How does product marketing own more of the funnel strategy (acquisition, conversion, retention) rather than just support revenue growth reactively?
I'm not sure I'm fully understanding the premise of the latter half of this question, so I will address the first part. For those interested in this question, if you can provide me more explanation around what you mean by "support revenue growth reactively," I'm happy to respond.
On the former, how can product marketing own more of the funnel strategy. I'll highlight how we're working at Morningstar on my team in the three areas you laid out:
- Acquisition - Product marketing has a particularly strong alignment to acquisition strategy, IMO, especially as it relates to new product launches. Typically, you're either launching into a new market segment with an existing product or launching a new product into an existing market segment...or, if you're really brave, you're creating a new category by launching a new product into a market you've not served previously. Product marketing's role is to determine what the growth opportunity really is and build a strategy to capture that, which is fundamentally aligned to acquisition.
- Conversion - here's where we product marketers need to remember how important empathy and market understanding is; then, we need to unleash our inner marketing scientist. Improving conversion (and here I'm defining conversion in terms of the sales funnel vs. conversion rates on your website, for example) stems from deep market understanding and empathy. The more you understand your audience, the more likely that will emanate in your positioning and messaging, thus the more likely someone will be interested in what you have to sell them. However, deeply understanding your audience requires testing and research, not just of the focus group variety, but in leveraging things like paid search and multi-variate testing on your website to determine what is resonating the most with your prospects. Similarly, I find holding a weekly or bi-weekly feedback meeting with your sales teams to garner these insights as well is particularly helpful. Lastly, I read through every comment on our NPS surveys to see what customers are telling us they like and don't and how that might be improved in our storytelling and customer experience. One caveat here is that you can get into research hell without putting something out in the market quickly. I tend to err on the side of pushing out an MVP of our messaging and then testing, learning and iterating from there. Again, embracing the agile mindset.
- Retention - Retention seems to be the long lost cousin in the product marketing world for some reason. We marketers are always coming up with new names for something, so I've found the new shiny way to talk about retention falls somewhere in the realm of growth hacking or may fall into the world of product management. Here's where I think we have an opportunity, especially in B2B tech, to integrate product usage data into our marketing automation tools to identify patterns and then test campaigns to increase the behavior we want to see and leads to higher customer lifetime value. For example, if you have historical data that points to XYZ behaviors are more closely correlated to higher customer lifetime value or lower churn rates, then develop campaigns/programs to perpetuate that behavior. I know, seems obvious, but there are few B2B tech companies that I've see do this well. Also, think about borrowing from the new trend with gyms and products like Peloton (admittedly a huge fan) that aggregate your personal usage stats and then packages them up in an email or text tapping into your inner competitive nature to drive the behavior that you know will engender more usage and loyalty.
I think of product marketers as business owners; as such, we need to make sure that we're looking holistically at how we're growing and preserving the business. Depending on the lifecycle stage of your product or market, you may prioritize activities that are linked to one of the three above. However, I believe a comprehensive strategy encorporates them all in some way.
PMMs can be more proactive to own more of the funnel and customer journey when they expand their expertise to have a say in or own the pricing and packaging strategy.
PMMs already connect the dots between customers and products and know how to deliver value across the entire customer journey. We deliver value through our positioning, messaging, story telling, content creation (pitch-decks, case studies, webinars, campaigns, white papers, website, etc..), product launches, competitive intelligence, analyst relations, etc...
But, if you look at a customer journey from the first touch point and interaction with a campaign, website, event, deck, demo, all the way to a conversation around packaging and pricing -- the customer has to find value along each interaction and it needs to be consistent. If pricing and packaging was done in a silo with no PMM input, the customer isn’t experiencing consistent value and I’ve seen deals fall apart at that stage or sales struggle to close a deal when pricing comes up -- and they rely heavily on “discount to sell” strategies to get a deal over the finish line. PMMs who add pricing and packaging to their toolkit can deliver value at every step of the customer journey and can be a part of the entire funnel strategy and help build customer lifetime value from acquisition all the way through retention and expansion revenue.
- Extra tip: expansion revenue is the bucket companies often forget about, and when you can double down in this area with strategy, execution and results that bring significant revenue and value to any company -- you will be handed more of the funnel.
In order to make proactive strategic decisions, I am always analyzing customer data: usage data, purchase data, discount data, segment, expiration, etc... and I’m bucketing the data and looking at trends based on what our company’s OKRs are. The data tells a story and I discuss the insights with other stakeholders and through this process, it helps uplevel all the decisions I’m making for pricing, packaging, content, messaging, positioning, campaigns, sales plays, etc...
- Example: at a prior company, our churn was higher one quarter and reducing churn was our company’s OKR the following quarter. I decided to look at customer data and study what customers purchased vs. what they were using. I looked at which customers were expiring that quarter, how much they spent, what usage tier they purchased and what their current usage was for our product. Then, I grouped customers into 3 buckets (I actually had 6 buckets but will use 3 for simplicity): 1) those using most of what they purchased, 2) those using half of what they purchased, 3) those using little of what they purchased. Bucket #3 was our high churn group we were worried about and bucket #2 was a group we wanted to keep our eye on, so I came up with a different pricing & packaging strategy, messaging, positioning and marketing campaign that sales used to engage with the customers in these two buckets. By having a view across their entire journey, I came up with a proactive funnel strategy and we reduced churn that quarter.
I partner very closely with the VP of Rev Marketing to make sure we have a coordinated funnel strategy. We are in constant communication and alignment for acquisition, conversion and retention. In addition, product marketing measures deals influenced for attribution. Our product marketing team’s metrics are quite different from rev marketing team’s metrics, so I don’t feel the need to own more of TOFU. However, I have a vested interest in conversion and retention, which is where my product marketing leans in most heavily.
It depends on the type of organization you’re in (marketing-led, sales-led, product-led) and your relationship with Rev Marketing. I have mostly worked in product-led environments, so product marketing isn’t reactive to rev growth, but rather a main stakeholder in coming up with the campaign concept, putting together the strategy and plan, and working with rev marketing to execute it.
I'll guess you're frustrated with reacting to what your sales team wants rather than what it needs. Instead of "own" I'd like you to focus more on "influence". You will do yourself a huge favor if you map the Buyers Journey and start to analyze where sales deals fall apart. Focus on finding the step where deals are lost and do something about it. Do this is a continuous process. Over time you'll improve the W/L ratio and get recognition for your efforts.