Growth Hacking Your Funnel From Top to Bottom

A fundamental tool for growing a business is the funnel. A basic funnel has multiple stages:

• Suspects: potential prospects we have not yet talked to but fall in the target segment
• Prospects: aka marketing qualified leads or MQL. These folks have expressed a general  interest in the company and purchasing services 
• Opportunities: these are qualified using a methodology such as BANT (budget, authority, need, timeline)
• Customers: focus on how to retain, engage, upsell, and obtain referrals (ie. new suspects!) 

5 mistakes companies make with their funnel:

1. Not tracking the funnel at all. It’s shocking how most companies don’t actually talk about the business in terms of their final and a clean final diagram.
2. Not having good data for the final, often goes hand-in-hand with number one. Not having any data means you’re operating your company blind! That’s pretty crazy.
3. Focusing way too much effort on new customer acquisition rather than simply listening to customers and up selling customers 
4. Counting leads as qualified opportunities, giving a false sense of having a lot in the sales pipeline when in fact there’s actually very little
5. Not having anything deliberate in the suspects category , Just doing marketing in hopes of getting general eyeballs regardless of who

Let’s look at each category each stage of the pipeline and see what kind of growth hacks we can apply.

SUSPECTS

These are actual names of people that you would want to attract to the business because they are representative of the target segments you are looking to sell to. First you need to know what your target segments are. Unfortunately most companies as I’m sure you know see their target segment is being the whole world, or something far too broad for their business and paradoxically end up bringing in far less business then if they picked one or two targets and focussed on them for a while 

Most common pitfalls:

1. Not having target markets, shooting for the whole world
2. Thinking you have target markets, but when you dig into it it’s actually kind of like the whole world
3. arbitrarily picking target markets without enough evidence to pursue them
4. clinging to your target markets for far too long even if it’s not working
5. thinking of target markets as vertical spaces or domains. A segment is a group of people that share a common problem and this could be geographic, this could be you need to certain kinds of companies 

What you really need to do with suspects:

Do we have real target markets and if not let’s start finding them. Finding them typically means  starting with some hypotheses of who your target segments would be, get it reviewed by some independent experts to make sure you’re not falling into pitfalls by accident, and then start talking to those folks and see what kind of information you can collect . So, start with a hypothesis, test for a while, get back data and analyze it and decide if you keep going. This is growth hacking! 

Often the company already has target markets or has a hypothesis and so in parallel you need to start marketing to this until you have something better. Same approach, use a ‘growth hacking’ approach with short iterative tests to see what is working within those segments.
In both cases, the hardest part about suspects is actually getting the names. You either have to literally get lists of names that you can directly promote to, or make sure you have the right channel and venues where those folks go.

Best way is to start small, how can I get 100 names of people to promote to of which maybe 5-10 will talk to us? Some obvious places would be:

• Existing customers, of course. Companies tend to either never talk to existing customers (because sales is too protective), or rely too much on existing customers (not thinking of the ‘rest of the world’ that isn’t using your product today), so make sure to balance
• Find a partner whose audience you can reach via guest post
• Direct outreach on LinkedIn or other social media, but this only works if you are very targeted and very genuine in your outreach, and it typically needs to come from a high up person within the org
• Go to a conference and speak, and arrange meetings while there

  
PROSPECTS

Assuming you have the right target markets and the right place(s) to find them (events, direct marketing, partner, etc.) the next question is how do I convert as many to prospects as possible, ie. get them to reach out and express an interest in buying something.

Typically this relates to the content and the packaging of the content.
Unfortunately most marketing tips and tricks I see focuses almost exclusively on the packaging, but the more essential ingredient is making sure the content is good. Especially in technical fields, marketing is often not technical and therefore focuses on communication tactics in isolation (video! SEO!) without deeply understanding what markets wants. The content is then developed as a favour by a subject matter expert or executive, etc. but without clear guidance as to what the audience wants to know. The biggest role for marketing to play is to actually listen and understand the subject matter in depth, even technical. Understand the nuances of the target segment, what they want to know and hear, what will get their attention, where they go, what formats they want to consume in.

Most common pitfalls when trying to generate prospects / MQLs:

1. Poor content. When marketing doesn’t understand the subject matter in depth and there is no ‘growth’ hacker, typically subject matter experts are left to generically explain their idea or product with no guidance as to what the market wants to hear or what would be different or refreshing. The result is a generic message in an already noisy market that gets no attention.
2. Poor messaging – this can range from a number of problems
   1. you’re saying the same thing as everyone else. Often stems from not understanding the market problems enough or your differentiated position
   2. the message is not clear and concise, and full of jargon either because the person writing the copy doesn’t understand, or because the SME or leadership is too afraid of writing something simple thinking that it may devalue the company and instead focuses on very complex buzzword heavy messages that are hard to understand. If you speak the English language and still don’t understand what the website is saying, chances are it’s not you, it’s them!
3. Mismatching content format to the audience. For example VP believes we need more video because “people don’t read anymore”, overlooks that the target segment are busy executives who travel constantly that prefer whitepapers they can print out and read on airplanes.
4. Marketing to a tiny audience. Lots of time promoting new content to social media, blog and direct marketing but to a tiny following – unless you are the next Uber the math just doesn’t add up. You’ll just end up exhausting your tiny audience
5. Too much focus on SEO ‘hacks’. Yes there are good SEO principles to keep in mind (in 2019 – make your website mobile-first, follow Google UX principles, make content authoritative and 2000+ words, etc.) but too many marketing teams focus on rigging keywords and other unnatural things that actually detract from the content

What you really need to do with prospects:

First, identify “who in your company is the market expert?” “Who is expected to be the market expert?” By expert, this means understanding
- what the target buyers personas are and what their big unsolved problems are
- what their buying habits are
- where they buy, who they consult
- what a day in the life of the buyer looks like, etc.

In small companies, sometimes this is the CEO or one of the founders. Perhaps the founder worked for 20 years in the target space and understands it really well. Some companies implement Pragmatic Marketing closely and have certain product managers with this responsibility. Others have marketing managers or industry managers with this responsibility, some have a “strategy manager”. It doesn’t really matter who it is as long as they have time for it, are doing it consistently, and doing it very well.
 Most companies don’t really have this and therefore I believe the most logical place is actually in marketing – a true “product marketing manager”, “industry manager” or “growth manager” role, as understanding this is fundamental to lead gen (and ultimately to the company strategy and product roadmap).

In fact, marketing almost has to own this by default because others will say they own it but ony own a piece of it. For example yes the CEO does understand the market but only through a certain lens and using informal methods. Or maybe product does understand the market but more the existing customers than the rest of the world.

Make sure then that this person’s responsibility is to:

• really understand the market in depth, including the technical aspects. A technical person in marketing? That’s growth hacking!
• continually sync with the rest of those in the company that are talking with the market (PM, CS, CEO, strategy, etc.) to update the knowledge
• Make sure this person has a strategy for getting to the buyer. Are we going direct, via influencer, etc. and then choosing the right lead gen formats (type of video/audio, where to find them, etc.)
• Work very closely with the SMEs on the message. It needs to actually solve something people need, be packaged in a way that will get their attention, stand out from the noise or better yet target a less noisy but still lucrative segment, etc.
• Focus group test anything that goes out. This step is so critical, we’ve started to understand it in product design (ie. do ‘usability testing’ before releasing a feature broadly) but are still way behind in marketing. Before you send a big campaign out to everyone you know – check it with a few external representative users who will give an honest unbiased opinion! There are sites now that let you crowdsource this type of thing.

Apply a growth hacking approach – run a campaign or two for an iteration, get the results, review the data, and plan the next one!

OPPORTUNITIES

Marketing often thinks that once the lead is handed off to sales, it’s now sales’ job to convert that lead to an opportunity, and if they are not successful, well they’re just not selling hard enough! That is the wrong approach. Not only is it not collaborative, but 1) it very well could have been that the lead was wrong to begin with and this is something marketing should want to know about so they can refine 2) the person that really cares about growth doesn’t just care about 1 or 2 levels of the funnel, they are extremely curious and feel an ownership to the WHOLE funnel

Top 5 Reasons why Leads aren’t converting to Opportunities:

1. Buyer isn’t getting what they thought. Perhaps the marketing is disconnected from reality or sales isn’t trained properly
2. It wasn’t a “lead” to begin with and shouldn’t have been passed to sales. The definition of a lead is very important, this is someone in your target segment who has somehow verbally or non-verbally expressed a need for your product/service. If it’s just someone who attended a webinar, well that’s probably not enough evidence to consider it a lead much less an opp.
3. Not solving a problem that is urgent enough. Prospects are interested generally but can’t ever qualify for BANT opp because there’s no budget or timeline for far-off opportunities
4. Not the correct buyer or influencer. Too low in the chain.
5. Some aspect of the sales conversation is not going well – either the communication, the visual supports, the demos, the technical validation, etc.

In general this should not be too hard to find out why, just ask the sales team. Often sales might not fully be able ot give you an answer because 1) politically risky 2) didn’t ask questions like “what brought you here”, etc. but more targeted sales “what’s your budget”. Bottom line is you’l have to ask many times, many different ways, different levels, and perhaps sit in on some calls as well.

Remember that pragmatic marketing says you need to solve problems that are 1) urgent, 2) pervasive, 3) people are willing to pay for (in the target segment). And the target segment obviously has to be large enough to support your growth goals. Is this the case? If your offering doesn’t meet all of these criteria, then no matter how much growth hacking you put into your business you are not going to fool customers into buying.

CUSTOMERS

This is where things get really interesting. What is your growth strategy with existing customers? Selling something additional to existing customers is the fastest path to revenue. You have a trust relationship there already, you have procurement already in place i.e. contracts, approved vendor list, etc. and you have a captive audience who will tell you all about their problems and what  they need and will pay for. And yet most companies focus their marketing, sales and strategy  on new customers and new segments and treat their existing customers with the most mediocre of attention.

Top 5 pitfalls with growing an existing customer base:

1. Thinking of  customers as just a source of retention and renewals, not growth
2. Losing customers (depending on industry, retention rate should be 90-98%!)  you simply can’t grow as a company if you don’t have a strong foundation to rely on and SaaS metrics like ARR  are you starting to put this in the spotlight 
3. Asking customers what they want (“faster horse”) instead of exploring their unmet problems. Only talking to customers about their feedback and requests for the existing product, rather than asking them what problems they have in general that are urgent, pervasive, and would pay to solve
4. Focusing most marketing and sales attention on new customers and new segments 
5. Continuing to sell only to the existing buyer at the customer site rather than finding other buyers and other groups 

By far, one of the most egregious and most common growth strategy mistakes that companies make is focussing too much on creating something brand new, winning new customers, when they could achieve nearly all of their growth goals by simply up selling existing customers 

In fact, a great growth manager will look at the growth objective for the company, and do a breakdown first existing customers versus new customers, where is the revenue coming from this year and in the future? Then work the math backwards to understand what you need to do at each stage of the final to upsell and retain existing customers as well as bring in new customers

Understanding what customers actually need and will pay for it versus what customers say they want is also very challenging and usually could benefit from a user experience researcher or someone trained in use or interviews and ethnographic research. There’s a great talk given by the former product manager of LinkedIn who explains how she was sure the customers were going to love a new newsfeed because they were all telling her they wanted that, but when it ethnographer went in and asked more sophisticated questions like when’s the last time you read a newspaper, what was the article, what compelled you to read it? They uncovered that people Loved the idea of getting up in the morning and reading industry news but in practice they weren’t even able to read other sources of news today so it seemed very unlikely they’d be able to use a newsfeed feature after all. 

Don’t forget referrals under the “prospects” section!