Episode 45: Shiv Narayanan & Kate Hawkes of How To SaaS on How C-Level Marketers Impact Company Growth

Episode Transcript

Shiv: All right, Kate, welcome to the show. How's it going?

Kate: Good, yeah, excited to be this side of the camera. I'm normally getting the episodes kind of published and promoted, so this is a change for me.

Shiv: Yeah, and for the audience, Kate is actually our VP of marketing. She's the one that does all the promotional work and all the campaigns around the book, the podcast, all the content that we put out there. So a lot of times when you hear from me through email or social platforms, Kate and her team are behind that. So super excited to have you on. And for the audience, what we're going to try to do today is Kate is going to actually we're to do like a reverse interview format. Kate is actually going to ask me questions to help bring out this concept of what a C level marketer is and for your benefit and to also talk about our training program. So Kate, with that said, I'll hand it over to you.

Kate: Yeah, so I think maybe it makes sense to kind of just set some context around what you mean when you say a C-level marketer, because we talk about that a lot, I think, in our content, but it's a phrase and a kind of approach that I think not everyone is super familiar with.

Shiv: Yeah, I think, you know, I started thinking about this concept about a year or a year and a half into starting this company. And previously when I was a CMO, you know, when I first got the title of CMO, I thought I had made it and I actually hadn't because I really didn't know what the hell I was doing. And over the years, as I kind of got better at being a marketing leader, slowly, I started to appreciate the nuances of what it took to be really elite in that role.

And when we started working with companies inside How to SaaS, we would meet a lot of marketers who held similar titles, either VP of marketing, SVP of marketing or CMO or what have you. And, I would, it would just be surprised at the, the quality of talent in that seat. And I just feel like companies are often under-leveraged on marketing just because they don't have the right leader, in that marketing leadership role.

And it kind of cascades down throughout the organization. So slowly I started to develop this idea that you can have the title or the role, but really you need to think like a C-level marketer in order to actually be able to create value for an organization. And a C-level marketer thinks very differently than a standard marketer. You can be a very talented marketer in specific domains like product marketing or demand generation or corporate marketing or events and all of those things. But to be a C-level marketer to me is somebody who understands the overall business strategy, understands the objectives of the CEO and the investors that are involved, can actually communicate at that level and get stakeholder buy-in to be able to do the things the organization needs to do to ultimately grow the organization to the next level and really create enterprise value long-term.

Kate: Yeah, and I think sometimes marketing doesn't get the attention that it deserves. I know we kind of see that all the time. So maybe to kind of put that into context, like why should our CEOs and our investors who are listening, why should they care about having C-level marketers on their teams? And what kind of impact does that have on businesses?

Shiv: Yeah, I think if you really think about how companies start, and we've met a lot of companies that are 100 million plus that really suck at marketing. And there's a reason for this because when companies start, they often start as sales companies. Usually the founder or founders have a unique insight into a market or an industry. And so then they start the company. And then the first strategy that they use to sell is through their personal network. And so they go to folks that they've known from other initiatives or other roles that they've held and other just partnerships or relationships that they may have. And they leverage those to close the first few deals of the company. As the company grows, the founders start to replace themselves. And then they hire more sales reps that do outbound or inbound type of sales. And it's very realistic for a company to grow north of 10, 25, even a hundred million to have a pretty large sales team because the founders focused on replacing themselves and adding more folks and not enough marketers.

And it could still be a very healthy business with a good year over year growth metrics, good net revenue retention metrics, but just marketing is understaffed and just overlooked because the company has been growing and it kind of masks this underlying problem. But as you get to a certain stage of company, you start to plateau out. And for different businesses, that point is at a different mark, I guess. So for some companies that mark might be a 10 million for some companies, it might be at 50 million. And that plateau often looks like missed sales projections, maybe you forecast pretty aggressively and your sales team can't, can't cover the, the amount of pipeline that you need to close. It looks like VPs of sales or chief revenue officers being fired or replaced. And it kind of becomes this revolving door. And it often looks like marketing playing a supporting role where marketing is - the entire function’s role is to just enable the sales team and do traditional activities like events, product marketing stuff, sales enablement work, but not really being accountable to revenue and actually helping the organization grow. So the idea or the opportunity is to understand that your revenue problem is actually a marketing problem when you hit that plateau and you need marketing to contribute at a higher level in order to be able to hit your sales projections. So if you're missing your sales projections, you can replace your CRO as many times as you want, but if you don't generate more pipeline, they're not going to close more deals. and you can, you know, redo the coverage of your sales reps. You can change the sales process, but if there aren't more folks that you're meeting and that are high quality and best fit type of customers, you're not going to be able to hit the types of revenue numbers that you want to hit. So once you start to understand that, then you start to look at marketing very differently and you start to think of it as more of a revenue accountable function that needs to actually focus on driving more pipeline and revenue for the organization. And actually you start to prioritize it much differently and you think about resourcing it differently as well.

Kate: Yeah, and I think kind of at the heart of that core issue of marketing not kind of playing a big enough role in the kind of the revenue and the overall business objectives, right, is that marketers don't always connect what they're doing to the business context. It feels like kind of the activities marketing are doing, it kind of feels divorced from where the CEOs and the investors are actually trying to get to. So yeah, maybe we can talk a little bit about how marketers can better understand the business context and fit what they're doing in with the overall objectives.

Shiv: Yeah, I'm so glad you brought that up. So when marketers are leveling up in their careers, one of the most common frameworks that they're taught is this idea that you need to become a T-shaped marketer. And T-shaped is this idea - and marketers that are listening have definitely heard of this- is this idea that you pick a domain inside marketing, whether it's content marketing or SEO or events or paid media, whatever it is, and you get extremely specialized and good at that function. And then the other marketing functions you kind of dabble in and have some idea about. So it looks like a T shape. and the, the issue with that is at some point, your career caps out because you don't have enough of an understanding of what is actually happening, happening at, at the higher level of the business. 

So for example, let's use SEO. Like you could be a phenomenal SEO marketer and have, driven a lot more organic traffic for a specific business. And then you come and talk to your manager and say, look, I'm driving so much more traffic. want to be promoted or get a raise or whatever it is. And you might find that you're encountering resistance, which is kind of perplexing and confusing as a marketer. And the reason for that is that even though you may have grown organic traffic, the overall company may not be doing as well or may not be hitting its growth projections and not reaching where it wanted to get to from a strategic perspective. And so the counterfactual to that or like an alternative framework to think about it as is this concept that we call a C level marketer. And this type of a person is not just well versed in a specific domain. You can lean one way or another, like, Kate, you're a great product marketer and a content marketer. But at the same time, you need to be connected to what are the organization's objectives overall? What are, what is the current financial situation or what are the financial constraints on the company and how do the other functions inside the organization need to work together in order to achieve those objectives? And so if you don't do that as a marketer, it's quite unlikely that you're going to get the kind of resources and support that you would like to have inside of a company. And that creates this vicious cycle where the marketer doesn't have enough resources because they're not able to sell enough internally.

And then on the flip side, CEOs and boards want to grow the company, but they're not able to hit targets because marketing is not contributing as much as it should be. And so a good framework that I use to kind of illustrate this is if you're, if you're a company, just ask yourself, what is overall marketing's overall contribution to pipeline. If your contribution to pipeline from just marketing sourced activities is less than 20%, odds are that it's quite an immature organization. And I would say that about 80% of companies we meet fit into that bucket, which is quite shocking. And so it becomes not just like a career problem for the marketer, but it's a company problem for whoever owns and runs the business.

Kate: And then it becomes kind of a huge internal problem as well, right? Because you get that tension internally if you don't have that revenue accountability and you've got like sales, then blaming it on marketing and marketing blaming it on sales. And, you know, I think that then leads to all kinds of internal and team problems as well, right?

Shiv: Yeah, I would, I would call things like those like almost like symptoms to this larger problem, right? So inside immature companies, very common problem is sales says we're not getting good leads and marketing says we gave you good leads. Why aren't you converting them? And there's this like finger pointing exercise that happens. The problem that that's a symptom of is that the company is simply not mature enough to look at marketing as a revenue driver and to align the entire organization around revenue targets where marketing has just as much accountability as sales to contribute to those objectives, right?

So that would be one of the first things that we need to fix inside companies. And then it starts with marketing actually behaving that way. So if, for example, marketing drives, let's say 10 leads to a salesperson and the salesperson says, none of those 10 leads were good fit leads. We actually have to believe the salesperson, even if it feels like they're not converting because they're not doing a good job. As marketers, we have to actually try to diagnose why that happened. Whether they're the right fit leads, whether they have bad timing, did they not have the budget? Maybe we did send right fit leads, but we didn't have the right conversion tools or sales enablement content in place. There could be a whole list of problems that exist and marketing needs to be just as accountable for that. And as, as we start changing the culture of that, we start to discover like what is the C level marketer actually supposed to do to get marketing its rightful seat at the table?

Kate: And I know another kind of area of misalignment we often see is between kind of the CFO and the finance side of things and the marketing leader. So how can marketing leaders kind of more closely align themselves with what's happening on the financial side of the business?

Shiv: Yeah, I would say this is one of the things that marketers almost never look at, which in itself is quite shocking is your CFO in a lot of ways is your best friend inside of a business, especially if you want to grow marketing's impact inside of a company. But very few marketers actually have spent any time looking at an income statement, looking at how their marketing budget breaks down and how that connects to the overall profitability of a business.

Looking at the balance sheet of a company and figuring out what assets are there, what liabilities, what's the working capital, are there financial covenants on the business that need to be met? And then really understanding cash flow, how cash is moving in and out of the business. Is there enough cash even to support some of the things that marketing wants to do or what the financial objectives are? And then finally, what are the revenue forecasts and targets? What are the EBITDA margins? What are the objectives of the board? And then connecting that back down to the functional level to really understand what marketing is supposed to do in order to help hit those projections. 

And a good way to kind of think about this is this idea that like, whatever your functional strategy is, is a subset of the company strategy. So your marketing strategy doesn't live in a vacuum. Your marketing strategy is connected to your sales strategy. Both of those two things need to connect to the overall go to market strategy. And that needs to be connected to your overall product strategy or how are going to compete in the marketplace? And all of those things need to ultimately roll into what is our company strategy. So the better you understand the company level strategy and then you connect it to the financials and the metrics and the constraints, the better you'll be able to adjust your marketing decision-making and bring more of a strategic insight to the table so that marketing can make a bigger impact.

Kate: And yeah maybe we can dive a little bit deeper into that. So assuming that a C-Level marketer has that understanding of the business context and that kind of alignment with the high level objectives, how would a C-level marketer go about building the right strategy for the marketing and then trying to build the budget as well to support that strategy?

Shiv: Yeah, so I think the starting point is really knowing that strategy, like we discussed. And then from there, as you understand the financials, it's really breaking numbers down and starting with the data. 

So let's say there's revenue projections, you need to close $10 million in new bookings next year. Well, what percentage of that should be sourced by marketing versus sales? What percentage of that should be from new customers versus existing customers? How much of that is upsell? How much of that is cross-sell? How much will attrition or retention make an impact on that? Are there pricing initiatives in place that'll adjust how much we are able to expand existing customers? Are there market dynamics at play or even strategic initiatives? Do we have an M&A roadmap that we're currently executing on? Maybe we're about to buy a business that adjusts the cross-sell and upsell targets or it opens up a whole new set of opportunities for us because there's a new product line in the mix. Are there product roadmap initiatives that influence where we should focus? Maybe we're releasing a new feature or a module that opens up a whole set of other activities and programs that we should be focused on. So as you start to ask these kinds of questions, it drastically changes what you do on a day-to-day level. And you wanna kinda work your way backwards to those targets. 

So as you understand those numbers, then the next question becomes like, let's say new bookings, 10 million in ARR and it's from entirely new customers. Well, what percentage of those new bookings need to come from certain channels or how much can certain channels actually contribute to those numbers? Because you may want to generate 10 million in new bookings and you'll say, okay, I want to do it all from, from paid media as an example, but it may turn out that the market that you're selling into, for example, let's say you're selling into the 600 largest CPG firms in the country. Maybe a lot of them are not searching for the solution on Google or they're not as accessible on LinkedIn. Well, then you need to go to a different strategy and try to figure out what channels can be leveraged to generate that kind of pipeline. So you break it down channel by channel and you try to figure out from a bottoms up forecast because in a lot of boards and in forecasts, the work is done kind of top down. It's like we did 10 million last year. We went to 20 million this year. And it's kind of a math exercise, but what you really want to do as a C-Level marketer is you want to bring that bottom up forecast to the table to say, inside each of the channels or places that we invested, here's how much revenue or pipeline we generated. We've tied our work all the way through to closed-won revenue. And then here's how much more potential there is to spend inside each of those channels. 

As you do that work, you might figure out that the five, 10 main channels that you're investing in get you to 70% of that mark. So if our goal is 10 million, maybe we can generate 7 million a new ARR from those activities, but you're still short $3 million. And I would say a lot of companies don't know whether they're going to be short or they're going to reach their objectives by just continuing existing activities by ramping up budget. So as you understand that gap, now it's time to figure out what else can we do to meet that gap on the new booking side, for example. And that could be starting new channels and campaigns. It could be introducing new initiatives. It could be going back to the CEO or the board or to other functional leaders and say like, hey, this is a problem I'm surfacing based on what we can do currently and our current budget. We actually cannot hit our projections. And so now that becomes an opportunity to lobby for more budget. And now you can bring business cases back to those, to that group of people to say, here's how we can do it in order to generate three more million dollars in revenue, I need X amount of more dollars of budget. Here's how I will allocate it. Here's the ROI or the payback period. And here's how I'm going to break it down in terms of people or, or program spend. And then from that point, it kind of becomes like an investment committee decision. And the process I just described should be constantly happening because the marketer should always be on top of day to day, week to week, month to month metrics, as things change in the market, as pipeline changes, as deals close or as conversion rates change. We need to be constantly updating these numbers and surfacing either problems or shortfalls that will happen in revenue and be able to rectify them before they actually become problems. And all of that work actually significantly increases the likelihood that we will meet the expectations of all the people that are in the CEO or the board level.

Kate: And I think, having those, having the numbers going into those discussions to advocate for the budget is so key, but it's also having the right numbers, right? And I feel like a lot of the time marketing falls into thinking they have the right numbers, but actually they're not the ones that the people who have the decision making power really care about. So again, yeah, I guess that goes back to that alignment idea of like, if you know what your CEO and your board really want, it's a lot easier to come with the right metrics that are actually going to make a compelling argument.

Shiv: Totally, yeah. Actually, it comes back to this concept that I talk about, is communication is probably the most important skill that a C-Level marketer needs to have. Yes, like you have to lead your team that is standard for any managerial position. You have to talk to the market. We know that as a marketer. But I think the one or two roles that is quite understated is that the C-Level marketer needs to constantly educate internally and manage expectations upwards and have this like two-way communication street with the board and the CEO so that everybody knows what's going on and where the levers are or what's working and what's not working. And data is a really big aspect of that, right? And we work with a ton of private equity firms, like data is like their main language. So marketers need to think about it in that way. And the more data you bring, the easier it becomes to push the marketing agenda forward and actually make an impact. So this means like, if you just think about it like a standard CEO or board update. It's like telling a story. You want to be able to tell a story in like a very simple digestible format because the CEO or the board doesn't really care about the specifics of a specific channel or campaign that you're working on, right? So if you did really well with SEO and you ended up finally ranking for that tough keyword, like that's as much as you might be proud of that, that's less relevant at a board level. What they really care about is did that impact our final metrics? Are we seeing more leads? Are we seeing more opportunities? Why or why not and being able to explain that. 

So the right format for that story is in to get their buy-in, buy-in without making them fall asleep really is you want to start with overall performance. Here's where we were last year or last quarter. Here were our goals for this quarter. Here's our current performance in pipeline bookings, revenue, customer acquisition costs, our close rates. Then next level deeper is like overall funnel metrics like how are we doing in terms of leads, MQLs, opportunities, closed-won deals. Then you break that down further and you think about at a channel level, your overall performance, which channels are doing well, which ones are not. Maybe you want to reallocate spend based on performance in a particular channel. Maybe you've shut off spend in another channel and maybe another channel is doing really well and you want to scale up spend. So you want to be able to explain that. Next, you want to look at campaign level performance, maybe within certain channels. Events is a really good example of this where we see 80% of the revenue from events for most companies coming from 20% of the events. So being able to show within this channel, here's what's really working well for us. And we want to continue that next quarter or next year. And then here's what didn't work. And we're going to shut this off as well. And you're getting very granular and explaining that. 

Then you want to talk about your performance versus the plan. Like here was what we plan to do this month, this quarter, this year. And here's how we trended on all the key metrics that we've just discussed, month over month or year over year. And that allows us to understand where we were off track on that performance versus plan so that we can figure out how to make adjustments and scale things up or scale things down or, focus our attention or people or resources in another area. 

Then you want to transition to what are your updated priorities? How does this change your focus for the next three to six months? And how does it improve or change your perspective and how you're seeing marketing or how much - how much you should be allocating in terms of programs or people budget towards that. 

Next, you wanna talk about your actual organization. Is the team changing? Maybe you don't have certain roles, maybe there's certain gaps, maybe you need to adjust some seats from one area to another area. So, and explaining like based on the plans that we have, here's where people come into that and how that allows us to scale things up and scale things down. And then finally, you wanna talk about how marketing performance will be updated based on a new forecast based on all of this information that has been shared. 

And so as you start to follow this kind of a framework and regularly update the board, you're going to find significant buy-in. You're going to inspire a ton of confidence from folks that are in charge of the budget. And you're going to find that marketing is going to get far more budget and resourcing and attention inside the organization. I think that communicating up piece, that's what this is about. By bringing all these metrics to the table, you're actually showing them that, I'm actually a business partner to help you achieve your objectives inside this business versus saying, like, I'm just working in my area here with complete unawareness by, being completely unaware of what's actually going on at the board level. So that communicating up piece is like pinging them and, sorry, communicating what you have uncovered.

And I think the second part is actually querying them for more information. So as you grow, the business and the business changes, you want to learn more about how the financial model has changed. Are there cross -organizational priorities that have changed? Is there something in the investment thesis that you may have missed? Like we talked about M&A, maybe something has changed on that roadmap that makes you need to adjust your plan. So it's like a bit of a dance where you're querying them for more information and then going back and adjusting your plans and then communicating that back upwards to say, here's how you've adjusted plans and then making sure you're getting more budget and kind of having this back and forth. And that ends up being such a big part of the role that marketers miss.

Kate: And yeah, I guess we've spoken a lot about what marketers can do to improve that communication and kind of that relationship. What do you think that CEOs and business leaders can do from that perspective to improve communication with marketing? Because obviously it's a two way street, right?

Shiv: Totally, yeah, and I think a lot of CEOs miss the importance of marketing based on some of the things that we discussed earlier. And so as CEOs start to get it and they understand how important of a role marketing needs to play in order to hit overall company level objectives, they need to make sure that they're making as much information available and transparent to the marketer and making sure that they're doing their part to ensure that there's alignment with marketing and sales and the board on all of these numbers and metrics. So in a lot of organizations, I feel like there's like a lack of transparency where there are sales projections and people are kind of held accountable for that on the sales team. But then maybe the marketing person is not fully aware of the overall EBITDA targets or they're not fully aware of the cashflow situation inside the business. So the more the CEO can bring those metrics to the table as, and as especially as marketers query for that information, the better because that'll allow the marketers to do their job a lot more. And then as marketing brings that proposal for increased budget or the data to show why or how they'll help the organization hit their projections, I think the second part of that is really to evangelize for the CEO with the board that marketing does need additional budget and how that plan is in alignment with the overall strategy of the organization.

Kate: And so if a CEO or an investor wanted to help a marketing team level up, become C-level marketers, have the kind of impact we've been talking about, how can they support them doing that? Like what kind of education is there out there?

Shiv: Yeah. And that's really the issue. There isn't that much. And a lot of the things that I've found that are out there are quite tactical and live in the realm of like, specific domains or, or topics like demand generation or social media or revenue operations and, things like that. And there's a lot of great content on, on stuff like that, but the, the big roadblock is budget and people. So - and which is something that I don't think people understand by default. You just think like if you have, if you run a great marketing campaign, you know, you've done your job or, or that will lead to the results that you want. But the biggest unlock for marketing or any domain to contribute more is, the budget that you have to deploy against the things that you want to do. So the - I just don't feel like that there's enough education in this area. 

And that's kind of why we created this course or training program called C-Level Marketing. And my goal for that was to teach marketers the evergreen concepts that no matter like what channel is popular or what initiative is going to make the biggest impact, because that'll always change, right? 10 years ago, it may have been events and now it's paid media across social platforms. And in 10 years, it might be what to do with the LLMs and chat bots and things like that, right? So that'll always change. What will never change is this idea of how to communicate and lobby for budget and what to present at the board level and how to have those conversations and build the right strategies that's in alignment with the overall company strategy and have the right team members and how to lead team members or communicate with the market. Like a lot of those things are evergreen that I just feel like there's no place to kind of learn it. So that's kind of why we built this program. And with the hope that as marketers take it, they can go back to their respective organizations and make a much bigger impact of high plan and revenue.

Kate: Yeah, and I think that aspect of strategy over tactics is so key, right? Because a big part of it is knowing what to say no to. And I know we kind of touched on that before, but like not every channel is going to work for every company. And, you know, a marketer throughout their life will be working at multiple different companies, things will change. So it's all very well kind of focusing on one set of tactics. But as you progress in your career, as the company develops, actually, you know, those strategic - that knowledge and that approach is going to have a way longer lasting effect on you as a marketer and the companies you work with, rather than doubling down on tactics that may not work for the next company or the next year.

Shiv: Yeah, totally. And yeah, really the goal should be for the marketer to elevate the role beyond just the tactical, right? Cause anybody can be good at tactics. I know plenty of marketers that are really good at specific tactics and in specific areas, but it's very rare to find a true business leader who understands all the things that we're kind of talking about and can really elevate the conversation and then educate all the key stakeholders on why they need to invest more in a particular area or really make a bet on marketing and I think that's really what we need to develop. And the more marketers get good at that, the easier it is to grow companies.

So I what I'd ask the people that are listening, if you have a marketing team or if you yourself are as CMO, but you feel like there's more for you to grow in that position in terms of your overall executive presence or how you communicate with CEOs and boards is to really look into the C -level marketing training program. And it starts on October 3rd and it's a 12 week program. And I think that can be a great first step for marketers to start to level up. And if there people on your team as well that can benefit from that, take the course with them and then bring a lot of that knowledge back to your respective companies.

Kate: And yeah, where can people go to find out more about this?

Shiv: Yeah, I guess we'll link all of that out in the show notes and the follow up emails and all of that. But it's all on the How to SaaS website, the C-Level Marketing Training Program. like I mentioned, it's 12 weeks. It's all live. And then plus there's recordings available and a bunch of other extras, like we're doing office hours every Friday. We're doing the training sessions on Thursdays. There's going to be a back end portal where all the recordings will be available, plus a bunch of templates and frameworks in terms of how we work with other private equity investors and companies that you can use and bring back to your respective organizations as well. And there might be some sort of additional component beyond that of community as more folks take the program as well.

Kate: Yeah, it's an exciting kind of next step and I think we'll hopefully be able to help a bunch of people make a bigger impact. And as two people who've come up through marketing, I know how kind of passionate we are about that and educating other marketers and helping people progress in their careers and just succeed in the companies that they're in.

Shiv: Yeah, 100%. So yeah, hopefully the people listening got a ton of away, took a ton away from this. And at the very least, you know, they'll have learned from this episode and hopefully some of you that you can really benefit from this program. We hope you take it and share it with some of your colleagues as well.

Kate: Great, thanks Shiv, thanks for chatting today.

Shiv: Thanks, Kate. This was fun.

Kate: Okay, we'll speak soon.