(00:04):
Hey everybody, it’s Jenni from GrowthMode Marketing. You are listening to The Demand Gen Fix the podcast where our team of GrowthModers and our guests discuss the ins and outs of demand generation and why we believe it’s the key to long-term sustainable growth, especially in HR tech industry.
(00:24):
Today’s episode, we’re going to be talking a little bit about the economy and we all are feeling the fear and struggles right now going on in the economy. Is it a recession, is it not? That all plays into what your marketing strategy is. Greg and Deanna and I are going to discuss whether or not you should just stay the course or change your marketing strategy or just scrap it, which of course we’re going to say no, that’s not the option. So Q2 this year has been really tough for a lot of B2B companies, including those in the HR tech space. Revenue is down for many organizations and with the pressure on how will you react. We’re going to talk about all of the pros and cons and different strategies that you might take to get your way through these iffy times in the economy.
(01:22):
I think the first thing we should talk about is the reality of the market. There is still quite a bit of debate on whether we’re actually currently in a recession or we’re going to avoid one, or if it will happen in the second half of the year. I mean, just Google, are we in a recession? You’ll see what I mean. Some people say we’re avoiding it. Some people say it’s about to happen. I don’t know. What we can say is we’ve seen a lot of workforce reductions and layoffs across the sector, and many companies have tightened their budgets and cut spending this year, which means they are buying less.
(02:01):
In a healthy economy, about 5% of your companies in your total adjustable market or ideal customer profile are already to buy, you know? But now everybody’s tightening their belts, so that number is getting even lower. It’s probably down to 1% now. So, whether we’re in a recession or not officially, everybody’s cutting their budgets, so you need to realize that they’re also not ready to buy.
(02:25):
We’re seeing a lot of talk in the market about how it is clear that there are less B2B prospects buying right now. So, whether the in-market companies has dropped to 1% or less than that, the reality is many companies out there, probably some of you listeners are seeing that a lot of them marketing programs you’ve been doing aren’t getting the results at the level that they have in the past. That sales is struggling to meet those revenue targets and the pressure is on. I think everyone is feeling it. And if you really step back and think about it, it’s this trickle-down effect, right? The board starts to feel the pressure because profitability and stock prices are wavering. So what do they do? They turn around, they talk to your executive team, so they’re getting pressure from the board, which means the sales team is being pushed to deliver results and meet revenue targets even harder because they’re missing them. Inevitably it comes down to the marketing team where people in the sales organization and at the executive level are turning to us and saying, Hey, you need to up the ante and you need to bring more leads in the door because we can’t afford not to hit our revenue targets. There’s too much pressure coming from all levels on it, and we need to figure out how to break through that wall and get back onto that growth trajectory.
(03:57):
Yeah, it’s like a knee jerk reaction, right? Everything’s going south and it’s like, Hey, we need to take leads in the door now, but the budgets are slashed, the marketing efforts are being pivoted, but at the cost of what, it’s sort of kills the momentum of what you’ve been doing. That’s what’s happening at so many companies right now. The business goals become short-term focus goals instead of the longer term know goals for your growth.
(04:21):
When you put all the focus on the short-term growth, sometimes it’s at the expense of future growth. As we talk through this topic, that’s one of the things we’ll look at is how do you balance that? Because you don’t want to cut your nose off despite your face. You’ve got to be able to balance the needs of the business now, but you’ve got to be able to keep an eye on long-term. How do we ensure that we grow and that we come out of this economic downturn with a lot of momentum? You might try to think about what kind of marketing programs and spending are you doing that’s not actually essential and impactful and necessary. Spend your money smarter rather than cutting it out altogether. You don’t want to cut so deep that you’re going to create future challenges for your company.
(05:14):
One of the things to call out, which we see a lot is when organizations find that revenue is down and they’re missing those revenue targets, that budgets start to get cut across the organization, right? And unfortunately, a lot of times what happens is one of the first places that gets cut is marketing. Well, if you cut too deep, it’s going to hurt your organization. And so yes, look at the programs across the board to figure out where cuts can be, because we all have to be good corporate citizens. There are probably things that marketing are doing that are less impactful where you could trim down some of that cost. Henry Ford made a quote once that I love, it’s stopping advertising to save money is like stopping your watch to save time and stop and think about that. You’re not actually doing yourself a favor when you do that if you cut too deep. And so if your organization is having that knee-jerk reaction, take a step back, help your executive team and your CFO understand the programs that you’re doing, the value that they’re adding, where you think you can make cuts and where you have serious concerns about making cuts because you want to make sure that you’re doing the right thing for the organization, not just in the moment, but long term as well.
(06:41):
It’s funny how every time the economy is going down, these old quotes keep coming back out, right? But what was true then it’s still true now, it doesn’t change. I was thinking about that, if you’re going on a long backpacking trip and your backpack’s too heavy, do you take the food out of the backpack to make your load lighter? That’s the food for the engine, right? You can’t take the food for the engine out you have to figure out how to cut. Maybe I shouldn’t bring this or that. You have to do it wisely.
(07:15):
When you think about it, the companies that do invest in brand building and awareness during these slow times in the economy will in the long run have bigger growth your marketing has done to fuel that growth in the future. Not right this minute. It’s working for your future growth. Right now, if other companies are cutting back, then that means less competition in the market, right? You have the opportunity right now to stand out a little bit more, right? You’re not competing from a message standpoint with as many competitors right now because a lot of organizations, including in the HR tech space, are cutting back on their brand building budgets right now and on their marketing programs. And so, it’s an opportunity, if you have the ability to continue to invest in marketing and determine how to be front and center in front of your ideal customer profile, it’s a great opportunity to get more traction than you typically would as far as being in front of them and having that message seen.
(08:18):
You can look in Harvard business and review, Bain and Company has done a study over the last hundred years. Everyone knows the economy is cyclical, right? And recessions come every so often. And there are many studies out there that show that top performing companies continue to invest in marketing during recessions and their trading short-term profitability for long-term gain. I don’t have any studies directly in front of me. I didn’t want to spend time talking about all of those. But again, just Google it. You’ll see there’s lots of data and information out there that supports how companies weather the storm better when they’re making the right investments in marketing during downturns, that they come out stronger than other organizations when the economy comes back to a good place. It just makes sense, honestly.
(09:18):
The short-term thinking turns into hurting you in the long term as far as your revenue. If you completely explode your marketing process that you have now, you know it’s going to impact what’s going to happen in a year. It might help you right at this minute, but if you don’t get, if you don’t keep it going, then it’s not going to help you in the future,
(09:38):
I think specifically when we’re talking about building out your demand generation engine, we’ve talked about it on other episodes, it takes time to build that out. You have to continually fuel it. You have to be able to build that audience and get them to follow along. So if you’re looking at what do we do with marketing right now because we’ve got to bring leads in the door, we’ve got a lot of pressure on our shoulders, we always have to bring leads in the door, right? That requirement never changes. It just the pressure intensifies quite frankly when revenue is down, because people are panicking. There are companies, their ability to stay open, their ability to continue to support the employees that they have, they want to make sure they’re able to support their clients. And so, there’s added pressure. What you end up doing now negatively impacts your future growth potential long term, you’ve got to balance that and really think about how is that going to happen?
(10:45):
And some of the things that we’ve seen organizations do when they need to focus on immediate growth at any cost, and there are always organizations out there, whether the economy is good or bad, that find themselves in this position where they’re like, we’ve got really aggressive growth goals or not hitting those revenue targets. We need to bring leads in the door now. What do they do? They start shifting budget from creating demand to capturing demand. So ignoring the 95 to 99% of companies that are not in market today, and they’re turning off targeted awareness campaigns, they start gating content again that they might have previously ungated. They start shifting all the budget to paid search because paid search feels like, oh, if they respond to that, they must have buying intent, which is not always true. They stop doing the content. Instead of investing in that, they start to allocate that budget to those demand capture program.
(11:50):
So again, shifting to things like paid search and they’re even cutting marketing programs in support, our recommendation is that you have to be able to find the balance between the short term and the long-term results. So we’re not saying, Hey, if the revenue’s not coming in the door, don’t worry about it. Stick to demand, in three years you’ll be great. That’s not at all what we’re saying, but what we are telling you, our listeners is don’t panic and blow everything up for the sake of getting immediate results. Instead, you need to take a step back and really evaluate where you’re at and what you can do to balance between the need now and the need for future growth.
(12:39):
So, you really have to evaluate what is working, what’s proven to work for you in the past, what things are you’re questioning that you’re unsure of what hasn’t had the time enough to gain some traction? And then what is not critical to success? So, you can peel that onion, right? And try to figure out what pieces of this thing can, and I’ll say pause. I’m not saying cut, right? Because once things turn around and everything’s going better, you really want to put those things that you’ve taken out back in, because that’s part of your demand gen strategy, right? You don’t want to just throw it out temporarily, but then never bring it back.
(13:14):
That’s a really good point, because you’ve done all of this work and you’ve developed a strategy. I’m sure you have other team members that have all been working on that together. You just don’t want to throw all that away. You want to make sure that you save that and just like you said, put it on pause during this, maybe this downturn in the economy and then you can pick it back up again when you’re ready. Those are good points. I think one area where sometimes marketers struggle is determining what is actually working and how to prove it depending on what type of things you’re doing. And I say that because for example, like let’s say you have a really strong LinkedIn strategy and you’ve created these brand ambassadors in your organization who are going out and they’re connecting with people that were, are within ideal customer profile companies.
(14:06):
They’re constantly putting content out, very targeted to those individuals. Well, those individuals might not actually be like liking and commenting on the posts that they’re putting on LinkedIn, but they’re seeing them all the time. And it’s very common for organizations that have these brand ambassador programs that as they’re asking prospects as they come in the door like, how’d you learn about us? Where’d you go to find research? They’ll be like, I’ve seen a lot of the content that Tom’s done on LinkedIn and been following it, and I’ve really been impressed by that. Well, that’s really hard to measure, almost impossible to measure if people are seeing it, but not actively like commenting on it, but they’re storing it away. Like that’s a really good thing. We call that dark social in the marketing world, that people are consuming that content. So then the question becomes like, how do I know it’s working?
(15:02):
How can I prove it? How can I show the powers that be that are trying to cut my budget that nope, this is one that I need to die on the sword for and advocate we need to continue to do this, or we’re going to lose the momentum there if you can’t measure it. And I think that’s a really good question, and as marketers, we’re always trying to solve that, but the reality is not everything can be measured. So it’s a little bit of, you know, where do you have the micro measurements where you see things working, asking yourself, have we given this enough time for it to get traction? Because I can tell you, let’s say you start doing the LinkedIn thing, or you start a podcast, if you’re three months in, you’re not going to have these results that you’re like, ah, this is amazing.
(15:50):
Look at all the people listening to our podcast. Clearly the leads are going to start pouring in. It’s a slow burn for a lot of marketing things. And the lack of patience is why we often cut things before we’ve given them enough time to, to really build them. I would say just if you can’t measure things, if you don’t even have like those micro measurements to see that you’re getting traction there and you’re not necessarily having people come in the door yet doing the self-attribution where they’re like, I’ve been listening to your podcast for six months, trust your gut. And if your gut is like, this is a complete and utter waste of time, or we are so far away from making this successful that it’s okay to pause it right now, then do that. But if you’re like, I just know in my gut that this is the right thing and it’s going to make a difference, then don’t cut it unless you absolutely have to. I mean, we’ve all been in budget situations where sometimes you have no choice but to pull the plug on things that you believe firmly in, but make sure it’s not critical to success if you’re going to cut it out.
(17:01):
So, what you need to do then is determine which programs support the long-term growth. Through your demand gen program, you have to ask yourself, does this create brand awareness and trust like in Deanna’s example of LinkedIn? If you really know deep in your heart that that’s working in your brand ambassadors are getting it out there and convincing other people that you know that what you have is what they need. That’s maybe something you want to make sure you stick with and ask yourself, have you built up an audience that follows along and engages with your content? And in that LinkedIn example, so maybe you pull back a little bit on one thing, maybe you’re not going to develop as much brand-new content, but then you can repurpose what you have and keep that LinkedIn going by repurposing what you already have. So maybe it’s just figuring out how to shift a little bit. And then you want to also ask yourself, has the program been running long enough to gain traction? Maybe you just have to let it ride a little bit more while you’re waiting to move to the next step and see if you’re going to put it on pause altogether or if you’re going to keep pushing on it.
(18:10):
We’ve got to be able to do programs that are about demand creation and we’ve got to be able to do programs that are about demand capture. So it’s not blow up your demand generation engine, go back to lead generation and just focus on capturing leads. Now it’s about how do you make sure you have that balance? And so as you’re looking at trimming down your demand generation engine, making sure if I’ve got an audience that’s following me, the dumbest thing you can do really is stop it. And all of a sudden, these people who are following and listening along to your podcast and reading your things on LinkedIn and coming to your blog and reading those things and looking at your social media accounts, like that’s gold.
(19:08):
Because they may not be in market now, but they may be in market down the road. And whether that’s three months, six months, two years from now, like if they’re following you and they’re engaging in your content when they raise their hand because they’re in market and ready, they’re going to be great leads for you because they’ve already almost made up the decision that they want to work with you already. So it’s really important that you do not just get rid of your demand creation programs as you’re thinking about that. So keep that in mind. Because you need leads now, identify opportunities to capture demand in support of generating short-term results. We’ve talked a lot in this podcast and as a company about having quality leads and not just quantity leads. That’s something that you definitely should take a look at, making sure that those leads are actually showing some sort of buying intent that you’re going after.
(20:13):
You’re still creating content and campaigns that are relevant to the high level, but also creating content and campaigns relevant to those really high intent buyers such as demo videos, case studies, competitor comparison guides, all of those kinds of things. I think there’s an opportunity to drive leads through email and digital campaigns. So if you stop and think about it, like who are the low hanging fruit? And what I mean by that, don’t revert back to lead gen tactics where you start gating content. Anybody that out the form gets flipped to sales because need quality over quantity. If you’re just going to start bringing in a bunch of names that actually aren’t in market to buy, that’s not going to solve your revenue shortfalls. It’s just not. You can’t convince somebody who’s not ready to buy your half a million dollar a year HR technology to buy now unless they’re already there and they’re already thinking about it and ready to make those decisions.
(21:13):
But you can look at things like stalled pipeline, who are the companies in there? Can you create campaigns to target them? What about your known website visitors? What are they looking at on your website? And if you’ve got a website that’s rich with content and has the type of content that if people look at, there’s a pretty good indication that there’s some level of buying intent. So for example, they are looking at your video demos and they’re reading your case studies and they’re looking at your pricing page, things like that. That’s a great opportunity to retarget those individuals because you’re probably not looking at case studies and demo videos unless there’s some level of interest there, right? Also, can you leverage intent data if you’ve got the technology tools in place to be able to see like different buying triggers that companies might have that would indicate there’s some level of interest in your product and building campaigns from an email standpoint around that. And then of course, creating nurture campaigns that are really about the funnel stages, so you can see who’s engaging with that more high intent, ready to buy type of content versus who’s not. And you should keep nurturing.
(22:34):
I wonder if there’s probably also a way that you can look at the cross sell and upsell opportunities too, right? Like you, you already have somebody who’s a, who’s a customer. Maybe there’s something else you can do as an add-on to what they already, what they’ve already purchased. So it might be a good time to start looking at those types of opportunities and programs.
(22:53):
Yeah, that’s a really good point because everybody knows statistically it’s more cost effective and easier to sell to an existing client than it is to go find net new logos to add to your book of business. And if they’re already working with you, they’re more likely to be open to learning about the other things that you do and hopefully are seeing the results from working with your organization that there actually is some, some reason for them to have the conversation to, to learn more about what you guys are doing and add on to the suite of products that they’ve already got. In essence, we all know the struggle is real and we all know that we need leads and we need them now. And the reality is that more than ever companies as they enter the second half of the year are behind on revenue targets.
(23:48):
So it’s a shame to see all the progress that these companies have made in building out their demand generation engines just throw it out the window and revert back to the old school tactics to drive their immediate needs. No matter what you do, whether you’re gating your content, increasing your digital ad spend, redirecting all your efforts to lead capture, it doesn’t change the fact that prospects make up to 80% of their purchase decision before they’re willing to engage with the sales rep. And building brand awareness and trust long before a prospect is in market is the thing that really matters. So if you find yourself in need of driving more leads, now you’re not alone, but make sure you balance the trade-offs because if you totally divert away from demand generation programs, your company may find itself in the exact same spot, quarter after quarter, chasing those elusive revenue targets from behind. And everybody knows that’s no fun.
(24:44):
Thanks for joining us on The Demand Gen Fix, a podcast for HR tech marketers brought to you by GrowthMode Marketing. We sure hope you enjoyed it. Don’t forget to subscribe for more perspectives on demand generation and B two B marketing strategies, plus give us a like, tell your friends. We’ll see you next time.
