Category Archives: Strategy

Should Your Website Drive Prospects to a Demo?

TLDR:  Think twice before you do and three times about how you do it.  While it’s a very common practice, I think it’s often a lazy one, done by default, and without regard for either the buyer or seller downstream.

When I visit enterprise SaaS websites these days, I see two primary calls-to-action (CTAs) in widespread use:

  • Try it:  used by the product-led growth (PLG) crowd, and a great CTA — provided the company is actually executing a PLG strategy [1].  While we won’t drill into this large topic today, know that I am working on a PLG post to go up soon.
  • Get a demo:  in use by most others and typically promising a personal demo, but sometimes offering to watch a video or join a weekly live webinar.

See below for three clipped examples of both demo and trial CTAs from enterprise SaaS websites (read across) [2].

The question:  while it’s certainly a common practice, is it a good one?

My answer:  often, not.  Using a demo as your primary CTA, whether weasel-worded (e.g., “request demo”) or not (e.g., “get demo”), can frequently lead to problems:

  • Double qualification.  Typically, the prospect first speaks to an SDR who does preliminary qualification (e.g., BANT) and then passes the prospect to a seller to deliver the demo.  The buyer thinks:  I didn’t click a button labeled, “speak to two people,” I clicked one labeled, “get demo” [3].
  • Raising expectations.  The SDR often justifies their call by saying, “I’m here to gather some information to ensure we personalize the demo to your needs.”  That’s great if the ensuing demo is actually tailored in some way; it’s criminally bad expectation-setting if it’s not.
  • Horrific second-calls, reminding me of a quote from Fail Safe: “what you’re telling me, I’ve been specifically ordered not to do.”  We tell sellers to do qualification and discovery, understand and solve business problems, and under any circumstances never to spew features — then we walk them in front of a largely unqualified prospect with whom we have set an expectation that they’re going to see a feature demo [4].  It’s a wonder they don’t revolt.
  • Hampering sellers from doing their jobs, which at this point in the sales cycle should be discovery and qualification — i.e., asking a series of open-ended questions to determine if this is a real sales opportunity with a qualified buyer who has a business problem that our product can solve.
  • Super-awkward situations, where the seller thinks they’re having a basic 1-1 demo and the entire buying committee shows up for “the demo” of your product, which will be delivered unprepared and without context.  I’ve seen that happen; it’s cringeworthy.
  • Wasting sellers’ time.  Doing a standardized demo is arguably not selling, but marketing — and your marketing team can likely do it as well as your sellers [5].  If sellers are doing lots of 1-1 demos for lots of semi-qualified prospects, marketing might be generating a lot of activity for sales, but don’t forget the old saying about processionary caterpillars confusing activity with progress.

The root problem here is not that get-demo is somehow inherently an evil CTA [6], but that this may reveal a deeper problem in sales and marketing alignment.  In a siloed company, where sales and marketing are not working together, the above problems can and do develop because marketing is trying to maximize clicks on get-demo without thinking enough about either the seller or the buyer downstream after they do.  Think:  we passed 47 get-demo oppties this month, we’re not the problem.  Buzz off.

There’s an easy way to determine if this is a problem at your company:

  • Listen to Gong recordings of the first-calls with sellers (where they are notionally delivering this demo) and do so from the perspective of both the buyer (e.g., are they getting a demo?  is it good one?) and the seller (e.g., are they doing qualification and discovery?  are they spewing features?)
  • Talk to sales leadership.  Bring your knowledge of the generic problems along with your learnings from the Gong recordings and have a discussion about how you can work together to improve the early sales cycle process for both seller and buyer.

Note that win/loss reporting will likely not catch these problems because this activity typically occurs upstream of opportunity creation, so there are definitionally no lost opportunities due to a bad initial demo [7].

Improvement Ideas for Get-Demo Calls To Action
Here are some ideas on how to mitigate these problems, all offered in the spirit reducing friction in the buyer journey while maximizing efficiency for the seller:

  • Always have an ungated 30-60 second explainer video that explains what your product does so curious people can quickly understand what it is.
  • Publish a 2-3 minute ungated short demo video of what your product does for those who want more information.
  • Publish an as-long-as-necessary deep demo video both on your website (possibly gated) and on your YouTube channel [8].  Remember David Ogilvy:  “long copy sells!”  If you solve an important problem to which I’m seeking a solution, I’ll have plenty of time for a long, well-executed demo.  Just make sure it’s well-executed.
  • Hold a weekly live demo which (1) gets the buyer block time on their calendar to see the solution, (2) gets us the buyer’s contact information, (3) offers the buyer the opportunity to ask live questions during the event, (4) gives us the chance to spot target accounts expressing interest and the chance to engage with them about that, (5) provides SDRs with an alternative CTA to “do you want to speak to a seller?”, (6) provides a broad indicator of interest over time (i.e., weekly demo attendance), and (7) gives us a platform we can easily build upon — think:  on Tuesdays, it’s the product overview; on Wednesdays, it’s the demo for retailers; and on Thursdays it’s the demo for use-case X.

Basically, I’m trying to let the buyer decide what they mean by get demo, potentially let them get that right away, and provide a way to drive interested prospects who don’t want to speak to a seller to a periodic live event where I can deliver a high-quality, in-depth demo while driving scale economies in so doing.

After the weekly live demo, the SDR calls and says, “how did you like the demo?” and “did you see anything relevant to the challenges you’re facing?”  If those answers are positive, then they can pass it to a seller for discovery and qualification.

Don’t get me wrong.  I’m a huge believer in also having a clear call to action that says, “have a seller contact me.”  I understand that it won’t get pressed very often, but oh, when it does — it’s likely to be a pretty interested prospect [9].

My Three-Point CTA
I’m aware that many marketers today don’t want to paralyze buyers with choice, so there is a general preference for the fewest possible options in a CTA, but that notwithstanding, if I had to solve the problem myself, I’d use this as my default CTA [10]:

When is Get-Demo a Great CTA?
The first revision of this post prompted some questions along the lines of, “I understand you don’t like get-demo as a CTA, but when is it appropriate?” to which my answer is:

  • I’m not against get-demo as a CTA.  I just think we need to put more thought into what it means, the options we offer, and what happens to both the buyer and the seller when someone presses it.
  • For most companies, the vast majority of people who press get-demo are not worth investing in a personalized demo.  If you want them to self-demo, adopt a PLG strategy and let them use the product.  If that’s not possible, then they’ll need to see a demo somehow and my ideas above provide numerous options for doing that.  I like the weekly live demo because it’s cost-effective way to let everyone see the demo while allowing sales to focus on the handful of attendees who are most interesting.
  • If, somehow, you’re in a model where you think it is worth doing a live, personalized demo for everyone who wants one, I’d first remind you about processionary caterpillars, and second say to set up a call center and drive people live into that call center.  The key to velocity sales is friction elimination, so if someone wants a live demo, and you’re willing to give them one without any real qualification, then get ‘er done — don’t let any time lapse in scheduling.

(Revised 11/22/21)

# # #

Notes

[1] And if it’s not, marketing trying to do PLG on their own (because they want to, the investors want to, or the company would like to be PLG but isn’t), with a product that’s not designed to be easily adopted and sell itself, is a bad idea.  In this “PLG is the new black” era, the only thing worse than not doing PLG is trying PLG tactics when you don’t have a PLG company or PLG product.  To mix metaphors, you could likely end up putting your best foot forward into your mouth.

[2]  Note the wasted space by having login in this zone of the page.  I’d put login buttons or icons somewhere else completely (e.g., top right, page footer) so as to make room to have 3 calls to action as presented below.

[3] Sometimes, it’s actually triple qualification:  the SDR does worth-passing qualification, the seller does worth-accepting qualification, and then the seller and a sales engineer do a deeper discovery call — all before the buyer gets their demo.

[4] The results in sellers spinning plates — doing qualification with one hand, demoing with the other, and doing a bad job at both.

[5]  I’d argue generally that doing standardized things is definitionally marketing while doing personalized things is sales.  Think:  given what you’ve told me about your unique situation, here is how our product can help you meet your goals.  That’s selling.  If you just want the White House Tour, then that’s marketing.

[6]  To which many website types were quick to object in my first revision of the post — but it gets clicked all the time.  Well, perhaps that’s because people actually do want demos and also because we give them no real alternative CTA!

[7]  That is, the bad initial demo resulted in no opportunity being created.  That said, you might get wind of it in your win/loss reporting from opportunities that made it into the pipeline if you ask customers about their high-funnel experience through both ratings (e.g., “what was your impression after the initial demo”) and qualitative questioning (e.g., “how was your experience from when you first contacted us until you were put in touch with your seller?” or “how did your first meeting with your seller go?”)

[8]  Which I know makes it semi-gated, but it also enables people to find and watch it directly via Google/YouTube search.  Have some faith that if they like what they see, they’re not going to forget to find our contact-us form and fill it in.  (And you’re going to remind them to do so at the end of the video, of course!)

[9]  When you’ve truly internalized that marketing is about generating sales via the creation of valid sales opportunities you stop caring only about how often something gets clicked (or how many leads we got) and start caring about how fast we can get qualified hand-raisers through the process and off to sales.

[10]  Perhaps more interestingly, if you forced me to drop one, it would be stay-in-touch, not contact-us.  I’d make stay-in-touch a backup offer on the get-demo page.

Are We Growing Fast Enough?

Say you’re a $40M SaaS business growing at 40%.  Is that good?  Is that bad?  How do you know?

In this post, we’ll take a quick look at three lenses you should look through in considering this question.

  • The plan lens
  • The benchmark lens
  • The market lens

The Plan Lens
Every startup has an operating plan that is used to set targets for the company and manage the cash runway.   The first question is always, “what were new bookings as a percent of plan?” and only then do you get the second, “what does that represent in terms of year-over-year growth?” [1] [2]

That order is not accidental and it subtly reveals something important:  plan-relative performance is more important to most boards than absolute performance.  That’s shocking when you think about it because plan-relative performance is at least in part about game theory (i.e., plan negotiation skills) whereas growth is a better measure of raw performance [3].  But it’s true.  When I started as CEO of MarkLogic the seven words the legendary Mike Moritz said to me were not, “grow more quickly than your primary competition,” but instead, “make a plan that you can beat” [4].

Why is this?  I think plan-relative performance gets top billing because it ultimately measures whether you are in control of your business.  If no, get in control of your business.  If yes, are you growing fast enough?  If no, make a faster growth plan.

The trouble with the plan lens is you can literally go out of business beating plan.  Consider this example:

Your company beats plan every year, performing in the 105% to 110% of plan range and growing at a respectable 40%.  The problem is you’ve lost the market.  You had a competitor who was more aggressive, grew faster — who knows maybe even missing their plan every now and then — and in year 7, they end up 3+ times your size, are seen as the clear market leader, win more deals because of that, command a market leadership premium in their fundraising, and can raise vast sums of money to keep outgrowing you with only modest dilution [5] [6].

Game over.  Startup markets are not won by the timid.

The Benchmark Lens
Now that it’s clear that plan-relative performance is only one lens, you may decide to get some benchmark data to see what kind of growth is normal or good at your scale.  So you grab a copy of OpenView’s benchmarks or the the KeyBanc SaaS survey.  Looking at KeyBanc, you’ll find this chart.

While I’m a big believer in gathering such data and using it for context, benchmarks alone are not enough.  In our example, we look at the $30-50M size column, see 38% as the 75th percentile cut-off, and feel even better about our 39% growth.  Yes, relative to the universe of private SaaS companies 39% growth at $30-50M scale is top quartile (you can pick up your participation trophy on the way out), but what actually matters is your size and relative market share in your target market.

While on a quick glance bankers may tell you, “your numbers look pretty solid,” when they dig into the market and realize that you are only 1/3rd the size of your archrival, they’ll take a sudden and deep interest in positioning — specifically how you position relative to the market leader and whether that story paints you as the market leader in a defensible niche or simply downstream roadkill.

The Market Lens
The most impactful chart I ever made is the one below, which I’d present at QBRs back in the day Business Objects.  Every quarter I’d divide ours and our key competitors’ quarterly revenues by our quarterly revenues, creating a relative size factor where we were definitionally always at 1.0 (the blue line, below).

In this format you can see relative market changes very easily.  Anyone moving up is gaining relative share, anyone moving down is losing it.  Above the blue 1.0 line means they’re bigger than we are, below it means they’re smaller.  The data is fictitious, but you can see that Cognos (COGN) started out bigger than we were but we overtook them.  MicroStrategy (MSTR) posed a real threat for a while and then mostly leveled out.  Brio had some momentum but then lost it.  Because the data was largely available, I could even cut it by major geographic regions.

If I only had one chart to answer the question, “are we growing fast enough?” it would be this one.

Nowadays, with companies going public late in their life cycles, this data usually isn’t available during the first 10-12 years of evolution.  Lacking public data, I’d have my competitive analyst make and maintain a spreadsheet that triangulates revenue using scraps and tidbits from VCs and other sources (e.g., Nathan Latka is remarkably effective at getting spokespeople to spill revenue information) and I’d make a separate sheet that uses headcount from LinkedIn as a proxy for ARR, using the method in this great post by SaaStr’s Jason Lemkin.

Summary
To answer the question, “are we growing fast enough?” you need to look through three lenses:

  • Plan performance, which primarily measures whether you’re in control of your business.
  • Benchmarks, which tell you how you stack up across the universe of private SaaS companies, remembering the vast majority of which operate outside your target market.
  •  The market, where you need to assess whether and to what extent you are succeeding in becoming (or remaining) the leader in some space against the competition.

# # #

Notes

[1]  So much so that you should proactively include them in any quarterly results summary slide or email.  They shouldn’t have to ask.

[2]  YoY as opposed to sequential (i.e., QoQ) growth because enterprise SaaS is a seasonal business so the YoY comparisons are more meaningful.

[3]  In fact, I believe the best metric would be relative market share (i.e., how are you doing relative to your competition) but that’s hard to get data on (particularly in the private SaaS world) and managers would resist it like the plague.

[4]  I recently found a 642-page collection of his awesome wisdom here.

[5]  To really rub it in — in year 7, they added 1.25x your company in net new ARR.

[6]  The only potential winner at YourCo is the VP of Sales who presumably was a great target negotiator, always kept the bar low, and always beat it — but even they lose when it comes to the value of their equity.

Appearance on the “Yes, And Marketing” Podcast

A few days ago, Steve Pockross released a new episode of his Yes, And Marketing podcast on which he interviews a series of “eclectic and enlivening” marketers where “your weird shower thoughts and disparate liberal arts references take a road trip.” I was last week’s featured guest, and I don’t think the episode fails to deliver on its rather unusual promise.

Steve posted a nice summary of the session which lays out the topics we discussed including:

  • A rambling introduction where we talked about the Grateful Dead as related to marketing and business models, the philosophy of math and Russell’s paradox, the linkage between mysticism and quantum mechanics, the art of the proper French dinner, an unlikely similarity between geophysics and marketing (inverse problems), the quote from A Christmas Carol that most applies to upwardly mobile CMOs (“mankind was my business”), Gad Elmaleh, The Three-Body Problem trilogy, and stuff like that.
  • Imposing simplicity, a critical duty for all marketers
  • The two archetypal marketing messages, Bags Fly Free and Soup is Good Food.
  • Long vs. short copy and how to correctly apply David Ogilvy’s “long copy sells” adage.
  • Content marketing, and when to write C+ deliverables vs. A+ deliverables, and how to be explicit about that in planning.  (Lest you end with straight Bs.)
  • What to look for in a CMO for a startup, particularly if they’re potentially joining from a large company and you’re worried they may struggle in a startup environment.
  • Aligning sales and marketing, a perennial favorite topic, but this time both from the CMO and the individual marketer perspective.
  • The importance of rigorous definitions in messaging, and how you can use them to turn gray messages into black-and-white messages.
  • Walking the benefits stack by repeatedly asking “so what?” and not being afraid to do so.
  • Never forgetting the kiss, i.e., the ultimate benefit from the point of view of the customer, in your marketing.

Thanks to Steve for having me, to Crispin Read for referring me (his episode is well worth a listen), and to all of you who find the time to listen.  While I’ve been doing a  lot of podcast interviews of late, like the Grateful Dead, I promise that each show is different.  And this one’s a barn burner.

Tomorrow’s Product Power Breakfast with Paul Jozefak on Introducing SaaS as a Layer to Lighten the Legacy Load

Please join us for tomorrow’s SaaS Product Power Breakfast with entrepreneur and venture capitalist Paul Jozefak, CEO of Receeve (an all-in-one platform for collections and recovery), on how to use SaaS as a layer atop legacy systems to prove return on investment (ROI) and smooth the customer’s transition before setting out to rip and replace them.

This is an interesting strategy that I’ve seen numerous times in SaaS and it cuts to core product strategy issues, most notably, to what extent and in what timeframe do you “design in” versus “design out” the underlying technology.

In addition to both impromptu and (hopefully some) audience questions, we’ll be asking Paul:

  • Why layer on top in your target segment?
  • Are there any risks to layering?
  • What are your customers trying to accomplish when it comes to working with Receeve?
  • Where is technology in the segment headed?
  • What hurdles do you hit with decision makers?

Thomas has not been feeling well so, while he’s slated to be our lead interviewer tomorrow, I may end up taking the lead on this episode.

Either way, see you there!

Structuring the Organization and Duties of Product Marketing and Competitive Analysis

I sometimes get asked about how to structure an enterprise software marketing organization and the relative roles of product marketing vs. competitive analysis.  In this post, I’ll share my (somewhat contrarian) thoughts on this topic.

My first job in marketing, which served as my bridge from a technical to a sales-and-marketing career, was as a competitive analyst.  Specifically, I was the dedicated Sybase competitive analyst at Ingres in the late 1980s, in a corporate job, but working out of the New York City sales office.  Because, at the time, Sybase was a strong new entrant with a beachhead strategy in financial services, this was rough equivalent of working for the Wehrmacht on Omaha Beach on D-Day.  I learned not only by watching Sybase’s market invasion, but more importantly by watching how the local reps [1] and corporate [2] responded to it.

I’m a huge believer in competitive analysis, which probably started when I first heard this quote watching Patton as an adolescent:

“Rommel, you magnificent bastard, I read your book!” [3]

My other formative experience came from watching yet another movie, Wall Street, where antagonist Gordon Gekko refers to Sun Tzu’s The Art of War.

While Gekko doesn’t use my favorite quote for these purposes [4], his reference to the book was very much in vogue at the time, and probably why I first read it.  My favorite quote from The Art of War is this one:

“If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.”

Regular readers know I believe the mission of marketing is to make sales easier.  So the question becomes:  in enterprise software, how do we structure product marketing and competitive in the best way to do just that?

First, let’s review some common mistakes:

  • Not specializing competitive, instead declaring that each product marketing manager (PMM) will cover their respective competitors.  Too much scope, too little focus.
  • Understaffing competitive.  Even in organizations where competitive exists as its own team, it’s not uncommon to see a ratio of 5-10 PMMs per competitive analyst in terms of staffing.  This is too unbalanced.
  • Chartering competitive as strategic.  While I often euphemize the competitive team as “strategic marketing” or “market intelligence,” that’s not supposed to actually change their mission into some think tank.  They exist to help sales win deals.  Don’t let your competitive team get so lofty that they view deal support as pedestrian.
  • Putting competitive under product marketing.  This both blurs the focus and, more importantly, eliminates a healthy tension [5].  If your messaging doesn’t work in the field, the CMO should want to hear about it early (e.g., in their own staff meeting) and have a chance to fix it before it escalates to the corporate QBR and a potential sales attack on marketing in front of the CEO.
  • Putting competitive in the field.  This happens when marketing abdicates responsibility for producing sales-ready competitive materials and someone else picks up the ball, usually the sales productivity team, but sometimes field marketing [6].   This disconnects corporate product marketing from the realities of the field, which is not healthy.

Now, let’s tell you how I think structuring these departments.

  • Product marketing exists to build messaging and content [7] that describe the features and benefits of the product [8].  The job is to articulate.  They are experts in products.
  • Competitive analysis exists to research competitors, devise plays, and build tools to help sales win deals.  The job is to win.  They are experts in the competitors.

As long as we’re in movie quote mode, here’s one of my favorite quotes from James Mason’s character in The Verdict [9]:

I’d prepared a case and old man White said to me, “How did you do?” And, uh, I said, “Did my best.” And he said, “You’re not paid to do your best. You’re paid to win.”

While he was speaking to about lawyers, he might as well have been speaking to competitive:  you’re paid to win.

That’s why I believe competitive needs to be holistic and play-oriented.  Simply put, take everything you know about a competitor  — e.g., products, leadership, history, tactics — and devise plays that will help you win against them.  Then train sales on how to run those plays and supp0rt them in so doing.

If you adopt this mindset you end up with an organization where:

  • Product marketing and competitive are separate functions, both reporting directly to the CMO
  • Product marketing is product-oriented, focused on articulation of features and benefits
  • Competitive is competitor-oriented, focused on using all available information to create plays that win deals and support sales in executing them
  • Product marketing staffing is driven by the number of products you’re covering
  • Competitive staffing is driven by the number of competitors you’re covering (and at what depth level or tier).
  • You end up with a ratio of more like 3:1 than 10:1 when it comes to the relative staffing of product marketing and competitive

You think of these organizations as a matrix:

# # #

Notes

[1]  In the case of the reps, their response was to walk away from financial services deals because they knew they were likely to lose.  This, of course, had the effect of making it easier for Sybase to enter the market.  The smart reps went to Westchester and Long Island and sold in other verticals.  The dumb ones battled Sybase on Wall Street, lost deals, missed mortgage payments, broke marriages, and got fired — all for doing what the c0mpany strategically should have wanted them to do:  to slow down the invasion.   A classic case of micro and macro non-alignment of interests.

[2] The corporate response was to blame sales management.  Rather than seeing the situation as a strategic problem where an enemy was breaking through lines with an integrated strategy (e.g., partners), they chose to see it as an operational or execution problem.  Think:  we’re hiring bad reps in NYC and losing a lot deals — fire the sales manager and get some new talent in there.

[3]  Good Strategy, Bad Strategy tells the presumably more common inverse tale, where during the Gulf War in 1991 General Schwarzkopf was widely credited with a left-hook strategy described as “surprise,” “secret,” and “brilliant,” that was clearly published in the US Army Field Manual 100-5 saying the following, complete with an illustration of a left hook.

Envelopment avoids the enemy’s front, where its forces are most protected and his fires most easily concentrated. Instead, while fixing the defender’s attention forward by supporting or diversionary attacks, the attacker maneuvers his main effort around or over the enemy’s defenses to strike at his flanks and rear.

[4] Gekko refers to:  “Every battle is won before it’s ever fought.”

[5] Organization design is all about creating and managing healthy tensions.  Such tensions are a key reason why I like marketing reporting to the CEO (and not sales), customer success reporting to the CEO (and not the CRO/sales), and engineering reporting to the CEO (and not product), for a few examples.

[6] At one point, way back, Oracle had a huge market intelligence organization, but housed within Americas Marketing, a field marketing organization.

[7] Content being collateral (e.g., web content, white papers, e-books), presentations (internal and external), and demonstrations — all built around communicating the key messages in their messaging blueprint.

[8] Often, but not always, with a primary emphasis on differentiation.

[9] It’s not lost on me that the character was morally bankrupt and was implicitly saying to win at any and all costs.  But I nevertheless still love the quote.  (And yes, win within normal legal and societal constraints!  But win.)