Six Growth Levers For Bear and Bull Markets

Six Growth Levers For Bear and Bull Markets

Today’s B2B markets are more dynamic than ever. Despite macroeconomic headwinds, high inflation, contracting deals, longer sales cycles and looming concerns of a recession, purchasing behaviors from a new generation of buyers are changing how the C-Suite creates a go-to-market (GTM) plan that can serve their market and grow their business with favorable per-unit economics. To help founders, C-level executives, and go to market (GTM) leaders better architect their revenue supply chain, let’s look at a foundational framework that enables six growth levers.?

A strong foundation begins with clarity and agreement on the target audiences. The C-Suite should have a good understanding of their economic buyer, champion, user, influencer, and blocker. Another important layer of the foundation is a brand-first approach, in which the company develops the right stories, conveys the right image, and establishes a crisp value proposition that fosters trust to ensure that it can increase the likelihood of winning the business.

Nailing down these foundational components is highly recommended before determining how to best leverage any of the six growth levers. Product and market dynamics will determine the level of focus a business can apply to any of these growth levers. Now let’s explore the six growth levers in more detail.?

Product-Led Growth (PLG)

• Customer Acquisition Cost (CAC): Low
• Tech Stack: Emerging
• GTM Use Case: Land New Customers

PLG is highly topical given the proliferation of SaaS and the ability for potential customers to not only use the product but also buy directly with little to no friction. PLG delivers sellers with product user engagement signals and sometimes drives viral adoption within the buyer’s organization. These dynamics show the promise to lower customer acquisition cost (CAC) and provide attractive per-unit economics. New technologies, like DemoStack, have recently surfaced to help sellers capitalize on this PLG trend as well as optimize the experience they deliver to users. In bear markets, PLG is an attractive way to grow the business, as it de-risks the buyer’s commitment and delivers clearer purchase intent signal for the seller.??

Recommended Thought Leaders:

Carilu Dietrich, CMO Advisor familiar with Atlatssian’s GTM, and Elena Vema, Growth Advisor and former SVP at MalwareBytes, have extensive thought leadership material in this area that advise how to best utilize this PLG lever to grow massive businesses.

Sales-Led Growth (SLG)

• Customer Acquisition Cost (CAC): Medium / High
• Tech Stack: Mature
• GTM Use Case: Land New Customers / Expand With Existing Customers

SLG is a well-understood framework for sales. There are various sales methodologies and presales frameworks that help sales and presales professionals optimize their outreach and discovery process. Sales Development Reps (SDRs) and account executives have access to tools like Revenue.io to automate outbound prospecting and follow-up, while presales can use tools like Consensus to automate demo delivery. The CAC for this sales motion may be medium to high, which is why this type of sales motion is typically coupled with an account-based marketing (ABM) approach, focused on targeted accounts that can support larger deal sizes and provide favorable per-unit economics.??

Recommended Thought Leaders:

The following thought leaders provide great insight on ways to automate and streamline the SLG workflow:

• Peter Cohan, founder of Second Derivative
• Garin Hess, author of “Selling Is Hard, Buying Is Harder”?
• Alastair Woolcock, former Gartner GTM analyst?and Revenue.io CSO
• Chris White, author of “Six Habits of Highly Effective Sales Engineers”?

Marketing-Led Growth (MLG)

• Customer Acquisition Cost (CAC): Medium/High
• Tech Stack: Mature
• GTM Use Case: Land New Customers / Expand With Existing Customers

MLG is a fairly mature mechanism that has evolved beyond brand recognition. It uses educational content, social, SEO/SEM, and inbound to generate leads. It also uses ABM marketing when focused on key named accounts or verticals. The technology stack, provided by public companies such as HubSpot and 6Sense,? is also fairly mature in this space.?

Recommended Thought Leaders:

VSSL, a premier digital marketing agency, provides an in-depth digital marketing maturity model that can help the C-Suite determine its level of readiness for MLG. Additionally, HubSpot has great educational content to help marketers optimize their MLG plans.??

Partner-Led Growth (PNLG)

• Customer Acquisition Cost (CAC): Low, Med, High
• Tech Stack: Mature, Evolving
• GTM Use Case: Land New Customers / Expand With Existing Customers

PNLG is a very familiar GTM lever. It can come in the form of the affiliate, co-sell, resell, and/or white labeling, such as managed security service providers (MSSPs) that package cybersecurity solutions as part of their core service offering. While partners typically don’t help vendors create new markets, when done correctly, they can help satisfy market demand at scale and even address markets the vendors do not want to reach out to with their direct GTM force.? In certain markets like IT infrastructure and the cloud, PNLG is evolving through mediums like AWS Marketplace, which stands to disrupt the traditional two-tier distribution model typically associated with on-premise IT providers. Mature technologies, like Impartner, exist to help vendors manage partnerships. And new vendors, like Crossbeam, have emerged to help companies better collaborate on their corresponding target lists.?

Recommended Thought Leaders:

As this is a fairly mature market, publications like Channel Reseller News (CRN) provide great material and a plethora of experts to follow.???

Customer-Led Growth (CXLG)

• Customer Acquisition Cost (CAC): Low
• Tech Stack: Mature
• GTM Use Case: Expand With Existing Customers

CXLG focuses on monetizing your existing customer base and requires particular attention from both growing and established companies. To maximize total enterprise sales (TES) and lifetime value (LTV), the CRO, CCO and the C-Suite need to pay attention to churn, renewal and expansion rates. The CCO and CRO can use technologies like GainSight to monitor the satisfaction level of existing customers to ensure that the right customer expansion metrics are met.?

Recommended Thought Leaders:

Nick Mehta, CEO of Gainsight, is a very vocal figure in the customer success arena. He also provides great insights on how to best serve existing customers. Other thought leaders include the top 50 customer success influencers identified by Smart Karrot.?

Community-Led Growth (CLG)

• Customer Acquisition Cost (CAC): Low
• Tech Stack: Nascent
• GTM Use Case: Land New Customers / Expand With Existing Customers

CLG can be a highly efficient means to build a loyal user and advocacy base. This GTM lever can typically be found with vendors who have open source communities or companies that make an investment in supporting their corresponding community, independent of commercial interests. CLG is a bottom-up means to potentially convert an avid community of users to commercial customers and holds the promise for lower CAC and more desirable per-unit economics. General collaboration tools like Slack and purpose community tools like HiveBrite can be used to manage and foster communities.?

Recommended Thought Leaders:

Talia Goldberg and Katherine Walker, from Bessemer Venture Partners, recently published the Five laws for community-led growth, which is a great read. Additional thought leadership content is available from Whitney Rothe, from Insight Partners. Read his The ScaleUp Guide to Community-Led Growth.?

Summary

Today’s C-Suite may elect to utilize any or all of these six levers for growth. How companies allocate resources for each one will vary on product packaging, markets they serve, competitive dynamics, per-unit economics and the overall GTM strategy designed to maximize enterprise value for the business.?

All levers will ultimately drive toward obtaining OKRs (Objective Key Results). And they will be measured with the corresponding KPIs (Key Performance Indicators), which the C-Suite monitors. For a great guide on what to measure based on the maturation of the business, take a look at ScaleUp by the Numbers: SaaS Sales KPIs for Startups at Every Stage by Pablo Dominguez from Insight Partners. Additional prescriptive content is available by Bessemer Venture Partners on The Cloud 100 Benchmarks as well as by Tomaz Tunguz from RedPoint Ventures.?

The more you research the different growth levers, the easier it will be to determine which ones are right for you – the C-Suite – to maximize your company’s enterprise value.