Tech Uncensored - An Altitude Accelerator Podcast

[00:00:02.570] - Hessie Jones

Today on Tech Uncensored, we are discussing marketing ROI. I'm wondering if that's actually an oxymoron and why actually it continues to be a budget black continues to be a budget black hole today. So my name is Hessie Jones. Hi everyone. The advent of digital has created a lot of mechanisms for more marketing accountability. Before digital, it was really difficult to validate the halo effect from television, from impressions from magazines or print. But when digital arrived, we started to see the emergence of ad tech, the growth of SEO, SEM and a lot more attribution software. So now marketers have a wide range of opportunities and tools to actually develop sound ROI strategies that are actually trackable. But here's the rub. A lot of companies are still frustrated by the marketing spend. They don't understand how to effectively track their return to the pipeline in larger organizations. I've seen this as a rift between marketing and finance. But even in highly technical startup organizations, they too miss the mark in establishing their marketing operations early in the journey. So I'm pleased to have with me today Samantha Lloyd from Skeleton Crew Agency. Welcome Samantha!

[00:01:30.390] - Samantha Lloyd

Thank you so much for having me Hessie.

[00:01:32.370] - Hessie Jones

No problem. So Samantha is a co-founder and managing director of Skeleton Crew. So their agency is focused on strong high growth return on marketing activities for business facing technologies across Canada and the US. She has a decade of experience building organic growth brand as well as digital marketing channels for many B2B companies. And so she is currently the Marketing Director and Head of Marketing for various clients in the technology industry. So this is going to be fitting because we are talking about how relevant this is, especially to the startup industry. And today we're going to talk about how marketing has evolved, how startups should begin to see marketing as an opportunity to build awareness, to build brand strength even before they're ready to sell. So Samantha believes that by understanding what's important to track and why both for business growth and for sustainability of the company, people should actually start investing in correct channels to make a difference in how well their company prospers. So let's get started with questions. A lot to unpack. Okay, so let's start with the fact that there has been historically an aversion to marketing, especially early in, I would say, the startup cycle but this is more of a pervasive problem, so let's talk about that a bit.

[00:03:14.540] - Samantha Lloyd

Yeah, so I think what happens is, of course, marketing like we're talking is seen as a budget black hole, so it's seen as an investment that may or may not get a return, and especially in, I think, startups where they are keen to invest. But typically I find it very rare that there is a marketing kind of brain in the founding team. And so as a result, you have maybe highly technical or business people who aren't familiar with how to act on marketing channels and which ones are the best ones to go after. And as a result they either fear that they're going to just waste a lot of money, which is a possibility, and that could just not be realistic for them. And then of course, as the business grows you create kind of this confusion because there's no marketing operations in place. So they're starting to get traction and they're getting customers and they're like, we don't really understand, like we're talking to people and they're like, oh, I've heard of you before. And we're asking them where and they can't really pinpoint where and there's a lot of then confusion that grows and that will only unfortunately continue to scale if the marketing operations aren't kind of solidified early on and in a way that makes sense that everyone can really get behind what the marketing plan would be for the company.

[00:04:30.290] - Hessie Jones

I found this even when I worked in banking and it's in corporate as well as startups, is that the communication between marketing and some of the other divisions isn't always equal? And I find that when budget day comes and the allocation happens, there is always, I guess, a discussion that product goes first, any kind of research gets priority and then marketing, which always does big parties for some reason measure the value of that party will tend to go last in my experience. In your experience, growth is an essential part of how a company's success is actually measured. So why from your perspective, is marketing usually the last thing to come to mind even today, specifically for technology organizations?

[00:05:43.060] - Samantha Lloyd

Definitely. So again, I think it goes back to that traceability where companies know like, okay, I have my sales team, they're sending messages outbound, everything's in the CRM. I can see what's happening, I can see these activities and I'm getting this return or I'm not getting a return and now I can action. Whereas for marketing, even though it's in that GTM site, I think it still feels very fuzzy. They don't have the proper kind of operations stack that allows them to track through to the CRM so that then they can see, oh, all right, well this marketing activity brought in this client. This client has a package worth this great, I see the return or hey, this channel, we've had it operating for twelve months, I see nothing. So I think it still always goes back whether it's corporate or startup. There's just this inability to kind of see the pipeline themselves. And I think everybody in the organization, especially leadership, needs to be able to actually understand. And I think it's our job as marketers to make sure that the metrics we're presenting actually make sense to the people we're presenting them to, and that there's a lot more visibility and clarity there in what we're presenting and why it matters and what is contributing to the business.

[00:06:51.010] - Hessie Jones

Okay, so this is one of the areas where there is this gap between marketing and the rest of the organization. So I read this in an article recently. More than 50% of CMOs we surveyed said they face pressure from non-marketing leaders who tend to focus on the short-run effect of marketing spend and they are not patient for the long-run effects of marketing spending. So tell me how this in and of itself contributes to that whole marketing black hole issue.

[00:07:26.000] - Samantha Lloyd

Yeah, so I think part of the issue with marketing, and even for all leaders, the reporting obviously is happening quarterly at the slowest rate maybe, especially if you're in a startup, you are giving like monthly reports just because things are happening very fast back to your board. So even if things are happening quarterly, then you're expecting a project to start and then have some sort of measurable return within kind of 2.5 to 3 months that you can have metrics on it that prove that, hey, we have to keep going with this. This can be a challenge, especially if you're doing organic marketing. I still believe that you can get a return on organic marketing fairly quickly, but I do look at the three to six month range when you really start seeing that heavy return, and then as you continue to invest, more in those channels, such as upping your content or your social, whichever is kind of contributing most. Then you could see a return that's happening, like, every month, every week. You can really see driving inbound through those channels, but at first you're just not going to as you're finding your footing and figuring out what sticks. So that, I think, can be a challenge with marketing leaders just having to be able to have something to report and make sure that it is actually effective and working so they can justify the budget and continuing to invest time in the channels that they really believe are the strong ones.

[00:08:45.050] - Hessie Jones

So let's talk about organic, but also let's talk about this idea because I want you to define it, but also this idea, this halo effect, because in the past, even large organizations, I'm not talking about startup, but large organizations understand the value of TV. They understand the value of mass media. And mass media has had significant value in driving brand awareness and yes, potentially sales, but yet it's still not directly attributable. So why is there a difference in being able to approve stuff like that and not seeing the value of things that can be measurable?

[00:09:31.990] - Samantha Lloyd

Sure, yeah, I think that halo effect kind of can lead to vanity metrics or even just unknown metrics or putting people in the nun bucket. So when you're watching a TV commercial and you've seen it repeatedly and you eventually go to make that sale, it's very difficult to track. Of course, even if you have a QR code on screen or you've put a website with a specific page, hoping people will navigate to it, or you're looking at the app downloads at a certain time when your commercial aired, and hoping you can make a connection there. It can feel like there's a lot of loose ends, and you're making a lot of assumptions. I even have an example in digital where a press release went out, and we had UTM codes to all the links, and as soon as the press release went out, within like 24 hours, the amount of inbound we had was crazy. But through any of the UTM codes, almost no clicks, and we had a ton of direct traffic, which implies that people are just going to their search bar and typing in the website directly. I attributed it to the press release, assuming that the launch of that had led to the influx of traffic and inbound, but I actually had no proof, and that was a digital one where I had prepped ways to track it. So I think that this happens a lot, and it causes that kind of halo effect of like, okay, we think this is from this, but we can't really track it, and then people become very uncertain if that's really then the right move. And then further, it can also lead to kind of more of those vanity metrics, like, oh, we were in a TV commercial, so it went out to this many households and this many people it was in front of. And again, those things same with digital, when we're talking about impressions and things like that, they're just not fully trackable in a way that I think is valuable to a business. So I think you have to be careful in weighing your options. I do think that there's value in offline channels. Billboards still get me, so I do think that there's value there. But whether or not we'll ever able to track those channels the same way we track digital, I don't really think so. So the investment, I think, just has to be careful and well thought out when doing those channels.

[00:11:43.590] - Hessie Jones

I have a feeling at some point when in the future we're able to determine a cognitive link and whether or not that's a VR or some kind of headset that basically says, hey, I saw that, and it's like these kind of latent type behaviors, like, let's say ten days later, I decide I want to buy that. I attribute it to that ad, maybe that's coming. But again, that's more of an intrusive way to do it, as opposed to trying to attribute properly. And I think right now we're still at that point, because, as you said, events, TV spend, print spend, they don't have any direct attribution. From your perspective, what are the metrics that we should use to determine whether or not they're effective?

[00:12:39.390] - Samantha Lloyd

Yeah, so when I'm looking at metrics to see if any channel is effective, I want to see the pipeline contribution. So I want to see how many people come through to our sales pipeline. But also what is the size of these customers who are we actually grabbing the attention of? Are we getting the big logos or are we getting more like smaller packages that are easier to onboard and people are coming in and closing within 30 days. So the way that I look at the important stuff is all centered around the sales pipeline. And then some of the other metrics that I look at because they are important for the sales pipeline is website traffic and traffic to lead conversion because those are benchmarks that we want to see how they're converting. For events, I look at it a bit differently. There are benchmarks depending on the type of events that you go to. Some companies have published benchmarks, but I typically come up with forms the sales team has to use to collect all leads from the event and then from that event. See the ones that actually engage with us in the pipeline again, the size of the contract or the customer and their time to close from the event, which typically, I find, takes like, one to two events to actually close a customer. So you're meeting with them a couple of times, but then yeah, for other offline ones it's difficult. Like with a billboard you can't even really say impressions. You can say like it's in a city of this many people and we think this many people are relevant to the business, therefore it's relevant to this many overall or this percent of the city. But it's complicated to try and measure what is important there. And I think sometimes when you're doing brand work like that, you have to believe that it's the right position for your brand to be in and know that you're investing with a bit of understanding that you're just not necessarily going to track against it.

[00:14:32.630] - Hessie Jones

Okay. It's tough, isn't it?

[00:14:36.400] - Samantha Lloyd

It is.

[00:14:37.930] - Hessie Jones

No matter how much we have data on everything and everyone, there's still channels that we're still hard pressed by. Okay, so let's get into the startup ecosystem because mainly from the perspective of small businesses who just started and they want to go up against the big guys because let's assume that a new startup has come up with a solution that has a varying, I guess, solution that kind of mimics their biggest competitor but not really.

[00:15:17.110] - Samantha Lloyd

Yeah.

[00:15:17.750] - Hessie Jones

So they still have to market themselves. From your perspective, do they have the resources to be able to go head to head with them with their biggest competitors?

[00:15:31.680] - Samantha Lloyd

So I think this is a complicated question and answer. So I do believe, and obviously we've all seen the rise of a small business. A small business can definitely succeed. It can remain small, it can scale and become huge. So there are ways in which of course, that they can compete. So I'm going to use the example of modular furniture with Ikea. If you're a small business in the modular furniture space or the flat pack furniture space, you are coming up against one of the giants. They already have a very established brand. If you're thinking of like I need a new piece of furniture for a dorm room or anything, instantly, there's just no thought. It goes to Ikea. So you have to take away some of those eyeballs onto yourself, which is very difficult because they are pretty ingrained in people's just behaviors and habits. And then beyond that, you also have to consider that their budget is huge for offline channels and for online channels, it would be very difficult to compete directly with them. So the things that you can do is look for openings that they haven't gone for yet. So spaces where they're not occupying, but you know your customers are occupying.

[00:16:43.080] - Samantha Lloyd

So Ikea might do a great job of having storefronts everywhere. But can you save customers money by being solely digital and direct to consumer? Is there a partner that you could have like Ikea partners with different logistics partners or things like that? Is there a logistics partner you could have that could also put your brand logo on more things to get you in front of more customers? Is there a way to play maybe on social media? I definitely think that social ads are a really good way if you're a direct-to-consumer, just a B2C brand, it's a really good and inexpensive way to test the market. So you could certainly compete on there and go after your target market there. And so even if Ikea's ad pops up, your ad can also pop up. You could also do hyper-local. So just really focus on the area where maybe shipping is the least expensive for you because it's local to your warehouse or your factory or anything like that and just see if you can really drive some local interest and appear on local Google Maps and things like that. So I think there are ways to compete. You just have to consider that of course, if you are in a space that goes up against the big guys, they do have more hands, they've got more money, but that doesn't mean that there isn't an in for you. And that doesn't mean that we haven't seen competitors just come in and take over before. Like Wayfair is a good example of a company that came in and slightly different business model, but they came in and now they're equally, I would say, as thought of when you're thinking of like, I need some new piece of furniture, those are the two places where you instantly think of them right now.

[00:18:18.060] - Hessie Jones

Exactly. I think the other thing I would add is if you do any kind of search research and determine, let's say, within the category, are there specific things that people are searching for that your competitor may not necessarily be able to fulfill by capitalizing on? It's almost like creating a service for yourself, knowing that there is a demand for it. So you develop a service as a result of the demand that one company may not be fulfilling. Is that fair?

[00:18:51.770] - Samantha Lloyd

Yeah, I think that's definitely fair. You can not only in search, but even in product. I remember way before the big guys adopted it, there were a few kind of smaller brands who had adopted really cool AR or other technology with their products. So you could see how it looks in your room, or you could upload a picture of yourself and see how the makeup would look on your face or something like that. And I always thought that that was really interesting. I think that there are cool ways where you can show value to customers, for sure.

[00:19:21.760] - Hessie Jones

I want you to talk a little bit about where we've evolved, because before digital, we did have paid media, we had PR, but we didn't really have channels that we could effectively control because the ones that's out there, it's out there and we can't take it back. What is different now about the channels that we have today and how is each important to the sales funnel?

[00:19:50.430] - Samantha Lloyd

Yeah, so we've got a few channels now that we do have more control over. Even when we put something out there, because it's digital, there's always the ability to edit and change things. But yeah, so you've got your bot owned and earned, which for people who aren't as familiar when you buy marketing out there so that could be like a press release, anything that you are purchasing. Then you have your earned media and that could be like a company coming to you like a news outlet and saying we want to feature you. And then your owned ones, which could be like your social media or your email marketing things where you have full ownership of it. The audience on there is yours, and those are kind of your three segments. So the owned ones, obviously, you have the most control over, and that makes a big difference, I think, versus prior. When we were doing a lot of these offline channels, whatever you submitted was put out there, and they could put your bus ads on completely wrong, and you had a big plan for how they had to appear in a certain order and they could mess that all up. You could put a TV commercial out there and you could see the fine print that you submitted is not put in there properly. I've actually seen ads today where I can see their fine print was cut off and you're like, that's important. So there's things like that where you just don't have the control. And I'm sure every marketer goes through that panic of like, I can't change it. And I certainly have. Even in modern ones with email marketing, when you hit send and you see that there's a spelling error and you're like, that's it. I can't handle it anymore.

[00:21:24.420] - Hessie Jones

The only thing you could change is the web version. Which nobody reads, right?

[00:21:28.970] - Samantha Lloyd

Yeah. Nobody clicks the web version.

[00:21:31.950] - Hessie Jones

Oh, my goodness.

[00:21:33.790] - Samantha Lloyd

That is the nice thing about most of your own channels, is like, if you make minor errors or things like that, it's very easily rectified, which is great. And even press, like, if you make a mistake in it, you still have the ability to go back and they can just put a notice out that it was edited and that's fine. So, yeah, there's a give and take. I mean, I think it would have been a lot more stressful if most of my job revolved around things that were very offline and uneditable. I don't know about you, but I go back to content pieces and I'm like, okay, just one more round of edits. And always changing things.

[00:22:08.490] - Hessie Jones

Listen, I used to work in print and believe me, if there was a comma change or there was a grammar change or something and we were already at the film stage. If you remember film before you print, you had to redo the film. Right. And every stage cost was expensive. So if we look at the cost of social media today or any kind of digital publishing, it's still like one quarter or one eight the cost of the cost of actually printing a brochure. Right. Or doing a radio spot or anything like that. Stuff that you couldn't take back anyway. Okay, so I read this great quote from an article. So this is a financial services CMO that said "it's not a question of spend at the top of the bottom, at the top or the bottom of the funnel. It's yes, and there's a misunderstanding with other executives that you can steal from Peter to pay Paul, but it doesn't work. Brands have to be more differentiated. They have to knock on the door and say hello to customers. We don't do a better job of this, and I don't think customers are going to care if we provide an offer".

[00:23:31.030] - Hessie Jones

So how do you do this? How do you execute this properly on both the top and the bottom of the funnel?

[00:23:36.910] - Samantha Lloyd

Yeah. So I think there is a big challenge there that ties back to the marketing black hole where we want to invest equally in kind of all channels and give every channel a fair shake. Especially because when we're talking about even investing in in-platform marketing and things that we think could be valuable to upsell customers, that's a whole different part of marketing. But maybe it's not as valuable as driving new clients who are coming through with large contracts. And there is very much like yeah. This idea of, like, you have this full budget and you don't get to just add to the budget because you see another cool opportunity. You've got to take it from somewhere. And of course, when you're working with teams, teams also have their say. Like a product team is like, well, we got to invest in the product marketing, whereas the sales team is like, I have to go to events. So there's like a split always of where you have to invest. I agree that that is how it is. That, yeah, you have to steal from a place to be able to give it to another to properly allocate. In my dream world, do I have a marketing budget where I can equally invest in all stages of the funnel and also do the in-platform marketing and do retargeting and account-based marketing? Yes, but that's just not the reality. So I think the best way to balance it, they usually say to try to hold 10% of your budget for experimental if you can, which is great. Sometimes that ends up being more of a contingency budget and ends up getting used by something or just not included in your budget for the following year, which is fine. But I do think investing on top of the funnel to drive new contracts that you're keeping kind of everyone happy about the pipeline is important. And then really trying to justify that spend to keep your existing customers engaged. And upselling them or making sure that they're continuing to use the product and then saving that little bit so that you can really experiment and try new channels and hopefully find one that's really great, that you can add back into that big one and say, hey, it's worth investing a lot into this one.

[00:25:36.520] - Hessie Jones

Okay, so if we're talking now about how to attribute your sales sorry, your actual transactions back to your pipeline, what matters in terms of impressions, engagement, the actual conversions, what are the things either in and of themselves or combined that really matter to both the marketer as well as, let's say, your financial organization, for sure.

[00:26:08.600] - Samantha Lloyd

So for the marketer, and we've hit on this a bit before, but I'll go into more specifics. If you're in B2B, what I like to see for site traffic at a minimum is if you're doing the right things, your site traffic should be increasing 10% month over month, and that's just a minimum. That means that people should be engaging with your content. They should be researching things to land on your landing pages. Your product pages should be found easily by them, and it should really speak to your market. If it is, and you're doing everything on social and all your other owned channels, this increase should be fairly standard. And then from your traffic to leads for B2B, it depends on the industry. But you're looking at about a 1.8% conversion rate. So you want 1.8% of that traffic to come through as a lead. And the lead is not like a marketing qualified or sales qualified lead. It's just, hey, they came through the form or whatever kind of entrance point you have that you're digitally driving everyone to. And then from there you want to of course, filter them from into marketing qualified leads. There's a joke that marketing says every lead is a qualified lead but just filtering out some. Like you'll have people who come into your lead form and they're applying for a job or something like that. So just make sure you're filtering that so that sales teams have their leads in place. And then Sales goes through and says, all right, yeah, this is a segment we're focusing on. This looks good. And they take their qualified leads over. And then from there you kind of now have an idea of the pipeline you've contributed from your SQLs and then from there the sales team gets their SQLs or their Sales qualified opportunities and those are people who are engaging back with them to get a meeting. So that's great. It might surprise people, but people come through forms and then don't respond to book a meeting. That happens. So then from there, sales can through those meetings, get a better idea of like, okay, the contract is going to be this size. They're going to sign on to us for X number of years. We think it's going to take this long to close. So Sales starts really getting this data. That's very helpful to marketing because you want to know the time to close. If you're sending leads over that are taking a year to close, but Sales outbound is taking six months to close. The marketing leads are not strong. If you're sending over contracts that are consistently a lot smaller than what Sales outbound is driving, that's also not great. You want to make sure that there's a balance unless there's an agreement that marketing is driving a specific segment of your business versus sales. And then from there you want to see who closes and then further on who stays on. Are marketing leads churning after a year? That's also not great. So there's a lot to track throughout this full funnel. But I think that these metrics matter a lot. And then like I talked about for events and other offline channels, doing your best to attribute where you can so that you can also track the similar return as much as possible there, but digitally that's kind of what you want to see. And then if you have a digital product where you can kind of track how people use it, getting those product metrics is great. Are marketing leads like the people who came through marketing and closed, how are they using the product? Do they come back once a month, once a day? Is it typical for the other leads that close and again just being able to track that and be like, wow, the marketing leads who come through, they close within three months and they come back to our platform once a month and their contract is excised. That's the. Stuff that really is important to report up to the executives and the board to show the value of marketing all the way through the kind of journey.

[00:29:29.280] - Hessie Jones

See, that's great. I'd love to see a lot of this now because even when I used to work in a corporate environment, it was really difficult to actually go beyond a conversion. Now we can actually see that, determine whether or not those leads and we're talking now lifetime value, how many of those stay, how many of those churn. So when you're actually talking about what's working, what's not working, you could look beyond the actual sale itself and determine over the long haul which ones are your best customers. So that's okay. So how should people start doing this today? Tell me about what this tech stack looks like.

[00:30:14.680] - Samantha Lloyd

Yeah, so for a tech stack, so it depends on every company, of course. And every company has a bit of a different budget. If you are able to get like a marketing operations person, even just on contract to come in and set everything up, you will probably feel a lot of relief. I love working with marketing operations people, especially ones who are strong in data or data science. They are incredible. So one of the things that every business can do that is easy is of course, just put Google Analytics in place on your website. It's basic and it's free, but it's there and it's good to just have that tracking because even if so, say like years down the line, you decide to do marketing operations, you still just want to have data somewhere. So Google Analytics is a great one. I also really like mixpanel. Mixpanel is a good one that can kind of track not only your website, but also your product usage. So you get more of that kind of flow of like a lead came in and used your site and then when they converted and this is how they use your product. So you can get like a good scope there. There's heat maps and some other tools that are really good too to see site usage and then product usage for these users as well. The CRM is something the marketing person has to understand. I think there's a lot of marketers who are opposed to going into the CRM or they don't want to touch anything in there, but really, really say that a marketer has to be in the sales CRM and understand what's happening, like HubSpot or Salesforce. Whatever it is that you're using, you need to know how it's set up, why your sales team has set it up, how they do, and then how you can connect what you're doing in marketing through to them. So like, HubSpot will give you an idea of how a lead came in, like what it was attributed to. Was it a keyword, was it content, was it social media? And then you're able to see how that person, or you can even do your offline channels in there if you want. You can assign events and things like that, but that way you can see the attribution of all your leads. And this is also helpful for the sales team. So I definitely think marketing needs to be in the CRM always. And then after that, working with the product team, you want to use tools that the product team, of course, is using as well. So, same with sales. You're going into their tools. That's the same thing with product, so you can see the product usage and what's happening on that end as well. And then my favorite thing to do for a tech stack, and this is just to give visibility to the is to as much as you can integrate with internal tools. So if your team's using Slack, Slack has a ton of integrations that lets you auto-publish analytics or your social media or anything like that so that people can see how things are performing. People can see where there's activity. Oh, we just posted a new tweet. I should go like that and retweet it. Or X, what is it called now?

[00:33:02.250] - Hessie Jones

The new X or something? The new X AI or something like that.

[00:33:07.480] - Samantha Lloyd

But yeah, I think Slack is a really good tool for that. So I love integrating as much as possible. And again, this is something if you're not comfortable with your data operations person can do, or your marketing operations person. But Slack has made it very easy for you to look up integrations and be able to just do it yourself. And this is just an instant way to give everyone kind of like a quick view of what's happening and get them engaged and understanding why we're doing what we're doing.

[00:33:34.230] - Hessie Jones

Okay, that's awesome. Well, it looks like we're out of time, and this is all we have time for today, unfortunately. Samantha, thank you for joining me. This continues to be a critical piece for many startups as they grow, and I'm glad you're able to share your expertise with me today.

[00:33:53.210] - Samantha Lloyd

No, thank you so much for having me. I had a great chat with you, Hessie. I really appreciate it.

[00:33:57.630] - Hessie Jones

Me too. From one marketer to another, you're awesome. So for our audience, we tackled a similar topic previously. So if you haven't checked out, every marketer at every stage needs a marketing strategy. You should actually take a look at that as well. So Tech Uncensored is a production of Altitude Accelerator. You can catch us on YouTube, and we also have a podcast, so you can find us anywhere you get your podcast. In the meantime, for our audience, if you have any topics that you want us to cover, please email us at communications@altitudeaccelerator.ca. Until next time, I'm Hessie Jones. Please, everyone, have fun and stay safe.