Scaling B2B Startups #4: The 5-M Approach to B2B marketing

(Based on requests, I have taken a detour and pushed part 2 of creating the gotomarket strategy for later, and now taking a dive into the marketing aspects of scaling B2B startups. While the approach outlined below is generic, my focus is on companies that are trying to sell $25k-$1mn and above deal tickets to mid and large sized enterprises) 

MARKETING STRATEGIES DEPEND UPON THE STAGE OF THE COMPANY

It’s important to start from here. Like all other functions, marketing goes through a period of evolution and reinvention, based on the stage of the company. In a previous article. I had talked about the three stages of a startup:

(For a more detailed explanation of the above, please read article 3 in the series https://www.linkedin.com/pulse/scaling-b2b-startups-3-6-step-approach-effective-strategy-mathur/)

Prior to stage 1, marketing generally doesn’t have an independent identity, getting bundled with other teams. Marketing work at this stage is usually all about putting together a basic website, brochures and a PowerPoint deck! As the startup grows, marketing evolves from a bunch of independent initiatives into a more coherent team and structure. And as you progress further, the marketing functions matures and strengthens, quite often leading the way for the rest of the company.

Therefore, it’s quite logical then that marketing challenges and strategies vary based on the stage of the startup. However, I’m not certain if there are any marketing frameworks that are based on this logic. A google search on this topic led me to results that speak a very generic and broad based approach. Therefore, the first point to note is that marketing strategies depend upon the stage of the startup, and probably this is where most startups up struggle to define a sharp strategy. 

KEY MARKETING CHALLENGES FOR B2B COMPANIES

Before I embark on recommending a strategic approach, I thought it would be useful to start with a a list of common challenges that I faced in my 2 decades of working in B2B startups:

Challenge #1 – lack of deep marketing talent

As unfortunate as this sounds, I feel that while B2C marketing has grown by leaps and bounds, B2B marketing is lagging behind, at least in this part of the world. I don’t think any marketing courses do full justice to the marketing needs of a B2B startup. Marketing talent is at a premium, and extremely hard to identify!

Challenge #2 – so many options - what’s the right mix and how much to invest?

There is a problem of plenty here. A key question that hounds many minds is on the right marketing mix. You’ve got events, social media, inside sales, online advertising, website, brochures, white papers, and what not. What’s more effective, where to build capability and where to outsource, how much to spend – these are tough questions to answer. And to top it all, there is more and more being thrown your way in terms of tools, solutions and software that is practically impossible to keep track of.

Challenge #3 – inability to measure effectiveness

Ok, this is probably an age-old problem, and I’m sure many businesses face this challenge. But in this age of hyper growth pressure and pace, everyone is looking for the right way to measure ROI, but very few seem to have nailed it. (And to make matters more complicated, I came across this very interesting article that questions the measurement of online advertising at its core. I strongly recommend reading this through till the end - https://thecorrespondent.com/100/the-new-dot-com-bubble-is-here-its-called-online-advertising/13228924500-22d5fd24)

Challenge #4 – marketing and sales teams don’t talk to each other

I’d go one step back and ask marketing teams how well they understand the customer, their problems, competition, and your solutions. There is a big problem here, because most marketing teams don’t get the opportunity to interact with customers, who many a times are based outside the home country. And for all that its worth, sales and marketing don’t interact enough with each other to share insights and knowledge

Challenge #5 – what should really be marketing’s role?

I’ve put this as number 5, but really needs to be the first issue to address. Should marketing be used for generating leads, or building brand awareness, customer engagement, supporting sales or all o them or what else? Of course, all of these and more fall under the gambit of marketing. But what should you focus on???

MARKETING STRATEGIES FOR B2B COMPANIES – THE 5-M APPROACH

I’m put down my thoughts, recommendations and learnings in the 5-M approach to marketing:

I would add two guidelines before you read on:

First, follow this process in a step by step manner, but review as the business evolves. I would suggest a quarterly assessment

Second, treat these recommendations as directional, and not precise prescriptions. Each business is unique, so please calibrate based on your situation.

M#1: MISSION

It all starts from here – what do you want marketing to do – generate leads, build brand awareness, engage with customers and prospects, right awesome content, help sales with effective presentation decks and collateral, organize events, drive thought leadership, and have the most awesome website in the world? In other words, you want it all, and that’s rarely possible. So, what do you really want marketing to do?

It’s a tough question, and I recommend the following approach:

• Explorers: go overweight on direct lead generation, and others based on need and capacity. Why? Because at this stage, the focus has to be on growing the pipeline in the shortest period of time, and therefore marketing should make lead generation the primary area of investment.
• Establishers: drive thought leadership. By this time, your lead generation engine should be fairly robust and running, and you would have a reasonable customer base. Now is the time to cement your place in the competitive landscape.
• Exploiters: emphasize customer engagement. At this stage of the startup, you’re all about maximizing the opportunity in front of you. Again, the expectation is that lead generation and thought leadership have matured, so that you have the ability to build an exceptional customer engagement journey.

M#2: MEANS

Under this, I’m going to talk about the following – who should head marketing, what should be the org structure, and what tools and software to use

• Explorers: since startups at this stage cannot need to be careful about costs , I recommend that marketing be part of either sales (under a Chief Business Officer) or product management (Chief Product Officer). (The choice of a CBO and CPO depends upon this – if your product strategy is reasonably sorted, hire a CBO to drive growth. If your product strategy is only partly clear, hire a CPO). To support the CBO or CPO::

1. Team: Inside sales and events (1-2), Content and social media/product marketing (1-2), Designer (1)
2. Tools: free CRM (eg Hubspot), website management (eg Wordpress), design (eg Adobe Illustrator),
3. Reporting structure: Flat

• Establishers: At this stage, I would still recommend that the marketing function stay with the CBO or CPO, but with the addition of a senior marketing manager.

1. Team: Marketing manager (1), Inside sales and events (3-5), Product + social media marketing/product marketing (2-3), Research (1-2), SEO and website (1), Designer (1-2)
2. Tools: marketing automation (eg Hubspot paid), website management (eg Wordpress), design (eg Adobe Illustrator), SEO optimizer (need basis)
3. Reporting structure: I would recommend that you organize the team into two – inbound and outbound, both reporting into the marketing manager. And have the research arm report into the CBO/CPO so that it stays independent

• Exploiters: now is the time to separate marketing into a separate function, by hiring a Chief Marketing Officer (CMO).  

1. Team: Account marketing team (2-5), Inside sales and events/product marketing (4-7), Content and social media marketing (4-7), Research (3-5), SEO and website (1), Designers (2-4)
2. Tools: marketing automation (eg Hubspot paid), website management (eg Wordpress), design (eg Adobe Illustrator), SEO optimizer, account-based marketing, social media automation
3. Reporting structure: I would recommend that you organize the team into four teams – account marketing, product marketing, inside sales and research

Subnote 1: importance of a database. I cannot stress enough the importance of having your own database that is current, updated and utilized. The inside sales team has the responsibility of taking charge of this.

Subnote 2: Develop the profiles of your thought leaders. You have to be careful to cultivate the profiles of a select few – 1-2 leaders at the initial stages and scaling up from there. These thought leaders need to be the real thing = folks who have a point of view, are great speakers, and active on social media.

Subnote 3: Define your core messaging strategy. Everything that you communicate should be around this single core theme, which of course should be related to the customer problem you are trying to solve.

#M3 - METHODOLOGY

A common question within marketing is – do we need to unify various activities into a common, overriding objective. And if so, how do we achieve it? What generally happens is that individual activities tend to drive forward in their own direction - content is writing a white paper on a key area, inside sales is trying to generate leads for a particular segment or geographic region, there is some SEO work going on, etc. Do all of these activities need to work independently or together?

My belief is that most (if not all) marketing activities should be aligned to a common theme, and here is the approach I recommend:

1. Segment and prioritize the market. I think many organizations treat segmentation as a theoretical exercise, and end up creating segments based on obvious parameters like industry or geography or size. I think this reflects poor market understanding. Marketers need to bifurcate the market based on buying clusters based on their solutions, and not using standard parameters alone. For instance, a very common thing that marketers say is – we target all profitable large private sector banks, with an asset base greater than blah blah blah and based in A, B & C regions. I thank that’s wrong. There are far more characteristics that can be used to sharpen the segment definition. For instance, you could add characteristics like such as time since the last core IT system upgrade, or presence of a chief digital officer. The moment you start thinking deeper, you will realize two things:

a.      First, the target buyers are not all of whom you thought. They are a much smaller bunch (that's actually good news)

b.      And second, you might end up combining sub-segments from different industries and create your own unique target segment profiles.

2. Pick the priority segments. Once you have segmented the market as defined above, try and prioritize the segments, in consultation with sales.

3. Create a marketing calendar with programs. What you need to do here is to assign priority segments to a time period such as a quarter, or a month. Now, you could create this for the entire year at one shot, or work in an agile fashion on a 12-week or similar rolling period basis. I personally like an agile approach, prioritizing and reprioritizing based on market feedback.

4. Create the plan. For each marketing program, you need to create a detailed plan. Specifically:

a.      Set the goal. What do you want to achieve

b.      Identify the mix of elements you will use in each program (see #M3 – MIX below).  

c.      Define the messaging. It has to dovetail into the core messaging strategy

d.      Create the execution plan with steps, timelines, owners

e.      Execute

f.       Review on a weekly basis – mandatory. Discuss results and learning. Iterate as you go along. Give this time, don’t rush any review.

Does this sound daunting? The first time – yes, its arduous. But as you become comfortable with this approach, you will find it a very natural set of steps to do.

It would be ideal if these are managed on a CRM system, but spreadsheets will do as well!

#M4 - MIX

Admittedly, this is difficult. So, here are some guidelines that I believe will benefit marketing professionals. Having said that, I think every company needs to do a fair number of experiments to figure out what works for their business. It takes time to get results and create the impactful program that you want. I think anywhere from a couple of quarters to a year or more are required to get the mix right. Iterate! Experiment! And be patient

Essentials

I see the following as must-haves, no matter what size and stage of your company and what budget you have:

1. Own events: Enterprise businesses require people connect. The larger the deal sizes (and consequently the larger the impact to a customer’s business), the more is the need for direct interactions with decision makers, influencers and others within the customer organization. Therefore, I always recommend that the sales effort be matched with physical or virtual events run by marketing. Now, events sometimes conjure up images of grand industry events, lots of branding and high expenses. But no - there are smarter and far more cost-effective approaches available, such as breakfast roundtables, lunch and learn sessions, and the like. An audience of 10-12 is generally enough. Do this diligently and regularly, with industry-centric (not your own product centric) themes, and they will come. I recommend one such event per quarter per location, at the very least, and that a significant portion of your marketing budget always go into this.

2. Industry events – based on budgets. I think it’s extremely important to participate in industry events, especially in the early years. But participating in one-off events never works. You need to be consistent and regular, so be prepared for the long haul here. And that’s the challenge, because industry events are expensive. What I would say is that never create a budget for a single industry event. Instead, create a budget for at least 2-3 events per year per location, and then you’ll know how much you can afford. If you think its just that one event, I’d advise against it and suggest you spend those precious dollars on a custom event, where the audience is smaller but the impact much larger.

3. Social media posts. If you talk about basics, I’d bet primarily on Linkedin, followed by Twitter. Here, you need to create a rhythm of relevant posts that people would like to read, and not what you would like people to know about your products and services. The same designated individual/s should write original posts, or share posts from interesting sources. Key is to hover around the core messaging that you have identified above, and produce interesting variants. This quality of posting takes time to evolve in terms of tone and manner – as with all things marketing, be patient and experiment.  

4. Website – there is nothing sadder than a website that is not current or stagnant. You have to add elements of freshness into the website at regular intervals. Easy wins are changing home page banners, events, and press releases.

5. Solution presentation – you need a standard deck that everyone uses. i will advise you to keep evolving till you find the right tone, but don’t change too frequently (I’ve been guilty of being too “agile” in this regard). I think once in 6 months is fine.

6. Sales collateral – basic. Here I’m talking about the minimum viable collateral you need. Product brochure, case studies, some white papers, etc. Something that you can share easily and keep prints ready when needed

7. Outbound campaigns – basic. These should be a mix of emailers and phone calls. I’ll need a separate article to share my experience here, but suffice to say that you need a solid database, a good script, and smart folks who are fearless and speak well. An email followed by a call generally works – I prefer this over completely cold calls or no calls at all.

Add-ons

Once you’ve got your basics in place is when I recommend that you add the following to your marketing mix:

1. More of own events and industry events. These will help you build the ecosystem

2. Create a very high level corporate brochure. Something that is generic, talks about the industry problem you are trying to solve, an extremely high level view of your solution, and what makes you different and unique. Please doesn't provide too much specifics, so that even if your products evolve, the corporate brochures can serve the purpose without too many changes.

4.      White papers, ebooks and how to guides. Here's when you start expressing your knowledge of the space. How to guides are extremely effective in reaching out to influencers

5.      Webinars and podcasts. A monthly cadence helps keep you fresh in your target customers' minds. Team up with industry folks, dont do this alone.

6.      Outbound campaigns – automated (see note below)

7.      Original research (see note below)

8.      Sales collateral - advanced. Here's when you start creating documents that the sales guys want. Sit down with the sales leaders and create which the sales guys will actually use.

9.      Paid search. I've had mixed results here. All I can say is to pilot with small budgets and decide based on your results.

There’s really no end to it, but I would like to go into detail for two of the above:

• Original research – one of the most powerful marketing tools that are at a your disposal. Its surprisingly low cost to execute, while generating extremely high returns. What you need is a one super capable person to manage this initiative, at least to begin with. Crowd source the research ideas, start with something basic and not too ambitious (like a survey), analyse the data received, and produce a well designed report. And then share it with everyone – free. Use it as feed into your social media posts, in your sales presentations, to validate your core strategy and communication, and test your hypotheses about the market need. One report per quarter is easily achievable, and over time this will pay immense dividends.
• Marketing automation – I’m really not sure how many marketing teams are fully leveraging the power of automation. Its brilliant and deceptively easy to setup and implement. I’ve seen Hubspot produce some outstanding results with surprisingly low effort. I’m not going to begin a tutorial here – just a strong recommendation to look at automating your campaigns

#M5 - MEASURABLES

So, how should marketing’s performance be measured? There are so many different things to measure – new website visitors, downloads, incoming requests, social media engagement, number of collateral produced, website engagement, etc, along with tons of intangibles like brand recognition and thought leadership.

I think that marketing’s role is to assist sales in growing the business, and therefore suggest two approaches for measuring the effectiveness of marketing:

1. Approach 1 – contribution to the sales pipeline through SQLs (sales qualified leads). Whatever we do, if its not helping generate new opportunities, then its worthless in the end. You could think of adjacent KPIs such as MQL and contribution to business won. But really, I feel that its SQL encapsulates both ends of the spectrum the best
2. Approach 2 – based on two measures:

• SQL, as defined above
• Market engagement – the % of companies engaged that convert into SQL. This requires some explanation. What I mean is that marketing makes all this noise about awareness and brand recognition, but its hard to measure without expensive research. So, how about if we look at our engaged database and see % of conversion from there. If there are say 100 companies that are participating in events, or downloading our stuff, or coming to our website and attending our podcasts and webinars, the question is – how many are talking to you in real business terms? If its more than 50%, then your market engagement is great. If its <5%, then you know that all the effort isn’t helping you grow the business.

 In conclusion, marketing takes time to evolve. It requires experimentation around communication tone, tools that work and those that don't, execution capability and a host of other factors. So be patient, experiment, iterate and evolve!