The document discusses building a repeatable and scalable sales model for a business. It explains key elements like cost to acquire a customer (CAC) and lifetime value of a customer (LTV) that are important for a profitable business model. The document also discusses how sales complexity impacts CAC, with CAC increasing exponentially as sales processes become more complex and involve human touch. It provides an overview of funnel design and key stages like top-of-funnel awareness generation, middle-of-funnel lead nurturing, and closing deals. Metrics for measuring and optimizing the funnel at each stage are also highlighted.

1. Building a
SALES & MARKETING MACHINE
FUNNEL DESIGN AND OPTIMIZATION
CAC
ROI by
Viral Lead
Coefficient Time to Source
Recover
LTV CAC
Churn
Rate Viral
Cycle Conversion
Time Rate

2. You’ve
heard
all
about
Lean
Startup…
All
about
how
to
get
to
Product
/Market
Fit
What
comes
next?

3. Search
for
Product/Market
Fit
Search
for
Repeatable
&
Scalable
Sales
Model
Scaling
the
Business

4. What is a
“Repeatable, Scalable Sales
Model”

5. Three
things
• Repeatable
• Scalable
• AND
Profitable

6. The
Key
Elements
behind
“Business
Model”
• Cost
to
Acquire
the
Customer
(CAC)
• Profit
from
that
Customer
over
their
lifeRme
(LTV)
There
is
a
common
problem:
Startup
Killer

7. An
out
of
balance
Business
Model
Entrepreneurs
are
over-­‐opRmisRc
Cost to
Acquire a
Customer
(CAC)
Monetization
(LTV)

8. Simple
Customer
Acquisi3on
Funnel
200
Visitors
required
for
1
cust
Visitors
5%
Trial
Using Google:
At 50c per click
10% Cost: $100 per cust
Customer

9. Add
in
People
costs:-­‐
CAC
increases
drama3cally
Input
V ariables
Total
Web
V isitors
10,000
SEM
cost
per
click $
0.50
Conversion
to
Trial
% 5%
Trial
conversion
% 10%
No
of
Sales
&
Marketing
Staff 3
Cost
per
e mployee
per
month $
16,500
Marketing and
Sales people
Flow Qty. Conversion
%
involved:
Total
Paid
Web
V istors
10,000
CAC rises to
Trials
500
5%
Customers
50 10% $1,000
SEM
Marketing
Spend $
5,000
Total
Headcount
Costs $
49,500
Cost
of
Customer
Acquisition
Without
headcount
costs $
100.00
With
headcount
costs $
1,090.00

10. Sales
Complexity
No
Touch
Light
Touch
High
Touch
Field
Sales
Freemium
Field
Sales
Self-­‐Service
Inside
Sales
Inside
Sales
with
SE’s

11. How
I
assumed
the
two
would
relate

12. A
rough
es3mate
of
CAC
versus
Sales
Complexity
No
Touch
Light
Touch
High
Touch
Field
Sales
Freemium
Field
Sales
Self-­‐Service
Inside
Sales
Inside
Sales
with
SE’s
Rough Estimates of Cost of Customer Acquisition (CAC)
$0-­‐
$50
–
$1,000
-­‐
$3,000
-­‐
$25,000
–
$75,000
–
$10
$200
$2,000
$8,000
$75,000
$200,000

13. The
rela3onship
is
roughly
exponen3al
Clearly adding
Human Touch
dramatically
increases costs

14. CAC
(logarithmic)
10x
10x
10x
Sales
Complexity

15. SALES
&
MARKETING
FUNNEL
DESIGN

16. st
1
THE BASICS
OF FUNNEL DESIGN

17. Expand
Suspects
Closed
Deals
Upsell
Cross
sell

18. IN
A
PERFECT
WORLD…
1
Step

19. IN
A
PERFECT
WORLD…
MyProduct.com
DESCRIPTION
HOW
IT
WORKS
Our
product
allows
you
…
Only
$9,999.99
BUY
NOW!

20. THE
ART
OF
MARKETING

21. THE
BUYER

22. THE
BUYING
CYCLE
PURCHASE
CONSIDERATION
CLOSED
DEAL
AWARENESS

23. TRIGGERS
• Moving
house
• Movers,
phones,
cable
TV,
furniture,
insurance,
etc.
• StarRng
a
new
sojware
project
• PaaS
(Plalorm
as
a
Service),
Dev
Tools,
etc.
• Need
to
hire
a
lot
of
new
employees
• Applicant
Tracking
System
• Just
lost
my
data
in
hard
drive
crash
• Backup
sojware/service
• Read
about
a
new
scary
computer
virus
• AnR-­‐virus
sojware

24. AN ORGANIZATIONAL
METAPHOR FOR THE KEY
FUNNEL STAGES
SALES
MIDDLE OF THE FUNNEL
CLOSED
DEAL
TOP OF THE FUNNEL

25. WHAT IS TOP OF THE
FUNNEL?
customer is not aware customer has a
they have a problem, or problem and is
that your product looking for a solution
category exists
GENERATE GET FOUND
AWARENESS

26. WHAT IS THE MIDDLE OF
THE FUNNEL?
QUALIFY MQL
(MARKETING QUALIFIED
LEAD)
NURTURE

27. WHAT IS THE MIDDLE OF
THE FUNNEL?
QUALIFY MQL
(MARKETING QUALIFIED
LEAD)
NURTURE
• Blog
• eMail Campaigns
• Webinars Wait
for
a
Trigger
• Free Trials
• Newsletters Or
try
to
create
a
Trigger
• etc.

28. THE
BUYER
CONSIDERATION
ADDRESS
THEIR
QUESTIONS
&
CONCERNS
• Will
this
work
for
my
situaRon?
• Is
it
the
best
product
in
the
market?
• Is
it
a
safe
choice?
(Who
else
is
using
it?)
• Will
I
get
a
return
on
my
investment?
• Is
it
scalable,
secure?
• Is
it
easy
to
implement?
• Will
I
get
good
support?
• Etc.

29. LEAD
NURTURING
• Higher
value
if
they
are
TARGETED
directly
to
the
interests
of
the
reader
• This
means
personalizaRon
• Requires
LEAD
SEGMENTATION

30. LEAD
SEGMENTATION
What
do
we
know
about
them?
What
do
their
acRons
tell
us?
Buyer
Behaviors
APributes

31. EXAMPLE
SEGMENTS
Role
in
Purchasing
Customer
Size
Technical,
Business
buyer
Enterprise,
SMB,
VSB
Customer
or
Reseller
Ver3cal
Financial,
Pharma,
etc.
Areas
of
interest
SEO,
Social,
MoFU,
etc.
Stage
in
Sales
Cycle
Pre-­‐trial,
in-­‐trial,
Lead
Source
post-­‐trial,
purchased
Social
Media
Webinar,
SEO
keyword,
etc.

32. MEASURE
"IF YOU CAN NOT MEASURE IT,
YOU CAN NOT IMPROVE IT."
- LORD KELVIN

33. WHAT TO MEASURE
FOR
EACH
STEP
/
ACTION:
NO
OF
ACTIONS
%
CONVERSION
RATE
TIME
TIME

34. THE KEY METRICS
CAMPAIGNS
TO DRIVE
TRAFFIC
VISITORS
OVERALL
CONVERSION
CONVERSION % %
TRIALS
CONVERSION
%
CLOSED DEALS

35. NOT
ALL
LEAD
SOURCES
ARE
EQUAL
Google
Ad
Word
Funnel
FaceBook
Ad
Funnel
Visitors Visitors
5% 2%
Trial Trial
10% 20%
$5,000 Customer $8,000 Customer

36. Suspects
Suspects
Suspects
Suspects
Suspects
Suspects
Suspects
Suspects Suspects Suspects
Suspects Suspects
BUT EVEN IF YOU ARE MICROSOFT,
CISCO, ORACLE, OR GOOGLE
YOUR FUNNEL WILL HAVE
BLOCKAGE
POINTS

37. 3 IMPROVE

38. IN DIAGNOSING MANY FUNNEL BLOCKAGE POINTS,
I HAVE FOUND THAT THERE IS A
CLEAR
PATTERN…

39. YOU ARE HOPING YOUR
CUSTOMERS WILL DO
SOMETHING
THAT THEY ARE
NOT MOTIVATED TO DO

40. IN OTHER WORDS…
YOU DESIGNED YOUR FUNNEL
THE WAY YOU HOPED IT WOULD
WORK…
BUT YOU MAY NOT HAVE THOUGHT ENOUGH ABOUT
THE CUSTOMER’S POINT OF
VIEW

41. JBOSS EXAMPLE
PUT A REGISTRATION FORM
ON THEIR WEB SITE BEFORE
A FREE DOWNLOAD
IMPACT
CUT THE DOWNLOAD RATE
BY MORE THAN 10X

42. GET INSIDE YOUR
CUSTOMER’S HEAD
FRICTION &
CONCERNS

43. UNDERSTAND WHAT
MOTIVATES THEM
FRICTION &
CONCERNS
MOTIVATIONS

44. JBOSS
EXAMPLE
• Making
$27,000
a
month
selling
documentaRon
• Solu3on:
• Give
away
documentaRon
to
get
their
email
address

45. EXAMPLE:
DRIVING
TRAFFIC
TO
YOUR
WEB
SITE
GETTING FOUND
Not going to find your site
unless:
friction & - On top page of Google
concerns search results
- Recommended by a trusted
source
- Referred to in social media or
blogosphere

48. LESSONS FROM WEBSITE
GRADER
• Free tools drive viral spread
• Low customer work required
• High value delivered
• Score leverages competitive urge, and acts as a trigger
• Builds trust through clear
demonstration of expertise

49. using engineering for marketing

50. USING DATA TO DRIVE WEB
TRAFFIC
SYSOMOS: SOCIAL MEDIA MONITORING
LEVERAGED THEIR DATABASE TO
CREATE BLOG POSTS WITH DATA ON
TOPICS OF CURRENT INTEREST:
• IRAN ELECTION RIOTS
• TWITTER’S GROWTH
• FACEBOOK USAGE

52. LED TO:
SYSOMOS ARTICLES IN
ECONOMIST, NY TIMES
WEB TRAFFIC TO READ THE FULL REPORT
LEADS – IMPRESSED BY THE CAPABILITIES
OF THE SOFTWARE

53. First
Contact
Sell
Build
Build
First
Contact
Sell
RelaRonship
Trust

54. OFTEN
NECESSARY
TO
FIND
TOPICS
THAT
ARE
NOT
RELATED
TO
THE
SALE
Build
Build
RelaRonship
Trust
First
Contact
Sell

55. SELLING IS 10X EASIER…
ONCE YOU HAVE ESTABLISHED TRUST

56. THE KEYS TO SUCCESS
THE
BUYER
GET
INSIDE
YOUR
BUYER’S
MIND

57. CONCLUSION

58. For
More
informa3on
n Visit
my
blog
at
www.forEntrepreneurs.com