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The Inescapable Need For Marketing

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Corey Haines
Why in the world do we need marketing? Let's get back to the root need.

“My SaaS product doesn’t need marketing, it has virality built in”

“Only bad products need marketing, good products market themselves.”

“I don’t have the time or money to do marketing right now. We’ll worry about that later.”

These are just a few of the conventional beliefs across the internet that show the misunderstanding around what marketing is and why every business needs it.

In a perfect world, no, you do not need marketing for your SaaS product. In a perfect world, companies would not need to spend the $200+ billion in advertising every year in the United States alone. In a perfect world, B2B marketers would not need to dedicate 39% of their marketing budget to creating content. In a perfect world, 97% of Google’s income would not be from Google Adwords.

But the truth is, it’s not a perfect world, and marketing is the most fundamental reason your SaaS will be a success.

“Startups fail for all kinds of reasons–their technology stinks or they’re not filling a need–but marketing should never be one of them. And yet in spite of this, a lot of businesses fail because they’re just no good at acquiring and retaining customers.” - Brian Kotlyar, Director of Demand Generation at Intercom.

Here’s a couple reasons why your SaaS business absolutely needs marketing.

Reason #1: If you build it, they will NOT come

Here’s another common phrase I see across the Internet:

“If you build it, they will come”

It’s been repeated and romanticized by public figures for decades now.

That may have been true for the billion dollar anomalies, or when the only marketing channel was word of mouth. But it’s not true any more.

The “if you build it, they will come” motto is a dangerous and slippery slope. It’s toxic for founders, and here’s a couple reasons why:

Market Saturation

Nowadays, there are virtually no new revolutionary products. Everything is a mixture, combination, or new take on something old. In other words, everything is a remix.

So you built another social network? Congratulations, join the club with the thousands of others out there. So you built another to-do app? So you built another project management app/marketplace/CRM/you name it... Congratulations, join the club with the tens of thousands of others out there. “Build it and they will come” will never be true for your product because there’s no way that it’s new enough to be even remotely interesting.

Distraction

People are simply too busy to notice new products. The average person sees hundreds of ads a day, surfs a variety of websites, and hears about a multitude of tools that all sound like they do the same thing. Distractions from social networks, websites, text messages, emails, podcasts, games, and many others leave you with a very distracted audience.

No One Cares

People today are desensitized and more skeptical than ever. No one cares about your product until you convince them why they should care. Not everything is so plainly understood that people will flock to you and bring their friends too, especially for SaaS apps; competing with micro-differences and littered with industry jargon, it’s more difficult than ever to clearly articulate what your product does and why people should care about it.

Reason #2: Luck runs out

For all these mottos and sayings… the truth is: You could probably survive without marketing for a while. You could make your cases about why it’s not necessary or why “good products don’t need marketing.”

But here’s the thing: It’s never sustainable.

Don’t rely on the luck of being discovered, suddenly hitting the top of the App Store, or getting covered on TechCrunch. Make your own luck: Marketing.

The truth is, a company is only as good as it’s marketing. Why? If your customers cannot find you and be convinced they need you, it doesn’t matter how great your product is or how much time you’ve spent building it. The future of your company depends entirely on marketing.

Listen to me, do not put yourself at the mercy of hope, luck, and word of mouth. Take the reigns of the internet and let yourself be the one to determine the fate of your beloved SaaS.

At the same time, don’t expect thousands of customers just because you launched on Product Hunt and ran an ad on twitter for a month.

To most founders, marketing comprises of two things: 1) the launch and 2) new feature releases.

A launch will only get you so far, and nobody cares about new features if they aren’t convinced that the features benefit them in some way. More on that later.

Reason #3: The math is not in your favor.

Here’s why your SaaS needs marketing: Math.

Let’s say that somehow your app hit #1 on Product Hunt, made it to the top of the App Store, or become popular on the Shopify App Store without any “marketing” for example. You manage to get 100,000 people to your website that day.

Out of those 100,000 people, only about 10,000 were even remotely qualified for your app. Out of those 10,000 people, 5,000 of them get distracted and bounce off the page or just aren’t ready for your product yet. Out of the remaining 5,000 people, let’s say that 10% (which is really good!) of them convert to a free trial.

You now have 500 people actively in a free trial! After a week, you notice that half of them are idle and haven’t really actually used the app. Out of your 250 freebies, 10% of them convert to paying customers at the end of the trial. You now have 25 paying customers. If your app costs $29 per month, you just yielded $725 in MRR.

Not too shabby!

But guess what, tomorrow, it starts all over again. And this time, you don’t have something to launch on Product Hunt, the App Store, or the Shopify App Store, which means you won’t be getting 100,000 people to your website.

But let’s say you manage, somehow, to attract 4,000 people to your website per month.

Using the same math we did previously, 4,000 website visitors per month would convert to just one, lonely paying customer per month.

Consistently getting people to your website and converting them into customers is a huge challenge with this math.

This is what is called, “The Long SaaS Ramp of Death,” which got its name from the very long, slightly inclined MRR graph that somewhat resembles a ramp.

So how does marketing solve this? You must understand that marketing is not things that you do, it's a mindset that you have. Marketing is simply the act of intentionally getting your product into the hands of your customers.

Stop thinking about marketing in terms of social media posts and your website and press releases. Think of marketing as getting your product into the hands of your customers.

Marketing helps you fight “The Long SaaS Ramp of Death” and create sustainable growth because it 1) provides a systematic way to get more traffic to your website day after day and 2) works to convert more of those people who come to your website so you can use the math in your favor.

Marketing boils down to these two things: More traffic and more conversions. Any “marketing” that you do will serve one or both of these purposes.

So if you ignore marketing, you will always have a lack of traffic and you will definitely always have a low conversion rate.

Reason #4: Your customers tell you how they want to be sold to.

Let’s think about it this way: How successful would you be in selling your product if you went door to door, asking people to buy your product without even showing them the product?

They’d probably say things like:

  • “What the hell is a SaaS app?”
  • “I don’t have a business”
  • “I’m not interested”
  • “How does it benefit me?”
  • “Can you show it to me?”
  • “Who else uses it?”
  • “How can I trust you?”

See, your customers need to be taken through a very specific system in order to be sold to. Door to door is NOT how software is sold. And there’s very good reason for it. Everyone is going to want to see the product. Everyone is going to ask you some fundamental questions about why they should buy it and how it can help them.

The point is, you need to sell to your customers how THEY want to be sold to, and the better you can accommodate them, the more you will sell.

The process of selling to your customers how they want to be sold to is traditionally called the “customer journey.” It’s essentially a series of events and milestones a customer takes before they buy your product.

The customer journey is essential to customer-driven saas marketing because it orients you to put yourself in your customers’ shoes and understand them on a deeper level. Marketers have a tendency to try to dictate the customer journey to their customers, but you have to let the customer tell you how they want to be sold to. A buyer of a SaaS product (your customer) experiences the customer journey in seven stages: Awareness, Acquisition, Nurture, Decision, Convert, Referral, and Upgrade.

I know seven seems like a lot so before you check-out, let me explain the logic:

  • In the awareness stage, your customer “discovers” your brand and makes first contact with you in the form of an ad, a blog post, a reference online, etc.
  • In the acquisition stage, your customer interacts with you in some way by joining your newsletter, downloading something, or giving their contact information for something of value to them.
  • In the nurture stage, your customer consumes more of your content and is now offered to learn more about and buy one of your products.
  • In the decision stage, your customer now makes a decision about whether or not your solution is the right fit for their problem.
  • In the convert stage, they actually invest in your solution by way of payment.
  • In the referral stage, they decide if your solution is good enough to share with others.
  • And finally, in the upgrade stage, they decide if your solution is still a fit for their problem and if they should invest more or less into your product.

So the question is, how are you going to lead your customer through all seven stages?

How the customer journey translates to your business will depend on what kind of sales model is best for your SaaS business. SaaS is sold in two different models: low-touch sales and high-touch sales.

The great Patrick McKenzie explores these two models in detail in his article “The Business of SaaS”, so here’s the condensed version: Low-touch sales models sell themselves in a scalable fashion and require minimal human interaction while high-touch sales models require much more human interaction and are generally more labor-intensive to scale.

I’ll help you identify which model is right for you later on, but let’s get into how you lead your customers through the journey according to the two sales models.

The customer journey goals in a low-touch sales model:

Awareness

- Goal: website visit / social media follow

Acquisition

- Goal: acquire email address

Nurture

- Goal 1: qualify if they are a potential customer

- Goal 2: educate them on your products and your expertise

Consideration

- Goal: free trial

Conversion

- Goal: paid plan

Referral

- Goal: testimony / case study / referral / positive online mention / positive 3rd party review

Upgrade

- Goal 1: annual plan

- Goal 2: upgrade to higher tier plan

The customer journey goals in a high-touch sales model:

Awareness

- Goal: website visit / social media follow

Acquisition

- Goal: acquire email address

Nurture

- Goal 1: qualify if they are a potential customer

- Goal 2: educate them on your products and your expertise

Consideration

- Goal: demo

Conversion

- Goal: contract

Referral

- Goal: testimony / case study / referral / positive online mention / positive 3rd party review

Upgrade

- Goal 1: additional features / services

- Goal 2: renewal

Reason #5: Marketing is everything.

Many people will dispute this representation of the customer journey by saying that “marketing’s job is to get leads; once they’re in the product, it’s someone else’s job.” But I disagree.

Every interaction with your company and your products is marketing. One bad experience at the cashier’s counter and you may never go to that store again. One seemingly minuscule conversation with tech support over the phone can make a customer for life.

You can’t tell me that products and services are not marketing when you look at Apple’s products. iPhones were, and still largely are, the most talked about product in the world. The Genius Bar isn’t just a customer service desk, it’s a place to build brand loyalty and make customers feel like royalty. The annual iPhone release is the most anticipated global product launch of the year.

Regis McKenna, a pioneer in marketing technology products, said it best in his 1991 article you can find in the Harvard Business Review, “Marketing Is Everything.” Not coincidentally, Regis was instrumental in some of the most innovative technology product launches, including Apple’s first personal computer, the Apple I.

Regis is a proponent of the marriage between the product and marketing and says, “the critical dimensions of the company—including all the attributes that together define how the company does business—are ultimately the functions of marketing. That is why marketing is everyone’s job, why marketing is everything and everything is marketing.”

At a fundamental level, marketing is a part of culture. It’s a culture of service, relationship, and pride in what you do.

In summary

When you stop viewing marketing as a necessary evil and start viewing it as an act of service, you’ll find that there’s a world of opportunity in front of you.

In the next chapter, we’ll explore how marketing starts with the customer and the importance of deeply understanding who they are.