From the email library
April 4, 2020
Ripples become a tsunami | Find prospects who are shopping | Prepare for marketing budget cuts
Most of the United States is now under government orders to stay at home.
Today 38 states have enacted statewide mandates. Another 7 have stay-at-home or shelter-in-place orders in parts of their state. Only 5 states have no active orders.
Ripples through the economy become a tsunami
The US population under stay-at-home orders is now more than 297 million.
Some public health experts are talking about shutdowns through June and into July or even later.
Prolonged or recurring orders may apply where infection rates continue to climb. Or where they climb again after being relaxed.
The duration will depend on how much of the population has fast and easy access to accurate testing.
This past week, another 6.8 million Americans applied for unemployment, following 3.3 million the prior week. That brings the total to 10 million newly unemployed in just 2 weeks.
That’s more than the combined populations of Los Angeles, Chicago, and Houston.
Some economists have escalated their language from global recession to potential depression. And from disaster to catastrophe.
Time to shine
Whatever happens and however long it continues, one thing is certain: This crisis will test revenue leaders more than anything since 1929.
It’s also an opportunity to do the best work of your life.
Let’s not ‘walk on eggshells’
Last week, Driven reader John Stopper offered a valuable perspective on an article last week (Issue 24, “Fast and Agile: Do these 11 things now to generate pipe.”)
The article shared ideas from TOPO, a Gartner-owned consultancy that helps tech companies grow.
John leads an enterprise sales team at a Silicon Valley software company. They generate most of their revenue through perpetual licenses. Here’s what he says:
…we are sales professionals. Our job is to help our customers buy software.
Maybe they do want to engage in a sales process.
…we should seek out customers who are also professional and see this as an opportunity to put good tools in place that will enable their companies to prosper during this time or when they recover.
There is no right answer here.
We must experiment.
But walking on eggshells is not the answer.
I agree with John. You can’t tiptoe around this crisis. You must keep selling.
But in your selling, you must acknowledge that almost everything has changed for your customers—at least for now.
The debate is not whether you should keep selling now. It’s about how you should sell.
For some, selling in the short term will look and feel more like helping and educating.
I don’t know the right answer for your company. You’ll have to work that out with your management and your revenue team.
Driven is here to share ideas.
In this week’s issue…
- How to find customers who are shopping for a product like yours
- Marketing budget cuts: How to protect the essentials of your programs
Your reading time this week is about 10 minutes if you read at 200 words per minute.
SALES | MARKETING | REVENUE | CUSTOMERS | DATA | INTENT
How to find customers who are looking for a product like yours
Despite the current crisis, companies are still buying products like yours. Or at least they’ll be ready to buy as soon as the crisis passes.
How do you find them before your competitors do?
This article explains what customer intent data is and how it can help. It will be most useful to revenue leaders in the roughly 50% of B2B companies that are not yet using intent data.
Why might you need customer intent data? Here are some questions to ask yourself:
- Is your company among the 3 best-known vendors in your target markets?
- When buyers search on popular keywords related to your product, does your company appear on the first page of Google results?
- Does your company or product rank among the 5 top-rated choices on third-party review sites such as G2?
- Is your company running an effective program of pay-per-click advertising?
- Do your target markets contain more prospects than your sellers or sales development reps (SDRs) can reach in 60 days?
- Do you have a strong network of partners who bring plenty of opportunities your way?
The more of these questions you answer with a no, the more likely you are to benefit from using customer intent data.
Why it matters now
It’s always been hard to find the few prospects who are already shopping for a product like yours.
Today it’s even harder, because even fewer companies are buying now.
Even in the best of times, it’s a race to find good prospects before they choose one of your competitors.
Your haystack may be relatively small, but it’s still a challenge to find the needles fast and efficiently.
With so many marketing budgets facing cuts, it’s especially important to find them cost-effectively now.
Find the few companies that plan to buy soon
In any market—B2B or B2C—only about 3% to 5% of potential buyers are in active buying mode at any time. Maybe another 7% to 10% are open to hearing your commercial message now—even if they aren’t ready to buy.
The remaining 87% to 90% of potential buyers are not open to hearing your commercial message now.
For generating revenue in the short term, the key is to find the 3% to 15% who are willing to engage with you now.
If you can do so, it will save you a ton of time and money.
Digital ‘footprints’ suggest buying intent
Before a company commits to buying a product or service, some employes research potential solutions online.
As they do so, they leave digital footprints that suggest their intentions.
Think of a buyer who researches customer relationship management (CRM) software. That person might fill in a form to download a CRM buyer’s guide. This activity suggests a level of purchase intent.
If your website has the right technology in place, it can capture the internet protocol (IP) address of such visitors. It can do so even if they don’t download nothing.
Data services can then identify the companies and locations to which those IP addresses belong.
By tracking and interpreting these and other online footprints, you can infer varying degrees of purchase intent. You can also see when a company may be ready to buy
Used well, intent data can help identify potential buyers before your competitors do. It can help you focus the efforts of your sales prospecting.
Your competitors may already have a big advantage
Are you already gathering or buying customer intent data? If not, it’s worth considering now.
That’s because intent data is one of the fastest-developing, most promising areas of new technologies for enabling revenue growth.
Four 2019 research studies suggest that many companies plan to invest in it soon.
In one study, more than half (53%) of B2B respondents said use of intent data is their top priority for improving data intelligence.
In another, about two-fifths (42%) of respondents said they’ve set a high priority on use of intent and signal data to identify opportunities in 2019 and beyond.
In a third study, about a third (34%) of respondents said they planned to test and deploy signal and intent data in 2019.
In a fourth, almost two-thirds (61%) of respondents said it’s a high priority to collect buyer intent data soon.
What’s Working in Intent-Based Strategies: Sales and Marketing Teams Turning to Intend-Bases Signal Data to Inform Content Offers and Channel Mix to Reach Buyers at Key Stages. Demand Gen Reports 2019. Sponsored by Demand Works Media. Downloadable PDF. 13 pages. No charge.
2020 Database Strategies & Contact Acquisition Survey Report: New Research Shows Companies Unlocking Buyer Intelligence to Identify Key Stakeholders & Deliver Relevant, Targeted Messages. Demand Gen Reports. 2019. Sponsored by ZoomInfo. Downloadable PDF. 21 pages. No charge.
MARKETING | ADMINISTRATION | BUDGETS
Be prepared for cuts to your marketing budget
In an online poll conducted in late March, 45% of B2B marketing leaders said they expect their budgets to be cut. Almost a third (30%) said they didn’t know, and a fourth (25%) said their budgets would stay the same.
In the coming weeks, I suspect the number of marketers facing lower budgets will rise to 60% or more.
Reductions are especially likely for marketing teams that don’t have a strong, collaborative relationship with their counterparts in sales.
So which of your marketing programs are most important to protect?
Expect your customers to look hard at the value you offer
Here’s a rationale your might consider. It comes from Sangram Vajre, cofounder of Terminus, a fast-growing SaaS company in Atlanta.
All companies, Vajre says, are looking for ways to cut their cost of using SaaS products. They’re trying to decide which they need to keep.
You must figure out ways to keep as many of your current customers as you can. This is where you should invest every available marketing dollar.
Free ‘VIP workshops’ help cement relationships
Terminus, Vajre says, is offering free “VIP workshops” to all their customers. Normally they charge $5,000 or more per workshop.
Their goal is to help customers use Terminus systems in more efficient and productive ways.
“We’re trying to get ourselves and our customers ahead of the conversations they’re are likely to be having with the people who set their budgets,” Vajre says.
So focus first on accounts that generate your recurring revenue.
Focus your marketing dollars to protect recurring revenue
How much marketing budget do you need? Here’s how Vajre thinks about it.
Base it on a percentage of your average customer lifetime value (LTV).
Let’s say you have 100 customers, and each spends, on average, $100,000 a year with you. That’s about $10 million in annual recurring revenue.
If your average customer stays with you for 3 years, your average LTV is $300,000.
To retain your customers, you may estimate that you must spend, say, 5% to 10% of the money they spend with you in a year.
You’ll invest that $500,000 to $1 million on email campaigns, direct mail, personalized content, and more.
If your investment gets them to stay with you longer, it adds to their LTV. If your average LTV is $300,000, the money you spend to retain them will be easy to justify to your chief financial officer (CFO).
Start by investing first in the companies that generate the most revenue and are closest to their contract renewal.
What about net new accounts?
Some young SaaS companies don’t yet have enough recurring revenue for Vajre’s approach to work.
You may also need new accounts to survive.
In that case, identify the 10 customers you most want to sell in the next 6 months.
Focus your attention on them. But don’t try too hard to sell them now.
Instead, build relationships by seeing how you can help them.
Offer online VIP sessions to small groups of peers
Nearly all software providers, it seems, are now offering webinars and virtual events.
With so many look-alike invitations to online webinars and summits, it’s hard to get attention. The people you want to reach are already booked heavily on other video calls.
So offer them something of higher value.
Rather than running another conventional webinar or event, put together VIP conversations among small groups of well-chosen peers.
Invite both customers and prospects to talk about how they’re coping.
You can hold a successful conversation with as few as 5 participants. Enable all participants to see each other online.
Don’t present or pitch. No PowerPoint slides. These sessions are not about your company or your products. They’re all about your participants.
This is what your target prospects value now. Everyone open to such conversations.
They’re stuck at home, hungry for a change of pace that helps them cope.
You needn’t spend a cent to do this
You can offer such events or discussions at almost no cost and without much preparation. You’ll need only these elements:
- A list of participants who want to talk to each other
- An interesting agenda and dicussion topics
- High-value, open-ended questions to get the discussion started
- A videoconference service (preferably one that can record)
If you’re an individual sales rep, you can offer such events without any help from marketing. But you may want to invite others from your company to participate.
If your target group consists of CFOs, for example, you might invite your own CFO to the conversation.
Tips for organizing your online VIP event
Short sessions. Try limiting your session to 30 or 40 minutes. You may find that more senior participants will make time only for shorter meetings.
If they value your first discussion, offer repeats. This could be the start of a small community.
Recordings. If you want to record the session, be sure to ask your participants if it’s OK.
On the negative side, your participants may be less likely to talk candidly if you record.
On the positive side, some may appreciate having a recording or a transcript available afterwards.
Content ideas. Whether or not you record, you may be able to use insights from the conversations to develop content you can share more broadly.
Sensitive information. Be careful, of course, not to share confidential or sensitive information that may come up during a session. Your main goal here is to build relationships and trust.
Competitors in the same session. It’s probably a good idea not to invite competing companies on the same call.
If you do so, check with your legal department. You don’t want to cause antitrust issues for any participants.
What to do now
Here are 5 things you can do right now:
- Identify the customers whose recurring revenue you most need to protect. Offer them free services to ensure their success with your software.
- Plan marketing and customer success initiatives that can help ensure renewals.
- Prepare an estimate of the cost of such initiatives. Have them ready for when your CFO talks to you about budget cuts.
- Identify high-priority prospects to focus on in the next 6 months. Brainstorm topics they may want to discuss with their peers among your customers. Avoid making the session topics about your product.
- Schedule your first online VIP session with a small number of participants.
“5 Ways CMOs Are Reallocating Budget for Today’s Environment.” Sales Benchmark Index (SBI). Webinar. April 3, 2010.
Sangram Vajre. Daily LinkedIn Live sessions, recorded. April 2 and April 3, 2020.
Whew. There’s always so much more to cover. And so little space in each issue.
I hope you feel you’re getting useful ideas here.
Remember, this is the time to do the best work of your life.
If you find value in this week’s edition, please share it with friends and colleagues who may be interested. They can go here for their own copy of future editions.
Have a great week!
Driven is a free weekly email for time-strapped revenue leaders in business-to-business SaaS companies.
Its goal is to keep you informed about a broad range of topics related to revenue growth.
We scan the horizon for insights and ideas from sources you may otherwise miss.
You can receive your own copy of Driven at no charge by sharing your email address here.
About links, endorsements, and recommendations
When I provide links to articles from vendors, it does not imply an endorsement of their products or services. I link to them because they offer good content.
I’ll make it clear when I’m recommending a product or service.
© 2020. SilverStream LLC. All rights reserved.