Why Marketing Automation is Dying for Software Companies
Software (SaaS) go-to-market strategies are undergoing a significant transformation. I firmly believe this change will forever influence how companies in all industries and verticals deliver value to their customers. This transformation is founded on the natural progression of a go-to-market (GTM) evolution that began, in part, with the latest wave of SaaS growth from 2005 to 2016.
Before marketing automation changed the world with its marketing-led approach for GTM strategies, we were primarily using a sales-led model — where sales organizations took the lead for all sales development, customer meetings, demos, proof-of-concept installations, and the like. During this time, we came to realize that this expensive go-to-market model wasn’t going to work for the less expensive SaaS offerings that were disrupting incumbent, on-premise software providers.
As a result, we created a new marketing-led GTM model aimed at generating mass leads and reducing customer acquisition costs by introducing new ways of working. However, the speed of technological advances in the marketplace is making older marketing automation standards largely irrelevant. The rate of innovation now being employed by modern software companies means Chief Product, Marketing, and Sales Officers need to understand newer adoption paradigms. Those that can help them manage customers and the product experience as part of their product-led GTM strategy, which has now become essential to winning.
All this has led us to the conclusion that marketing automation is at a crossroad. Current GTM strategies fueled by marketing automation are not personalized enough and these older platforms lack the real-time capabilities to engage the customer while using the product. Thus, it is our belief, that the current wave of marketing automation has reached the end of the line. Moreover, as I discussed in my blog, “Goodbye MQLs and SQLs, say hello to PQLs!”, this mass demand-gen strategy is now largely inefficient and, what was once the more CAC-efficient model, is now a key contributor to higher customer acquisition costs, as pricing and feature pressures become more regular occurrences.
Marketing, Sales, and Product organizations will still need to work closely to generate awareness, however, what is changing is how they determine if a prospect is ready to purchase. I believe software product teams need a better way to drive and measure adoption, influence user behavior, and optimize customer experiences while prospects and customers are using their products.
Also changing, is pricing and packaging. By leveraging product-led and data-driven approaches, software companies are beginning to employ more progressive purchasing strategies; those that allow customers to purchase exactly what they are consuming, rather than bundled packaging/pricing approaches. Yes, indeed products do need to be built to do this, but being able to understand your users to make these decisions will become simpler to accomplish than before.
In closing, companies and prospects alike are fatigued with mass demand-generation, gated content, and web forms. I believe there is a better way. Companies have already begun to lead with their products as a primary GTM channel. Light websites geared to generate ungated demand with a single call to action, to “Sign up” and then nurturing adoption, not leads. So, stop focusing on getting leads into an MQL stage, rather, focus on getting the right customers into your product and convert those that have met your minimum adoption thresholds to customers.
At Aptrinsic® we believe your product is your best salesperson and marketing channel. We also believe using a product-led GTM strategy will help companies acquire, retain, and grow customers by creating realtime and personalized experiences driven by product behavioral data.
Read the full “Mastering Product Experience: How to Deliver Personalized Product Experiences with Product-led Go-to-Market Strategy”
In this book, we share what we have learned about what it takes to succeed with a Software-as-a-Service (SaaS) company. We explain how to deliver a winning customer-centric experience strategy to your customers throughout the customer lifecycle, from acquisition to up-sell/X-sell. We show how to implement a faster and more effective product-led go-to-market strategy to meet changing customer expectations. And we share how to optimize Customer Acquisition Cost (CAC) and increase Customer Lifetime Value (CLV) by building better contextual relationships through personalized product-driven engagement.
