Welcome to The Factors Podcast! With today’s episode, we’re starting a new series in partnership with TripleDart. We'll be looking at relevant digital marketing levers for post-product-market-fit firms to scale their inbound efforts.
February 7, 2022
Welcome to The Factors Podcast! With today’s episode, we’re starting a new series in partnership with TripleDart. Our guest is Shiyam Sundar, a digital marketing veteran, who has worked with some household names in the SaaS industry — including Zoho and Freshworks. He’s currently helping more than 25 VC-backed companies at various stages of growth at TripleDart. With over 7 years of experience in performance marketing, Shiyam is here to share some knowledge and insights into several topics in marketing and growth, particularly for those looking to scale and venture into performance marketing.
In this episode, we will be looking at some of the most relevant digital marketing levers that a post product-market fit company should be pulling to scale their inbound growth engine. Shiyam opens up some secrets of what steps your company should take, what you should focus on and talks about what has worked for other companies at this stage.
A lot of new SaaS companies are emerging out of India. Most of them have already found their product-market fit and they are set to compete against legacy players. So for this range of companies averaging around 250k of revenue, who have already found their product-market fit, have a few early customers finding value from the product and are actively at a scaling stage, a good next step is to classify the demand generation efforts into two types:
For organic, create content in large amounts which will become your assets. So create content in all areas that are relevant to your product or service. When at an early stage, your content helps you gain or increase visibility and reach audiences. On an average, good quality content disbursed in large quantities takes up to 6 months to assign visibility to your brand. So start making content as soon as you can.
With regards to paid marketing, it is important to first identify the unit economics of the product. An important number here is the payback period which you calculate using the average CPC and conversion rate numbers.
Let us explain this with an example.
Say, after identifying and analysing the ICPs, their pain points, your competitors, etc company X finds that their average CTC is around 10 dollars for the keyword that they’ve selected. Furthermore, their budget for Google Ads is 5000 dollars and they have a recurring model.
Now, the maximum unique visitors that X can bring in is 5000/10 which is 500 visitors. If their maximum conversion rates are 10%, then out of this 500, they get 50 leads. If the firm has proper enrichment and pre-qualifiers, then most of the leads will get qualified as MQLs. Now, if their sales team is good enough to convert at least 10% of your MQLs, then the company is getting 5 customers out of this process.
This makes the CAC 1000 dollars.
The next step is the pricing. If the pricing is 10 dollars a month and the average revenue is 100 dollars per customer, it means that for every 5000 dollars the company puts in, it is getting 500 dollars (5 customers x 100 dollar revenue each) as revenue.
The payback is calculated as the period after which the company becomes net positive. Here, company X has a payback period of 5000/500, which is equal to 10 months. This means that only after the 11th month, company X will become net positive for the efforts they’re putting in within operations.
So calculating the payback period is the first thing that your company should be doing if you’re a post product-market fit, early stage company. This calculation is the starting point of your paid advertising efforts.
Payback period depends on your pricing strategy. If you have a pay-as-you-use strategy which is based on the number of agents, the number of sessions, usage, etc your pricing is a changing type. The CAC can be accommodated in this case. For example, if the first user is free, the payback period looks very long. But as more employers (users) get added to the package, the payback period starts decreasing.
If the company is targeting SMBs, a good strategy is to aim for 5-6 months which can go upto 9 months based on capital and testing requirements. If the company is targeting enterprises, a good payback period would be around 3 months.
First, let us analyse the playbook. Let's take 3 months. The first 30 days is to analyse everything related to the existing landscape that a company has. This includes researching the competition and taking note of the low-hanging fruits within reach. An example would be, say the biggest competitor is very aggressive on paid search in the US, we check for tier-2 content or other areas where we can take a few competitors out or outrank them. Such an analysis, coupled with a little bit of experimentation is used to create a streamlined model within the first 30 days. This helps understand what metrics the company should be improving and where the benchmarks lie.
The goal of the second 30 days is to find ways to improve the metrics from where they were in the first 30 days. After figuring out what works, this period is also used to build muscle memory on practices that have shown improved results. Here, we also ensure that we know how much the company needs to spend, based on the research and analysis of the little data that we have already come to possess.
The final 30 days is focused on bringing consistency to the operation and forecasting the next 2-3 quarters.
Now, coming back to the question of search marketing and platforms like review sites, what matters a lot is ‘positioning’. And positioning becomes important in the context of any platform, search, review or otherwise that you wish to use. A good strategy that I have seen has worked with several companies, particularly in the B2B context is positioning your company as a thought leader in your particular market. Positioning is a big part of performance marketing.
Another thing to note is that the team needs to work closely with the product managers and product marketers to understand the solution to the pain points that you can leverage whilst pushing for the product. And always test various taglines until you chance upon the one which leads to a clear increase in brand awareness. Particularly, with search marketing, you can try forecasting keywords that have potential for high search volumes and start bidding on them. Use these keywords in your video marketing, Ads, ect by positioning these taglines on the creatives.
So it is recommended to check various aspects of your before investing your money. If you are in a highly competitive space and you have 10-15 competitors, don’t just focus on the US. Check parallel-y with other countries and start bidding more on competitor terms and don’t depend on generic or core services terms. And if you have a comparison page and have an advantage with pricing, that will definitely help in bringing in customers who would want to try your product and compare it with the competing products.
It is suggested to work on both. When looking for a product all customers, especially on the B2B side of things, make a thorough comparison of all products that give them the solution to the problem that they are looking to solve.
So create your profile and collect the marketing assets from the review sites. Next, ensure that you cover all the main search results that a consumer could potentially go looking for. Before choosing what tool to use, consumers typically research and understand the solution that the tool provides. They also go through blogs, the thought leadership content, compare competitors, even before they give out contact details like emails on the tool provider’s forms.
They may put all the details on a document and compare the tools on the basis of the different criteria like basic requirements, to-dos, must-haves, privacy policies, etc. So the company must determine these categories and how their tools perform in these categories and ensure that their search marketing takes care of consumers who come looking for this information. This is because consumers, even those who are technically adept, find this data to put on their comparative documents through simple Google searches. This comparison is also parallely taken forth on review sites like- G2 crowd, Capterra, TrustRadius, etc.
So you need a good marketing mix between search and review sites so that you don’t miss any opportunity to cater to the customer.
To begin with, whatever a team does with paid socials, paid search or SEO, they are essentially creating a demand for the brand. However, there are two things to consider: demand fulfilment and demand generation.
Demand fulfilment comes into play with bottom funnel keywords, competitor pricing, consideration channels, etc.
Demand generation is where we do paid socials, pop-up funnel, creating blogs, community building, etc.
With regards to the testing and experimentation, a good idea is to keep aside 10-15% of the paid marketing budget for testing all the marketing efforts. If this is the case, ensure that only 85% of this budget is being directly attributed to your MQL and all the funnel metrics like cost-per-click, cost-per-MQL. For the 15% going towards testing, the metrics will be different. Micro Conversions are a better metric to track testing.
A few micro-conversions for testing can be:
There are also different types of tests. With paid search, you can test manual bidding vs automatic bidding, you can test new campaign categories like smart bidding, etc. With paid social advertising, you can test the audience. Within creative you can test for different creative types like Carouses Vs gifs. You can also compare ad placements like Instagram and Facebook, Newsfeed vs Reels, etc.
Finally, don’t avoid platforms like Quora, Reddit and Twitter while experimenting. These are good places to track the queries that are bringing in the traffic that you wish to target and to target the questions and answers. You can answer as well as promote answers in Quora and Reddit. Look at these platforms as an extension of your paid search and treat them as high intent channels. For Twitter, a lot of new tech CEOs, new tech people, customer support reps, and sales people are active on Twitter. So it is a good strategy to share more gated content and other resources on Twitter.
In organic, it is a good idea to classify a content into the three buckets: bottom-funnel, middle-funnel and top-funnel. And each type should have a resource allocated to it.
Top-funnel: Infographics and un-gated materials, etc.
Middle funnel: assets like white paper, e-books, etc
Bottom funnel: in depth case studies, etc
For top-funnel, prioritise blog pieces, longform, articles comparing industry trends. It should capture the overall demand.
For example, if the company sells products for project management, then its top funnel content should cover everything that is relevant in the project management sector.
For middle-funnel, prioritise more on bottom-funnel SEO keywords, which are less volume and can easily be benchmarked against competitors. A good strategy is to increase topical authority over domain authority so that you’re recognised more easily by search.
To conclude, performance marketing, search, organic and paid take an important place once scaling becomes a priority. These are important and very useful tools that can make a marked difference when it comes to reach. We hope that you found something useful for your own scaling endeavours and stick with us as we explore other topics in this domain in the upcoming episodes!f