In this article, I’ll discuss how to drive company strategy with product marketing by explaining how PMM teams can help set and drive overall strategy and key initiatives, get involved in build, buy, partner decisions, and leverage pricing and packaging levers to drive growth and profitability.
I'm Chris Mills, VP of Product Marketing at SalesLoft and in this article, I'll discuss driving company strategy with product marketing.
I've spent the majority of my career working in software SaaS in various product management, product marketing, and strategy leadership roles.
I've spent a lot of time launching new products and categories and working closely with my counterparts in product sales to drive go-to-market strategy and growth.
In this article, you'll learn how product marketing teams can help set and drive overall company strategy and key initiatives, get involved in build, buy, partner decisions, and leverage pricing and packaging levers to drive growth and profitability.
SalesLoft, for those not familiar, is a software company that delivers software for salespeople to help them build a pipeline, manage deals, and engage with customers across the revenue lifecycle.
We're a venture-backed company headquartered in Atlanta, with offices in San Francisco, New York, Indianapolis, London, and Guadalajara.
We have about 2,600 customers and 70,000 salespeople on our platform. We orchestrate about 1.2 million salesperson to customer interactions every day.
As marketers, we spend a lot of time driving product launches, building marketing and integrated campaign plans, and various tactics. But without a guiding strategy, we may be running fast but not getting anywhere. In the worst-case running off a cliff.
By its nature sitting at the intersection of product, sales, and the rest of marketing, product marketing is in an ideal position to inform and drive company and go-to-market strategy.
One of the key areas that we can make an impact on is which markets to go after.
Size and prioritize markets
You can't go after every market so you need to pick one or a few.
In Geoffrey Moore's Crossing the Chasm, he talks about a framework to evaluate different markets based on market attractiveness, the company's current and/or future ability to execute in that market, and obviously the size of each of the markets that you evaluate.
Lots of potential growth markets
At SalesLoft, and this probably applies to your companies as well, we looked at a bunch of different potential growth markets to go after.
For example, what tech ecosystem do you want to plan? For example, in the sales technology space, we complement CRM so:
- Did we want to go after a specific CRM market like Salesforce?
- Did we want to support all the different CRM platforms?
- Which industry should we focus on?
- What use cases and personas do we serve today?
- Are there opportunities to expand how we serve those particular users and personas, or different use cases that apply to those?
- If you play primarily in smaller or mid-sized companies, is there an opportunity to go upmarket and sell more into larger enterprise companies? Finally,
- Is there an opportunity to expand internationally and go global?
Evaluate and score the options
When I joined SalesLoft, we were actually exploring all of these different options, at the same time.
My team led an effort to size and prioritize the different growth strategies. We used market data to estimate the number of companies and potential revenue in each growth lever and then evaluated them using a modified version of The Crossing the Chasm model.
We evaluated each growth market based on a scoring model that scored them based on:
- The level of effort that we thought it would take to train and enable our sales and customer-facing teams to support that market,
- The potential level of product investment that would be required to meet the needs of that market, for example, for international supporting multi-language,
- Then looking at did that market have a clearly identifiable buyer and customer that we had access to or could get access to?
- Did they have a compelling reason to buy our solution?
- Was there any urgency?
- Then we looked at general product-market fit for that segment, as an example, are companies in that market adopting technology like ours, or are they laggards and not yet invested in similar technologies?
- Finally, looked at the competitive dynamic in that market: Are there competitors there?
- What are the competitors like?
- Are they strong?
- What are other barriers to entry into that market?
All of that work fed into our 12 to 24-month strategic plan, which highlights our vision of where we see the market going, our mission for what we want to deliver for our customers, our core values as a company, how we measure our goals in terms of revenue and market leadership.
Those growth levers down in the right-hand corner, which is three growth levers around commanding upmarket are going to serve larger enterprise customers, deliver full cycle, which really meant serving a wider portion of the sales revenue organizations within the customers that we serve, and then going international.
All of these growth levers and the other different levers on this strategic plan bedded into a very large project plan, essentially, that was segmented out by each of the levers that were here with detailed project plans of how we were going to execute within each of those levers.
Gather input from stakeholders
When you're looking at different markets, and where to go after, definitely gather input from different stakeholders, people within the organization within sales, marketing, customer, and product.
Quantity and score options
Quantify and score all the options based on a weighted model.
More than three is too many
Then choose which ones you're going to go after, you may be tempted to go after many of them or all of them. But I think it's really important to choose.
In our case, we chose three, we thought we had the resources internally, and it was important for us to go after three of the growth options that we consider. We actually considered a lot more, we considered six different potential growth opportunities.
For some companies that might be one, choose one and really focus 100% on serving and winning in that market. Sometimes saying no to things is the most important thing that we could do.
Build, buy, partner
As you look at your strategic plan and start to understand what it's going to take to win in a market, you may have to decide the best way to get there. When the market needs something that you don't currently have, you may need to consider and decide on:
- Whether you build it using internal resources in your product and engineering organizations.
- Whether you look at a partner ecosystem and complement your own internally built solutions with a partner solution and how you might go-to-market with that partner, or
- Do you want to look at considering acquiring a company or set of capabilities?
Strategic planning identifies opportunity
For us, as we double-clicked into our strategic plan around an initiative to better serve the needs of an entire B2B sales organization, we identified some gaps in our current solution portfolio.
We were great at helping sales development reps and salespeople prospect and engage with customers. But we knew we were missing a pretty critical capability for sales reps who were closers or full-cycle reps, who did a bit of prospecting but also were responsible for managing and closing opportunities.
That was where we really wanted to invest in figuring out did we want to build, buy, or partner for something?
Sweet spot historically...
Our sweet spot historically had been, as I mentioned, sales development reps and inside sales reps who were doing high-velocity selling. Sending hundreds of emails and making hundreds of calls every day.
They needed better tools, processes, and automation to help them drive that high velocity of activities. We did really well in SaaS and cloud companies that had adopted this type of modern sales organization where they had specialized sales resources, who did prospecting and high-velocity activities versus closers or hunters that were out closing opportunities.
As we looked at the market as part of the market sizing opportunity, we recognized that the number of account executives for traditional sellers was probably eight to 10 times bigger than the number of sales development reps who were primarily specialized in prospecting and handing deals over to AVs.
The market was huge and this was also validated by some of our external analysts and company advisors, who were saying this market that we're in - sales engagement - has a huge expansion opportunity to serve not just the needs of SDRs, but for the full sales organizations.
Identify gaps for this market
As we looked at what we were missing in our current solution portfolio and the needs of those other types of users in the revenue organizations, we identified three major areas.
Streamline opportunity management
Those sales reps were looking for ways to streamline opportunity management, not just do prospecting and interact with their customers, but how did they actually manage their day to day opportunities and understand which ones to work on and how to forecast them up to management?
Better forecasting predictability
Better forecasting and predictability for those managers to get a better handle on where their revenue was, what the gaps were, and where they should focus their reps.
Coaching and next best actions
Finally, coaching, how could sales managers do a better job of using their limited time and resources to coach reps who needed it the most in the areas where they needed the most? And help drive the next best actions to get those deals across the line.
Evalutable time vs. market opportunity
Then, as we identified where the missing pieces of our solution portfolio were, we partnered with our product management peers and looked at how long it would take us to build our current platform to support those additional use cases and capabilities those users were looking for.
We looked at the potential revenue opportunity, both today and over the long term as we deliver that solution. Obviously, the longer it took to build that solution, the more of an opportunity cost there was in not serving that market today.
Thankfully, over the years at SalesLoft, we built a fairly extensive partner ecosystem of other software integration partners that complement our solution. We were already partnering with and actually, our internal sales teams were already using a few solutions that helped them conquer these problems that we were looking to solve.
After going through a due diligence process, we ended up actually looking at a couple of the partners that were in our ecosystem and actually acquired those two companies. One was a company called Note Ninja, and the other was a company called Costello that did, respectively, conversation intelligence for coaching purposes (NoteNinja), and opportunity management and forecasting (Costello).
By acquiring these two companies, it really accelerated our time to market by probably at least a year.
M&A accelerates our strategy to power the entire revenue cycle
Through our merger and acquisition strategy, we were able to accelerate that strategic plan in terms of our ability to serve the full revenue cycle, not just SDRs but all of the individuals that were involved in customer-facing positions, from the SDR to account executives, account managers, sales managers, and sales leaders throughout that revenue lifecycle.
In summary, as you look at build, buy, partner decisions, it's really important to understand market needs, and then estimate what you need to build to serve that market need, how much it will cost and how long it will take to get there.
Ideally, if you've already got a partner ecosystem, or looking at the other technology landscape of complementary solutions that may meet that need that you're looking to fill, look at potentially partnering with them or based on time to market resources, and potential revenue opportunity and access to capital, look at potential M&A opportunities.
Pricing & packaging
Once you identify which markets you are going to go play in, and how you're going to solve problems for that market, pricing and packaging can be one of the most strategic levers that you can pull to serve that market.
Establish a cross-functional marketing committee
At SalesLoft, product marketing chairs a cross-functional pricing and packaging committee, with leadership from marketing, product, sales, customer success, our strategy organization, and operations.
Pricing committee objectives
We review pricing and packaging-related topics and oversee smaller working groups to investigate, make recommendations, and approve pricing and packaging changes.
As we aligned on our growth initiatives for full-cycle and going upmarket into larger enterprise customers, and started evaluating how to incorporate the new products from the mergers and acquisitions strategy, we embarked on an initiative to evaluate and recommend new packages to align with our evolving solution portfolio.
We used overall pricing guiding principles, things like simplicity, price to customer value, and focusing a priority on market share and growth over immediate profitability, as an example.
We used these guidelines and principles, as we looked at and evaluated different potential ways that we wanted to price and package our offerings for the market.
We looked at a few different pricing models, including:
- Good, better, best, which is your typical salesforce.com-like model where it's a minimum solution, a little bit better solution, maximum solution.
- A solution that was more oriented towards use cases or specific personas and the problems that we solve for those.
- A base platform plus potential monetizable add ons that were on top of that platform.
- We looked at what if we took all of our capabilities and sold that as an all-in-one platform and that was differentiated in the market.
Ultimately, we aligned on the use case driven solutions, because it best suited the needs of the various buyers and user personas we serve and the different problems that we solve for revenue organizations.
Our evaluation process included a lot of internal input and alignment with sales, product, customer success, and finance, as well as a lot of interviews with customers, our customer advisory board, industry analysts, and other company advisors.
It was a very comprehensive process to get both internal alignment as well as get external validation.
SalesLoft plans for personas and use cases
Our plans bundle different capabilities and products within our solution portfolio to serve the needs of the different roles in the sales and revenue organizations within our customers.
It allows us to mix and match different packages for different types of users within the same organization and provide those solutions at potentially different price points and willingness to spend within a revenue organization.
A customer success team may buy one thing, an SDR team may buy another thing, and a full cycle rep or AEs may buy another thing with different sets of capabilities at different price points.
One key element to pricing and packaging or really any strategic initiative is you need to measure the results and effectiveness of this change or strategy that you're driving. So you know:
A) if it's working, and
B) if it's not, how to tweak and make adjustments to see if something else works better.
As we looked at measuring the effectiveness of our pricing and packaging offers that we rolled out at the beginning of this fiscal year, we've seen a huge success of these new packages, including:
- A pretty significant increase in our monthly average revenue per user, and
- A significant decrease in the amount of discounting that we were seeing from our sales and customer success and renewals who are driving new deals and customer expansions than what our traditional discounting was.
- Looking at win rates, we saw a huge win rate uptick when we're selling our highly differentiated enterprise package that had all the capabilities and platform in it.
In closing on pricing and packaging, it's one of the most complex cross-functional things we do in product marketing.
Get cross-functional buy-in
It's really important to work cross-functionally, to get input from not only leadership but also frontline sellers, who are ultimately going to be the ones that take the solutions to market and sell value around them to customers.
Talk to customers & analysts/advisors
It's also really important to talk to external folks, and not just internal baseball. We did a really good job of going out and talking to customers and users of our platform, and getting their input and where they saw value in the platform and how they want to buy.
Also leveraging industry analysts and external company advisors to get their input as they look at lots of other different companies that are pricing and packaging solutions for the market.
Stress enablement and communication
One of the things related to pricing and packaging, particularly if it's a significant change is there's a lot of change management involved. It's really important to stress as a part of the project plan, making sure that you've got an adequate level of sales and customer-facing teams enablement and that it's communicated both internally, as well as how these changes are communicated within your customer community as well.
Measure and adjust
I can't stress the importance of making sure that you measure the effectiveness of any changes that you make from a pricing and packaging perspective, and then make adjustments as needed.
In summary, product marketing, when done right, can have a huge impact in forming and driving company strategy. Yes, we have our day jobs in terms of effectively launching new products and updated products and ensuring our go-to-market organizations are properly enabled to take those new products and new capabilities to market.
But the driving of this strategy stuff is the really fun stuff that at least I enjoy and I think my team enjoys a lot. I think all of us as product marketers look for opportunities to make this kind of impact in our companies.
Having a strategic plan is so important to know where we're going and how we're going to get there.
Our leadership team actually pulls this slide up at least once a month in our company all-hands meetings, in our objective and key results quarterly planning that we do, and in quarterly business reviews that we do in each of our functional departments to see how we're doing.
It gives me a huge amount of pride to know how much impact the product marketing team that I lead has had on the definition and execution of the strategic plan and where we're going as a company.
A few ways you and your teams can make an impact on your company's strategy are:
- Helping identify those markets that you want to go after.
- Figuring out how you're going to get there, whether you want to build it, develop partnerships or potentially acquire companies or capabilities along the way.
- Coming up with the right offers that your customers want to buy, and really importantly want to pay for.
Ultimately, that drives your strategic plan.