The Evolution of Marketing and what it means for Enterprise Fintech
Mad Men no more - it's about tech and data to build a growth engine
This time it’s purely about marketing. Let’s jump right into it.
Marketing is often absent in the B2B fintech space (the irony of it didn’t escape me when I started this newsletter). Often the role doesn’t exist, or the team called ‘marketing’ lacks strategic initiative.
It is not new. Throughout my personal experience in financial markets sales, the marketing department was typically in charge of some of the following: PR, campaigns, creating branded material or key investor documents, organising events, sales support… These are related to marketing, but they are peripheral activities. They are missing the considerable opportunity offered by the data and tools available in the digital era.
It is natural for a B2B startup to be sales-driven, whereas the B2C space is marketing-driven. Especially when the process is complex, and the value per account is high, a salesperson introducing your company to the right contact at a significant prospect can change the game. Yet, this doesn’t mean there is no further growth potential.
Here are just a few areas frequently left behind in the B2B Fintech space:
Inbound: using content to attract qualified people and turn them into leads and customers
Customer journey: looking beyond the transaction experience and finding ways to improve relationships throughout the journey
Branding: typically erodes over time unless maintained actively, yet having ‘just a great product’ exposes you to a lot more competition than if the market engages with your brand
It’s the marketers (the Mad Men’s) own fault if they are absent in the enterprise space. To exist today, they need to evolve and build a growth machine, powered by data and driving sales.
From Mad Men to growth engine
I love the pitches scenes in Mad Men. When Don Draper illuminates the room with a genius one-liner. Like he did for Lucky Strikes. The FCA has recently labelled cigarettes as “unhealthy”, and the cigarette company needs a rebrand. Don latched onto the fact that the tobacco is "toasted”, and won the pitch. (By the way, the slogan ‘It’s toasted’ is real, and still on the packs)
It was a time when you could sell a ‘bad” product with beautiful packaging and smart messaging. That was the function of marketers then, but this is not what it should be today. For many, marketing needs to be unlearned.
A new definition
There are many definitions of marketing (and they are moving: I remember the 5 Ps from my business school studies, now apparently there are 7). My favourite one comes from Mayur Gupta, ex-CMO of Spotify.
Marketing is about growing the user base, the user value and the brand.
The three are NOT isolated, they amplify each other and ‘marketing has to prove that amplification, not just through a philosophical belief but through data’.
The chart also shows that marketing is not isolated. Growing the user base is a function shared with sales; the user value relates to product and sales support. The brand is a variety of factors.
Marketing is about building that machine for the company and improving it over time.
Let’s be clear: should we call it marketing or growth?
Coca-Cola doesn’t have a CMO any longer, instead, it has a chief growth officer. Startups also like to use Growth as a function. In this article Andreessen Horowitz VC Andrew Chen stated that growth hacking is the new VP Marketing. I also talk about growth consulting (sounds better than ‘marketing consulting’). Growth, however, cannot be owned by a single team. So for clarity purpose, it works better to use ‘marketing’. Marketing doesn’t own growth but it should orchestrate it.
A new balance of power
The Mad Men era also meant that we, as consumers, accepted to be 'victims' of marketing. This era extended well after the 60s when the series finished, but it is vanishing. Today Amazon is the best place to witness the end of that era. And it's worth listening to the advice of its founder:
The consumer has the power to decide, and this is particularly true in the B2B space. No one wants to be accountable for signing a year-long, enterprise-wide contract because the pitch was terrific (cf. Don Draper).
For consumer companies, viral growth and simplicity matter most. Enterprise companies are built relationship by relationship, going through a complex sales process to demonstrate the value of the offering.
Marketing with a focus on relationships & value
Value is at the core of our marketing definition and feeds in the other two aspects.
Bain has organized the 40 distinct kinds of value that B2B offerings provide customers into a pyramid with five levels. It’s a bit overwhelming… but has the benefit of making us think of value beyond functional features. Discovering what other elements matter the most to your market is critical when it comes to improving your product or offering a new one. Conducting interviews is an excellent way to explore customers needs and sources of satisfaction and frustration, and the compromises they make in using your products and services.
Now let’s look at relationship-building through the marketing spectrum.
A well known and trusted brand will help start the conversation. Offering more value to existing users will help “world of mouth” and transforming your existing clients into promoters.
When prospecting, or initiating relationships: segmentation, lead generation, touchpoints, are all marketing activities that can be conducted by sales but should be part of a ‘growth engine’.
A crucial part of engine construction is using the right tools. As such, it can’t be separated from technology: Marketing/Communication ecosystems. Without that, you may understand the industry, know the consumer, have the budget, nail the message, but it will be hard to measure or scale efficiently.
From budget allocation to dashboard
Marketers are still often guilty of launching big campaigns a few times a year, spending the budget without measuring its impact precisely. When companies lack reliable mechanisms to track how marketing efforts translate into measurable sale conversions, they count as a cost.
The digitalisation of business means it is easier to measure outcomes and return on investment (ROI). Once measured, marketing initiatives cease to be a cost. They become growth levers that perform and can be scaled, or not and can be shelved.
Marketing is about having a dashboard
Just like in modern days car racing, without getting data about the engine’s performance, you are not going to win the race.
Marketers don’t need ownership of all the marketing activities; the budget and initiatives may come from other places. (Sales initiated an event, IT developed a new CRM functionality, there is an ongoing PR campaign). Still, it should be able to measure the impact.
Instead of spending X budget and then waiting for it to reset, you can adopt more frequent tweaks in iterations. By developing appropriate KPIs and ways to measure them, you can adjust and improve your allocation of resources continuously.
Tips To Get started
If your marketing function is non-existent (at least from a strategic initiative point-of-view), or stuck between a rock and a hard place, getting started does not have a to be a C-level decision. It’s safer to start small, focusing on just one aspect: inbound, branding, customer journey, process. To do so, you could hire a marketer or an agency. The former requires overheads and a long-term commitment, with the latter costs can be high and there is a risk that critical skills will remain externalised. Another approach is to use your existing setup and carve out some resources dedicated to marketing. You could use a consultant👋🏻 to launch initiatives that can be operated by your current staff. Either way, to start act with an experimental mindset and try out things than strategize.
Here are two things that are worth considering to build a solid basis before getting started.
Audit current activities
Based on existing data, surveys and benchmarking: establish what worked, what didn't and the main ideas. Look across the past initiatives and focus on what worked best. It also works for content, what article and whitepapers performed well. You can then prioritise ideas: is there anything easy to fix and impactful, that you could right away? Are there objectives that are worth a special effort and long term commitment? Or ongoing activities that you need to rethink?
Use this simple framework
The key is to be able to test various implementation ideas and amend them without losing sight of the big picture. If it wasn’t successful in the way you wanted it to be, at least you can figure out why and then you can shift dollars and resources.
Here is the framework we use. It’s loosely inspired from what you can find under ‘agile marketing’ but adapted to small teams.
The use of data and accompanying metrics is critical. It requires some digital tools. However, keep in mind:
Data doesn’t have to be only “Big Data”. There are times when “Small Data” is the only relevant, like getting feedback from one customer.
Tools don’t have to be a sophisticated CRM system, DIY, freemium and straightforward solutions abound (more on that topic soon)
You can check our central marketing document used both for client work and internally (where the charts above come from) and see how it all fits together.
A thorough whitepaper from Ernst & Young about the evolving role of the B2B CMO.
Great video about the business model of fast-growing B2B startups like Dropbox, Slack.
Next, I will be going into more practical details about how marketing works within a sales-driven organisation. If you have questions/suggestions on that topic, I’d love to hear them.