Part art and part science, marketing is one of the most challenging functions to get right in a growing enterprise software company. Knowing when to hire a CMO, how to integrate sales and marketing teams, how to create a budget, and which metrics to measure are critical decisions for any founder.
To delve into what it takes to build a marketing function that contributes to long-term profitability, we turned to two enterprise marketing mavens: Meghan Mitchell-Marks, CMO of Orca Security, and Sarah Lubeck, Drata’s VP of marketing.
Read on for their take on top questions from startup founders, or watch the replay:
Hiring a marketer early is wise if this person can help design a strong go-to-market structure. Keep these tips in mind as you hire and recruit:
It depends whether your sales motion is enterprise-focused or product-led, but here are some strategic ways to decide on a budget:
In the beginning, don’t try to put a hard number on marketing, such as X% of our overall budget. Instead, choose goals you want to attain, such as having 5,000 developers using your product in the next year, or signing on three large enterprise clients, and then have your marketing team devise specific budgets to meet those goals.
Pro tip: Don’t make the mistake of underinvesting in branding. It might feel frivolous, but when you’re a new company, you need to make your mark and get known. Investing in branding work early will help you stake your claim on the market.
It’s difficult to calculate the dollar-for-dollar impact of marketing in early-stage companies, but there are many metrics you can measure, including:
When your company enters the Series B stage, you can begin to measure the impact of marketing on the sales pipeline.
When it comes to measuring marketing metrics, don’t just think about how to meet targets this quarter, but how to hit them two to three quarters ahead.
Measuring how marketing impacts the top, middle, and bottom of the funnel is the ultimate goal, but don’t fall into the mindset that marketing is only about generating leads. Marketing is just one component of building a pipeline engine firing on all fronts.
Look at the pipeline as a shared metric that both teams own, and then discuss how marketing contributes not just to bringing in leads but also how it helps convert them.
Make sure the sales team understands brand marketing because the majority of prospects self-educate before becoming leads. They find out about your company through content, PR, communities, word of mouth, and other hard-to-measure branding mechanisms. The best way to measure branding impact is to ask your customers: “How did you hear about us?”
Remember: Never pit sales and marketing against each other because they should be working together on a combined GTM function.
In the beginning, keep marketing simple. You likely have one product, so use demand-gen marketing tactics like customer acquisition and branding to increase bookings. As you grow and become a revenue business—generating sales through cross-sell, upsell and retention—then shift marketing to product, content, community building, and customer success.
Consider shifting some of your work to account-based marketing (ABM) as you grow. Once you’re confident you fully understand your target customer—when you really, really know a certain persona is right—you can start using ABM to generate leads.
Hire a team that can evolve. Think of each marketing hire as someone with a career path and is part of a grand design to move the company forward. For example:
Lesson #1: Don’t neglect PR. As your company reaches Series A and later, PR is a critical investment. PR is usually best outsourced to a consultant or a PR firm.
Lesson #2: Don’t fall into the overtooling trap. There are so many martech tools out there, but many get more expensive over time, so be aware of the total cost of ownership. Carefully pick a few tools that will form your core martech stack.
Lesson #3: Your first paid ads don’t have to be on Google or LinkedIn. If you have a very small budget, try some low-cost paid ads on places like Reddit and Twitter.
Lesson #4: Set aside 20% of the marketing budget for experimentation. Nine out of 10 times, these experiments may fail—but one of them could end up growing your business 10X.
Get more tactical tips and actionable advice in our Evolving Enterprise series: