Marketo Secret Sauce for Revenue:A Practical Case StudyA Practical Case Study
J Mill VP M k ti g d C F d M k tJon Miller, VP Marketing and Co-Founder, Marketo
Author of Modern B2B Marketing blog
© 2011 Marketo, Inc.
Fastest Growing SaaS Company
SalesforceSuccessFactorsO iOmniture NetSuiteConstant ContactTaleoMarketo
Page 2
Year 0 Year 1 Year 2 Year 3 Year 4All revenue numbers normalized to Marketo Year 1
© 2011 Marketo, Inc. Marketo Confidential and Proprietary
Highly Efficient Revenue Engine
90 cents in Marketing for every $1 in Sales80% of revenue directly sourced by marketing$1.2M annual recurring revenue quota
Productivity (1‐year New Customer Bookings / $M+S )
1 00
1.50
2.00
0.00
0.50
1.00
Page 3© 2011 Marketo, Inc.
Q3‐08 Q4‐08 Q1‐09 Q2‐09 Q3‐09 Q4‐09 Q1‐10 Q2‐10 Q3‐10 Q4‐10 Q1‐11 Q2‐11 Q3‐11 Q4‐11
Buying Has Changed Forever
OLD DAYS: INFO SCARCITY1960s – Recent
TODAY: INFO ABUNDANCE
BUYER
SALES REP SALES REP
Page 4© 2011 Marketo, Inc. Marketo Proprietary and Confidential
Marketo’s Revenue Cycle
MQL
ll N
ames
ospe
ct &
ec
ycle
d
Lead
WA
REN
ESS
Enga
ged
Opportunity Customer
Sale
sLe
ad
MQLSQL
SAL
Al
Pro RAW
E
NurturingNurturing Database
Marketing SDR Sales
Page 5
Marketing SDR Sales
© 2011 Marketo, Inc.
Marketo’s Revenue Cycle
MQL
ll N
ames
ospe
ct &
ec
ycle
d
Lead
WA
REN
ESS
Enga
ged
Opportunity Customer
Sale
sLe
ad
MQLSQL
SAL
Al
Pro RAW
E
NurturingNurturing Database
Marketing SDR Sales
Names are just names.
Page 6
Marketing SDR Sales
© 2011 Marketo, Inc.
Marketo’s Revenue Cycle
MQL
ll N
ames
ospe
ct &
ec
ycle
d
Lead
WA
REN
ESS
Enga
ged
Opportunity Customer
Sale
sLe
ad
MQLSQL
SAL
Al
Pro RAW
E
NurturingNurturing Database
Marketing SDR Sales
Meaningful interaction with us.
Page 7
Marketing SDR Sales
© 2011 Marketo, Inc.
Marketo’s Revenue Cycle
MQL
ll N
ames
ospe
ct &
ec
ycle
d
Lead
WA
REN
ESS
Enga
ged
Opportunity Customer
Sale
sLe
ad
MQLSQL
SAL
Al
Pro RAW
E
NurturingNurturing Database
Marketing SDR Sales
Qualified, engaged potential buyers.
Page 8
Marketing SDR Sales
© 2011 Marketo, Inc.
Marketo’s Revenue Cycle
MQL
ll N
ames
ospe
ct &
ec
ycle
d
Lead
WA
REN
ESS
Enga
ged
Opportunity Customer
Sale
sLe
ad
MQLSQL
SAL
Al
Pro RAW
E
NurturingNurturing Database
Marketing SDR Sales
Showing buying signs or significant engagement.
Page 9
Marketing SDR Sales
© 2011 Marketo, Inc.
Marketo’s Revenue Cycle
MQL
ll N
ames
ospe
ct &
ec
ycle
d
Lead
WA
REN
ESS
Enga
ged
Opportunity Customer
Sale
sLe
ad
MQLSQL
SAL
Al
Pro RAW
E
NurturingNurturing Database
Marketing SDR Sales
Qualified as sales-ready by a human.
Page 10
Marketing SDR Sales
© 2011 Marketo, Inc.
Marketo’s Revenue Cycle
MQL
ll N
ames
ospe
ct &
ec
ycle
d
Lead
WA
REN
ESS
Enga
ged
Opportunity Customer
Sale
sLe
ad
MQLSQL
SAL
Al
Pro RAW
E
NurturingNurturing Database
Marketing SDR Sales
Page 11
Marketing SDR Sales
© 2011 Marketo, Inc.
Benefits of Content Marketing
Risk Reduction
SEO
Social
Scoring
Page 12
Popular Blogs Definitive GuidesResource Center Marketo TVWebinars
© 2011 Marketo, Inc.
Content: When To Ask For Registration
Early Stageh h l d hi d bThought leadership and best practices to build brand and awareness
Middle StageBuyers guides, RFP templates and y g , pindustry information to help structure research
L t StLate StageCompany‐specific information to help evaluate and reaffirm l ti
Page 13
selection
© 2011 Marketo, Inc.
Short Forms Outperform Long Forms
Short (5 fields)Conversion: 13.4%
Medium (7 fields)Conversion: 12.0%
Long (9 fields)Conversion: 10.0%Conversion: 13.4%
Cost per: $31.24Conversion: 12.0%Cost per: $34.94
Conversion: 10.0%Cost per: $41.90
Page 14© 2011 Marketo, Inc.
Problems With Self-Submitted Data
Page 15© 2011 Marketo, Inc.
Marketo Prospect Generation 2H2010Velocity Lead toSource Prospects Cost % Lead Velocity(Days)
Lead to Opp Index
Trade Show – Virtual 3,793 $25.44 17% 81 1.03rd P t E il Bl t 3 302 $34 65 18% 43 0 53rd Party Email Blast 3,302 $34.65 18% 43 0.5Trade Show 2,703 $221.30 23% 61 1.9Paid Webinar 1,760 $68.50 21% 60 1.0PPC 990 $158.10 45% 42 1.4Content Syndication 536 $82.84 12% 59 0.3Other Paid 208 $187 50 13% 93 1 3Other Paid 208 $187.50 13% 93 1.3Website 2,871 58% 27 2.6Sales Prospecting 1,888 26% 46 2.2Partner Co‐Marketing 903 17% 102 1.1AppExchange 353 78% 37 3.4Referral 80 36% 12 1 0
Page 16
Referral 80 36% 12 1.0Other Inbound 370 100% 19 9.0
© 2011 Marketo, Inc.
Why Lead Nurturing: Stay in TouchBuilding relationships with qualified prospects regardless of their timing to buy, with the goal of earning their business when they are ready.
MQL
All
Nam
es
rosp
ect
&
Recy
cled
Enga
ged
LeadNurturing Le
ad Opportunity
Sale
sLe
ad
SQLSAL
A P R
“The art of maintaining permission to stay in front of your buyers as they educate themselves”
Page 17
of your buyers as they educate themselves
© 2011 Marketo, Inc.
The Value of Lead Nurturing
Marketo ROI Results
Fast Leads( MQL <1 mo)
Slow Leads(MQL >1 mo)
Total Leads (MQL)
Cost / Lead (MQL)
WithoutNurturing 20% 6.67% 26.67% $206.00
WithWithNurturing 20% 20.0% 40.0% $137.50
Source: Actual Marketo data; assumes $55 per prospect
Results: 50% more marketing qualified leads from lead nurturing
Page 18© 2011 Marketo, Inc.
Lead Nurturing Relevance
1 2 3Stages
1. BUYING STAGES• Early (Pre‐MQL)
A
y ( Q )• Mid (MQL)• Late (Opportunity)• CustomerB
C
• Customer
D 2. BUYING PROFILES• Industry: 82%• Role: 67%• Company Size: 49%
Page 19
• Company Size: 49%• Geography: 29%
© 2011 Marketo, Inc.
Content - Don’t Panic!
1 2 3Stages
A
1. Short content is good! (YouTube)B
C
2. Reuse and repurpose3 Stay ahead of the drip
D
3. Stay ahead of the dripStart small, think big and adapt quickly
Page 20© 2011 Marketo, Inc.
Other Kinds of Lead NurturingAccelerators
Move prospects along the buying cycle faster with relevant “nudges” gtriggered by specific behaviors
RecycledRecycledKey driver of messaging in active recycling is the reason for disqualificationLimit number of reasonsLimit number of reasonsTimeframe of months or quarters
R i dReconstitutedAKA “Wake the Dead”Great place to experiment
Page 21
p p
© 2011 Marketo, Inc. Source: SiriusDecisions
The ROI of Lead Scoring
How Easy Is it To Get Information About Prioritizing Sales Efforts?
Other Benefits of Fewer But Higher Quality Leads
• Higher Win Rates• Shorter Sales Cycles• Higher Revenue Per Rep
Page 22© 2011 Marketo, Inc.
Source: CSO Insights
A Framework for Lead Scoring
Explicit InfoWhat the prospect tells you
Inferred InfoWhat you observe or inferWhat the prospect tells you What you observe or infer
Fit • Demographics• Data quality• Corporate vs. personal
Are you interested in them?
Demographics• Firmographics• BANT
email• Inferred from IP (geography, ISP in them? (g g p y,domain)
Interest • Latent behaviors Are theyinterested in you?
• BANT(engagement)
• Active behaviors (sales readiness)
Page 23
in you? )
© 2011 Marketo, Inc. All Rights Reserved
Interest Scoring - Examples
• Early stage content +3• Early stage content +3• Attend webinar: +5• Visit any webpage / blog : +1• Visit careers pages: ‐10Visit careers pages: 10
• Pricing pages: • +10 regular +15 detailed+10 regular, +15 detailed
• Watch demos: • +5 overview, +10 detailed
• Mid‐stage content +8
Page 24© 2011 Marketo, Inc.
• Late‐stage content +12• Searches for “Marketo” +8
Closed Loop Refinement: Top Behaviors
Page 25© 2011 Marketo, Inc.
Identifying Marketing Qualified Leads
21+ Super‐Target Lead Lead LeadTarget
9‐20 Target Lead Lead
Fit
2‐8 Other Lead
<2
Engagement <20 20‐44 45‐89 90+st Engagement <20 20‐44 45‐89 90+
Buying Intent <6 6‐14 13‐23 24+Interes
Page 26© 2011 Marketo, Inc.
The Marketing-Sales Handoff (SDRs)
Best place for dramatic improvements in business performance are handoffs between functionsBenefits of a Sales Development functionBenefits of a Sales Development function Faster, more consistent, & better quality follow‐up on leads Better economics The human touch enhances lead nurturingg Better data and more metrics Talent development for sales
Page 27
No Lead Left Behind
Day 0 Notification
Day 1 In untouched, reminder
Day 2 If untouched, reminder cc boss
Day 3 If untouched, alert executives
Day 7 If stale, reminder
Day 8 If stale, reminder cc boss
Day 9 If stale, alert executives
Page 28© 2011 Marketo, Inc.
Sales Insight
Page 29© 2011 Marketo, Inc.
Measuring and Proving Marketing’s Impact on RevenueRevenue
© 2011 Marketo, Inc.
Revenue Cycle Modeler
Page 31© 2011 Marketo, Inc.
Key topic areas:Key topic areas:• Balance• Flow• Conversion• Velocity
Filter/Drill into Trends over time
/data, e.g. by Program Type, Business Unit, Geography etc
Page 32
Geography, etc.
Marketo Revenue Cycle MetricsNew Customers
($5,800)80% of all deals follow this model Lead to Sales Lead: 7%
Sales Lead to Opp: 80%Opportunities
130 / mo($2,000)
40% of prospects
pp1.4 people per Opp1,000 Leads = 40 Opps
Lead Type VariantsSource
Leads2,000 / mo($137.50)
4 0% / mo
40% of prospects eventually become a leadChannel
DivisionSize
20%Active Prospect
4.0% / mo 75%
Paid 9,500 / mo
Size
Prospects3,800 / mo¾ paid ($73)¼ unpaid ($0)
Active Prospect DatabaseNames
($29.33)
10%Unpaid
40%Inactive
80%
Page 33
($55 average) 10%Names($0)
Inactive (Last 6 Months)
Conversion and Speed By TypeProspect to LeadProspect to Lead
Page 34© 2011 Marketo, Inc.
Conversion Over Time
Predict conversions from one stage to another over time
Create plans / forecasts about futurep /
Marginal Conversion Cumulative Conversion
y = 50.749x-0.571
R² = 0.430140
50
60
70
y = 994.2x0.1352
R² = 0.95511 000 1,200 1,400 1,600 1,800 2,000
0
10
20
30
-200 400 600 800
1,000
3 13 23 33 43 53 63 73 3 13 23 33 43 53 63 73
Page 35© 2011 Marketo, Inc.
Marketing Forecasts
Page 36© 2011 Marketo, Inc.
Key Takeaways
1. Grow revenue by making sales more productive, not just by hiring more reps
2. Focus on the entire revenue cycle, not just the top of the funnelnot just the top of the funnel
3. Don’t contact a lead before its time
N l d l f b hi d / i l l4. No lead left behind / service level agreements
5 Use forecasting to turn marketing5. Use forecasting to turn marketing from a cost center into a revenue driver
Page 37© 2011 Marketo, Inc.
Contact Me
Marketo, Inc.901 Mariners Island
JON MILLER901 Mariners IslandSuite 200San Mateo, CA 94404
VP Marketing
[email protected]@jonmiller2
Direct: +1.650.376-2310
blog.marketo.com
@jonmiller2
blog.marketo.comwww.marketo.com
Download the “Definitive Guide to Lead Nurturing”k t /d 2 l d t i
Page 38
www.marketo.com/dg2‐lead‐nurturing
© 2011 Marketo, Inc.
© 2011 Marketo, Inc.