RapNet Symposium 2014: How inbound marketing is disrupting everything

How inbound marketing is disrupting everything.

Sam Mallikarjunan

RapNet Symposium 2014

Sam

@MallikarjunanHead of Marketing & Growth

@HubSpot

Labs

We live in the

most interesting

period in the

history of

business.

We live in an era of big bang

disruptive innovation.

Knowledge is power. And the balance

of power between companies and

consumers has shifted dramatically.

What is Inbound Marketing?

Frequent Blogging Is Critical72% of eCommerce businesses that saw ROI from Inbound Marketing blog at least once a week, and people who blog are 155% more likely to see ROI from Inbound Marketing.

Instead of interruptingexperiences people love…

Inbound Marketing is…

Inbound marketing focuses on creating them.

“We don’t make money when

we sell things. We make money

when we help customers make

purchase decisions.”

Educational Content Leads To More Spending

Are you owning your customers?

Inbound marketing channels cost less

than any outbound marketing channel

Source: State of Inbound Marketing, HubSpot, 2012

Inbound Marketing is taking over B2B & B2CDoes your company do inbound marketing?”

Educational Content Leads To Higher ROI

C ustomer Centricity

A lot of people talk the talk…

*Source: HubSpot’s 2013 State of Inbound Marketing Report

You can’t call yourself a “customer centric” company if your customer isn’t the center of your universe.

#INBOUND2013

#INBOUND2013

OH NO! He’s gonna make us do math!

Yep. I’m not here because I was the cool kid in class.

Marketing $$$

Sales Revenue

We naturally operate

using ratios

Marketing $$$ Sales

Revenue

Ratios help us determine leverage

Marketing $$$

Sales Revenue

What do we do with this

information?

Marketing $$$ Customer

Revenue

What kinds of customers do

you want?

Exclusionary Buyer

Personas

Service

Demanders

Revenue

Reversers

Promotion

Maximizers

Spending

Limiters*

Narrative vs. Algorithmic Personas

Narrative Buyer Personas

Uses psychographic dimensions

to create experiences that attract

and influence

Algorithmic Buyer Personas

Uses automated numeric

correlations to predict

behavioral responses

“I’m spending a bunch of money on marketing, and

I’m making more money than I’m spending back.”

The Old Economics Model

Expense Yearly Amount

PPC $500,000

SEO Firm $60,000

Content Writing $120,000

“I’m spending $X money on marketing, and I’m

making $Y in sales per channel.”

The New(er) Economics Model

“I spend $W to acquire customer of persona X from source Y,

and they spend an average of $Z with me over their lifetime.”

Growth Startup Economics Model

Customer centricity creates leverage.

Time to Payback

This value analysis reaches

all the way back to marketing

This value analysis reaches

all the way back to marketing

Research PhaseMarketers are not just building a contact

list, they’re generating predictable future

sales revenue that they can analyze.

𝐶

𝐷∗ 𝑉

C = # of new customers,

D = # of downloads,

V = Average LTV

Starbucks has an AOV of ~$6*

How Much Would You Spend?

*

*Source: KissMetrics

Customer Centric Companies See Higher ROICompanies that saw ROI by company focus

Customer LTV Is A Profitable FocusCompanies that saw ROI by LTV focus rating

THANK YOU

I made an unforgiveable error and forgot business cards.

So tweet me

@Mallikarjunan

if you want to connect.

* Special Bonus Content

Solve For The Customer

Solve for LTV

Word of Mouth?

There’s a math for that.

So easy, pretty, and simple to understand, ain’t it?

The Conventional LinearBuying Process

It’s not an end-state

It’s an infinite loop

A Grand Unified Theory of eCommerce



Price competition

isn’t working

anymore – there’s

always someone

willing to

make less money

than me.

More marketers are adopting

pre-transactional conversions

Marketers Aren’t Measuring60% of ecommerce marketers don’t know their abandoned cart rate


The marketing activities and tools to this point add up to the Cost Of Customer Acquisition

Now the focus shifts to increasing the customer’s Life Time Value




Everyone goes through this process