The Strategic Marketing Mistake Almost All Tech Companies Make
It's tempting to think about marketing as an incremental game. I'll spend $10, and if I get $50 back, I'll spend $20, and so on.
Having worked with dozens of B2B tech companies, I’ve noticed that most organizations think in this incremental way, and it’s a mistake.
Why? Because the incremental, tactical approach to marketing doesn't account for the nonlinear impact of a relatively expensive step in the marketing process: strategy.
Spending the time and money to get strategy right before investing in tactics will save you a lot of money — and produce a much greater business impact. But to invest wisely in strategy, we need to have a sense of what marketing strategy looks like (the process) and who’s the best fit to help out with it (the people). Then, we can understand its value.
To be successful with marketing, you need to answer three strategic questions
1) Narratives: You need to say something unique that connects to your unique selling point. Otherwise, you can reach all your prospects and still be forgotten.
2) GTM: You need to have a reasonable hypothesis about where to reach people and how to move them down the funnel. Otherwise, you can produce content driven by brilliant narratives and still fail to make a business impact.
3) Measurement: You need frameworks and technologies to measure what's working and optimize. Otherwise, you could be crushing it with half of your marketing efforts, and you’d never know what to double down on. (This recalls the old adage: Half my advertising spend is wasted; the trouble is, I don’t know which half.”)
Let's say your marketing budget is $120k for the year. Investing $30k in the proper talent at the beginning to get these three dimensions of your marketing strategy sorted will have a nonlinear impact on your results — because you’ll be able to reach people in the right place, make a memorable impact when you do, and measure the results. And because you’ll have well-considered hypotheses and the ability to measure their correctness, you can then adjust to produce better results where the initial strategy comes up short.
With that $30k, you should be able to conduct a strategic audit and develop an action plan to answer the aforementioned three questions: How much business value is marketing generating? How are you measuring that value? Do you have differentiated narratives that help your customers understand why you’re the best possible solution for their problems? Once you’ve considered these questions, you can come up with the answers in the form of an action plan that delineates the assets you’ll create and how you’ll distribute them to increase pipeline, what narratives you’ll propagate, and how to measure and optimize your impact. Where there is room for improvement, you can continue testing and optimizing until you hit your pipeline goals.
But so many tech companies never do this. Instead, they limit themselves to cheaper, tactical resources, and they're either never quite sure if their marketing is having a business impact, or they are sure, and the impact isn’t enough to justify the cost. So, then, 12 months later, many companies fire their marketing team or agency, and they repeat the cycle over the following 12 months. The failure to invest in workable strategies is the single best explanation for the perennial churn of marketing leaders and agencies.
To capitalize fully on marketing’s potential, you need to get off the tactical hamster wheel — the self-reinforcing cycle of investing in tactical approaches without a strategic foundation that leads to perpetual dissatisfaction with marketing results.
Invest upfront in strategic hypotheses that you can evaluate on a quarterly basis. This strategic foundation will empower you to optimize consistently until you’re exceeding pipeline goals that previously seemed out of reach.
But let’s say you’re sold. You want to take a step back from marketing tactics and invest in strategy. The question then becomes, “Who’s going to help me with this?” In other words, getting marketing strategy right is a question not just of process but of people.
If you don’t have the right people on the bus, your bus isn’t going anywhere
I’ve worked with a lot of in-house marketers and marketing agency professionals, so I know that almost everyone in marketing feels pressure to say they ‘do’ strategy. Especially for in-house marketing teams, it can be very daunting to admit that strategic help is needed. Isn’t devising a strategy the in-house marketing team’s job?
The answer is more complicated than a simple yes or no. Figuring out whether you could benefit from strategic marketing help — and what kind of help you need — depends on the personnel you have in-house.
Let’s say you have senior marketing leaders (a head of marketing, VP, or CMO). In this case, a strategic partner could be helpful in two ways. First, very few marketers are masters of all three dimensions of marketing strategy (narratives, GTM, and measurement). Second, even senior leaders struggle to see their company from the perspective of a knowledgeable outsider. There’s a reason CEOs of Fortune 500 companies bring in McKinsey. Similarly, the average marketing leader could benefit from an outside perspective, especially if the company is struggling to hit its marketing goals.
The other possibility is that your company does not have a senior marketing leader. You may have no in-house marketers or only junior marketers. In that case, you’ll need a highly experienced marketing professional who can either handle all three dimensions of marketing strategy or recruit collaborators who can. This person will probably be a former VP of marketing or CMO who has led an organization similar in size to yours. They’ll likely also have experience in your industry. And they’ll be able to answer the aforementioned three questions, which are how to:
Build narratives that set you apart from competitors in a way that resonates with customers
Guide the customer from the top of the funnel to conversion
Measure and optimize the impact of marketing to generate measurable results
Where almost every tech company goes wrong is that they either expect their in-house team, which is almost always struggling with bandwidth, to answer all three of these questions, or they invest in outside help that claims to assist with strategy but does not have the ability to answer the three core marketing strategy questions.
Many agencies like to say they help with strategy. But if they’re just doing tactical work (e.g., writing SEO blog posts or bylines or running paid ad campaigns), they’re not putting the puzzle together; they’re just offering you a piece of it, and you need to invest in a genuine strategic partner who can help you figure out how all the pieces align. Only by obtaining a vision of what the completed puzzle looks like can you effectively evaluate whether the pieces fit together (or how well each marketing tactic is working toward meeting your overall goals).
Become the hero to your board or CEO by answering the three strategic marketing questions
The main reason organizations hesitate to invest in marketing strategy is that it’s expensive. Answering the three strategic marketing questions is a matter of who, not how: you need someone on your team who has overseen entire marketing organizations, taken the risk of being accountable for pipeline, and delivered results. Very few marketers have done this. And they don’t come cheap.
To avoid this daunting expense, organizations typically take one of two routes:
They hire a relatively junior marketer and expect them to deliver CMO-level results. This person can’t see the entire picture or answer the three strategic questions, so after 12-18 months, leadership fires them and then wonders whether marketing even works.
They play it safe and limit themselves to tactical support. They try to own marketing themselves (as CEO, CRO, etc.) and hope that by stringing together tactics, they can hit their pipeline goals and establish marketing as a satisfactory contributor to revenue. But at some point, these organizations typically find themselves with a lot of little victories and a lack of overall impact, which is a reflection of having skipped the step of putting a measurable and optimizable strategy together.
Both of these substitutes for investing in the people and process required to set up a marketing strategy lead to churn and continual frustration, which is unfortunately widely associated with marketing itself as a discipline. So, the question becomes: How do organizations invest in marketing strategy without breaking the bank and while still getting the tactical help they need to implement the strategy?
This is where agencies that are genuine strategic partners can be a good fit. If you don’t have an effective marketing leader, you can go out and spend $300k+/year (including taxes, fees, and benefits) on a VP of marketing or CMO. Or you can spend the same amount of money on an agency team spearheaded by a C-level marketing strategist and powered by world-class tacticians. The strategist will lead the way on setting the strategy, measuring its efficacy, and optimizing efforts to produce the desired business impact. Meanwhile, the rest of the team will handle implementation, providing what is, in effect, a marketing department for the cost of either a single VP/C-level hire or one director and one manager.
Ultimately, marketing is about driving pipeline. Beyond all the small victories and vanity metrics, that’s what the CEO, CRO, CFO, and board care about. To get there, your marketing team needs a strategy, but strategy doesn’t need to be an intimidating and abstract concept without definite answers. Strategy boils down to three questions. The question for you is: Whom will you enlist to answer them?
