Evaluating and optimizing business growth metrics are steps crucial for any company that wants to scale successfully. But with so many metrics, strategies, and teams involved, it can feel overwhelming to know where to start.
To help demystify growth, we spoke on “Marketing, Demystified” with Asia Orangio, a SaaS growth analyst, speaker and former Moz board member who is currently CEO and founder of Demand Maven. We covered the key topics that any marketer should understand when assessing their company’s health and identifying opportunities to accelerate expansion.
Tracking the Vital Signs: Key Marketing Metrics
Asia explains that when auditing a company’s growth, she evaluates two main areas:
What needs troubleshooting? This involves digging into any conversion rates or metrics that seem below industry benchmarks. It also means clarifying who the ideal customer profile (ICP) is and assessing whether there are any activation, retention or monetization issues.
What opportunities can be optimized further? Even if everything seems relatively healthy, this entails an analysis to find areas that have room for improvement.
There are a few buckets she analyzes across the board, said Asia:
Overall conversion rates – Tracking how ideal customers move through the funnel from awareness to trial to paying customer. This includes analyzing conversion performance differences across channels, segments and desired outcomes.
Cohort performance – Comparing metrics for different customer segments. For example, viewing trends for qualified vs. unqualified leads, or customers who signed up with a particular intent.
Parts of the whole – What percentage of generated leads convert to marketing qualified leads (MQLs)? What percentage of MQLs convert to sales qualified leads (SQLs) or won deals? Identifying these breakdowns illuminates growth opportunities.
Podcast Host and CEO of Growgetter Jenn Mancusi points out, metrics that may seem important, like volume of leads or cost per lead, do not actually demonstrate business impact if they aren’t converting through the funnel or aligning to revenue growth.
Instead of obsessing over benchmarks, Asia stresses understanding how your business model works and which leading indicators connect to revenue and expansion. That context will shape impactful priorities.
When it comes to optimizing marketing for growth, Asia explains that the primary focus should be choosing the right customers at the right time for an affordable cost, while also building an unreplicable brand experience.
While performance marketing like paid ads can help with acquisition, Asia cautions companies to not become overly obsessed with driving volume at all costs. As research shows, improving retention and pricing optimization actually deliver exponential revenue lift compared to similar percent gains in acquisition.
Asia summarizes that marketing’s role includes:
- Deeply understanding the ideal customer so messaging can resonate when they are ready to buy
- Distributing the product through effective strategies and campaigns
- Fostering affinity and community that competitors cannot copy
The danger is over-rotating on short-term customer acquisition without enough emphasis on winning over the best long-term, high-lifetime-value users.
What’s more, Asia predicts acquisition costs will continue rising while privacy restrictions make attribution more complex. This necessitates strategies that go beyond tracking codes and temporary discounts.
Authentic brand building is crucial but admittedly harder to quantify. As Jenn notes, marketers first need to deliver on short-term pipeline before typically getting leadership buy-in to invest in emotional connections. But for long-term growth, both are imperative.
Optimizing Conversion Rates (CRO)
Asia positions CRO as a way to spur more efficient paths, but cautions against overvaluing minor percentage gains without understanding motivations.
For example, a company may see their free trial start rate is below the industry benchmark. But without researching why visitors aren’t converting, any CRO experiments may prove ineffective.
Asia advocates calculated CRO focused on areas with clear business impact. For instance, using CRO to increase activation once trials start could boost retention. Or refining lead gen form copy could provide sales with more qualified contacts.
The key is balancing sufficient volume for statistically significant testing with enough context to explain the human psychology behind dropoffs. Obsessively chasing arbitrary conversion percentages often backfires.
Aligning Teams for Shared Goals
With so many moving parts driving growth, cross-departmental collaboration is essential. So how to foster team alignment?
Asia explains that executive leadership must model the priorities and cooperative culture. But even without overt top-down direction, marketers can spearhead productive partnerships, especially in early-stage startups.
The key is suggesting regular touchpoints, providing structure, and clearly communicating how each participant can contribute and benefit.
Of course, this requires understanding how your business makes money so you can highlight intersections with other roles. But that spirit of service – seeking to support colleagues instead of just maximizing marketing numbers – drives win-win relationships.
While committees or workgroups focused on a shared challenge can work when launched by leadership, motivated marketers can also assemble the necessary experts without directive from above. The main requirements are facilitating cooperation through reliable meetings, cadences and agendas so it becomes habit, not hassle.
Avoiding Pitfalls on the Path to Scale
Despite best-laid plans, even the most seasoned marketers stumble in efficiently scaling their companies.
For one don’t over-rely on generic industry benchmarks without comprehending company-specific context on data flows. Teams focused strictly on superficial metrics like website conversion rates might miss more meaningful patterns or pitfalls underneath.
Business model literacy and customized cohort analysis are vital to accurately diagnosing trouble spots, not average benchmarks. Customer psyche can defy sweeping generalizations.
By becoming more nimble, decision-makers armed with actionable, tailored insights around revenue drivers, businesses can sidestep stagnation on their growth trajectory. Pair that with cross-functional collaboration and supporting efficient systems, and scaling becomes exhilarating rather than exasperating.