How to build a winning SaaS marketing team with Kathleen Estreich (Part 2 of 3)
What founders should know about setting marketing goals
This is part 2 of my conversation with Kathleen Estreich of MKT1 about building SaaS marketing teams as a founder. Read part 1 here which covers how to find the right first marketing hire for your startup, identify quick wins and set them up for success.
We’ve all heard the famous phrase “half of my marketing dollars are wasted, and I don’t know which half” but lucky for us in 2022, MKT1 has a framework on how to measure and set goals so that you have a pretty good idea. Kathleen walks through how to set the right goals, bake experimentation into your processes, and prioritize.
Setting marketing goals for founders
Lyndsay How should founders and marketers set goals and evolve them? Any common pitfalls you see?
Kathleen One of the most common things that we see are goals that are set around activities versus impact. When I'm working with either a founder or a marketer, they'll set a goal of ten blog posts, for example. We’ll push them to ask why? What are you trying to do here? If the goal is traffic, that should be the goal, not an activity goal, but an impact goal. 10,000 views to the blog this month with a conversion rate of 2%. You can achieve that through one blog post or 20 blog posts. The goal in and of itself is not the blog post, it’s the traffic and conversions.
That is the number one mistake that we see, activity-based goals. You could do fewer things that are higher impact and higher quality, or you could do more things that are throwing paint at the wall and splattering it everywhere.
When you're an early stage company and you have a small marketing team, you’re inherently under-resourced. There's a lot more you can do than you should do. You need to focus on the impactful things that move the business forward and help it grow.
Lyndsay How should a founder set the goals with their marketing team?
Kathleen The main thing that the founder can do is set that North Star and be very clear about that. The most important thing for the founder to help marketing with is guidance on making the right trade offs. I'm a big fan of goals and non-goals.
You're inherently resource-constrained. If you say our focus is enterprise, we don't care that much about inbound self-serve. We want to keep that on autopilot so that the marketing team has a clear directive. The product updates coming out are going to support this. There's nothing worse as a marketing leader to hear a priority and the product and engineering team are working on something different. This is where founders can help ensure that everyone in the company and all the functional leaders are aligned.
From a goals perspective, founders set the company goals and outline the trade offs, the marketing team can prioritize from there. If you don't have that, you have the product and engineering team building something for one audience, the sales team selling something that doesn't exist and marketing gets stuck in the middle. They are the connective tissue of the organization and that's where things fall apart.
As a board member, I think it's helpful for you to hold the founders accountable to that focus. And if it changes, that's fine. But making sure that trickles down across the rest of the functions, because if marketing is the only one focused and the other ones aren't, they have nothing to market, nothing to sell that's connected to what all of the teams are doing.
Lyndsay I agree with that, the founder needs to internally market the company’s goals and align everyone.
Kathleen Yes, making sure that from a founder’s perspective alignment is consistent across product and engineering, marketing and sales because they all need to work well together in order to grow.
Lyndsay Definitely. That makes a successful company!
When a new hire comes on, what is the right way for the founder to work with marketing to set goals?
Kathleen For a founder, you don't want to just give the marketing team goals. You want to give the company goals, let the marketing team set their goals, and then give feedback on them. Typically you don't want to set *only* a leads goal. That's one input, but it's not the only thing.
We have a goal setting framework, where we recommend four types of goals:
Metrics/KPI Goals: This would be a metrics goal like like leads or conversions, etc.
Project Goals: Product launches or initiatives, things on the fuel side that are harder to measure using short-term growth KPIs. Those are things that marketing is owning and driving towards.
Experiment Goals: At an early stage, you don't know everything that's going to work and you need to have some goals that are experimental. Without these you're only going to focus on marginal goals, and you're only going to grow linearly. You need to explicitly call out where you have a hypothesis and are going to experiment.
Ops Goals: This is about building the foundational stuff. Marketing’s job is not just to help grow the business this month, this quarter. It's also growing the organization for the long term. These are things such as the right tooling and software. Migrate on to HubSpot, make sure our website is in a good spot, hiring the team. You need to call out these goals explicitly so that you are holding yourselves accountable.
Lyndsay This is great. Where does focusing too narrowly, for example just on leads fall down?
Kathleen The biggest challenge with only focusing on leads is that you end up with perverse incentives. You might optimize your lead scoring and end up sending a bunch of leads to sales that then aren't converting. You won't want to change your lead scoring criteria if you are measured on a leads number.
It can get in your way. And then you're ultimately not going to grow as fast because you're afraid to change and optimize your funnel.
You also might only be focused on short-term and marketing needs to make sure you are filling the funnel today so you can drive growth tomorrow.
Lyndsay We’ve talked about the importance of having both testing and scaling in a marketing strategy. What is the right way to think about measurement with this experimental work? How should the founder know what's working, even if it's not in the numbers yet?
Kathleen You can look at early indicators. It might not be fully baked out, but you should have some sense of these. The marketer needs to do a good job of communicating to the founder about the experiment they’re running and approximately how long they think it will take. They should show the early indicators that will show whether we're on the right track or not. You need to be pretty clear with the founders around that. I found, especially if the founders are coming from a technical background, they tend to want to be able to measure and understand what's going on. The role of the marketer is to communicate in a way that they will understand. It’s also critical to recognize that new channels, campaigns, segments, etc. take time to perform as well as your proven core initiatives, so don’t set as aggressive goals for experiments to start.
Part 3 of this conversation will wrap with our discussion on what board members should be asking marketers.