There is no shortage of revenue growth theories, models, and best practices. And yes, there are hundreds of books, articles, and podcasts on the subject. Want proof? Just open up LinkedIn and start scrolling. The problem is, you’re probably wasting your time. LinkedIn, like every other digital channel, is an echo chamber for the latest buzz words and growth theories, and with that comes a lot of noise.
So how is a marketing leader supposed to scale revenue? Pick a theory or framework and go? Pick a channel and double down? Hire an expert? Upgrade your tech stack? All of the above? Do nothing?
This is the dilemma we see many, if not most, marketing teams grappling with these days.
The interesting thing is, not everybody is struggling. Which marketing teams are succeeding in scaling growth?
In a recent episode of the “Highly Questionable Marketing” podcast, Jay Baron and Joergen Abboe, discuss how focusing on marketing fundamentals like brand narrative and developing a process for identifying and executing growth levers leads to predictable growth.
Jay Baron: “I have customers that were getting 200-300 demos a month. Now, we’re getting 80 demos a month, and they’re 3Xing their pipeline goals…”
What are most B2B marketing teams missing?
Jay Baron: “Why is it that for some companies growth comes easy? They gain momentum and it accelerates, yet for most of us marketers it feels like pushing a boulder up a hill.”
Growth is not something you do. It’s something you attract.
Growth is about finding, attracting, and closing best-fit customers, then helping them succeed. That’s what we call authentic growth. While we want to develop a marketing engine that creates and sustains authentic growth, most companies get lost trying a bunch of marketing tactics and repeating those that appear to work best. Jay calls this “tugboat marketing”.
Jay Baron: “The only thing many marketers know how to scale is demo requests, and they get stuck in this tactic-focused marketing that I call tugboat marketing. They plan a campaign, they get a bump in leads, and it goes back down. They plan another campaign, they get a bump in leads and it goes back down, like a tugboat struggling to pull a load over rough seas.”
Joergen Abboe: “…it’s okay to play what you call tugboat marketing for a while, right? The problem is, you get stuck playing it forever, and then you have to pile on and you still can’t scale it, and then everybody in the company gets frustrated with why you can’t grow.”
Responding to a recent popular LinkedIn thread about demand generation vs lead generation, Jay points out the #1 reason why B2B SaaS marketing teams are stuck, and most don’t even realize it.
“Content not performing? Create more content and turn off intent for brand.
PPC ads not performing? Adjust your keywords, change your account structure, and increase budget.
LinkedIn ads not performing? Run more LinkedIn ads but without a gated form.
ABM sucks? You need a larger budget and account ‘personalization’.”
These are all tactics without any real strategy, and little potential, for creating real demand. Tugboat marketing may produce a temporary lift in vanity metrics, such as traffic or leads, and it may create the illusion that marketing is creating demand, but real growth is about attracting and building trust with real people, not impressions and clicks or traffic and leads.
Ultimately, it’s about growing pipeline and revenue in a predictable, scalable way.
Why are we stuck in this high-seas, risky adventure?
For the past 15 years or so, we’ve relied on a sales-led go-to-market model. Marketing was tasked with filling the funnel with leads that sales may or may not qualify for further engagement. Got a problem with the leads? Get more leads… Until sales complains about the quality of those leads. Tugboat marketing, meet submarine sales.
But now the rules have changed. Marketing is being asked to source pipeline directly and to be accountable for scaling revenue. The problem is, they don’t know how to do this. They are programmed to generate leads and demos from anybody who will surrender an email address. They are measured and evaluated on traffic, leads, and demos, not by direct pipeline contributions or revenue. So the tugboat keeps bobbing up and down, only now, it’s starting to capsize…
It’s tough to be a marketer these days under the new rules, but there is light at the end of the tunnel. What marketing teams need to do is to develop a process that will 1) identify growth levers that will work for their business, and 2) test growth levers, select the best levers, and exploit them to scale revenue.
What exactly is a growth lever?
Growth levers are specific, strategic actions you can take that lead directly to sustained revenue growth. They require a deep understanding of Market, Message, Channel(s), and Product and how each of these work together to drive revenue. If you get all four of these aligned, it’s a sustainable growth lever. It’s possible to do it with only two or three of them aligned, but growth may lose steam quickly.
Tactics, on the other hand, are temporary actions that may increase leading indicators, such as traffic and leads, but seldom yield long-term growth or achieve business goals.
Most of the time these tactics should be used as an accelerant to an existing growth lever but they’re often used as a crutch. Here are some examples of each:
Buyer-Led Growth Framework
A frictionless buyer experience.
Virality and freemium product
Lead-based marketing (Volume)
SEO and website traffic
Run paid media for leads
Optimize on keywords and leads
Hand off all inbound leads to SDRs
Sales efficiency and screening
Learn more: 8 Smart B2B SaaS Lead Generation Strategies for 2021
What’s the problem with traditional growth tactics?
- Sustained growth is often elusive
Symptoms of declining growth may not be obvious, because marketers measure the wrong KPIs, like traffic and leads, and ignore revenue. They learn about missed revenue goals in quarterly reviews and point the finger at the sales team for poor close rates. But the problem is deeper. The leads they hand off to sales are unqualified or not ready for a sales conversation, and represent a waste of the sales team’s time. Naturally, sales blames the marketing team for sending them unqualified leads. Chaos ensues.
- There is no unified growth plan
Marketers spend so much time tweaking and optimizing campaigns and keywords to support their traffic and lead goals that they fail to think about their buyers. What is it that buyers are looking for, and why? Who are they? How high is their pain level? Do they know how to buy and what to look for? Do they understand the solutions you offer and how they can transform their professional experience? What’s missing is a coherent brand narrative that answers these questions and establishes a well-understood relationship between four marketing fundamentals: Market, Message, Channel, and Product. It’s more than product-market fit. It’s how you and your customers work together in a mutually aligned and trusted relationship.
- There are too many distractions
All too often, we find that marketers get distracted by the latest technology or buzzword. A new capability surfaces that allows them to skip much of the busy work or find high-intent leads without actually talking to them. It’s easier to plug in a new MarTech app than it is to nail down marketing fundamentals and serve buyers – all in the interest of reaching the next level of vanity metrics like traffic and leads.
So the marketing tugboat speeds up a little but still goes around in circles.
What’s the solution?
- Do the fundamentals and create growth levers
Establish a fundamental baseline that everyone in your organization understands and is committed to. Start with your brand narrative and identify growth levers that align with your customers – who they are and what they want. Remember that your brand narrative is unique to you, and your growth levers may be very different from other companies in your category.
Adopting a Buyer-Led Growth approach enables all of your customer-facing teams to think like buyers, reduce friction, and deliver exactly what buyers want, when they want it, and how they want it delivered. Select and exploit growth levers that best fit your Buyer-Led Growth model. Monitor revenue growth that is sourced and enhanced by marketing’s efforts and report on progress to the entire revenue team.
Most importantly, build and adhere to a process that specifies who is responsible for developing, monitoring, and updating your fundamentals and for implementing and evaluating the effectiveness of your growth levers.
Make sure that everyone understands the process, commits to it, and does their part.
- Replace tactics-focus with growth process
Align your entire go-to-market team on revenue goals and metrics. This requires agreement among sales, marketing, and customer success on revenue-related metrics and goals that each team is accountable for and mutual agreement on criteria for qualification or ICP, segmentation, and targeting. You may still want to track progress in website traffic and lead generation, but these are no longer your primary KPIs. Adopt growth levers that each team understands and accepts as better ways to attract high-value customers based on your brand narrative and go-to-market strategy.
- If marketing is still not driving sufficient growth…
Look again at your fundamentals, Market, Message, Channel(s), and Product. Start with Market and Message and make sure that they are aligned. Are you reaching out to ideal customers based on fit and readiness to buy? If so, does your message resonate with those buyers? Experiment with channels and look for high-quality engagement, not volume. If certain channels are not working, either they are the wrong channels or you need to go back to market-message fit. Check for friction and eliminate as much as you can. In most cases, failure to scale growth means that you don’t know your customers well enough, you haven’t reached them with the right message, or there’s too much friction in your buying process – or all three!
What if you don’t take action now?
In 2-3 years, you may be facing even worse declines in revenue growth and loss of market share to companies that are aligning with customers, building trust, and using effective growth levers. If you stay with the same old lead generation tactics, there’s a good chance that’s exactly where you will be.
Check out the full podcast!