Leave Room for Marketing Failure

Anyone who tells you that they know exactly what type of marketing is going to work for your company is not telling you the truth.

Strategies and tactics are highly situational and every situation is a bit unique. The only way to learn what will truly work for your business is to try various tactics and measure carefully. That means you must leave room for failure; it’s going to happen.

Your marketing team must have an experimental mindset. They should be excited to try new things and be religious about tracking, measurement, and learning. My teams usually keep a Google Slides presentation with the various tests we’ve run and their results. This type of journal gives us an invaluable resource for learning and getting new team members up to speed. When you get to scale with digital programs, your journal should include statistical analysis to ensure the validity of your tests.

As the founder, it’s your job to encourage this. Don’t get upset if a well executed program doesn’t achieve the desired results (if it’s poorly executed, this is another story). Push for continuous learning -- which leads to continuous improvement.  Push for excellence in execution, but be forgiving if a test fails.

When something fails, ask the three whats?

• What? What exactly happened in the program and the execution?

• So what? What does this mean for future efforts?

• Now what? --What are you going to do next?

You and your marketing leader should demand crisp answers. This reinforces the importance of both transparency and learning.

As your company matures, your marketing mix will have a balance of “tried and true” programs and experimental ones. In the beginning, of course, most everything is experimental. The important thing along this path is be rigorous about execution and learning, but encourage risk taking and experimentation.

Let the "Why" Determine Your Metrics

A founder friend recently texted me asking, “how do you measure ROI on an event?”

My response, “Call me.”

When we spoke, I asked him to describe the the event and to tell me why they decided to do it. After a long conversation, it was clear that they did the event to build their brand. OK. Fair enough.

But the problem was that their Board had completely different expectation and was pressing the founder on qualified lead and opportunity numbers for the event. There was a mismatch in expectations.

I share this story to highlight how important it is for all key stakeholders to understand precisely why you’re investing in a particular marketing program before you do it. That way you can align on expectations and how you’ll measure success.

While the example above is about a founder and his board, this happens every single day within marketing groups, between marketing & sales leaders and staff, and across organizations.

If you’re a marketing leader, it’s your job to make sure everyone is clear. If you’re a CEO or founder, it’s your job to hold your marketing leader responsible for getting and sharing this clarity.

Get clear. Up front.

Today's Marketing Looks Nothing Like Yesterday's

That marketing has changed radically over the past ten years should come as a shock to precisely no one. Much has been written about this topic, so I won’t waste anyone’s time with laundry list of changes.

Instead, let’s focus on the top 5 things founders who need high performance marketing organizations need to know.

1. A large part of the buying cycle happens before your sales team engages.   What’s the first thing anyone does when they need to solve a problem? They search for solutions online and do their own research.

   Your solution needs to be easy to find, easy to understand, and clearly map to the buyer’s pain points. Clarity and brevity matter. Then make it easy for the prospect to engage.

2. Especially in crowded markets (like security), top-down selling is increasingly hard to do. The average C level exec is inundated with vendor requests and (usually bad) pitches. They don’t want one more. Be sure you’re prepared to enter the organization at lower levels with targeted offers (trials, free software). And look for marketing strategies that run counter to the herd.

3. Increasingly Product led growth, where the product IS the marketing, is a big part of the product mix.   Marketing leaders must be able to align with product (also, product leaders need to understand and embrace this).

4. Marketing technology/automation is increasingly critical. And effective marketing organization heavily leverages technology to increase efficiency and reach. Expect to spend money ensure that your team knows how to assess the value of these investments.

5. A related point — You need to have a developer on your marketing team. This is one of the highest ROI hires you’ll make, because it allows your team to move fast and do things that they wouldn’t otherwise be able to do.

Your marketing leader (and team) needs to embrace all of this. This can be tough for people who spent most of their careers doing marketing the “old” way. It’s a struggle to stay current.

But the most effective CMOs and marketing leaders spend the time to get experience with the new world order.

A word of caution here — experience can be a double edged sword for founders looking for a CMOs or other senior marketing leaders. You want the benefit of experience and domain expertise, but you also need to be sure you’re hiring someone who can work fluidly in the new world of marketing. Take note of the experiences they tell you about, and ask how they stay current.

CMOs Must Operate on Multiple Time Horizons

As the top marketing strategist, the CMO must be able to think and plan for this quarter, for this year, and for the next 18-36 months.

In the short term, the CMO must be closely aligned with the head of sales to ensure that demand and enablement programs are in place to meet revenue numbers.

In the medium term, he or she needs the strategies, programs, and plans to support growth in the out quarters. This includes planning for product launches, new market expansions, partner launches and other long lead items. Unless these plans are framed out with resources earmarked, each quarter will start with a scramble.

In the long term, the CMO must work with the CEO and product team to build category and market leadership. This only comes from an understanding of the operating environment and a good sense of where the company and the market are going. This will be a combination of strategic planning, market research, evangelism, and PR.

A strong CMO operates fluidly across these horizons and calibrates investment of time and resources. He or she communicates clearly to the executive how each market investment maps to the company’s overall strategy over time.

It’s the CEO’s job to help ensure that this balance and provide support for initiatives that have a longer term return on investment. The CEO’s support is especially important in ensuring alignment between Sales (who often wants 100% of investment for the current quarter) and Marketing (which must operate in all three horizons).

Achieving Go-to-Market Fit is a Critical Milestone

At this point, everyone has heard about product-market fit, the critical point where you’ve got sufficient evidence that your product meets a market needs and you’re ready to scale up. Simple enough.

But product-market fit is only one piece of the puzzle.

With due credit to Bob Tinker, founder of Mobile Iron, I would argue that an equally important milestone is go-to-market fit. This is the point where you know what message, delivered by which channels, and sold in which packaging, at what price, will allow you to truly scale.

There are a myriad of variables here that bear thoughtful consideration including target markets, messaging, pricing, marketing channels, routes to market, sales rep profiles. Where companies often go wrong is by attempting to do too many things.

Take routes to market. Your company’s customer acquisition strategy can be sales-led, marketing-led, product-led, or channel-led. You can aim to be high velocity (low average contract value, high number of customers) or enterprise (high average contract value, low number of customers). Your sales team can be inside sales, field sales, or channel account management driven.

In the early days, many founders want to believe you can be all of these things. Allow me to save you some time — you can’t. And you may not figure it out perfectly the first time. Experimentation is likely necessary and you’d be well served to be structured in the way you approach this. Your available capital, the size of the market, and the competitive environment will inform how aggressive you want to be in testing various G2M theses in the early days.

Your company’s G2M Fit will inform who you hire, where you spend money, and ultimately how quickly you can grow. Scaling before you have have G2M fit can be disastrous. In the best case, this type of premature scaling will waste time and money. In the worst case, it can stifle your company’s potential.

Your Sales VP and CMO are your thought partners in figuring this out. Be sure that these individuals have the flexibility and experience to help you arrive at G2M fit.

Hey Founders! Only You Can Own Your Early Customer Relationships

The most dear thing you have as a startup founder is your initial customer relationships.  

They teach you about their needs, influence your product and your message, provide references to investors and to other customers, and sometimes even evangelize for you. They even teach you how to sell to similar accounts.

Why would you ever delegate these relationships?

And yet many times I see busy founders do just that. They allow some other person in the company to run with these relationships, and, in so doing, lose touch with their most valuable stakeholders. They rationalize that they’re too busy with some other “important” task or that it’s really the sales or marketing leader’s job to manage these customers.

When early customer relationships are managed most effectively, the founder is the primary relationship owner. Other execs and staffers play supporting roles, are there to listen and learn, and can take action items. But when the customer needs to call someone, it’s the founder.

And when the company needs something from the customer (advice, a reference, whatever), it’s the founder who calls.

When it’s done this way, everyone benefits. Don’t let busy-ness or some other siren song convince you otherwise.

Categories Matter -- Deeply.

To understand the world, people need organizing principles. Categories do this for products.

Categories give your prospective customers, your team, your investors, industry analysts, potential employees, and others a common way to understand where you fit.

In every category there is well known leader, or category king. This player claims the majority of value in the category. If one considers the category “taxi alternatives” two points emerge immediately. First, almost everyone immediately identifies Uber as the category king. The second is that Uber has, at the time of this post, 8.5x the market capitalization of the number 2 player in the market, Lyft. Since the financial returns in any given category go disproportionately to the leader, it’s critical to be extremely thoughtful about your category strategy from the start.

Your category strategy includes several strategic decisions:

• Will we disrupt an existing category or create a new one?

• Who do we see as our competitors in this category? If we’re creating a new category, this question is extremely important — you cannot be a category of one.

• What is our unique perspective on this category?

• What sort of innovations are required to win? Product? Business model? Channel?

Your category strategy provides direction to every part of your company and drives your execution plan. As founders and marketing leaders, our job is to define a category strategy, determine a defensible position within the chosen category, and align the entire company around winning in this context.

For an excellent perspective on the importance of categories and how to execute a category strategy, I strongly recommend Play Bigger, which is the definitive book on the subject.

You Can't Spell "Marketing" Without "Market"

“How do I generate more qualified leads?”

This is often the very first question I hear from founders and their investors. And often marketers are all too happy to oblige with lots of ways to generate demand (and spend money).

Don’t get me wrong — qualified leads are hella important when you’re building your business. But when you ask this question before you’ve really done your homework, you’ve got the makings of sadness, frustration, and wasted dollars.

To build demand, first you need to really (really really) understand your market. Sounds obvious, right? But too many organizations skip their vegetables and go right to dessert. It’s temporarily satisfying (Look! We’re “doing* marketing now!”), but ultimately it’s empty calories.

Before putting in place your demand generation plan, you’ve gotta have a very strong thesis on three things.

Customer Pain — What specifically is the problem your prospect wants to solve? Who in the organization is affected? What are the consequences of not solving it? Are they annoying? Or intolerable? Are there financial consequences? Whose budget do those hit? Who is responsible for solving it? Who will be a hero when it’s solved? And so on.

Competitive Alternatives — If they don’t go with your solution, what will they do? Nothing? Adjust to a manual process? Buy another solution? What are the honest pros and cons of these alternatives? You must be clear-eyed here. And don’t be the guy who says, “we’re the only ones doing what we do; there are no alternatives.” There are always alternatives.

Unique Differentiation — What makes your solution so special? How important is your specialness in their world? Are you truly unique? How sustainable is your advantage? What would your competitors say about your advantage.

Clear, data-backed answers to the above questions will have a massive impact on your the ROI of your marketing investments. Without them, you’re shooting your arrows (dollars) at the target blindfolded.