Email marketing fails and how to overcome them
2020 was a challenging period for most businesses. With revenue loss, client churn, and priority shifts, organizations have been adjusting their strategies to adapt to the new post-Covid reality. Though some of the first strategies that may come to mind are changing your offering or going after a different market segment, lasting success depends on a well thought out go-to-marketing (GTM) strategy. Through it all, email marketing has been at the center of the discussion.
Particularly in the B2B space, sales teams rely heavily on email marketing as a tool for generating new leads. They prepare and execute an email strategy but as the email content hits their audience’s inboxes, things don’t pan out as expected. What went wrong?
At Andromeda, we focus on marketing consulting and digital content production for B2B sales teams. So, in order to answer this question, I tapped my friend Sardar Azimov. He’s the founder and CEO of Skief Labs, a growth marketing agency that leverages data to help organizations of all sizes develop customer-centric strategies to better connect with their target audience.
As he put it for me, it’s not just about ‘sending emails.’ Good email marketing revolves around a nuanced issue: understanding lead quantity and quality. It’s really about scaling and aligning a lead generation strategy with a company’s sales KPIs.
Use revenue goals to determine the leads you need
Every sales team defines corporate goals in terms of revenues to be generated. An efficient GTM strategy starts from this single value: the expected revenue.
The goal is to understand the required sales and marketing effort necessary to reach the target. Therefore, the company will have to define the part of new business to be generated vs existing depending on the nature of the business model. For instance, in the SaaS world, most companies have recurring contracts. This allows them to estimate the amount of revenue to be expected from the existing customers based on their historical return.
A simple example:
Company A wants to generate $3 Million in 2021:
-Existing customers bring in $2 Million.
-New customers are expected to bring in $1 Million, with an average sales ticket of $20k.
⇒ A sales team needs 50 new customers to reach their 2021 sales goal.
As Sardar explained it to me, there’s one common issue sales teams fail to address. As they prepare to trigger an email marketing campaign, they use an insufficient lead database.
Sardar continued by saying that when it comes to email marketing, teams tend to think that the only factor that might be improved is the conversion rate from cold outreach, in other words, the number of marketing-qualified leads they can generate from emails sent to recipients with whom they’ve had no prior contact. However, Sardar pointed out how frequently he comes across teams that just never consider how many people must receive an email sequence in order to reach target KPIs in each stage of the sales pipeline.
Sardar told me that many teams will never have enough people to fulfill their sales goals. Reaching impossible sales goals with a fraction of the leads necessary is a recipe for failure. This means that teams must either lower their sales expectations or increase the ticket price per new deal. Conversely, they can improve conversion rates for each stage (from lead to opportunity, and from opportunity to closed deal).
In a nutshell, he said that teams should scale demand generation by focusing on revenues. He reinforced the fact that email marketing is only one of the possible channels for lead acquisition. Besides content quality, the main way to determine the how well an email marketing strategy will do is by defining the quality of potential leads.
Because the definition tends to vary from company to company, by “potential leads,” we mean all key decision makers that fit your Ideal Customer Profile (ICP) due to their company and job title. Consider this as a pre-qualified list of target accounts and decision makers built upon your Product-Market-Fit. They may become marketing leads or sales opportunities at a later stage once there is a “connection” between both parties.
So, if a sales team is low on potential leads, they need to find the missing data. At this point you may be thinking you can just buy an existing list; however, Sardar really discourages this approach. He tells me sales teams need to be smart about how they source their data, since increasing conversion rates relies so heavily on good pre-qualified leads fitting company’s ICP.
However, as he framed it, sometimes sales teams just don’t have the time or resources to devote to proper lead generation. In this case, the question is not how many leads a sales team should get, but to be realistic about what they’ll get with the leads they already have. I call that managing expectations.
As we can see, having a lead database that promises the potential to meet your sales goals is at the root of a successful email marketing campaign. Skief Labs’ team is ready to help sales teams align their GTM strategy, positioning companies for success.