Marketing KPIs – Joe Chernov

In this episode, I talk with Joe Chernov (@jchernov ). Joe is currently the CMO at InsightSquared. He previously worked at HubSpot and Eloqua so he knows a lot about marketing technology. Joe and I talk about measuring marketing KPIs, how to use social media effectively and some of his successful and not so successful campaigns.

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Podcast Transcription

Scott: Well hey, Joe welcome to the show, thanks a lot for joining me.

Joe: Thanks for having me, Scott.

Scott: Today we’ve got Joe Chernov, CMO over at InsightSquared. You’ve may have seen him in the CMO circles at Eloqua and Hubstop and writing all over. Content marketing institute awarded you content marketer of the year. How’d you get that Joe? That seems pretty cool.

How did you win content marketer of the year?

Joe: Yes, so what happened was, I was the first one to get the award and I think it came down to he or she who could prove the value of content marketing would get the inaugural award because the industry association itself had an interest in proving that content marketing really worked. I just so happened to have some data to support my campaign, if you will. I suspect that made the difference, it wasn’t about the quality of my output it was about the impact of the output.

Scott: It almost sounds like a job, somebody had to figure out how to measure everything and then you come along and they paid you with the first award.

Joe: I had an unfair advantage. I worked for Eloqua at the time and we were a really data-driven marketing organization and I had a strong team that reported to me and that was adjacent to me, so I had a little bit of a leg up just given where I worked and the nature of that organization.

Scott: Yes, you would have an unfair advantage, Eloqua is a big system and you’ve been at Hubspot now InsightSquared. It seems like you are stuck in the martech vendor space and all of those different vendors solve different problems. I’m interested in what you consider to be the biggest challenge for CMOs today. Do you think that it’s in the martech space just because that’s where you live or do you think it’s something else?

What do you think the biggest challenges are for CMOs?

Joe: I can really only speak to my corner of the world and you right I’m stuck in my corner of the world in the mar-tech side. I think it’s funny term stuck, I laughed a bit when you said it.

Scott: I mean, some people may think that you’re crazy because that’s hard stuff.

Joe: I think it’s hard because the expectations are really high given that we tend to be at the front edge of change given that we represent the technology that will later cascade into the market more broadly. I don’t mean that as a boast but more so a statement of fact. What is most difficult for me and my cohorts of marketing leaders is that the expectation has spread from initially being expected to be responsible for building a funnel to now being responsible for throughput in that funnel, so we’re pulled more deeply into the sales process itself, I spend as much if not more of my time talking about sales follow up as I do creating demand itself. Now, there are rumblings that will be pulled all the way through the funnel and out the other side into the customer lifecycle. The expectations are that we will help retain, grow, renew, cross-sell, up-sell our existing customers to grow the business that way. The function itself, the CMO function is no longer limited to, quote on quote, just marketing but marketing plus sales plus customer success and that becomes a really big job.

Scott: It’s impossible, well not impossible, but very difficult for one person to do it. You’ve got to build a team around you to do all those different functions especially all the way through the backend customer renewals and everything. Everything is SAS based now so you have to renew customers all of the time. What do you think all of the executive teams, the CEOs and the boards, what do you think that they need to do to address the expectations on one person and how should they help him? How are you being helped maybe?

What questions are you asking to the CEO and the board?

Joe: I’m prone to say, show me how I’m measured and I’ll show you how I behave. I think it all begins with the right KPIs and the right metrics.  If my metrics are all pinned to the top of the funnel, if I am responsible for lead generations and I keep my job, I get a promotion, I get raises, I get my bonus all based on the number of leads.  and then you go and tell me that you’d also like me to focus on customer renewals. Well, if my KPIs don’t reflect that request then where am I going to spend my time? Show me how I’m measured and I’ll show you how I behave. I would urge leadership executive teams, CEOs, boards, to spend a disproportionate amount of time putting in place metrics, shared metrics, common metrics across sales, marketing and customer success that force, not just alignment but sort of functional integration. That’s the way to solve this. It’s not really through technology. It’s through putting goals in place that motivate the right behavior. At the end of the day the way I look at it is this. It’s going to work a little like this. I took a ski lesson one day and the coach, he told me a really great skier could lose a ski. One of the two skis could fall off during the run, and they could get to the bottom pull up to the lift and then realize that they are missing a ski. They are in such good balance that they don’t even realize a ski disappeared. So for me, the gold standard for sales, marketing, customer success should be if one of those executives dropped off the face of the earth the next day, could one of the other two fill his or her role and you never even notice that person was gone. That is an extreme way to look at it. But, metaphorically I think a lot about that advise that coach gave.

Scott: Yes, that’s interesting because a lot of the martech pundits talk about the machine. The marketing machine. They want the machine to work so that if one cog or one piece does go down that the machine doesn’t break the supply-chain of sales doesn’t break. So that is an interesting analogy, I’ve been skiing before and I’m pretty sure that I’d need both to get all the way down. I’ve accidentally skied on one when one fell off but I quickly realized, hey, I need two.

Joe: Yes, I’m in the same boat with you, that’s why I said I think it’s an aspiration more than a reality.

What is your favorite KPI metric and why is it you’re favorite?

Joe: It’s revenue growth. It’s funny I talked to my team  as we started going into plan for 2018 my team and I were talking about the metrics that are more equal that others. The metrics that kind of bubble up to the top of our priority list. We went around the room and talked about if you have to pick one which one do you use to sort of grade yourself. I was the only one who said revenue of the business. In a way I kind of appreciate that everybody one the team is looking for the number that they can most directly impact themselves. That’s probably a healthy outlook but you also need somebody on the team that looks at it as, if we hit all of our numbers but the business doesn’t grow did we really do the right thing for the business? The reciprocal is if we missed our numbers but the business is growing, everybody is going to forget that we missed our numbers. Nobody is going to beat us up over that. It all comes out into the wash based on how the business is performing.

Scott: Yes, because revenue growth is really what pays the bills right. You can’t go to the grocery store and buy your groceries with such and such conversion rate please give me all of my groceries. It takes dollars.

Joe: Exactly.

Scott: Yes so revenue is my favorite because that solves all problems.

Joe: I’ve been in board meeting where we missed the number but marketing metrics looked good. I always feel a little dirty boasting about marketing’s metrics. Ultimately all that matters is that they contribute to the business’s success. So, it feels a little icky to say you smashed your number but the company didn’t smash it’s.

Scott: Yes, supply chain problems. I want to shift over to your earlier days really talking about content. You’ve created content for a long time, content marketing institute awarded you, Content Marketer of the year because you were ahead of the game. You had all of these metrics and you helped them. Do you have a favorite piece of content, like one that was way more successful than the rest?  Maybe one you did yourself or do you have a favorite piece?

Do you have a favorite piece of content?

Joe: I do, by a country mile. It had nothing to do with business. One day, I read this article about shark finning. The study estimated that 100 million sharks are killed every year just for their fins, for soup. Everything else just dropped to the bottom of the ocean, the whole animal. I read it and then 5 minutes later I said, wait did I get that number right 100 million? 100 million? Yes, it was 100 million so I created with a buddy of mine, a designer who I had worked with in the past professionally. He had done most of the infographics and design work for Eloqua. I called him up and said, “Look man, how can we visualize how big 100 million is?” I said, “What if we faked an infinite scroll and we create an infographic that shows icons of a shark but we got 100 million of them of there?” And he’s like, “There is no CMS in the world that could support that.” So I said “Okay, divide 100 million by 12 and we’ll do how many are killed a month.” He said, “There’s no CMS that can support that.” So I said, “All right divide it by week.” On and on we went until we got to how many sharks are finned an hour and even that is like an infinite scroll. Why I love this piece is, it had an incredible amount of PR around it. I had people calling me saying, Kevin Smith, the film maker was talking about it on his SModcast. But the part that I really liked is that the fining tends to be a problem primarily in Asia. At least most acutely in Asia and there was a press conference. It was about environment sustainability, a press conference in China. The organization printed out the entire info graphic and rolled it out as if it were a red carpet and everybody that attended the press conference had to walk across it and physically experience the scope of this slaughter. I was just overwhelmed by that in that sense of contribution.

Scott: Wow, that’s pretty cool. did you just do this out of your own pocket? Like “Hey, sharks are cool I want to buy an infographic” or did the designer do it pro bono? How did that work?

Joe: It was a partnership so I didn’t pay. I would have but I didn’t have to. Robin the designer, Robin Richards he was able to develop quite a name for himself on the back of this. We were just a team. We both cared about it. It was something that startled us, the scope of that. He felt similarly to the way I did and we just decided to strike up a collaboration.

Scott: Well that’s outstanding. That’s a good use of data visualization and social media platforms like LinkedIn, Twitter.  Everyone talks about we should use those but how effective are they? How are sales and marketing teams using social platforms like LinkedIn well? You just provided a really good example of how I could put out content and then share it and it even showed up as a red carpet.

How are marketers using social platforms well and how could they be using them better?

Joe: Yes, in some ways there’s almost an embarrassment of riches when it comes to social media’s ability to facilitate the connection between one person and another. There’s an embarrassment of riches. That is to say, it is just really easy to find people and to interrupt them. The way I think it is being employed poorly is people who use LinkedIn messaging to side step email.  They send you a connection request. You accept the connection request because they have a common industry or common school, there’s something that tells you it is not spam.  Then, low and behold 30 seconds later you get a sales pitch. That is how they are doing it poorly. I’ll talk about the challenge with how it’s being done well.  How it’s being done well is, as we publish more and more of our thoughts, like people know that I care about shark finning or environmental issues, people know what my political leadings are, people know that I like to ski, all of this stuff is kind of fair game it’s out there. When people ignore, when people don’t stop to kind of study someone and develop almost of a scouting report on that person and then tailor their pitch to what that individual does, likes, his interested in, is concerned about and ignores that massive amount of unstructured information when they pitch and they just race to the close, that’s what flawed. The challenge is it’s very difficult to scale, where it’s effective is when folks stop, look and then respond. I can give you a really good example, I was pitched by a marketing automation company, I’ve worked at two of them Eloqua and HubSpot and I’ll use a third, Marketo. Somebody from a fourth wrote me. It was a BDR pitch, inside sales person, entry level rep pitch and said, “I know you’ve worked at two of our competitors. You probably know who we are. But, there is an element of our business you might not know about.  That is, we started with content in mind and I know much of what your focused on is content marketing. I’m okay if you don’t want to continue the conversation, I just really wanted you to know what our difference is.” It was such an unbelievably good pitch that I responded and I said, “I’m not in the position to buy, we just signed on with Marketo.” But, this is as perfect of a pitch as I’ve received. It’s short. It’s relevant. It’s focused on your value and I copied it to his entire executive team. He wrote me after to say, “I’d rather have my executive team see that response than the sale at this point in my career.” To me, I want more people should do that. That guy really nailed it and if I was in the market for a marketing automation product I would have given this company a shot.

Scott: Yes, that brings up a good point; One, on the bad example. I got one of those this morning. A connection request then immediately, “Hey I sell this.” I’m like “Dude, your doing it all wrong.” I have had because I put my self out there quite a bit. I got a pitch one time and it was articulating my history down to when I coached my daughter’s soccer team at the YMCA. My response was much the same, “Hey, thanks a lot for actually being interested.” What happens is the conversion rate on those are really high but the quantity is really low. It’s like “Hey, I need a million leads this month or 100 million, if your sharks”, where are all of my leads? People get lost in the quantity versus the actual conversion rate of an actual conversation. If you can create a conversation, I talk a lot of the podcast about B2B marketers need to humanize themselves and humanize their brands more like B2C. We are all people and social media makes it easier. I think it goes back to your KPIs, “Hey, maybe we need to look at the number of conversations we have versus the number of leads we’re getting.” The number of leads is irrelevant if nobody ever talks to each other.

Do marketers need to look at the number of conversations we have versus the number of leads we’re producing?

Joe: But, the flip side of that is if you have to get 100 sales to make your number and you can have 50 conversations even if every one of those goes on to buy, you’re going to miss your number by half. That’s why I said there’s a scalability problem with being too precious in personalization. You have to strike this balance. We have ethos internally where we say first is best. Meaning the first discovery about something that interest somebody or someway that you can make your pitch more relevant, that’s good enough. Stop there and then craft your pitch around that. That’s our way to try to create some degree of personalization at some level of scale.

Scott: Yes, total agree. It’s hard to read everybody’s LinkedIn and write a custom pitch. It’s just really slow, effective but slow you’re right. Outside of the shark infographic example, what’s one of your most successful campaigns? Do you have something else maybe for work that worked out? What made it effective and how did you measure the success of it? Do you have an example that is at the top of your mind?

What’s one of your most successful campaigns?

Joe: Yes, I do. I’m going to go in a different direction. We run direct mail programs. Really premium direct mail programs. Not sending people coffee mugs with your logo on it but like luggage tags with their initials on them and we do this for open opportunities. So this is designed to generate revenue for the business. That is, the marketing has already sort of done its job. We’ve sourced the lead. We’ve passed it over to sales. We’ve warmed up through nurturing and now there are in the sale cycle. In most companies marketing is done at that point and they go back to the top of the funnel to try to procure the next one. What we try to do is market all the way through the funnel. We partner with sales and we will run some direct mail programs at open opportunities. There are open opportunities that meet different criteria that will make them eligible for different levels of direct mail. We’ve looked at our close rate when we run those programs versus our standard optic close rate when marketing sort of abandon ship and goes back to trying to procure the next lead and the close rate is about 40% higher, when we stay involved throughout the entire sales process. We know that we are having an impact . Only one person sees the marketing output. That is the recipient. By definition can’t go viral because it’s one to one marketing. The impact on the business is significant so that’s what excites me about those programs.

Scott: Yes, that’s pretty cool. I like the middle of the funnel sales process that always works because sales people are sometimes looking for items to push a prospect from one point to another. In the direct mail piece are you sending anything specifically? Or does it vary?

Are you sending anything specifically in your direct mail campaigns?

Joe: It varies. We’ve done a variety of programs. We sell to sales teams. Sales teams are the users of our product and so we sell to a lot of tech companies. Their sales floors look a lot like our sales floors.  A lot of young guys with baseball caps on backwards and we’ve branded energy drinks, sort of Red Bull like energy drink. We’ve branded them with InsightSquared logos and some data visualization looking graphics. At the very top of the funnel if someone looks like a really good fit for us, we send them a case of those. What I like about that program is they get shared, there’s 24 sugary beverages being circulated on the sales floor, now everybody in that sales team knows who we are that’s why I like that program. But I like more of a spoke more one to one programs. We know if you used to use InsightSquared but have gone on to either a new company that doesn’t or if you were in our sales cycle once and you didn’t buy but you re-entered our sales process a second time, you’re three times more likely to purchase. For those cohorts we do our come running back program, which I think is kind of fun. We send them a postcard saying “We missed you. Come running back to InsightSquared” and the postcard has a URL where they add their shoe size. It’s kind of weird its all like running themes down the postcard and we send them a pair of Nike sneakers branded with InsightSquared colors. That is sort of a fun way to give the sales team an excuse to get engaged with this contact. They always take the call after getting that campaign. I look at our job as, similar to the agent in Hollywood. It’s not the agent’s job to get their client the part. It’s the agent’s job to get the client the audition and in my world the audition is somebody taking a phone call. My job is to get as many of those phone calls to happen as possible.

Scott: Yes. That’s a good analogy, I like the agent analogy that’s pretty cool. That is successful but you probably have some projects that you spend either a lot of money or time or resources on that didn’t work out.

What have you learned about things that didn’t work out?

Joe: Most things don’t.  It’s noisy out there, right?  It’s more and more difficult every day to get your signal heard amongst the noise. I run programs that I thought for sure were going to be a home run. For a while I was marketing to developers. It was kind of fun because they hadn’t seen the flavor of marketing that had been so delicious for marketing to marketers. That is some of the creative stuff, the info graphics, the videos. It just hadn’t been applied to that persona and I create this deck with a designer that was all themed around Tarot cards and the design was beautiful, he did such an incredible job. Nobody, I mean nobody consumed it. With marketers, it would have gone over like gangbusters. Developers are just to weird and it was just miscalibrated. So my lesson there was that you really do have to understand, that the content isn’t good or bad in absolute. It’s good or bad relative to who it is designed for. Not everybody would like Chopin. Classical music fans would like Chopin. A 20-year-old would like Taylor Swift. They’re not good or bad in absolute. They’re good or bad relative to their audience and I was looking at content in absolute in that regard. Another that I wouldn’t say it was a failure, I just have no idea if it was successful or not was last year we ran an out of home campaign. We sell a lot to venture-backed tech companies and we surrounded those companies with bus stop ads, outdoor ads throughout San Francisco. They were fun ads. They’re build like a bunch of sales reports and they would ask a provocative question like can you figure out what’s going on in this company? We knew we’re going to measure it by anecdote. We knew it was going to come down to were prospects acknowledging that they had seen this? We seeing Twitter activity. Were we seeing geographical search volume increase? In the end, we got a few anecdotes. I have no idea if I paid myself back for that. But, I do know the one lesson here is, you will never get a home run if you don’t take that bats and you’re going to miss as much as you hit. But look, the Hall Of Fame in baseball is filled with people who missed 70% of the time. You’ve got to accept that there’s going to be some trial and error here.

Scott: Yes that’s always the tough part. The at bats are always a good example because like you said the Hall Of Fame guys, the good ones get in on a 300 average. 700 is misses in and . I think most marketers get that. Especially if you are marketing to marketers. You kind of live in a different world because people like different stuff. But developers they just want free software. They say, “I have a problem right now can you help me solve my problem right now?” Let me go search for it, let me see what I can find. It may not be Tarot cards something like that. You’ve done this for a while and you’ve been marketing to sales and marketing folks for a long time.

Who or what do you listen to or read to stay on top of your game or to be inspired?

Joe: To stay on top of my game I try to curate a list. The people I follow on Twitter tend to be a pretty reliable signal for what matters. But if I had to pick a person, I think Jon Miller at Engagio consistently puts out the best stuff. I think he is extraordinarily bright and he gets where this industry is going. I think Jon is extraordinary. A couple colleges of mine at Eloqua Steve Woods and Paul Teshima, they run a startup called Nudge. They’ve written a number of blog post lately that I think are spectacular. They have one about how hustle is overrated and how volume is overrated very similar to our conversation.  They’ve discovered  the only way to advance the business is to try to help somebody to add value in every single conversation you have with them even if it’s a conversation that has nothing to do with what you sell. They’re kind of re-thinking their go to market around that ethos. I think those guys are putting out really interesting stuff right now and I know them both well and they’re extraordinary guys. I think those folks, the three of them are doing really well. I think the CMO at Engagio, a woman name Heidi Bullock. She spent a lot of time at Marketo. I think she is very strong. I think the best marketer in tech full stop is, Maria Pergalino who is now at Anaplan.  She was recently at Aptus. Her speeches are incredibly insightful because they are really tactical. It’s interesting she is one of the most prominent marketers in tech, she’s SVP’s CMO and yet she gives these really hands-on tactical presentations. It’s refreshing seeing someone at that altitude being able to talk about what people and their team do on a daily basis. She doesn’t get stuck rarefied air. So I think Maria is also a real inspiration.

Scott: Alright cool. Definitely I’ll take a look and search around for those blog post and link back to them, does sound interesting. What do people ask you Joe for advice on? Outside or martech and sales and marketing are you an expert at anything else?

What do people ask you about?

Joe: I don’t know if I’m an expert at anything let alone anything else. The email I always respond to is the LinkedIn message, I always respond to it. It is one about starting a career, changing a career, people that are trying to think about how they might want to adapt what they are doing, where they feel like maybe painted into a corner a bit career-wise. I enjoy those questions and I respond to those questions, I try to respond to those questions in as sincere a fashion as I can. I really try not to mail it in those responses because I’m incredible flattered that somebody would reach out to me on that. When it comes to, even with my team, my litmus is, I tend to manage people in Tech-Marketing. They are young and I tend to manage quote on quote millennials and what I try to optimize for is, when they go home at thanksgiving or if they drop off their laundry and their parents house, what do they tell their parents about their job? What do they tell their parents about their boss? What do they tell their parents about the projects that they are working on? I try to optimize for a response that the mom or dad says to them, “Wow you’re in a really good place, I wish I had found myself in that place at that stage in my career” and if I’m getting there, if they are having that conversation then I’m doing my job.

Scott: That sounds pretty cool. Pretty tough to measure because you’re not there at Thanksgiving with everybody else but good idea.

Joe: In marketing they are things that we measure that we can prove to be right. It’s a KPI. But, there are also things we need to do that we just know to be right whether or not we can prove them. We as an industry have shifted so far to prove to be right that we sometimes lose sight of the things that we simply know to be right.

If you didn’t have any responsibilities at home or work next week Joe what would you do?

Joe: I would try to get incrementally closer to try to lose one ski and find my way to the bottom of the trail without killing myself.

Scott: That sounds good. We should be getting more snow than ice these days so so hopefully you can you can find a downhill to go mono-skiing I guess. But a monoski is an entirely different thing. Have you seen one of these?

How do you prefer people contact you?

Joe: If it is something that is public you can ask on Twitter. That will get the fastest response. If it’s something private they could connect with me on LinkedIn and ask the question in the connection request and then I’ll accept it responded if I can.

Any closing thoughts on what we talked about today?

Joe: I am glad that we got to touch on the notion that not everything in marketing can be measured and there are certain things you need to do marketing simply because you know them to be right. I enjoyed talking to you about marketing KPIs and how ultimately in the end, if you want to induce the right behavior it all begins with attaching the right metrics from the very start. Show me how measured and I’ll show you how to behave. I think it’s important that marketers keep their content skills sharp by producing content that not only makes sense for them professionally but also inspire them personally and we talked a little bit about a passion project of mine.

Scott: Brilliant. Thanks Joe so much for talking with me today. I really appreciate your time. I learned a lot and hopefully the audience learned a lot. I just want to thank you for your time.

Joe: Thank you, Scott