The Fork In The Road

A Marketer’s Perspective of This Year’s SaaStr Annual

 

Last week, I attended the SaaStr Annual. This now-annual event is equal parts inspiration and celebration of companies who have achieved $0 to $100M and beyond in annual repeatable revenue (ARR). In other words, the number one goal of (almost) every SaaS company. Before I dive into why every marketer should attend similar entrepreneur-focused conferences, here’s my version of ARR:

Despite what some people think, SaaS is not a business model. It is infrastructure and a delivery model. Companies who have been successful with growing ARR have several characteristics in common: 

1. The ability to implement and repeat with little to no customization - Customers may be able to customize or personalize aspects of your service through their management dashboard, but if your developers need to get involved in significant customization for POCs, you are running a custom shop and will never be able to scale.
2. Integration with other preferred and appropriate software - For example, an analytics company not integrated into SFDC and Marketo with plans to add more integrations soon needs to reset its priorities. I say appropriate because integration and partners must match your core value. Check out MobileIron’s partner program. It’s my new favorite partner ecosystem example because the choice of partners fits perfectly with the company’s core offering and value.
3. Have hired the right type of sales and marketing executives - Since I’m a little too passionate about this subject to cover it in two sentences, I refer you to Jason Lemkin’s excellent blogs How to hire your (First) VP Sales (And not screw it up) and Hire the Right Type of VP Marketing — Or You’ll Just End Up With a Bunch of Blue Pens with Your Logo On Them.

There are many companies that have billed themselves as X as a Service that don’t fit. As cloud has become more mainstream for large enterprise, many of these have moved on to referring to themselves as “cloud-based, on-demand.” 

So, why was a marketing executive like myself absorbing everything that was said that this year’s SaaStr Annual? Because marketing’s job is the work in sync with sales, not just send them leads through pneumatic tubes. Sales and marketing working harmoniously doesn’t mean marketing needs do everything sales wants. In fact, if this were the case, it would be to the detriment of the company. Sales and marketing need to have a “business first” approach. In other words, if I’m not watching everything that affects the business, I’ve failed at my job. 

A good marketing professional, whether an CMO or a product marketing manager, needs to understand corporate goals, including all aspects of sales goals, not just quota numbers. How does the product support what is being sold now and where the market opportunities will be in the future? Are the (sales development reps) SDRs delivering (sales qualified leads) SQLs that have a good chance of resulting in a signed – and implemented – contract? 

Yes, wading through a gaggle of entrepreneurs and SaaS executives is a very good way to spend a day. 

The Art of Knowing When It’s Time to Give Up

Success sales today are part mathematics and part art.  Sales teams are assisted by a number of programs that help assess the readiness of a lead to move through the sales process. 

Marketing automation solutions such as Marketo and Eloqua include advanced lead scoring capabilities.  Marketing campaigns can now be created to automatically initiate depending on a lead’s reaction to a previous campaign.  For example, because Mr. Jones registered and attended our webinar about online security, he is sent an email through which he can download a related white paper.

Meanwhile, sales teams can also access real-time business and social intelligence through companies like InsideView.  Knowing the latest of what’s happening with prospects in real-time is something that wasn’t possible a few years ago.

When you add to all these solutions measurement and predictive analytics, it’s plain to see how much investment has been made in creating solutions to help the sales process.  To close a deal, it comes down to the art of the sale, which includes both skill and the gut feeling of how to approach and interact with any given individual.

With all the tools that are available to find leads and advance the sales process, what could be missing?  The answer: when to give up on a deal. 

By now, 100s of millions of dollars have been invested in helping marketing people qualify and nurture leads, and sales people to gather data on any company.  However, when it comes to when to give up on a lead, it is all left to art. 

Sales reps are by nature optimistic people.  They look at a prospect and think “I can convince them to purchase my product.”  To the credit of some of the great sales people I’ve known, they often close deals that initially seemed to be long shots.  Unfortunately, not every long shot is worth pursuing.

There seem to be a few reasons for this. First, if a lead is qualified, but the person is not the likely buyer within the target organization, the sales rep may get trapped in a cycle of having “good conversations” with one person after another, but never with the true decision maker or buyer.  A sales cycle that should be 45-60 days could easily become 9+ months if the initial lead doesn’t hold the budget.

Second, culturally, it may be impossible or unlikely that the sales target will come out and say no.  For example, this is often a surprise to US-centric sales teams, who may come out of a meeting in China thinking their project is moving forward only to learn later it wasn’t approved or would take several more trips to gain approval.  China is not the only place on the globe where people avoid saying no to a salesperson’s face, but it is known for it.

Third, if the sales process extends too long, it raises questions with the lead’s company.  “If we haven’t purchased already, do we really need it?”  In the end, these sales fall apart simply because there is no longer any momentum behind the project.

Honestly, I don’t have an answer for how to know when a deal is artificially lingering.  I’d love to see someone develop a formula that would help companies know when it’s time to pull the plug on a deal that will never close.  Sadly, as many a salesperson has realized firsthand, it is more popular to push revenue generators than something that will save time and money.  This means that in the end, we must continue to rely on the art of sale to not only close deals, but to know when to give up on them.

 

 

Death of the Playbook

I recently met with a CEO who asked me “so what’s your usual playbook?”  Wow.  There are a lot of problems with that question and the person who asked it.  First and foremost, any marketer who thinks they can create a playbook of tactics that will fit any given company should: (a) find a different career; (b) find an industry that hasn’t evolved in the last 10 years – hint: there isn’t one; or (c) work for someone who isn’t expecting much out of their marketing and sales teams.

Playbook marketing implies every situation is the same no matter the season, audience or product.  In other words, marketing is a series of tactics with no need for a brain to create the appropriate strategy. 

Companies who only hire demand generation professionals without balancing them with strategy are unwittingly falling into playbook marketing.  If demand generation efforts aren’t put into context of unique product value and audience, the result is likely to be raw leads that may not equal the most likely buyers.  Gathering a large number of these may actually slow the entire sales cycle.  “Good conversations” with leads who aren’t the right target mean at best your sales team will have multiple calls with several layers of contacts before they find the right person.  At worst, a large number of incoming, indiscriminate leads will distract your sales reps from closing deals.

Soon after Salesforce.com launched, Marc Benioff hired actors to protest in front of a Siebel conference.  Siebel called the police and a marketing legend was born. 

Clearly, this was not from a playbook, but it worked.  I’m now occasionally asked if we should add protesters at a competitors user conference, as if it is now part of a standard playbook. Benioff’s protest worked because it was pure guerilla marketing.  Most people hadn’t seen this before.  It was attention grabbing because it was fresh, creative and spoke to the target audience. 

Fortunately, this past week, I had two CEOs say “I’m willing to try anything if it will get results.”  It’s not surprising that each helms a successful company.  Their questions balance the need to be creative with the need to measure results.  Creativity without measurement is a waste of time and budget.  As more executives acknowledge this, I predict we will see marketing tactics continue to evolve.  Although the new approach is likely to include digital, social and guerilla marketing, it will also include tactics that continue to deliver positive results such as SEO, analyst relations and surveys.  The result will be continually improving marketing programs with improved ROI, and there is no playbook for that. 

 

 

Three (Duh) Ways to Improve Your Marketing

I spent a few days last week in a sales kickoff meeting.  Hungry for qualified leads, the sales team was quite enthusiastic about how we would improve the company’s marketing efforts.   Of course, I love this, but frankly, much of what I said seemed obvious.  Then I realized, for whatever reason, sometimes marketers think too hard and overlook ways they can make easy but significant improvements.

This leads me to give you three (duh) ways to improve your marketing:

1)   Make Your Sales Team Experts Through The Magic of Social Media

As a marketer, I tend not to like using people with sales and marketing titles as company experts. This means unless the topic is business strategies or international marketing, you probably won’t see me presenting at a conference.  However, social media changes this bias.  In the world of blogs, Twitter, Facebook, LinkedIn and Google+, an expert is defined by the quality of their content.

Salespeople often aren’t given credit for being subject matter experts. Frankly, if they aren’t experts on your product or service, they aren’t worth having on the payroll.

The best way to make a salesperson an expert through social media is to lay down the ground rules, let them know what tools and mediums are available, then get out of their way.  A good example of this is Paul Lancaster, who for three years was business development manager at GoGrid, an IAAS provider. I first found Paul when I started following IAAS experts on Twitter. He got my attention because his tweets went beyond simply retweeting company news releases and included industry news and trends. Paul also co-authors blogs and video blogs, and of course posts on Facebook. He became so well-versed in the IAAS world that a year ago he because manager of cloud ecosystem at GoGrid.

2)   Give Prospects a Chance to Interact with You

Many B2B companies give their prospects few opportunities to show their interest. Outside of “download free trial” or “view a demo” buttons, websites often are missing call to actions (CTAs) that provide valuable information. This is akin to walking in the door of a store, having a clerk pick something off the shelf, and asking if you want to buy it even though you may not have looked at it. Isn’t a better in-store experience when you’ve looked at things that interest you, had someone there to answer your questions and then made a decision to buy?

Yes, you want the option to jump in at any time to try out the product/service, but what if the price point is $100K+ or there are multiple offerings?  You may get prospects viewing your demo, along with your competitors, but outside of a form of contact information, you’ve learned nothing about them or their needs that will help close the deal.

If your company doesn’t have a healthy supply of assets created to be ingested at different stages of the sales cycle, you’re missing the chance to have your customers tell you what is important to them, while also learning more about your product/service. 

Yes, it takes time to create a stable of case studies, white papers, briefs and videos. This is why several should be created at once. For example, a customer has agreed to a case study. Yay! Here’s what you will create:

1. Word version of case study to be laid out as collateral, of course
2. Slide version of case study for inclusion in sales deck when appropriate
3. Video testimonial
4. Blog or video interview blog
5. Three-five slides of a use case for conference presentations
6. Byline article about the problem addressed in the case study
7. Media pitches to interview customer who has accomplished X, Y and Z by using your product/service

Your marketing automation efforts should also go beyond email campaigns. By implementing trigger campaigns, you will provide breadcrumbs in the form of related assets that lead down a path to a qualified lead and then a sale. Trigger campaigns can be defined as If/Then campaigns. If I respond to information about X download, then I’m offered Y download. If I download Y, then I’m offered Z. Soon, I’m contacted and asked if I’m interested in the product/service related to XYZ.

Just as the sales process is a series of yeses, marketing is a series of offers to engage.

3)   Test Your E-Marketing

What? You say of course you test everything. Really? Then I’m willing to bet you are in the minority. Everyone SAYS they test thoroughly, but not really.

Here is a brief quiz to test your thoroughness:

1. When was the last time you clicked on every link on your website, including those that link off the site, such as news clips?
2. Have you tested your website and offering on multiple monitor sizes, with multiple connection speeds? Yes, there are still people on dial-up, but frankly my “super fast” cable line isn’t always super fast.
3. Do you have Flash on your website? If so, why? Have you not heard of iPhones and iPads?
4. Have you tested e-marketing that should pop to a landing page?
5. Do you recheck your links after they’ve been shortened for Twitter? Does every article or infographic load as you expected? 

If you answered yes to all these, congratulations. I have yet to find a perfect company. Take Zuora, which recently announced expansion into EMEA and a USD$36 million series D. I’ve recommended Zuora for years. It is one of the few companies I believe is close to being a sure thing for great success. Having said that, is it my job as a Zuora fan to tell the company there was a problem with its LinkedIn banner ad?  Soon after its new funding was announced, I tried four times over four days to download a white paper advertised on LinkedIn. Each time, there was a problem with its landing page. If this happens with a company that is at the top of its marketing game, imagine what is happening elsewhere.

Clearly this is a short starter list and there are so many easy ways to improve marketing programs quickly. What are your other (duh) ways to improve marketing?

 

What’s Coming and What Could Hold Us Back

Last week, I attended Dreamforce, Salesforce’s conference. Like the now defunct TechCrunch 50, it is a great place to see a lot of very different companies; in this case with a thin layer of similarity. It is the common ground of Salesforce integration that makes the companies so ripe for assessment and comparison. 

I met some old friends, saw the next version of some familiar technology and had a few people lie to my face.

I’m not necessarily in the market for new vendors/technology, so for me it is a perfect time to skim the surface of new companies. There are definitely some interesting things happening.

Without a doubt, social has become more integrated into the mainstream consumer experience over the last 18 months and will continue to expand into the enterprise in creative ways. Having said this, the next significant wave seems to be new ways to leverage business intelligence and predictive analytics. This makes sense given both the technology evolution and the desire for companies to prepare for whichever direction the economy/business may go.

So getting back to the people lying to my face. Enterprise sales and marketing have often sold ahead of what is actually generally available. I get this. If you assume it will take at least two to three months to roll out new software that could push the software into the next release. With the increasing adoption of SaaS and PaaS, this is becoming less likely, but in many cases could still be a legitimate assumption. For startup companies with limited resources, there is also the development plan that builds what customers want, also called customer-sponsored development. If customers understand the timeframe of receiving newly-developed capabilities, this also seems a legitimate approach. I am not labeling either version of this selling technique as a bold-faced lie. 

Unfortunately, there are companies so eager to close deals, they promise features and capabilities that are several releases into the future. If prospective customers don’t know this timing, this can only be seen as intentionally misleading, and if the company in question is promising what it does not intend to deliver, it can be defined as fraud. This has happened throughout the history of business, but combatting it is more important than ever. 

Although the percentage of companies guilty of this might be small, their reach is large. Dreamforce is a good illustration of the reach of SaaS companies. Obviously, main companies around the world use Salesforce. Now these companies are starting to, or are about to start making significant investments with other SaaS vendors. If what they purchase does not meet baseline expectations, it damages the reputation of that vendor, the cloud computing sector and potentially the bottom line of the business that purchased it. “Bad seed” companies can only survive for so long, but it’s the potential for them to drag the rest of us down a peg or two on their way down that will hurt.

 I love startup companies and I love optimism. All I need now is a BS meter for the next conference. 

 

Microsoft Announcement Helps Cloud-based Marketplace

Microsoft has announced its first cloud offering, Microsoft Office 365, a “productivity suite.” This is a good thing for more than just Microsoft. As well-known organizations such as Microsoft or IBM make related announcements, everyone benefits. It reminds me of a friend who owns a few local coffee shops. He says his favorite thing to see is Starbucks coming to the neighborhood. His business always goes up because seeing Starbucks makes people automatically think of having a cup of coffee, but not everyone likes Starbucks, so they go to his locally-owned and branded coffee shop instead.

Similarly, when well-known, mainstream companies announce they will have a cloud offering, they are making it a legitimate option. The reality is if they only go as far as an announcement and actually do very little, to mainstream consumers and conservative enterprises the fact that they made the announcement means it must be important.

What’s interesting about Microsoft’s announcement are some of the real reasons behind it. We can all see that Microsoft is late to the party and is only offering a cloud-based version of its previous offerings. It is at best mostly a cloud version of Microsoft Office. At worst, this is a desperate “me too” attempt to combat decreasing sales.

This was also the right move for Microsoft. It will cost around $72USD annually for individual users and is likely to attract people less technically savvy who are used to paying for basic word processing software. In other words, Microsoft is likely to carry many of its current customers as they begin to look for a cloud-based solution. They won’t care about paying a starting price of $72 because they are getting the Microsoft name. I find it more than a little hard to believe that Microsoft will pick up a significant amount of Lync’s users as Kurt DelBene, president of Microsoft’s Office division, claims. The kindest thing I could say is that I believe he is mistaken. Someone with a little less tact may say he’s delusional.

The wild card in Office 365 is the integration of Skype. If Office 365 happens to be the only way to access Skype - I haven’t seen a clear answer on this – it could drive more adoption than would otherwise have come. At the same time, it could drive Skype users into the open and waiting arms of other options such as Google Talk.

Either way, I thoroughly welcome Office 365 into the marketplace, even if I never use it. In the end, it will be good for all of us in the larger cloud marketplace.

 

Are You Wasting Money?

Sometimes you pay for what you get and sometimes you just pay too much.

My day-to-day activities can be summed up like this: making sure our marketing strategy stays aligned with our business goals, tactical implementation issues, and of course, measuring all of the above. Sprinkled among my days and evenings may be meetings with executives, advisors, attorneys, and of course calls from vendors.

Given that I am a vp of marketing, I look on vendor calls as both a chance to gather information about a new product or service, and an opportunity to assess a marketing approach. I don’t have time to have a lot of these calls, but if something intrigues me I will try to take a 10-minute call. A large part of my job is to help my company’s sales guys find qualified leads, so I’m always interested in how vendors target me and determine I must be a good prospect.

I should state here that when it comes to marketing pitches I’m way more judgmental than I appear. I was raised to be polite, so I will never tell you I think your product is of little value and you are a borderline idiot, but that doesn’t mean I’m not thinking it.

Marketing pitches often include the value the product/service brings. At the same time, one wants to leave money on the table so the dance begins between “in the long run it will save you money” and “you get what you pay for.”

This past week, I had two experiences that reminded me you don’t always get more value when you pay more. First, I had a call from a television producer who said they had a great opportunity for our CEO to be interviewed. Of course, I know the company and it will cost $30k+ to be included in a piece no one will ever see.

Second, I met an SVP of marketing who told me her company has licensed one of the most complex/expensive marketing automation vendors available because it has “all the bells and whistles.” Her company also doesn’t have anyone on staff that knows how to use all the software completely, and the software isn’t known for being particularly intuitive. In this SVP’s defense, she inherited the software decision. The same company has also picked one of the most expensive pr firms.

In this case, my quick assessment of the situation has more to do with the company than the marketing executive. Here it is:

1. isn’t assessing value
2. is easily impressed with big names
3. has little understanding of marketing
4. isn’t thoroughly measuring marketing and sales efforts

I also happen to know the company is doing quite well financially, so there isn’t a clear correlation to revenue and embracing value. However, just because your company has excess money doesn’t mean you should spend it unnecessarily.

Whether you’re considering sponsoring a video, licensing marketing automation or hiring a pr firm unless you are assessing the value it will bring, you’re just wasting money.

The Newest Trend in Cloud Computing – Human Touch

As cloud computing is being more widely implemented, one of the excuses not to use it – concerns about quality – is falling away. This is partly because a new ingredient is being added to the mix: the human touch.

Many areas of cloud computing remain perfectly fine with the end user being the only human participation with the application or platform. However, for those that require judgment, fact-checking or outreach, frankly, it is good to have a human available. For example, Pramata provides on-demand BI for contracts. Unlike automated contract management systems, Pramata has humans – in this case those with a legal background – do QA checks where its technology leaves off. The difference is a higher quality of results.

Similar but different is ConnectandSell's approach to improve sales rep productivity. The company offers live dialers who tap into their clients’ CRM systems to work through a defined call list. Meanwhile, their client’s sales rep instantly speaks to whoever answers from the call list. The result is more connects in two hours than reps usually make in a week.

In both examples, people being part of the process is what makes the technology worthwhile. Yes, there are contract management systems that don’t involve people, but they aren’t as accurate as Pramata. And, yes, companies can use robo-dialers to connect their sales reps with prospects, but they are obvious and annoy the person being called.

It’s time to examine our automated programs and determine:

1)      Would this be better if there was a person involved somewhere in the process?

2)      Is the personal touch so valuable it warrants the additional associated time and cost?

3)      Will this hamper and enhance scalability?

4)      How can this be implemented at this time in our technology’s life?

As cloud computing has a larger footprint in more critical areas of business such as finance and legal departments, and sensitive industries such as financial services and pharmaceutical, the need for human drive QA will become more apparent. The companies poised to answer this need will have a clear competitive advantage.