Last updated 21 August, 2021.
Everyone loves to talk about data-driven decision-making. I can’t blame them; it’s a great topic! But the problem is that it doesn’t mean much on its own. This is why I’m setting out on this mission to make it mean something.
To make proper decisions based on your data, you need to have a concrete goal in mind, have adequate metrics to track, and read your data correctly to draw foolproof conclusions.
Too often in marketing, “data” simply refers to web analytics and social media data on a fundamental level. Such data usually includes vanity metrics like the number of website visitors, page likes, post shares, and so on.
However, if you know how and where to look, data can reveal much more.
In this blog post, I will dive a bit deeper into how you can make the most of the data you get from your marketing efforts and how you can get started with data-driven marketing to scale your business. 🚀
And psst: If you’re interested in this topic, stay tuned for more (and subscribe to our Advance Insider newsletter to make sure you won't miss any future posts! 👇)
Make sure to measure the right things — and understand the data you collect
Some of the biggest pitfalls in data-driven anything are not measuring or measuring the wrong things. When going down this road, you can quickly end up looking at the data wrong, thus drawing inaccurate conclusions and making the same mistakes repeatedly.
Now, successfully measuring data the right way isn’t only about proper tracking; it also depends on what you’re tracking. Sadly, many organizations don’t go further than tracking their website visitors and social media interactions.
It’s essential to keep in mind that these are only vanity metrics. And vanity metrics won’t help you make informed decisions. Even though they typically provide big numbers that look good on paper, they have no real impact or value. It’s important to remember that they’re only indicators.
An illustration of this is when marketers evaluate the success of a paid acquisition campaign by looking at clicks, impressions or conversions. Many follow these indicators as their sole key success metrics.
However, these numbers must be somehow connected to revenue. Alone, they don’t make sense.
In reality, relying on such vanity metrics to measure success is like saying, “I biked a total of 100 kilometers,” when someone asks you if you won the race or not. Don’t get me wrong, it sure adds some valuable information, but it cannot define success on its own.
Another important matter is choosing your success metric.
Say you only measure your free trial users as your success metric. I think we can agree that there's a huge difference between getting 5 and 5,000 trial users, right?
The considerable number might be tempting to look at, but it doesn’t say anything about revenue.
Instead, if you’d be measuring trial-to-paid conversions, you could see a big difference between failure and success. In this imaginary scenario, it could be that five free trial users who will eventually become your paid users are far more valuable than 5,000 free trial users who will never convert into paid users.
What this means is that you need to be very careful with your cost and revenue calculations in B2B SaaS. If you're not reading your data correctly or you’re looking at it too superficially, you might face underlying issues that will pop up later as huge holes in your revenue.
Make data literacy a priority
When it comes to measuring and reading data, we can see that most companies aren't there yet and significantly need to improve their data literacy.
Reporting is another crucial aspect of reading and presenting data the right way.
Many companies are still struggling to produce relevant reports or keep producing reports they don't fully understand — and cannot translate into a digestible story.
For example, many teams will use ready-made reports that they find on the internet or Google Data Studio. Unfortunately, they might not have the skills or resources to customize the templates, and will be stuck tracking and telling whatever's there.
In short, it’s best to customize your reports and learn to track the metrics that make the most sense to reach your organizational goals. And if you need to get help from a third party to build a proper process for your reporting, that’s okay too.
Tie all your actions to revenue
Every company wants to grow its revenue and have a good balance between incoming and outgoing money. To see the concrete effects of what you're doing, you need to connect your actions to your revenue.
Ask yourself: “Does it make sense to do something if you get impressions, clicks, or likes, but no revenue?”
Your marketing efforts have no value unless they bring you money. If it’s not influencing a deal or getting you new prospects, the number of clicks or free trials have no meaning.
Of course, some things are more challenging to measure than others. For instance, it’s hard to tie brand awareness directly to revenue. Hard, sure. But it’s possible.
Whenever you launch your campaigns or efforts related to brand awareness, make sure you can track every action your audience makes and that it’s connected to your revenue. You can, for example, use attribution.
Right now, growth marketing is a huge trend, and everyone and their grandma seems to be a growth marketer. In most cases, however, companies believe they are rocking growth marketing when in reality, they’re just rolling with good old traditional marketing methods.
Real growth marketing is an entirely different thing and it requires a certain mindset from your entire company. It’s about running experiments at all stages of your conversion funnel.
One thing I would have appreciated knowing before doing growth marketing is that not all experiments will succeed.
In fact, most of your experiments will most likely fail. The secret is to always move forward and test new things until you find the sweet spot that’s bringing you actual results. In the end, every experiment should bring you learnings that you can apply to your next campaign.
Growth marketing is about building a scalable and repeatable marketing engine that gives you data to conclude from and base future decisions on. It's actually quite simple.
Using your data for B2B growth marketing experiments
When you experiment with your campaigns, you should always have a measurable goal. It will not work if there is no purpose and a measurable metric related to a relevant funnel stage.
Quality content is essential in SaaS marketing. However, working with content requires having a purpose for it.
For instance, once you’ve thought about the why and created a content piece that’s targeting a specific segment of your audience, you need to promote it, track what’s happening with it, and conclude whether it’s working the way you intended or not.
It’s a good starting point, but not a conversion engine yet. You still need to finetune your ways of communicating your value to your audience by testing. Here again, every test is an opportunity to learn and to use your findings to support your next effort.
Back to our free trials.
Say your goal is to get free trials through a promoted blog post.
- You would need to start with your paid campaign and look at the number of clicks you received: How many conversions did it generate?
- How many of those ended up reading your blog post?
- Do they leave it right away or stay to read it through?
- How many of those who read your post created a trial account?
- And finally, how many of those free trials actually convert into paid users?
As you can see, we go through a number of metrics that shouldn’t be used to measure your campaign success but instead to optimize it.
Of course, it is valuable to look at each of those metrics, but they can’t give out much information on their own. You will only know whether a campaign is performing or not when looking at the big picture. In other words, what is the data telling you?
Once you have a sound tracking system in place, you'll be able to see every step your audience is taking.
For customer acquisition, you can go ahead and start experimenting. You can read our blog post on growth experiments to get ideas and tips for experimentation.
For customer retention, you already have the data at your fingertips. You know how your existing users and customers are behaving, and you can optimize your product even further to keep your existing customers happy.
How to use data to align sales & marketing
Ah, sales and marketing alignment! Another topic we all love to talk about.
To properly align your sales and marketing, everything needs to be transparent throughout your organization. From experience, most issues can be solved with data and open communication. ❤️
You should have one shared business goal for sales and marketing. It helps when everyone is working together towards a common goal.
In B2B SaaS, selling is usually marketing-led, in the sense that marketing typically addresses the audience and warms them up to an idea, educates them, and pushes them down the funnel to convert.
Then, unless it’s a no-touch sales model, sales is ready to meet them at the bottom of the funnel when they are already open to the idea of buying.
This is why collaboration is essential, and feedback is a crucial part of that.
Once marketing approves leads, sales should review them, contact them, and so on. If they are not qualified, the reasons should be communicated back to marketing so that they can optimize their process.
It’s a sort of data-driven feedback loop.
Feedback should always be the result of any effort. Each time something is done, the results should be evaluated, and future tactics are planned based on those results and feedback.
Alignment between different departments should be taken care of right from the get-go, so marketing can use any existing data and new data when it’s gathered to optimize targeting, communication, and conversion points.
And by the way, marketing should be aligned with everything: customer service, product, sales, you name it.
6 steps to starting using data in your B2B growth marketing strategy
Let’s finish with a short recap and my favorite tips for using data in your growth marketing strategy.
🚀 Have an open mindset in your organization. Take both success and failure as learnings to improve your following efforts.
🚀 There needs to be a purpose for every single action. Figure out why you’re doing it and what your goal is.
🚀 Map out your conversion funnel to find the biggest problems – and where to focus.
🚀 Understand your users’ paths to purchase and set a specific KPI for each section of the funnel.
🚀 Always prioritize using a scoring methodology.
🚀 Pay attention to your reporting. You can easily go in the wrong direction with inaccurate reporting and over-simplifying your data.
Check out the recording of our webinar “Growth experiments — a thin line between winning and losing” to find out what's happening at the intersection of data-driven decision-making and growth marketing. 👀
Or check out all our services here.