Growth is not solely about acquiring new customers — it’s also about expanding relationships and keeping your customers happy for the long haul. A net revenue retention (NRR) strategy can help you do all this while scaling revenue and accelerating growth beyond what new customer acquisitions can do for you. 

What Is Net Revenue Retention?

NRR is a way to view customer growth through expansion and retention. Suppose you started the year with 10 new customers each paying you $1,000, summing up to $10,000 on Jan. 1. By the end of the year, you would assess the value of those same 10 customers. If three customers, amounting to $3,000 in revenue, churned, your gross revenue retention (GRR) would be 70%. However, if the remaining seven customers expanded their contracts by an additional $13,000, your portfolio would amount to $20,000, resulting in a 200% NRR.

Why NRR Matters For Marketers

Marketing to existing customers is closely connected to NRR, as a high NRR indicates that marketing efforts are successfully retaining and expanding revenue from the existing customer base. Effective marketing strategies promote upsell and cross-sell opportunities for the existing customer base. Moreover, marketing to existing customers fosters loyalty and advocacy, encouraging customers to stay with the brand and refer it to others.

The Bowtie Model: A Holistic GTM Approach

NRR has not typically been fully leveraged as a pillar of growth because a typical go-to-market (GTM) funnel is optimized toward new, local customer acquisition. If this is your model, you may be asking questions such as:

●      How many leads are we getting?

●      What is our conversion rate?

●      How many new customers are we signing?

But what if you shifted your model framework to a process what Winning by Design Research & Development describes as a bowtie? The left side is the customer acquisition side, and then the right side is the customer lifecycle side.

A bowtie model illustration, created by Influ2.

The Power Of The Bowtie Model

The Bowtie Model helps visualize the best ways to reach your targets. You don’t need to just scale one piece of the bowtie to grow your revenue, and if you execute better in every piece of the bowtie puzzle, you can grow quite a bit faster without herculean feats of valor on the customer acquisition side.

The Bowtie Model offers marketers a big-picture view of the customer before and after the initial sale. Building a deep understanding of B2B decision-makers empowers marketing teams to efficiently engage with customers, improve the overall customer experience and build trust in the brand. It also encourages marketers to deeply understand customers throughout the business relationship, enabling them to create more informed and compelling campaigns.

5 Steps To Improve Your NRR

1. Shift your revenue paradigm from customer acquisition alone to LTV of a customer.

Activate your marketing efforts across the entire bowtie rather than focusing primarily on new logos. Quantify the effect you will have at every stage of the “bowtie” from acquisition throughout the entire lifecycle of a customer and look for ways to accelerate your impact.

2. Make revenue processes that you can replicate with an eye toward growing the long-term value of your customers

Remember, often companies rely on increases to boost revenue, but sometimes that can be detrimental. It’s possible to oversell customers with a higher ASP when, if you sold them at a lower amount, you might actually get a longer lifetime value out of them because they’ll be successful with the smaller amount. And then they’ll expand. And they’ll grow. And you’ll retain them.

3. Optimize revenue at each phase of the customer journey through great experiences that deliver impact

Create great experiences at each stage and touchpoint of the relationship rather than leaving off at solely optimizing everything around new local acquisition.

4. Align the goals, incentives and KPIs across the commercial team

If account executives get compensated solely on the initial deal size for a new logo, they’re going to try to extract every dollar possible on that initial deal versus what’s good for LTV of the customer. So, it’s critical for everyone on the commercial team to align with the appropriate incentives that match the goals.

5. Organize your teams for growth

Having a Chief Revenue Officer (CRO) with full-funnel revenue oversight is ideal to champion the effort. If there’s no CRO and there are multiple chiefs from various organizations, the CEO can create alignment between the groups, having the same definition of what it means to win and corresponding ways to measure success.

While customer acquisition costs might not decrease soon, marketers can still make a significant impact on revenue by supporting an NRR strategy. By nurturing and expanding existing customer relationships, focusing on their lifetime value, and aligning the entire team’s efforts, marketers can play a crucial role in driving sustained growth and success for their SaaS companies.

Joe McNeill is the CRO of Influ2, a person-based advertising company.

The post Using The Power Of Marketing To Unlock Net Revenue Retention In Your Organization appeared first on Demand Gen Report.

Stockpress seeks to combine file management with the features of digital asset management software. With the new capital, the company plans to grow its team and invest in attracting, engaging and converting new customers from the content, marketing and creative communities.

“We’re excited to continue scaling the Stockpress business — not just in terms of new customers, but growing through our existing customer base, too,” said Jessica Storry, CEO and Co-founder at Stockpress, in a statement. “We’re building integrations with the tools our customers are using every day. Whether it’s project management, design or communication, we’re looking to be the hub for teams to organize, share and find media files.”

The post Stockpress Raises $1.8M In Seed Funding appeared first on Demand Gen Report.

At the same time, marketers face increased pressure to prove the ROI of their efforts. While attribution is not a hard science, marketers need to stay attuned to executive leadership expectations about results and what is or is not working when it comes to driving ROI. While marketing software may pit metrics against revenue, and advanced marketers may have the savviness to create their own models, unanswered questions on which spend is nurturing and converting clients will inevitably remain.

One metric to answer these questions and showcase marketing’s impact is customer acquisition cost (CAC), which is how much a company spends to get a new customer. Higher costs to acquire customers lead to lower profit margins, worse sales and marketing inefficiencies. Properly managing CAC helps marketers function more efficiently, improve value and alignment with core business objectives, and reduce spend while increasing customer lifetime value (CLV).

1. Create Efficiency With Ad Spend

Despite CAC rising 60% between 2014 and 2019, marketing budgets have largely either remained stagnant or been reduced over the same period. Marketers often adapt to these changes by cutting back their advertising budget — but that’s a short-sighted quick fix. Turning off ad spend to reduce CAC could damage both short- and long-term pipeline. 

Instead, companies should strategically reduce CAC by creating sophisticated, creative digital experiences (DX) and optimizing every digital touchpoint by better targeting their ideal customer profile (ICP). When marketers leverage data to inform their advertising strategies, they create more efficient ad spend.

Having the right customer data platform (CDP) within their martech stack allows organizations to identify a cohort of valuable customers, then uncover similar customers to broaden their reach. CDPs enable companies to use their owned customer and prospect data to create specific, tailored ad audiences and look-alike audiences.

2. Revamp SEO To Generate Organic Traffic

Organic traffic is the holy grail of marketing, and the only surefire way to gain organic traffic is through SEO. While even the best content may not show immediate traffic results, it has a long, impactful shelf life – especially when the right investments are made to personalize and promote the content. Organizations must prove to customers that their brand is an authoritative voice to help solve their most prominent problems, creating a relationship that feels mutually beneficial. Strong content backed by a robust SEO strategy is one of the best ways to do that.

3. Reduce Reliance On Advertising Through SMS, Direct Mail & Email

Advertising is a must when attracting top-of-the-funnel prospects — but it’s an entirely different scenario once contact information is generated. Engaging customers positively and consistently is rewarding and cost-effective when tapping into channels that are much cheaper than advertising, such as direct mail, email and SMS. Once customers are ready to buy or already familiar with a brand, staying top of mind with relevant, personalized touchpoints across these channels is lucrative.

Through journey orchestration capabilities, companies can create a 1:1 personalized dialogue with their prospects and customers at scale over channels like email and SMS. Both are much more cost-effective channels than SEM and social advertising and are noticed more often than digital ads.

The past few years have seen massive changes in the market and in how all businesses achieve positive outcomes and generate sustainable revenue. CMOs are forced to rethink every customer touchpoint and dollar spent, analyzing how they can best maximize their already shrinking budgets. The best way to do that is to consistently measure and improve customer acquisition costs through strategies that are data-backed, content-focused and rooted in personalized customer experiences. With a focus on CAC that leads to long-term revenue growth, marketing budgets can stay off the chopping block and live to see the other side of another recession.

Shafqat Islam is the CMO at Optimizely, a digital experience platform.

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In the Monday afternoon keynote, “Acquisition Vs. Expansion: Using Decision Science To Acquire, Keep & Grow Customer Revenue,” Corporate Visions’ SVP of Marketing Leslie Talbot highlighted the biggest difference between high and low performances: Articulating value.

“To learn how to articulate value, you first need to understand what your audience actually values,” said Talbot. “How do they create value and make choices, and how does that influence how you — as a marketer or seller — interact with that?”

Disrupt The Status Quo To Encourage Change

The biggest takeaway from Talbot’s keynote was that client acquisition does not equal retention, and each one requires a unique, yet similar, approach. For acquisition, Talbot explained that it revolves around creating a buying vision, which she referred to as conveying a “why change, why now” message to prospects.

“If you want an effective conversation with the buyer, you need to back that conversation up to the point where the prospect is struggling,” she explained. “You need them to challenge their assumption about the way their current world works and get them to see it in a different way. If you can deliver that “why change” message, you can create a much faster and better trajectory for you and your solution.”

A major factor of conveying the “why change, why now” message is by disrupting the client’s status quo, which traditionally consists of:

• Preference stability, as people prefer to commit and double-down on their decisions;
• Cost of change, which includes believing the status quo is the same;
• Selection difficulty, when all options look alike; and
• Anticipated blame/regret, as no one wants to make a bad decision and be responsible for a poor product.

Now, to disrupt those notions, orgs must:

• Create uncertainty by making prospects doubt their current decisions;
• Show them that staying the same costs more than changing, as the client will likely fall behind as older solutions create compliancy, accelerate risk and generally create more problems;
• Depict a clear contrast between you and your competitors;
• Share a relevant client success story with the same/similar problem and how your solution helped.

Essentially, salespeople must destabilize prospects’ preferences, show them their flawed approach and then highlight how their solution can create a better workflow, process and more success.

“The biggest mistake I see marketers and sellers make is shoehorning their solution in too quickly in their ‘why change’ messaging,” explained Talbot. “Instead, you must get prospects to buy into your approach before they buy into your product. Your ‘why change’ framework must create urgency, too, by attaching their problem to a business issue or industry trend you know they care about. Make sure you align that story with a real-world issue.”

Re-Establish The Status Quo Once Change Is Made

Here’s where status quo disruption gets interesting: Once an organization defeats the status quo in the acquisition stage, they must shift gears and re-establish it in the retention stage. To do this, marketing and sales must:

• Reinforce why their solution(s) are the best choice for the client;
• Highlight how making a change can end up costing customers more money;
• Demonstrate how they’re keeping up with the market and other real-world changes; and
• Generate doubt about the client shifting providers.

Reestablishing the status quo gives organizations “the incumbent advantage,” Talbot explained.

“As the incumbent, you have an advantage because the client invested in you just as much as you’ve invested in them, so they’ll be reluctant to make a move because they would have to start from scratch,” she continued. “When your competitor comes in to steal the client away from you, they will not be successful because you are the status quo — not an untested, unproven and unknown solution. You need to have these conversations infused in all your selling and marketing materials to reinforce the client’s status quo bias.”

The Role Of Content & Bringing Prospects On Your Website

A major component of disrupting the status quo and making changes revolves around content. But before organizations can serve that content up to prospects, they must work to get those companies on their website to start the first stage of education.

Bridget Poetker, Director of Content and Brand for Postal, an offline engagement platform, highlighted the difference in content consumption in her case study with Demandwell, “How Postal Spent Less Money (But Drove The Same Results) By Investing In Organic Search.”

“We think we know how people consume content, but we have no idea,” said Poetker. “There are websites like Hotjar to give you an idea and you can add a CTA (call to action), but you don’t know how people are going to come through. The way I search a website is different than how you search a website, so you need to give people opportunities to find your content. We think too much about publishing and not enough about distribution.”

On the distribution side, Influ2’s Co-Founder and CEO, Dmitri Lisitski, took the stage with “How To Help Sales NOW With Person-Based Advertising.” Lisitski outlined the power of person-based advertisements, as they help organizations enable sales to:

• Target the same audience sales reps are already in contact with;
• Track person-based engagements, such as interactions with an ad, and let sales act on it quickly;
• Work in parallel with internal teams to ensure seamless handoffs; and
• Understand that sale metrics are marketing KPIs.

“When a person clicks on an advertisement, it means they’re interested and something in your banner drew their attention,” said Lisitski. “For sales, this means the person is interested in specific topics — and when sales knows what those topics are, they can leverage that information in discussions with the client and generate better results.”

We’re here in Boston all week, so the insights will keep on coming! Stay tuned for Tuesday and Wednesday recaps.

The post #B2BSMX Day 1 Recap: Start With What Makes You Unique… & Then Double Down On It appeared first on Demand Gen Report.

SOAR is designed to touch every step of the buyer’s journey from awareness, registration, browsing and ordering, engagement and repeat business. The new feature seeks to provide users with a full feedback loop of interaction data that includes information such as what customers are searching for, downloading and buying. Those insights can help B2B companies identify where and how to prioritize their digital marketing and commerce focus.

“We see it time and again: B2B companies over-engineer and overcomplicate their digital initiatives, which often causes them to stall altogether,” said Joe Harouni, Head of Avionos’ Commerce, Sales and Service practice, in a statement. “We created SOAR so that marketing, sales, service and IT can operationalize a digital strategy in weeks, prove value quickly and mature their capabilities over time. It’s a low risk, high reward business case that makes it incredibly easy to measure tangible results.”

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A recent content marketing roundtable, sponsored by Bizo, highlighted different aspects of content marketing followed by executive viewpoints from panelists: Joe Chernov, VP of Marketing for Kivey; Ann Handley, Chief Content Officer at MarketingProfs; Matt Johnson, CMO of uTest; and Todd Wheatland, VP of Thought Leadership and Marketing for Kelly Services.

 “B2B marketers have always created brochures, data sheets, and corporate videos that were played on VCRs,” said Sean Callahan, Editor for Digital Marketing Remix and moderator of the panel.  “What’s different today is the corporate web site which has moved far beyond its initial incarnation that’s ‘brochurewear.’”

Callahan shared two trends that have led to the evolution of content marketing:

– Search engine sites became more prominent, making companies focus more on the “look and feel” of their web sites.
– The emergence of blogs and social media, an essential platform to share content for B2B marketers.

The best SEO approach for a company is to have great content, noted Callahan. However, the question here isn’t whether or not to produce content; it is to understand the types of content needed to engage customers as well as the right platform to distribute the content.

For B2B marketers, content marketing is still about branding, sales and lead generation. The top five organizational goals for B2B content marketing according to a recent CMI/MarketingProfs report are:

– Brand awareness (79%);
– Customer acquisition (74%);
– Lead generation (71%);
– Customer retention/loyalty (64%); and
– Thought leadership (64%).

B2B Content Marketing Truths

The heart of content, according to Callahan, is social media. In fact, 87% of B2B marketers today use social media to distribute content, a 13% increase from 2011.

Chernov discussed what he considers fiveessedntial  content marketing truths:
1) Without content, social engagement stalls;
2) Logo size is inversely proportional to credibility;
3) No bait, no bites;
4) B2B needs to mimic B2C; and
5) We share how we want to be seen.

“Content is not only the ‘fuel’ for your social media programs, but it’s also the bait for your customer acquisition programs,” noted the former VP of Content Marketing for Eloqua. “One thing that we discovered early on at Eloqua was that the better the content, the better the campaign.”

Chernov added, “It’s important to look at your demand generation program through a content lens because the quality of content that you’re baiting your hook with determines the amount of fish you’re going to catch.”

The Content Marketing Lies

The concept in content marketing isn’t about storytelling — it’s about telling the true story well, and making sure they are worth sharing, explained Handley. “You have to think carefully as your creating content and in the best way possible.”

Handley laid a few content marketing myths to rest during her presentation:

1. Storytelling should be at the heart of your content.
2. Your story is about you.
3. Mo’ content, mo’ better.
4. Quantity trumps quality.
5. Don’t even think about trying to be funny.

5.5) LinkedIn is only for the unemployed.

The challenge is not about finding the right content marketing professionals; in fact, the majority (64%) of B2B content marketers said they are challenges with producing enough content. In addition, 52% find it difficult to produce the kind of content that engages with the customer; and in the B2B space, it’s important to focus on who you’re trying to reach, not just trying to reach everyone.

The CMI/MarketingProfs Content Marketing study noted that B2B marketers use an average of five social media sites to distribute content. Among them, LinkedIn holds the top spot, followed by Twitter.

Handley believes LinkedIn is a “rich resource, especially if you’re trying to have discussions around B2B subjects.”

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