#CloudSummit: 4 Tactics for Winning in the SMB SaaS Space

#CloudSummit: 4 Tactics for Winning in the SMB SaaS Space

Last week Kris Barton, Chief Product Officer for USA Today Networks and ReachLocal (a wholly owned subsidiary of Gannett), shared lessons learned at LSA’s 2017 SMB Cloud Summit regarding the SMB view of SaaS, media tactics, and other observations in serving a 15,000 plus SMB customer base.

Looking at the SMB market’s evolution from a marketing perspective, Kris talked about an influx of point solutions, tools, and vendors and how this has created a big challenge for SMBs. They miss a lot of the details when executing their own initiatives and programs. And rightly so, since its difficult to keep track.

Using market research, he illustrated that in 2018, businesses plan to use eight or more marketing tactics, 48% of businesses do not know which of these tactics are effective, and the majority of business surveyed said marketing measurement is being tracked manually or not at all. That’s a big problem, and the lesson is that any SaaS solution needs to be “closed loop” to deliver real value.

From his days at Omniture, and ASPs (Application Service Provider), to today’s world of SaaS, Kris contrasted the value delivered to SMBs in the past versus the promise SaaS tools carry today. Understanding the “sales funnel” remains critical among many marketers.

Safe to say that the sales funnel adage is old hat. The reality is that the purchase process is more complex and non-linear as consumers dart in and out, using various devices and touch points, as part of their journey. He presented the idea that SaaS solutions need to help local businesses tailor to the customer experience.

He shared four ways to win in the SMB market for SaaS providers and otherwise:

  1. Focus: ReachLocal has and continues to practice delivering a “customer first” experience, which is contrary to the product focus of many SaaS solutions.
  2. Coaching: He contrasted the way we advise SMBs between two styles: coach and concierge. The concierge provides data, is overly optimistic, and will do whatever you want. Whereas the coach demands accountability, provides instructions, and offers insights.
  3. Integration: This is key to reducing churn, creating stickiness. In ReachLocal’s case, attaching marketing to business systems (PPC and social ads to Quickbooks for example) via integration helps SMBs realize value.
  4. Engagement: SaaS solutions need to align engagement to the value proposition. Providers can’t rely on login sessions to remain constant or increase over time.  Instead focus on how to generate increased usage via awareness, so that SMBs get the most value.

As a parting thought, Kris also maintained that diversification is viable as always, when executing on a marketing strategy. The key is to deliver holistic experience, that provides meaningful return and value for the SMB, in addition to a set of tools that be leveraged.

#CloudSummit: GoDaddy Expanding Product Portfolio with Cloud-Tech

#CloudSummit: GoDaddy Expanding Product Portfolio with Cloud-Tech

At the 2017 SMB Cloud Summit, GoDaddy’s SVP of Productivity, Irana Wasti, had an insightful conversation with Local Search Association’s VP of Strategy and Insights, Greg Sterling about the small business ecosystem. Specifically, they talked about the impact of mobile productivity applications on the SMB market and what GoDaddy is doing in this area.

GoDaddy continues to play a critical role when it comes to helping these businesses start, grow and efficiently run their independent ventures. It is widely known that there are about 28 million small businesses in the US and close to 420 million globally, but Wasti pointed out that the total addressable market of small businesses is actually quite a bit higher when you take into consideration the nascent businesses that are still too young to be classified as “small business” by conventional standards.

Globally, GoDaddy serves over 17 million nascent and small businesses alike, and has 73 million domain names under management, but GoDaddy’s customers rely on them in ways that extend far beyond naming their business, including building a professional website, attracting customers, and managing their day-to-day workloads.

If there is one thing GoDaddy customers have in common, it is that they are all incredibly passionate about their business.  And, with this passion comes long hours and lots of hard work, especially since more than 75% of small businesses in the US are sole-proprietorships, or one-person shops, that don’t have the assistance that a team of employees provides.

It’s for this reason that GoDaddy and other companies are democratizing the playing field and making it affordable (sometimes free) and easy to acquire the tools necessary to allow small businesses to focus on what matters to them the most…their business.  Some of these tools include professional email services, Microsoft Office integrations, online bookeeping tools and more.

That said, as more small business service providers enter the market, small businesses may be led astray by simultaneously working with too many service providers, resulting in diminishing returns as their data becomes siloed and operations become less efficient.

In an effort to consolidate the plethora of tools available to small businesses, GoDaddy is continuously looking for ways to expand on their already impressive portfolio of products. But, as GoDaddy’s product portfolio grows, so does their challenge to optimize the end-to-end experience for their customers by recommending the appropriate products to a business depending on where it is in its lifecycle.

One way GoDaddy is solving for this problem is by leveraging their award-winning customer care organization of over 5,000 employees that are focused on intimately connecting with GoDaddy’s customers around the world, 24 hours per day, 7 days per week.  Collectively, GoDaddy’s Customer Care organization handles about 1.4 million customer interactions per month, and drove 24% of GoDaddy’s 2016 bookings.

Small business will continue to play a vital role in the global economy, and GoDaddy recognizes that they have a huge responsibility to ensure that these independent ventures have the tools they need to succeed.  GoDaddy has made great strides in the right direction, but there is still plenty of work to be done, and GoDaddy is excited for what the future holds.

#CloudSummit: How to Use Net Promoter Scores to Improve the Customer Experience

#CloudSummit: How to Use Net Promoter Scores to Improve the Customer Experience

As a company selling to SMBs, if you’re not paying attention to your Net Promoter Score (NPS), then you’re missing on a critical lever to manage churn.  Dan Slagen, CMO of Alignable, walked through case studies yesterday at the LSA’s SMB Cloud Summit, showing how some companies have figured out how to actively use NPS to drive lifetime value and in turn, to build a more sustainable revenue stream.

So what is NPS?  It’s basically a score that helps you understand the strength of your brand perception.  NPS = % of promoters – % of detractors.  The higher your NPS, the stronger your brand perception among your target audience.  Your promoters are those SMB customers who are actively promoting your business and acting as your evangelists, sharing positive stories about experiences with your brand at any level – and telling that story through word-of-mouth, social media and various other mediums.

NPS is important because the lifetime value of those promoters is 2.5x higher than that of a detractor.  And those detractors are 2.3x more likely to switch brands – a direct correlation to loyalty and churn.*

So while many companies focus much time and money on the acquisition and on-boarding phases of the customer journey, even more energy has to be placed on the customer experience.  And the use of NPS can help direct and inform retention efforts in this second half of the customer journey.

Dan explained an approach Apple took to move the needle on churn and revenue by using “detractor targeting.”**  Apple called its detractors within 24 hours of a purchase.  This test resulted in a retention increase of 10%.  Final analysis showed that every hour spent calling detractors was generating more than $1,000 in revenue or additional sales, for a total of $25 million in the first year of detractor targeting.

By going the extra mile for those customers who were not bought into the Apple brand, the company was able to shift perception and drive loyalty and spend.  It seems pretty simple, but it is not a typical approach to retention, nor is retention always top of mind for marketing teams.

Another way to leverage NPS is to integrate into your customer feedback loops.  Thomas Cook, a travel company in the UK, implemented NPS into its review cycle. The company actively monitored customer complaints, identified solutions to address those stated challenges, took actions to put them in place, monitored impact to NPS and reviewed feedback again – all within a two-week cycle.  Such rigor is needed and alignment with all internal teams to ensure focus remains on the customer experience.

In today’s world, it’s impossible to ignore the impact of word-of-mouth and social media on your business.  And with the trusted and vibrant community of SMBs, it’s not only critical that you actively measure, monitor and track your brand perception, but also smart to use new approaches to influence and drive that perception to impact your bottom line.

*Source: The NPS Industry Benchmark Series from CustomerGauge

**2017 Morgan Stanley report/CustomerGauge

#CloudSummit: Cisco Explains How to Sell & Market SMB Cloud Services

#CloudSummit: Cisco Explains How to Sell & Market SMB Cloud Services

Kicking off the LSA’s first SMB Cloud Summit, Jen Allen, who is the Go To Market Lead for the SMB Segment at Cisco, discussed the insights and findings from her research at Cisco on how to sell and market cloud-managed services to small businesses.

The Evolving SMB Market

SMB is a large segment that Jenn argued must be segmented further to micro-segments. At Cisco, they have taken the mid to small market (2-250 employees, 3 million businesses) drilled down into: individual owner/home practice, brick and mortar single location, cloud natives and startup, and regional chain.

Similar to Charles Laughlin’s findings in the Tech Adoption Index , Cisco is also seeing a growing trend of emerging small businesses that can’t be treated like “mom and pop” shops. Cisco calls these businesses, which are newly started, young, and have an eye towards scale, “Cloud Natives”.

Supporting sales with a simple unified message

The Cloud Native segment demands a hyper-focused marketing message and it is a challenge for marketing and sales to unify their message.

They want to be treated like the enterprise in terms of the white glove service and assurance that is provided by Cisco but they don’t need to be oversold by the tech specs, rather, the business objectives – there is a balance between treating these business like enterprise while selling to them like consumers.

Jenn’s data has shown that small businesses prefer purchasing bundled solutions from single providers. She argued that the offerings need to be succinct and simple without too many options. As a fan of In’n Out, she used their paired down menu as an example: “Someone who walks into In and Out doesn’t want to know how the cow was butchered, they just want a burger!”

Reaching the SMBs

In order to establish lasting relationships and grow the business, Cisco is experimenting with different ways to reach the evolving SMB space through small peer-driven events, marketing centered around business problems, and digital marketing that is “real time”- mirroring the message that the sales team is communicating to their prospects when they are simultaneously researching your products online.

One data point that jumped out from Jenn’s data is how underutilized podcasts are: 58% of their survey respondents replied that podcasts influence their buying habits, resulting in the following takeaway: Podcasts are the new white paper.

The key takeaways from this presentation for me were two fold: 1. Businesses are increasingly becoming more sophisticated in their needs and 2. As small businesses evolve, companies in the space need to evolve their marketing messages and sales tactics to align.