(A version of this post appeared on RocketWatcher )
I do a lot of coffee meetings with founders looking for marketing advice. Most of the time people have a specific marketing problem but occasionally I meet with frustrated founders complaining that everything they’re doing on the marketing and sales side just simply isn’t working.
Let’s put aside the very real possibility that there is a fundamental product or product/market fit problem (a big assumption but work with me on this one) — is it possible your marketing/sales strategy is getting in the way of the success of your company? In my opinion, yes that’s very possible. Can you hack your way out of this mess? Yes, again. OK, not always, but it’s worth poking around at a few things to see if it’s fixable. If I was in charge of marketing for a company in that situation, here are a few things I would try:
Hack the Definition of Your Buyer
If you are selling to businesses there is often a separation between users, economic buyers and executives/approvers. Sometimes selling to the folks that hold the budget is the easiest way to get a deal done, but often it can be easier to either sell to the end users (who feel the pain most acutely and can champion your solution to the economic buyer), or the executive team (who might better understand the overall ROI of the solution across the organization).
For example — at one company I worked at we started out targeting buyers in IT because they would ultimately be responsible for maintaining the integration of the solution with other systems. However IT saw the solution as risky and also secretly hoped the company would allow them to develop a solution in-house. The end-users of the product were sales people and we had a strong value proposition to the sales executive in particular. We switched to selling to sales executives and once we had their buy-in, they easily forced IT to get on board with the solution by getting the CEO’s agreement. As an example of moving the other way — I worked with a startup that moved from targeting the executive team (which in this case were difficult to engage with and didn’t understand the end-user pain) to targeting users directly who could start using the product and then lobby their managers to buy it.
Here are the things I rank when I’m looking at target buyers:
- Who does our value resonate with the most? Economic value props resonate more with executives whereas ease of use and efficiency often works better with end users.
- Who is the easiest to reach? Often C-level execs are impossible to reach by low-cost marketing methods whereas further down hierarchy is easier.
- Who has the most influence on a purchase? This is generally opposite to the previous point. Just because end users are the easiest to reach doesn’t make them a good target if they have no real influence over purchases.
- Which audience is underserved (Where is the competition the weakest)? In most markets there are groups that are heavily marketed to and others that are underserved. Selling to an underserved market can create a competitive advantage.
Hack the Definition of Your Market Space
The way you describe what you do will position your solution in a particular market. What market you are in, will determine what prospects see as your competition. Many startup solutions span different markets or are actually transforming an existing market into something new. You may have an opportunity to position yourself in a different market where the competitors are weaker and your differentiation shines through more clearly. For example I worked for a company that sold a database that was excellent at performing queries of large amounts of data with little data variation. When we positioned the product as “a database”, customers immediately started to compare us with Oracle and often rejected our solution because they were “an Oracle shop”. We repositioned the solution as a “Data Warehouse” for machine-generated data, which got us away from comparisons with Oracle.
Market frame of reference is important because it signals a bunch of things to prospects including:
- Competitive comparable — if you say you are a marketing automation platform you compete with Eloqua, if you are a testing tool, you don’t.
- What you are good at (and bad at) — There are expectations for each market space. For example if you are a marketing automation platform, I expect you to be great at email. If you are a landing page testing tool, I don’t expect you to do anything with email but I do expect you to be way better at landing pages than my marketing automation platform.
- What your price should be — Things in a market tend to be priced at similar levels. Switching markets means you switch the mental model for expected pricing.
- Who you are for — Markets serve particular buyers. If I tell you I am a CRM tool you expect that I’m something that is used by sales people. If I tell you I am a sales pipeline analytic engine selling to sales people is off the table.
Sometimes redefining your market space is really a matter of narrowing your focus. Most startups target too broadly and narrowing down to a sub-segment can be the key to early traction. I’ve seen startups do this by moving from being a horizontal solution to focusing on just one industry or by narrowing the focus within an industry to just one slice of it — for example, focusing on Investment banking versus Investment and Retail banking, or focusing on Residential Real Estate versus focusing on both Residential and Commercial.
Hack Your Value Proposition
Startups tend to fall in love with their own offerings and spend too much time talking about features that were technically difficult to build but aren’t critical to prospects. Prospects on the other hand usually don’t buy solutions because of 5 so-so benefits — they buy because there is one key thing that your solution has that they can’t get anywhere else. Sure there are other things your product probably needs to do in order to ultimately win the business, but marketing’s first job is to get a lead hooked. Are you leading with what your prospects think is your biggest strength?
At one startup I worked with we went from our site highlighting 5 key features to simply talking about one big benefit to prospects, resulting in more leads and higher close rates. At another we re-trained the sales force to lead every prospect conversation and demo with our key differentiating feature and to only move on to other aspects of the solution after that was well understood. Again, conversion and close rates improved dramatically.
Hack Your Sales Process
Sometimes the problem isn’t the front of the funnel, it’s getting the leads you attract to convert to paying customers. Understanding the friction points in the funnel and testing different ways of bringing prospects along a path to purchase is often a good set of tests to run.
For example, I worked at a company that sold large enterprise systems to technical buyers and we often got stuck doing proof of concept tests that never progressed into deals. We started to offer an alternative off-site real data test (we took a sample of their data and ran a test in our own lab) that was faster and more controlled than an on-site POC and led to more sales that closed quicker.
At another company we found that we couldn’t close a deal without giving buyers a way to test the system live ahead of time. Even though prospects didn’t ask for a POC we offered it, managed it in a very controlled manner, and closed deals faster. I’ve seen companies do interesting things with free trials and up-selling and cross-selling offers that accomplish the same goal of getting prospects in the funnel unstuck. Looking at not only where deals are dropping out of the funnel but really understanding why can lead you to creative changes in your sales process that move prospects along.