Identifying Efficiencies to Drive B2B Growth in a Recession
Marketing is always a bit of a roller-coaster ride. The B2B sales cycle is changing rapidly as the digital transformation takes hold – and now we may be heading for a recession. In a Forrester survey, B2B CMOs and marketing decision-makers said addressing those changing buying behaviors is their top priority, especially as we face the uncertainty of the next year.
Alignment between marketing and finance has always been essential, but the two departments need to work together now more than ever. Tough times can strengthen bonds if we turn towards each other instead of against each other. That’s why BOL and B2B In The Black, a collection of marketing, finance and operations leaders in the B2B space, have created this series on working together to prepare for the future.
In our latest session, I spoke with CMO Rashmi Vittal and Head of Finance Nick Mayes at Productiv, a leader provider of an enterprise SaaS management platform. Together they took a deep dive into how to find, articulate and execute on opportunities for increased efficiency during tough times.
Building a Relationship
Productiv’s marketing and finance relationship is very tight-knit. Rashmi and Nick recognize that there’s even more of a reason for marketing and finance to be in lockstep right now. They meet weekly, talk throughout the week and make sure there’s continuous dialogue so they can stay on top of important items.
It isn’t just about frequency of communication, but quality. Rashmi and Nick are able to be very direct with each other about what needs to be done and how to hit their goals. No hidden agendas. No behind-the-scenes maneuvering. They communicate with transparency and candor, and it works.
Thinking About Marketing as an Investment
Finance teams have been given a mandate to cut costs and budget. They need to justify why they should continue to make the investments that they’re making. Marketing often takes the brunt of forecasting and budget cuts in times of uncertainty. So how can you stay away from that knee-jerk reaction of wanting to cut marketing heavy and hard?
All teams need to shift from thinking about marketing as a disposable line item to thinking about it as an investment. Marketers need insights so that they have the data to have those conversations. And finance needs to consider long-term implications.
Nick says, “At Productiv, we're typically planning for at least four quarters out. So whatever changes we make to that budget in this quarter, I've worked with Rashmi to understand what we think is going to be, the impact of those decisions on the next quarter, the quarter after that, and the quarter after that.”
Aligning Leadership Teams
Cost optimization decisions are not happening in a silo, they are a team effort. Strong alignment not just between marketing, but also with procurement partners, line of business partners, VCs, the board of directors, and other members of leadership, is fundamental. But achieving it isn’t easy.
Keep the focus on the company’s objectives, and say it with numbers: If we cut $100,000 today, this is the impact on the next three quarters. Show marketing influence on pipeline and revenue. Prove your ROI. Focus on cost optimization and investment rationalization. And have a single place for data and insight that everyone can use to make decisions.
Finance in particular needs solid information to build out a pipeline forecast and best allocate the budget. Ask yourself what reporting finance is looking for. Do you need to dig deeper into spend and ROI, or try to forecast how the current pipeline will affect revenue? When marketing and finance can align on the value that marketing is driving and create a predictable way to forecast that value, great things will happen.
This also applies to your customer relationships. Across the board, everyone is actively working towards cost optimization, so aligning with your customers to optimize their investment in your product or service has a lot of value. Your customers achieve their goal of cost optimization while you achieve an even stronger and likely longer relationship.
Reallocating Instead of Cutting
One key strategy is to come up with tradeoffs that don’t involve slashing budget, but instead reallocating it. To do this, you need proof of what works and what doesn’t. You need reporting, data and analytics. The ability to look back on previous quarters and see trends that you can use is invaluable.
Dive into that information and ask yourself: How are our channels performing? How are our programs and campaigns performing? What’s our spend? Where are we seeing ROI and what ROI are we expecting over time? What is working – and what isn’t working? Only when you have data can you reallocate the budget to what works instead of cutting across the board.
Data also allows you to predict the success of your campaigns. Before entering into any campaign, ask yourself: What are the goals we’re supposed to hit? What’s the forecast on those goals? What’s the expected ROI? Armed with that information, you can determine if you’ll hit your forecast for the quarter, and where you might need to reallocate or cut.
Keeping Your People
One area neither Rashmi nor Nick likes to cut is people – because budget doesn’t mean anything without people to put it to use. If you have a lot of programmatic spend, but no people to enact the programs, you can’t use that spend wisely. Programmatic spend is a much more focused target to drive cost control. You can always add more dollars to your spend. It’s much harder to add good people.
You can be cost-effective in your budget while also keeping your people. That’s why data is important. Knowing what works and what doesn’t is important. Accurate forecasting is important. And as Rashmi puts it, “There's never a shortage of progress that we could make, and that is very, very much human-powered.”
Branding and Awareness on a Budget
Brand awareness is notoriously difficult to connect back to ROI, pipeline or revenue – which is why it’s often the first thing to go. Yet Rashmi and Nick agree that you won’t see as much success with your demand gen programs without putting some money into top-of-funnel awareness programs. Nick says, “Having worked for a company that had underinvested in brand for a long time, I've seen the impact of underinvestment on organic channels.”
It actually costs less to invest in your brand up front and build your campaigns from there. At Productiv, Rashmi enacted a vision to invest in the brand: After bringing in an independent brand consultant to help with research and execution, they were able to drive the brand forward with internal resources – making the project more efficient and effective.
Efficiency is key when you’re working with a shoestring budget. Rather than building “brand debt” by not investing at all, think about how you can do it as pragmatically and efficiently as possible. Because it will elevate your company, in any market.
Account-based marketing, or ABM, is more than a buzzword. The benefits of ABM range from shorter sales cycles and higher ROI to – you guessed it – better alignment between marketing, finance and sales. Productiv has a hybrid approach using a traditional funnel of leads combined with ABM tactics like account monitoring and activation monitoring. For example, they added a tool to access intent data, created a definition of an activated user, then modeled how many activated accounts are needed to drive pipeline opportunities and revenue opportunities.
Productiv’s ABM strategy is driving understanding of intent signals and allowing for retargeting in the dark funnel a lot faster, giving sales a priority list of accounts and letting them know when to engage. It also helps them be aware of shifts in pipeline velocity and plan accordingly for extended sales cycles.
Meeting the Needs of Customers
Ultimately, the success and failure of any marketing initiatives depend on how well you meet the needs of your customers. Period. You need to be obsessed with your audience. Shift your strategy based on what is more important to your buyers as it relates to micro- or macroeconomic conditions.
First, you must understand the value that you provide. Nick says, “Productiv has a product that provides a lot of real return to our users. That was there before the pandemic or the impending recession and that’ll be there after.” The key is to pivot your messaging to prioritize the product features that meet customers’ current needs. Make sure the right narrative is front and center.
When budgets are tight, it’s about increasing the value that customers get out of your product. “A lot of times that’s equating to real dollar savings for them, and it helps justify why they should either purchase Productiv or why they should keep Productiv in their tech stack. And we've been really successful at that,” says Nick. You can be too.
Are you ready to target the right customers, at the right time, with the right messaging? BOL can help you build a strategy, create content and report on your performance. Take a look around our site to see what we can do, and contact us for more information.