This is Part 2 of our conversation with Matt Heinz. Read & listen to the first part of the podcast interview.
In this episode of the Rethink Podcast, Act-On CMO Michelle Huff interviews Matt Heinz. Matt is president and founder of Heinz Marketing, B2B marketing and sales acceleration firm. Matt is often recognized as among the Top 50 Most Influential People in Sales Lead Management and among the Top 50 Sales & Marketing Influencers.
This is Part 2 of their conversation. Matt discusses the need for marketers to serve the business’s goals, Customer Lifetime Value, the new marketing dashboard, the four pillars of a B2B MarTech stack, the good and bad things B2B marketers are doing, and the elusive silver bullet of marketing.
This transcript has been edited for length. To get the full measure, listen to the podcast.
Serving the Business
You can get really myopic sometimes on some common metrics that marketing tends to get measured on and just stop it there, when, at the end of the day, you want to be able to translate your impact into the numbers that the CFO and the board care about.
A couple weeks ago I sat across from a marketer at a clients, and we were talking about just overall improving the funnel and making the funnel more efficient from a business output standpoint. And he literally sat across from the table and we were talking about different things to be creative and more focused. And he said, ‘I’m not willing to do anything that’s going to increase my cost per lead.’
Yes. He said that his job is to get a lower cost per lead, not a higher cost per lead. And look, they’re a fairly new client ‒ you’ve got to be careful. But what I wanted to do is reach out and just say, ‘Dude, your job is to close deals, right?’ And I get operationally in the right context. If you identify that Facebook is a great place to generate leads, and you spend 100 bucks to get 12 leads, I’m going to ask you how you can spend 100 bucks to get 18 leads. I’m going to ask you that question. But your job is not to get more leads from your marketing budget. Your job is to get more deals for the company. And it may turn the economics that you’re used to on their head. But you can’t be that myopic as a marketer. That is the path to irrelevance.
Customer Lifetime Value
Yes. Exactly. I could not agree with you more. In addition to that, some of the things we’ve been talking a lot about as well … you brought up customer lifetime value. And we talk a lot about brand, demand, and expand. And it’s really trying to think about marketing and about the full impact that marketing has on an organization. It’s a lot about the brand and getting awareness, and really helping brand the whole company.
How do you make sure they realize the value of your service, of your products? Get them to continue to buy more, to renew, expand their relationship and their purchasing from you. And a lot of times the whole role of customer marketing is very different, especially in B2B. Sometimes you don’t have anyone in the room. Sometimes all they do is references. How do you see customer lifetime value, its evolution with marketing, and the customer marketing role?
I think a lot of companies just sort of have gone a little too far with the idea that, well, you can’t keep a customer unless you acquire him in the first place … which is true. And in any business, the starting point is acquisition, get him in the boat. But we all know that not all customers are equal. Some customers are expensive customers. Some customers aren’t a good fit with our product or service. And if they churn and then are unsatisfied, but they’re unsatisfied because they shouldn’t have been in the product in the first place, the market doesn’t care. It’s just going to be muddy with bad stories and bad karma about your business.
I think everybody in the business has to be thinking about the long-term health of the business, which is not just acquisition, it’s retention. What are you doing to drive not only getting those initial sales, but making those customers so phenomenally happy and successful that they stick around forever, and they tell all their friends, and all their peers, and all their colleagues about you as well? And that is Marketing 101. This goes back to our MBA days. You look at the economics ‒ it’s just so much more efficient to keep your best customers and to make them happy. And now to do that, well, talk about sales and marketing working together, now we’ve got a much bigger dance. We need sales and marketing, but we also need customer service, product marketing, and product development. This is where the entire company has to orient around that customer satisfaction success.
I think in the same way we’re talking about account-based marketing or account-based revenue, thinking that’s an opportunity for marketing to really drive a stronger, more strategic, more integrated focus on the right acquisition … What you’re talking about in terms of overall lifetime value and lifecycle marketing, is also marketing’s opportunity to own a much bigger place at the table. We are thankfully living in a world where there is a very clear path from heads of marketing, CMO, to CEO. That wasn’t always the case. We’ve come from a place where marketing in B2B has been thought of as the arts and crafts department. And boards aren’t putting the arts and crafts people in charge of the company.
But when you’ve got marketers that are now growing up in a marketing department and thinking about the overall value of the business, thinking and talking about and measuring things that the business cares about, now you’ve got a business leader. If you’re a CMO or if you’re new in marketing and if you’re starting at the bottom ‒ and we all did ‒ your opportunity is to not just change what you’re doing, but to change the way you think, change the way you prioritize, change the way you talk. Go spend some time with your CFO and find out the way they talk, find out the words they use and the things they care about. I mean, even if you don’t have an MBA, or if you didn’t go to business school, I don’t care. I didn’t do either of those things either.
But it became really important for me and I became a much better marketer when I started to understand what lifetime value meant, when I understood why margin was important, when I understood the impact of things I could do in marketing and how that would decrease acquisition cost, and increase lifetime value, and the impact that has, especially in an SaaS business, when it starts to really impact the flywheel of business growth and health. You can use those words and you’re still going to have to go back and increase open rates and get more retweets. I’m not saying those things aren’t building blocks. … You’ve still got to do the work. You’ve still got to do the marketing. The marketing itself may not fundamentally change. But how you prioritize it, how you do it, how you report on why it’s important ‒ that is fundamentally different.
The Marketer’s Executive Dashboard
What is your top list of things you need to do to start thinking about it from a reporting and measuring standpoint?
I don’t think about it as sales versus marketing. The way I start to think about that now, both for my business, as we grow, as well as with clients, is I kind of erased that line to say, OK, starting as an acquisition unit, what do I care about? Well, I care about closed deals. I care about: How many of my target accounts am I closing? Whether you’ve named those accounts or whether you say, ‘I’m looking for companies that have these six attributes, and I want to close as many of those as possible’ … because I know that if they have these six attributes, they’re far more likely to see those long lifetime-value prospects.
There are closed deals, there are target account closed deals, and then there are some metrics behind that around pipeline created. In my business, I have two metrics around pipeline: I look at qualified opportunities created and I also look at a quarterly price opportunity metric. Because once I get an opportunity priced, based on our process, I know what my conversion rate is on those priced opportunities. And it’s been pretty consistent for a couple years. Those numbers I can put in front of our sales effort and say, ‘All right, if we get to that number, then I know that X percent’s going to close, and I know that that’s going to help us hit our number for the next quarter,’ or whatever I’m looking at.
We’re doing content. We’ve got a blog, we’ve got a podcast, we’re doing our campaigns. We’ve got metrics and ways that we’re managing operational efforts. But my marketing metrics don’t have anything to do with those. On my scorecard, it is closed deals, target accounts closed, opportunities created, and priced opportunities created per quarter. And that’s it. That’s what it rolls up to. And I figure if those are metrics that if I was the CFO, if I was the CEO, that’s the scorecard I care about. I think from a marketer’s standpoint that’s a good starting point. Again, separate your operational dashboard from your executive dashboard. Make sure you’re managing them both actively, but make sure you know your audience and what they need to hear and what they care about to prove your worth.
Four Pillars of Your MarTech Stack
What’s your viewpoint on the MarTech landscape, and what marketers should think about, or how they should approach technology when it comes to marketing?
Marketing technology and content has clearly replaced media as the coin of the realm for marketers. I mean, it’s not that we don’t need media, but I think our ability to not rent attention from third-party media sources but instead to own and to sort of manage our own attention-building channels is significant. I think the technology content process is really the fundamental ingredient that helps us do that. I do think that a lot of marketers are letting the tail wag the dog when it comes to technology. There are so many options available out there. There are just thousands and thousands of tools. And you go to Dreamforce, you go to any of these conferences, and you start to see all these different vendors, and they all think they’re the greatest things since sliced bread. And they might be.
But instead of saying, ‘Well, this technology is cool,’ what companies do is say, ‘What’s our sales process? Where are the gaps that we need to fill? Where are the biggest bottlenecks that keep us from being more successful?’ I fundamentally think there are four areas of technology ‒ four makes it way too easy to say these are four horsemen of the apocalypse ‒ no, these are the four foundations, the four legs of the stool. I think it’s CRM, it’s marketing automation, it’s attribution tools, and it’s big data ‒ some kind of intent data that’s allowing you to identify prospects, the buying signals that make them more ready to engage. Those are four things that I think have become table stakes for B2B marketers.
And look, there are vendors that we certainly think are better than others. We think the world of Act-On, and increasingly are pointing a lot of our customers in Act-On’s direction. That was not planned. This is not a commercial for Act-On. But I think what you guys are doing is fantastic. But I think it’s important for marketers not to think, ‘Well, okay, I bought Act-On, so what should my strategy be? No, no, no. What are you trying to solve? And then, what tools do you need to solve for that? It’s funny, some people say, ‘Well, what’s the best marketing automation tool on the market?’ That’s not even a useful question …What are you trying to do? What are you trying to achieve? What are you actually going to use?
I see way too many companies buying tools in a variety of different categories that they think are best in market but that they don’t use. And now they’re spending thousands of dollars on nothing. So I think understanding your strategy ‒ understanding and being realistic about the resources and people and content that you need to make those successful ‒ that’s important to have in place. And then you’re going to choose the right solution. Then you’re going to be more successful with those solutions to achieve the results that you want.
I’ve seen it a lot. Many times it’s easy to get distracted by the new and shiny and get something in place. But it only hard codes; it locks you into the lack of strategy, right? It’s much easier when you know what you want do and you build for it than trying to do it reverse.
What Are Marketers Doing Right & Wrong?
What do you think were some mistakes that B2B marketers continued to do in 2016? What should our resolutions be? And then maybe part two of it is, what makes you excited about 2017?
Well, the second part is the easiest. I mean, holy cow, we are living in the golden age of B2B marketing. It is so awesome to see the tools and the resources we have at our disposal ‒ the ability to really lead the business as a profit center. I believe profit-center marketing as an idea has come into its own, and we now have the insights, we have the technology, we have the tools, and we have the ability to capture that.
I look at 2016 and I think there’s a lesson there about a mistake we made over and over again, and that’s often looking for the shiny new object that is going to make things easier. I think in 2016 the shiny object was account-based marketing. And I saw a lot of people say, ‘Well, so we’re moving everything to account-based marketing.’ It’s like, OK, so you’re going to eschew everything else that may or may not be working because you’ve got a shiny new object? Two years ago that shiny object was social selling. ‘Ah, cold calling’s dead; we’re moving everything to social selling.’ I mean, 15 years ago it was the banner ad. ‘We’re doing banner ads. We’re going to hire a banner ad agency and we’re going to be awesome.’
We like the easy fix, man. Don’t knock us.
The Silver Bullet
One of our directors has been famous ‒ or infamous. I’ve heard him say a couple different times that everybody’s looking for the silver bullet. There’s only one silver bullet. It is Coors Light. And on a hot summer day when you’re working in the yard, it is cool and refreshing. But that’s its job. There is no silver bullet that is going to make marketing easier. If anything, look, marketing is getting harder. I use that CEB stat that [there are] 6.8 members on average of the internal buying committee. When CEB published the book The Challenger Customer, that number was 5.4. In the space of 15 months their research said it went from 5.4 to 6.8. Think about the orders of magnitude and complexity that made.
So our marketing is not getting easier, it’s getting harder. And the likelihood that there’s going to be a silver bullet, or a single initiative, or some new shiny object that is going to make it all simpler or make all the rest of it go away ‒ it’s a fool’s errand. But that doesn’t mean you can’t get your arms around this. It doesn’t mean that you can’t put a smart strategy in place that is customer centric, that integrates sales and marketing into one cohesive buying journey, that moves the needle for you. And keep in mind that sometimes you and your competitors are running away from the bear, and you just have to run faster. You don’t have to do this perfectly. You need to do it good enough. And I think that there’s an awful lot that marketers can do. Perfect is the enemy of good in so many cases.
And I think there’s an awful lot that marketers can do to start to move the needle, to have an impact, to create better clarity for their prospects, to create better impact in organizations, and to create more separation and differentiation from their competitors, that can make an enormous difference in their impact and results in 2017.
I love it. My dad used to have this saying: ‘People are people.’ You never have a single profile of a salesperson because there’s really never a single profile of a buyer. I think that’s kind of what makes our job difficult, because people are different, their journeys are different, and how we hold their attention is different. And in some respects there are a lot of just really interesting new innovative ideas that I think are helping make some things easier. But it is hard. But you’ve made me inspired at the end there. Any final food for thought?
I think more than anything, go listen to your CFO. The more you can align the way you talk, the way you position marketing’s impact … We have enamored ourselves with acronyms and the nomenclature within marketing that no one else understands or cares about. Our job is not to get the rest of the organization to care about our acronyms. Our job is to drive value to the business. In terms of the way we prioritize, and the way we think, and the way we communicate back to the organization, go find out the way the business thinks, go learn the way the business talks, and that becomes your compass.