
Why You Might Suck at Marketing
Like most founders, you’re dedicated to growing your SaaS business, which means increasing ARR and profits.
But to do this effectively, you generally need prospects and leads, which means you need to do “marketing.”
You begin with a budget (but many don’t).
Next, a decision is made on what to do.
Finally, your team begins tracking a sh*t ton of metrics from all the various channels and pays very close attention to the number of leads being generated by “marketing.”
As time goes by, you notice that some channels generate more leads than others. As a result, you do more of what works and less of what doesn’t. By doing this, your leads improve as your marketing efforts pick up steam.
There’s just one problem.
Despite all of these efforts, you’re still not generating more revenue and profits.
It’s Time to Starting Thinking About Revenue (Marketing)
When you solely focus on lead growth and pay no attention to where your marketing dollars generate revenue, it’s kind of like driving a car with just a speedometer. Sure, you know you’re driving the speed limit, but without knowing how much gas is left in the car what’s the f*cking point?
For instance…
At Clickback, our marketing team keeps track of the channels that bring in the most monthly recurring-revenue (MRR) for the company. We also know the ROI (CAC Payback).
Knowing these unit economics not only lets us double down on what’s working and minimize what’s not, but just as important, it gives us a financial framework or model to try new things.
Here’s why…
We put customer, revenue and payback constraints on all of our marketing efforts, which means after a certain period of time if we don’t see revenue and a suitable payback we make a new bet somewhere else.
Here’s an example…
Over the past year, we’ve experimented with paid social (specifically on LinkedIn and Facebook).
Naturally, being in the B2B space, we started with LinkedIn but after several failed attempts moved onto Facebook (I’ll write about our failed attempts in a future article).
So far, we’ve seen impressive results with Facebook in both the number of leads generated and the cost per lead. In fact, our last campaign even helped our team surpass a previous monthly social MQL record.
With Facebook, all lagging indicators currently look good, but we still haven’t closed a single customer from this effort. As a result, by the end of the third quarter, if we still have nothing to show for our efforts then budget will most likely be reallocated somewhere else.
Changing the Focus of Marketing
While marketing-qualified leads often indirectly lead to revenue, focusing solely on this and other pipeline metrics can sometimes create a conflict between marketing and the rest of the organization when it comes to the real value that marketing brings to the table.
That’s why the most important marketing metrics should always be (a) the amount of marketing-sourced revenue driven by marketing activities and (b) the effectiveness of the marketing investment (ROI).
Of course, improving lead generation will always play a pivotal role in the growth of any business. But if those leads don’t contribute directly to revenue growth or generate a poor return then you’re driving your SaaS business without a gas gauge.
Eventually, you’ll run out of fuel.
Originally published in ITBusiness.net.
