A survey of SaaS business executives recently published by Pacific Crest (results available free here) reveals some interesting information about the profiles of higher-growth companies.
In their graph below, we can see that while the greatest number of SaaS companies use a field-based sales strategy, those that use inside sales that are actually growing the fastest—on average, almost 75% faster than the field sales companies. (Growth is defined as year-over-year change in revenue.)
The complement to this graph is the one below, which shows that the Fast Growers (>45% growth) have lower customer acquisition costs. This differentiation is undoubtedly driven in part by the use of an inside sales force.
The final piece of the puzzle is revealed in the following graph. This slice of the survey data shows that Slower Growers are much more focused on Enterprise customers. Fast Growers, on the hand, balance their Enterprise sales with a healthy dose of SMB sales.
Of course, this data shouldn’t be read as an indictment of SaaS businesses that use field sales to sell mostly to the Enterprise; there are highly successful examples of such businesses. Instead, the data serves to highlight the achievement of those Fast Growers, and I hypothesize that effective marketing has played a key role in their success. It isn’t easy selling through an inside sales force to SMB; relationships are difficult to build over the phone and SMB management is often difficult to reach. Success, then, becomes a numbers game: Maximize leads (with a focus on inbound), and optimize conversions by creating tools to move prospects through the funnel. Without a highly capable marketing function, the numbers don’t add up and growth is elusive.
The NFIB recently published first-quarter 2012 data on U.S. commercial banks, which shows strong growth in commercial and industrial (C&I) lending, but continued decline in small business loan portfolios.
Overall, C&I loan portfolios at the end of 1Q 2012 were up 15% year-over-year (y/y). The growth was driven by the larger banks; banks with more than $1 billion in assets grew C&I loan portfolios rose 20%, while banks with less than $1 billion in assets increased C&I loans by just 2%. Most of the leading U.S. banks reported C&I loan growth rates of 20%+. American Express grew C&I loans 13%, indicating that its spend-centric approach is beginning to stimulate growth in business card outstandings. C&I growth was 2% between 4Q11 and 1Q12.
Small business loan portfolios (defined as C&I loans of less than $1 million) continued to decline, falling 1.6% y/y. However, banks with more than $10 billion in assets grew small business loans by 4.6%, indicating that these banks have increased their share of small business loans. However, the smaller community banks (with less than $100 million in assets) were the only bank-asset category to grow small business loans between end-4Q11 and end-1Q12.
Our analysis also looked at loan intensity–C&I and small business loans’ share of overall bank loan portfolios. As expected, the larger banks have a higher C&I loan intensity, with this ratio declining steadily for smaller bank-asset categories.
For small business loan intensity, we see the opposite trend. Smaller banks tend to have highest ratio of small business loans to total net loans, underscoring the importance of small business relationships to community banks.
Launching a trigger email is a little like going back for seconds and thirds at an all-you-can eat buffet: just because you can doesn’t mean you should. The temptation to launch a trigger campaign becomes stronger in light of the steady drum beat of email marketing experts who tell you it’s the right thing to do. However, what all this talk of email marketing “best practices” loses sight of is that, like any marketing tactic, trigger campaigns should be a logical response to a strategic problem.
The good news is that there are trigger campaign approaches that align with many common issues — you just need to figure out which campaign matches your strategic need. For example, let’s say you are a company that has made or will be making a commitment to content marketing as a driver of customer and prospect engagement. Your business model requires you to nurture contacts over a period of time until they are ready/have the need to buy. During this interval, you need to keep your company and products top-of-mind, but your response data suggests that you are not maximizing your potential to engage your audience.
In this scenario, the best application of a trigger campaign is to use your target audience’s responses to drive deeper engagement. Leveraging your available content, you can create a collection of emails triggered by a range of positive responses — clicking on an email, downloading a white paper from your website, visiting your booth at a conference — that offer the recipient “next steps” or additional information. The keys to making this kind of trigger successful are:
Clean data: Make sure that the email address to which you are sending the triggered email is the email address of the person who took the positive action.
Low friction: Make the featured content easy to consume to lower barriers to incremental engagement.
Timeliness: Deploy the triggered email within a day or two of the positive action to ensure that whatever spurred the initial engagement is still fresh in the target’s mind.
In our experience, triggered campaigns targeting those with a positive recent response have delivered view rates in the 60-70% range and engagement rates as high as 20%.