet your pre-determined criteria for a good lead. For example, if you know that call center managers managing teams of 60+ are the ones who buy most often, make sure these leads get segmented out and bubbled up to the top as quickly as possible.
5 - Lead score activity/behavior. If a lead keeps visiting your site, there must be something of interest there. Increase the lead score each time they visit and if they hit your pricing page give them a bonus score. Bubble them up to sales when they hit a threshold.
6 - Don’t let the ghost linger. If you have followed up and sent them relevant content move them to a “marketing stay-in-touch” campaign where you do just that, stay in touch at a cadence that is appropriate to your market. Change your leads status at this point to MSIT so you are not keeping them in your sales funnel.
7 - If sales has leads in their funnel they are not working, set-up automated process by which these leads continue to get activity. This would look different based on your company but you could auto reassign them to another sales person if there has been no activity for a certain time-frame. You could auto-alert their manager if the lead is going into “ghost” status. You could also set-up nurture at each stage of the funnel and for those stages that include a sales rep. these could appear to come from the rep.
8 - As a marketer you should spot check your leads on a regular basis and make sure the intended follow-up is occurring. Chances are if one ghost is appearing, there are more around the corner.
If you are hiring marketing people to generate leads for you, stop right now. Call me today and I will buy you some leads. With one phone call I can get you a list defined by your target marketing demographics. When a sales team says they want leads this is not what they are asking for. There is much more to marketing than a list of leads. If number of leads is still your top marketing KPI, you have a lot of catching up to do.
The definition of a lead is: an individual or organization that expresses an interest in your goods or service. Today, while this is technically correct, we as marketers have used the term more and more to define the possession of data.
Marketing measurements will be different if you are a B2C company vs. a B2B company. If you are an online businesses vs. a brick and mortar.
In the B2C world you would be looking more at what kind of traffic you can generate (into a store or onto your website) and what percent of that traffic resulted in the sale of your product/service. These transactional based marketing KPIs are often easier to measure than marketing in B2B where the KPIs involve a sales cycle, sometimes a rather complex sales cycle. For B2B marketers you need to start with what you know today. I paid “x” for this marketing effort and it resulted in “y” leads.
x = y gives you your Cost Per lead (CPL)
Now of those leads that I generated I am going to determine that “r” are valid enough to pass to sales. Read blog post Marketing Qualification to learn more.
Lead to Marketing Qualified Lead (MQL)
r/y = MQL ratio
Of those that we passed to sales they are actively working “w”
MQL to Sales Accepted Lead (SAL)
w/r = MQL to SAL ratio
Now that they are working the lead they have managed to convert “o” to an open opportunity.
SAL to Opportunity
o/w = SAL to Opportunity ratio
Now they are closing some of these opportunities to sales “s”
o/s = Opportunity to Won ratio
Now you look at the number of sales (won) and connect this value back to the original cost of the program.
This will give you your Customer Acquisition Cost (CAC)
Marketing cost/number of customers acquired = CAC
Nope, we are not done yet. You should also look at the value of the sale to the cost of the program to determine an ROI. If you will only plan to sell this customer one product one time you can stop there. However in most businesses the real value of acquiring a customer is in the lifetime value (LTV), or the value of the customer for the lifetime of the customer relationship.
Lastly you will want to track your Opportunity to Loss and your Returned to Marketing conversion rates to use as metrics for ways to improve your overall marketing efforts. If you are seeing that these numbers do not correlate with your leads you might have an issue with lead process and it could be that sales is not moving leads through the funnel and they are just sitting at stages that become inactive. We will talk about ways to design a sales process that doesn’t leave you with ghost leads in a later article.
Can marketing actually be tied to revenue goals based on the delivery channel? Why Not!
First, you must make a commitment to content.
Without a commitment to active and consistent content you can’t expect any channel to be tied to a measurable revenue number. However, if you can commit to ongoing, highly-relevant content for each channel you actually set goals by channel and build out trackable measurements based on channel:s:
What kind of traffic will you drive to each channel per month?
How do you capture leads in this channel?
What is the average of ratio from traffic to lead capture?
What is the cost to produce and distribute content in the is channel (for now just look at hard costs not including salaries)?
What are your lead to close ratios?
See Marketing KPIs Blog for more information on measurements.
Note, some companies are more transactional in nature and the content itself might directly result in a sale of a product, service or subscription.
Second, someone has to take true ownership of the channel.
You must find a marketer who can is comfortable taking ownership of one or more of your content channels and is able to view that channel success based on measurements and data. This person must own the strategy by which content is not only created but delivered. They also must work with other channels to cross-promote and create replicatable content that can be used by a number of channels. For example, if you have a webinar recording you can use on your blog, Facebook, Linkedin and Youtube each channel owner will need to understand the best way to position and promote this content on their channel to make the most of the content based on how the target audience interacts with the channel.
Third, you must define the qualification by which you will measure the channel.
Some companies will only measure marketing revenue contributions when a transaction occurs directly from that marketing activity within the same interaction. Other companies will cookie or log the original interaction and allow marketing to claim it against the channel if the completed sale occurs in a certain time frame. In the B2B world however, where you have a sales cycle involved, you will want to go back and look at the original lead channel at the close of the sale. In CRM, this is often when the opportunity is moved to “won.”
Last, you must be able to measure effectively.
If you have a sales process involved you must be able to track where the channel the lead came from along at the time they make a purchase. This means the channel source has to be able to follow the lead through the entire sales journey. You may also need a way to tie other channel contributions to the sale If the lead interacted with a number of channels before making a purchase you would want to give the original source a certain attribution however those that
contributed to the sale should also get some of the credit. If you are using a marketing automation system or a CRM to track interactions and activities you will want to create a master lead source or campaign along with lead source tags or child campaigns that will allow you to see the entire flow of activity for each completed sale.
While content is king when you want to leverage your marketing channels you have to be able to understand the value of the content as it pertains to that channel so you can continue to produce content for the purpose of growing the business not just content for content sake.
Seems a bit funny to give a single year such an important title. As a matter of fact, if you look back over time, we probably knew more about our customers 100 years ago before technology became a part of our shopping experience. If we go back 100 years ago the store owner knew his/her customers by name. He/She probably knew what his/her customer bought the last time they were in the store and probably had a good idea what he/she will buy this time. The store owner knew the kids names, the profession of the customer and maybe even his/her birthday. So when you think about history, small businesses had the first Chief Customer Officers and relied on customer experience feedback before technology ever played a part.
Now on to reality, while there are a few small town shops today where everyone knows your name, it is not how most of us conduct business. So who in a business owns the customer experience? The truth is, for decades this question has gone virtually unanswered. Most organizations believed everyone should own the customer experience but as we all know when you have two many cooks in the kitchen, something or someone gets burned.
In a small business where C-level executives do everything from unlock the doors in the morning to making payroll at the end of the day, who should own the customer experience? And, what does this mean?
It doesn't mean that each role in the organization is off the hook. In fact, it means that every role in the organization should be accountable for their part. In the end it doesn't really matter which department head or person in the organization is named the CCO or given the responsability but one person should be driving and monitoring the overall strategy, even in a smaller company, even if it is the CEO/President. Here is what this person should be responsible for:
Defining the customer journey
Defining the customer experience from the customer's point of view
Communicating the customer voice to decision makers
Making sure each person in the organization is communicating customer feedback to a central source
Looking at how each company decision impacts the customer experience
Monitoring and share customer loyalty stats and how it impacts the company's bottom line
Acting as an advocate for customers if something in the organization needs to change
Breaking-down silos in the organization that have a negative imapct on customer experience
Putting programs into place that improve the overall customer experience
Businesses need to rely on customer retention more than larger organizations. A positive customer experience for just one customer can mean the difference between growth and shutting the doors. If everyone in the organization is doing their part to make sure customers are happy but no one is responsible for making sure of it, you will end up reacting to bad experiences vs. proactively trying to create good ones.
My name is KC DeKorte-Cox and I am a demand generation marketing expert with over 15 years of experience focused primarily on helping businesses with marketing and sales alignment strategies aimed at driving growth. I help design marketing and sales programs that scale by leveraging the power of technology, specifically CRM and Marketing Automation.