It doesn’t matter where in the world you’re reading this article from; the likelihood is that as a sales or marketing leader, you’re probably feeling the pinch. According to the IMF, global economic growth over the next five years will drop to its lowest level since 1990. Investment news, particularly at the VC level, is also looking less than bright into 2024.
This means that everyone is making do with less. Whilst the good news is that marketing budgets on average, comprised 14% of company spend in 2022 - the highest recorded - the bad news is 42% of marketers had their budgets cut going into 2023.
Let’s be honest, marketing often (wrongly) gets a rap for being fluffy - and therefore non-essential, which means marketing leaders are constantly in “defend” mode. Regardless of this outdated image, when marketing budgets are cut - sales is also negatively impacted. So we’ve pulled together seven ways you can trim costs, increase efficiencies and align your teams to boot.
You would not believe how much money most companies are wasting because they’re a) siloed and don’t talk to each other b) lack proper planning/processes. The first step to cutting costs is to audit, well, pretty much everything. But here are some major culprits.
Around 44% of businesses’ SaaS licences are underutilised or wasted completely. Because of a lack of audits, 70% of these application contracts were renewed into 2023, despite the underutilisation. Sales teams tend to be the worst offenders, with over 50% of sales tech barely getting touched. On top of this, the average organisation adds six new apps to its tech stack every month!
You should be working cross-functionally to determine the following:
- Do we really need this?
- Why do we really need this?
- What is this used for?
- Do any of these apps overlap in capabilities (so we can consolidate)?
- Who’s using a licence/platform?
- How often are they using it?
- Are they utilising it to its full potential?
- Are they seeing ROI?
- Can/should other departments be capitalising on access?
- When do all of our licences expire?
- Who’s responsible for negotiating renewal (with better terms)? Is this built into their schedule?
- What are the annual cost and payment terms?
- Is there a notice period for termination? What is it?
Once you have your answers, see where you can cut the fat. Keep this information in a central database, designate ownership, and ensure teams are updating and that there are regular reviews. Or - invest in another piece of software like Cledara that will keep track for you.
Another aspect of your tech audit should be around non-native integrations. The more of these you have, the slower and clunkier your tech stack becomes - and more complex your processes by default.
Having a plethora of applications that don’t naturally speak to one another can add technical malfunctions to the list of issues your team experiences and can result in your leadership bringing an expensive consultancy on board to solve this. Money that could be better spent as you well know. If you’re adding new tech, make sure it integrates seamlessly with your CRM in particular.
Events. They can be expensive (ticket, travel, accommodation, sponsorship). But they can also deliver a serious return on investment and be a critical part of your sales and marketing strategy. As someone who built events for most of my career, I knew companies who did three-quarters of their lead gen for the year at one annual event. But they were also prepared and put in the up-front work.
I recently built a new event strategy for a company who had spent nearly a quarter of a million dollars on a variety of events the year before but could only name about three leads that had been generated off the back. A slightly shocking amount of money for a start-up. Why? No process. So where do you start?
- What events have you invested in over the last two years?
- What was the investment? (Speaking, attending, sponsorship, all three?)
- What was the cost?
- What was the reason you invested?
- Were your objectives fulfilled? Why or why not?
- What’s the cost/benefit ratio?
This audit doesn’t stop there because the answers aren’t always straightforward. Just because it hasn’t worked in the past, doesn’t mean it can’t work given the right process. You must also ask:
- Is their target audience our target audience? (Job title, companies, industries, geographies)
- Are the opportunities available the right way for us to speak to that target audience? If you did a booth before but observed the fantastic networking at a dinner, perhaps a new sponsorship route should be considered.
- Is the size or quality of the target audience worth the investment?
- Is the event’s reputation going to burnish ours and vice versa?
If the answers are yes, there should still be a process in place that requires your team(s) to build a business case for going.
- What is the objective?
- What are the specific goals?
- How many people need to participate, and who, to meet those goals?
- What is the pre-event plan to engage targets or promote your involvement?
- What is the follow-up plan post-event?
- How are you holding the team(s) accountable?
Getting the right support to deliver on your strategy is obviously important. However, whenever pennies start getting pinched, eyeballs inevitably start looking at both internal and external staff numbers.
Let’s talk about external support. If you’re working with an agency and suddenly your boss says it’s an easy win to bring everything in-house - hold up. You need to identify the skills gaps that exist on your team. Build a spreadsheet that outlines your team’s strengths and weaknesses.
It may be that certain members of your team can take on additional responsibilities that were previously outsourced. But an increase in workload with less support can be a false economy. 66% of marketers already confess to burnout due to increased economic pressures.
Two areas you don’t want to scrimp in particular: 1) Account-Based Marketing is far more efficient and effective when supported by a third party agency, particularly if you’re undertaking a 1:1 or 1:few approach. 2) Social media. It can have such an impact when done right - and minus ad spend, it’s free! But let’s be honest, how many B2B businesses have marketeers who fit in a few LinkedIn or Twitter posts here and there - to minimal effect?
But first, what content do you have? Time for another process! You can download this data from your CRM as a first step so you can see title, date published, author, asset type (e.g. blog, ebook, etc.), post URL and tags.
You then need to build in additional insights: What stage of the buyer’s journey is it targeting? What persona? Is it gated? What are the keywords? How is it performing? What are the recommendations for the marketing team - optimise, update, replace entirely?
Building a centralised content bank not only helps marketing to repurpose but gives sales an easily accessible toolbox at their fingertips; this enables them to know what is and isn’t available (and what’s needed), and send the right content to prospects and leads.
Speaking of sales and content, a small digression. Marketing leaders, listen up. Start turning your sales leaders into influencers, posting content on their accounts, encouraging them to write and be seen. People buy from those they trust, and trust is increasingly built online. Instead of always spending on influencer marketing, create your own.
#2 Fix your data
Let’s talk data. You need to input, clean and consolidate your damn data.
Inputting data: Sales leaders, you’re up. The amount of salespeople who slack on putting in data are astonishing. When marketing contacts the wrong people or can’t target the right ones - this is partly on you. And it impacts your lead gen. And the amount of time your team then spends prospecting.
Sometimes marketing contacts the wrong people or can’t target the right ones because the data has been cleaned, well, never. Usually rarely at best. There is no use bragging about your 40,000 person database if only 10,000 of them are relevant and only 4,000 are interested in engaging with you. Sales, marketing and customer success must work together to clean this and a rigorous process put in place for inputting the right data (another audit - what data do you actually need?) and regularly maintain it moving forward.
My final word on data. Consolidate it! For all of you out there using two or more (yes, more, god help us) CRMs - you must stop. Not only are the financial benefits of paying for one CRM clear, but having multiple sources of information for prospect and customer data increases the likelihood of mistakes. This negatively impacts conversion and churn rate.
Not to mention the time it takes for each team to search through different platforms for necessary data. And please it’s not either Salesforce or HubSpot - it’s what tech stack allows all teams to work off of and contribute to one data set, that’s all that matters.
#3 Know your audience
Of course you’re going to say, “We already know who our audience is - what do you think we’ve been doing this whole time?” Funny that.
This is a drum I keep on banging: If you haven’t done your personas or Ideal Customer Profile (ICP), then no, you actually don’t. You have a guestimate of who you’re targeting, but not intelligence based on market research and real data.
What do these bring to the table?
Your ICP defines the firmographic, environmental and behavioural attributes of accounts that are expected to become a company's most valuable customers. For instance, if you’re an ESG platform focused on medium to enterprise businesses (500+ employees) in the US market, your Total Addressable Market (TAM) would be over 45,000 businesses. That’s a lot of companies, much less people, to get in front of.
Now if you look at your customer base, and you see that it covers roughly seven industries, but two of them are consistently problematic because your solution isn’t quite right for them - you remove them. Your analysis also shows that your customers are most satisfied with your product when they tend to be in companies with less than 5,000 employees, already have an ESG leader and at least one sustainability report under their belt. Suddenly that TAM goes down to around 1,100 companies.
This is a much better starting point for targeting.
A buyer persona is a semi-fictional representation of your ideal customer based on market data and intelligence about your existing customers. It brings together consumer demographics, behaviour patterns, motivations and goals.
Perhaps you know that sustainability managers and boards are your key targets. But what individual role do they play in your buying journey? What are their drivers? Where do they get their professional news on a daily basis? These factors will allow you to hone your messaging and advertising channels.
All of us sudden, instead of the scatter gun approach to 45,000+ companies that may or may not have an interest/need for ESG software, you’re looking at 1,100 companies who probably do - with roughly 3-5 individuals a part of the ESG buying committee, who spend much of their time looking at peer reviews and thought leadership on LinkedIn.
This focused targeting reduces wasted resources on ad spend, content creation and pretty much every other marketing activity you can think of. You’re starting to bring people into your funnel that have a higher chance of converting and are less likely to churn if they become a customer.
#4 Know Yourself
Ok, I know this point sounds a bit kum-ba-yah. It isn’t - stay with me. If you don’t know your customers, and don’t do the work outlined above, you aren’t going to understand what it is your customers really need and value. Without this, your positioning and messaging won’t resonate and even the best ICP in the world won’t save you.
Positioning articulates your product or service’s benefits to the end customer; how you change their world for the better. It is not a list of features. It is not necessarily what the founder had in mind when they started the company either.
This requires in-depth customer research, hearing about what’s important about your product or service from the people who use it every day. It also means understanding the space in which you want to dominate. A thorough understanding of what you’re selling and the competitor landscape is needed.
Remember, this will also periodically change. This isn’t a rigid, one-off exercise. Your business, market and product will grow and shift - and your positioning should mirror that. Don’t be afraid to test and tweak as necessary. On a similar note, more testing and hypothesising overall please. We work with so many smart marketing teams that don’t test enough, and therefore don’t fail fast, incurring costs they could have avoided.
The positioning work will then feed into your messaging, or the external way you talk about your product/service and compels customers to take action. This underpins marketing and sales messaging. Which, by the way, must be the same. Everyone needs to be singing from the same hymnbook.
This alignment engenders trust. Understanding your customers’ values in relation to your offering fosters resonance. Again, these will feed into laser-focused marketing and sales, wiping out wasted efforts and increasing lead gen and sales.
This leads me to…
#5 Sales and marketing alignment
Failure to align sales and marketing teams is top of the list in terms of wasting resources. It costs businesses roughly $1 trillion annually. The vast majority of B2B content is not being used and three quarters of marketing leads never convert into a sale. These are terrible numbers - totally unnecessary and very fixable.
If you haven’t noticed, all of the above tasks have several things in common: 1) cross-functional working relationships 2) increased communication and knowledge sharing. Which leads to the ultimate goal of sales and marketing alignment.
I’m not going to say a whole lot more about this - you can read everything you need to know about why this is essential and how to undertake the process here.
#6 Get yourself some evangelists
Word of mouth is one of the most effective ways to drive sales and decrease marketing costs. It accounts for roughly $6 trillion of annual consumer spending globally per year - more than the GDP of Japan. This is, on average, 13% of all consumer sales. According to Neilsen’s global Trust in Advertising Study 2021, which surveyed 40,000 people in nearly 60 countries, 88% of individuals said they trusted recommendations by those they knew above all other forms of marketing. This number is only set to heighten with Gen Z coming into more buying power.
You need to get in on this. Who doesn’t love a bit of free marketing? Particularly, effective free marketing from people who love you?
It’s surprising the amount of business we work with who aren’t taking advantage of customer referrals. Particularly as software and digital goods have one of the highest referral rates of all industries, at 4.75% (double the average).
And this is despite the fact that during Covid, nearly 50% of B2B tech vendors agreed that customer referrals had been their most effective marketing tool.
Where to start?
Benchmarking. If you haven’t already undertaken a Net Promoter Score (NPS), now is the time. NPS is a customer satisfaction benchmark measuring how likely your customers are to recommend your business. You need to know if your customers actually do love you - or not - and why.
Your NPS is going to allow you to see which customers are happy, which aren’t, and tackle the latter appropriately. For those that are happy (and fit your ICP!), it’s time to build a referral plan. Note: the below works for partner marketing too.
- Dive into your CRM. NPS and referrals can be done via your CRM, which will also have templates and a process to follow so you aren’t alone in the wilderness.
- Build goals - besides the obvious one of cutting costs. What else are you looking to achieve? Growth, revenue, retention?
- Research how - if any - referrals currently come into the business and what you do with them. Customer success and sales should be in these conversations. How do you want referrals to be dealt with moving forward? Create a plan and share it cross-functionally.
- Build a list of advocates, including former clients. Not all of these should necessarily come from your CRM, but marketing should be looped in so they can track it; be mindful of relationships, how to best leverage them and when.
- Provide a reward. Let’s face it, incentivisation works. Cash reigns but an Amazon gift card works too.
- Create a content strategy. How will you educate your customers about your referral programme? What messaging do you need sales/customer service to adhere to? How will you say thank you? Referral kit, landing page, different emails for different personas, etc.
- Track and test. Not only do you need to track the progress of your programme, but like all things in marketing, it’ll need to be tweaked to maximise effectiveness.
It doesn’t matter if your product or service is £100 or £100,000 - product reviews should feature in your marketing. A 2022 survey from Brand Rated found that 95% of consumers read online reviews before making a purchase - and over half would pay more from a brand with good reviews. Gartner Digital Markets’ 2022 Global Software Buyer Trends Survey discovered that 85% of buyers trust online reviews as much as personal recommendations; they report using customer reviews sites as the top preferred channel to obtain information on software.
More to the point, your B2B buyer is most likely part of a buying committee, which means that purchasing your offering is going to take research, competitor analysis and an internal exchange of views on their parts. As a sales and marketing team, it’s your job to make that as easy as possible for them - as this itself can be a conversion factor.
Product reviews play into this. It can be as easy as a Google review. In the B2B Saas or fintech space, Capterra or G2 are also well-respected platforms where buyers hunt for information.
- Drive brand awareness and trust
- Generate new leads
- Provide intent data
- Boost your SEO
Similar to product reviews, employee reviews do exactly the same thing for your business. According to Glassdoor, 86% of job seekers look at a company’s reviews and ratings before they even decide where to apply for a job. You may be thinking, whoa, this is way out of my wheelhouse. And how does this reduce my costs?
It’s all about reputational marketing.
As sales and marketing leaders, you have an impact on how you run your teams. Aligning sales and marketing, benchmarketing your customer sentiment and feeding that back to product and customer sales to put the customer at the heart of what you do - this starts to positively impact the business. It breaks down silos, fosters a more positive culture and removes tensions. Happy employees, happy customers - they make noise for you. Help them help you.
A no-brainer when it comes to maximising efficiency and reducing costs is automation.
Top of the list is conversational marketing - or quite simply, bots/live chat, that focuses on delivering you Conversation Qualified Leads (CQLs) gathered on your website and landing pages. They can also exist on Instagram, Facebook Messenger, etc. (if that’s where your customers are). It’s a tool that helps you connect with your customers - and potential ones - at exactly the right time.
- Better marketing ROI: Conversations inside Facebook Messenger between companies and customers have a 30% better ROI than retargeting ads.
- Cost reductions: 80% of routine questions can be answered via conversational marketing bots; they can reduce customer service costs by 30%.
- Higher retention: 52% of consumers are more likely to make repeat purchases if the company offers support via live chat.
- Loyalty: 83% of consumers said they would be more loyal to a brand who offers a chatbot for tasks like making an appointment or handling customer service inquiries.
Your CRM will be able to facilitate some of this, and you should explore this option.
If you don’t have a lead scoring system in place, time to get sales and marketing together to build one. This process ranks potential customers using criteria that determines which leads are ready to make a purchase. At its most basic it looks like:
- Determine your target touchpoints, e.g. ebooks, product demos, landing pages, blogs, etc. Each of these should have a numerical ranking between 1-100. For instance, a blog may have 2 but a product demo may have 75 as the former could be merely educational and the latter an indication of buying intent.
- Determine a numerical threshold for when the lead looks likely to convert.
- Devise a plan for how you will nurture a lead to get it to that threshold - as well as a follow-up strategy once they do.
- Input into your CRM, which can notify teams at various points in the journey.
- As always, track and tweak. You may find that leads are converting at a lower or higher number and your threshold will need to be adjusted accordingly.
What’s the impact?
- Increased sales efficiency and conversion: The sales team only works to close leads that are actually qualified (by a mutually agreed on criteria).
- Remove wasted marketing spend: Marketing can clearly see what efforts aren’t working and shift investment elsewhere.
- Marketing and sales alignment
Two words: Chat GPT. It’s changed things and we should embrace it.
Content is vital to inbound marketing and lead generation off the back of it is significantly less expensive than outbound. According to Adobe’s latest Digital Trends Report, 89% of senior executives agree that demand for content has increased dramatically. The same source found that, “44% of marketing practitioners cite a lack of time to be creative as a barrier to delivering excellent customer experiences”. Only a minority of companies cited themselves as “good” at creating and delivering content.
Create some time for yourself and your team to be creative. Utilise AI content assistants to help generate ideas, social content and more that the real humans that work for you can build on. Let it take some of the heavy lifting for you.
We made it! I hope this unexpected beast of an article helps impact your sales and marketing bottom lines in various ways. The simple answer is that cost-cutting is productive with optimisation rather than trimming.
Cost-cutting may also seem painful, so the thought of tech migrations layered on top might seem too much to bear; you are doing yourself a disservice if all you do is cut numbers to please a leadership team. Treat this as an opportunity to reframe, reorganise and re-galvanize the troops and show your team that less doesn’t always mean less and to do more with less doesn’t have to be a negative experience.
Need a hand with an idea like this? Then feel free to reach out to our team and book some time; auditing tech and optimising operational environments is a key part of our product and support offering.