Tackling the SaaS Marketing Challenge
I’m six months into my SaaS marketing journey. My key thought so far? It’s tough. Tough like diamonds. But also shiny like them. Read on for a tale of challenges, team-work and striving for success.
The SaaS marketing game is tough
Take your software product (which is inevitably an ever-evolving beast) and generate leads that ultimately forge a path to creating new, valid customers. That’s pretty much the remit of any SaaS (Software as a Service) marketer. In fact, it’s the remit of any marketer. It’s simple in essence, however, far more complex in practice.
A brief look at the SaaS marketing and sales process…
In any software business that produces a product of any complexity, you’ll tend to see a structure/process similar to this:
- Marketing team generates MQLs (Marketing Qualified Leads) via a plethora of means.
- Said MQLs are passed to a sales team which comprises of BDRs (Business Development Representatives) and AEs (Account Executives).
- BDRs follow up on those leads in order to further qualify them — is the lead’s problem solvable by our software? If yes, the BDR will attempt to book the lead onto a demo
- The demo is then handled by an AE, who’ll look to further sell the advantages of the product and answer any questions the lead may have. From there, they’ll look to agree a sale of the software based on the lead’s exact requirements. The time this will take depends on the sales cycle of the software business in question.
There’s of course a further process from there, however, it’s not pertinent to this post.
The ‘tip of the spear’ here is the marketing team — if we don’t generate the level of MQLs required, the remainder of the chain starts to creek, and could eventually snap. Ouch. Talk about responsibility.
Filling the funnel
Marketing needs to add leads to the top of the marketing/sales funnel (info) and then effect them at each stage to push them down through that grinder towards the holy-land of customer conversion.
The number of leads required to drive the sales process will of course vary from business to business and is effected by a huge number of factors, from capacity to qualify them, right through to how many new customers are required to match growth targets and everything else in-between. The key factor in the lead volume question is that age-old question of quantity vs quality.
The good news is, getting leads is easy…
You can buy them from a number of sources. Throw money at said sources and you’ll get a plentiful level of leads to chuck in the top of that funnel. Yes, I’m totally winning at life. I’m making it rain with leads. Oh, wait.
The bad news is, getting quality leads is not…
Sorry. Poor quality leads aren’t leads at all. They’re not MQLs (Marketing Qualified Leads), they’re just leads. Leads that will fail.
These weak leads cause numerous problems including:
- A big fat waste of money.
- A big fat waste of sales-team time.
- A big fat barrier blocking growth.
That means we need to qualify
I can’t possibly go into every part of this process here, but let me at least provide a basis of how to do that:
- Establish your market (easy as pie. Not).
- Create personas of who you need to sell to — what problems can you solve for them? There’s a whack-load more to this! Info here.
- Define where and how you can reach those people.
- Define what content will support each stage of the funnel process.
- Combine that content with marketing activity (inbound, outbound etc).
- Make it rain.
- Test, analyse, tweak, repeat and report.
When we put that process into place, we should be generating qualified, warm leads that when the BDRs make contact with the human behind that lead, said human is aware of and engaged with the business/product in question. Quality? Check.
Wait! We need more leads!
It is possible to have quality and quantity and that’s what the team and I are striving for, and making nice headway (even if I do say so myself). There’s one key metric among many others that we’re tracking and that’s Qualified LVR (Lead Velocity Rate). Basically, it looks at the percentage increase of quality leads month-on-month (we track weekly too, however that can be a misnomer). In Q2 we’ve been pushing to increase LVR by 20% month-on-month — May was 66% up on April. Boom.
SaaS God, Jason M. Lemkin frames LVR nicely:
“The Key Metric, you should track and score yourself to, and hold your VP Marketing and marketing team to — Qualified Lead Velocity Rate (LVR), your growth in qualified leads, measure month-over-month, every month. It’s real time, not lagging, and it clearly predicts your future revenues and growth. And it’s more important strategically than your revenue growth this month or this quarter”
Taken from Jason’s post Why Lead Velocity Rate (LVR) Is The Most Important Metric in SaaS.
How do we get to that point of positive LVR?
It goes back to the process I outlined earlier in this post. If you can start from scratch with that process, it’s easier. Startups can do this, however, it’s rare they do for multiple reasons (see section ‘the application of marketing’ here for more on that). Outside of startup-land, you’ll see that process in progress with varying levels of success.
So far in my time at Administrate, I’ve managed to partially work through that process, however, upon starting it was clear that we had to rapidly improve lead-gen and that the time it would take for the team and I to make our mark on the full process couldn’t be afforded, in the meantime at least. We’ve had to reverse and cut up the process somewhat.
Jump-starting the lead-flow
It was time to get quick and dirty, with a view to increasing the leads coming in while maintaining a strong level of quality. What did we do?
- Assess and improve all PPC activity including Adwords, Capterra and GetApp, bringing costs down yet improving conversion rate.
- A key aspect of that improvement was introducing custom landing pages.
- Gutted our email automation process and content.
- Carefully tweak lead-scoring.
- Refine messaging across all activity.
These steps led to an increase in lead-fl0w, with an acceptable level of quality. Quarter one targets were met and it was time to push things further forward. Caveat — it wasn’t as easy as I’ve made it sound and there are of course still challenges on a daily, weekly and monthly basis.
The past six months have been about constant reflection and assessment, both on a personal level (am I doing this well enough? Can I continue to improve things?) and of the whole marketing function and the activity within it. That continual analysis (and taking action on it) is key to marketing and business success. Marc Benioff puts it nicely…
“You must always examine what’s working, evolve your ideas, and change the way you do things”
This assessment has led to a clear vision of what we need to push forward over the rest of this year. That ‘we’ word is key.
I’ve been building out the marketing team and we’ve now got a really great blend of experience, youthful curiosity and the key skills required to build the polished marketing machine we’re striving for.
The marketing team is only one part of a wider team that has to work together and support each other to drive the business forward. The relationship between the marketing and the sales team is vital, and at Administrate I feel it’s a strong one. That’s fair to say for all the components of the company. Maintaining that during a rapid period of growth is no mean-feat.
A big focus on personas and the creation of rafts of content based on those. This is key to improving all areas of the funnel, particularly the middle and bottom stages. Effectively, we’re going through the process I’ve mentioned far too many times already in this rather word-heavy post!
We’re putting measures in place that will far improve our conversion attribution, while improving the chances of conversion via a new trial sign-up and pricing process (not yet launched). I’m also looking to introduce an agile/scrum model to the marketing team, which I will of course, write about here! Alongside all of this, we’re organising our annual conference, LITE. It’s nice to be busy!
Marketing as a profession is always challenging and in the SaaS game, it’s perhaps at a level above other industries. So far, I’ve found it tough, but, I’m feeling more reward than I’ve ever felt before in my near 10 years in marketing and that’s a great thing to be able to say. Here’s to the next six months…
This post first appeared on my Medium account.