Hey everybody, welcome to the second growth podcast. I am Tori Kinlick, VP of Demand Generation at Refined Labs, and I am your host for today's episode. On this episode, I sat down with my colleague, Darren Peruji, and we covered tips for marketing with a reduced budget. The current economic state of the world, this is something that we are seeing with a lot of our clients, seeing a lot of noise about it on LinkedIn as well.
Call it a recession, don't call it a recession. The fact of the matter is budgets are getting cut, and we as marketers are being asked to do more with less. So on today's episode, we got into a couple of tactical tips on how marketers can handle this current situation, how they can make the most out of their budgets, and what opportunities they should be looking at considering, discussions they should be looking to have with their executive team, and lots of other helpful information. So today, I want to welcome to the show my buddy Darren.
Darren, could you just give a quick intro? Yeah, hey Tori. My name is Darren Peruji. I'm a director of demand here at Refined Labs, and I love all things marketing.
So excited to dive in. Thanks for joining me today, Darren. So Darren approached me with this topic, certainly one that we know is highly relevant today, everything that's going on with the macroeconomic state of the world. We're certainly seeing it across our client base.
We work with a few dozen different startups and scale-ups and even in market and enterprise companies as well. And it's really kind of the same situation throughout. No matter what size of the business that you're working in right now, many marketers are being faced with budget cuts. That is the reality.
It's an unfortunate reality, but it is the reality of the situation at hand. Oftentimes when companies get asked to tighten their belts and they take a look at the budget sheets for whatever reason, that maybe that's a whole separate topic. Marketing is oftentimes the one that is looked at first under a microscope, put it on the chopping block, whatever cliche you want to call it, we are the ones that are oftentimes being very reactive to some of these things just by way of the requests and guidance that we're getting from leadership oftentimes from the CFO and really coming around budget reductions. And so Darren and I thought that it would be great to just kind of jam out for a couple minutes today talking through some of our experiences over the years, both in and out of some of these economic downturns and hit on a couple different tips that we are hoping our audience can walk away with here that they can put into action or at least give some thought to that might help them maybe reassess their strategies or figure out different ways that they can continue to grow their brand awareness, their marketing metrics, whatever tasks and goals they are being asked to take on from their organization that they're able to do so and really do more with less.
With that, I think we can kind of get right into it, but maybe for a moment here, we zoom out a little bit and kind of talk a little bit more just about budget in general. Darren, question for you, do you think that there is any correlation between let's call association with top tier marketers and those marketers often having the largest budgets? Can you kind of share some of your thoughts on that? Yeah, I'd love to.
So I feel like there's a perception and I think that perception should be corrected. So I think there's a perception that the bigger the spend, the better marketer you are. I've been a lot of marketing teams and conversations and communities where it sounds like a bragging point like, oh, yeah, I might go to this much or I spend this much and it kind of gets this little bit of brown swale and people get excited about it. And instead of looking at overall impact, they measure their spend as if that's the success metric.
And so I think that there is a correlation, not maybe a correlation, but definitely a perception there. And sometimes it's rightfully so. Maybe the best marketers are the ones who are spending the most because they've figured out how to stack growth and scale their programs. But often case, my thought is almost like the most creative marketers are the ones who have the smallest budgets.
Yeah, I think that lack of budget, the uncertainty that comes with all that, oftentimes that's what's going to push marketers to, like you said, get creative and figure out how to make do with what they have. And I can speak to my own experience on that. I earlier in my career, I had a budget that I later realized was actually going to be larger than the total revenue for some of the companies that I was going to be working for in the start of in scale of space. Now, when I started my career in the enterprise space and enterprise marketing, I did a lot of work, I didn't have that comparison point.
So I was always fighting for more budget. A million isn't enough, a million and a half isn't enough, two million isn't enough. You're increasing my targets, 20%. You need to increase my budget, 20% as well.
I didn't have really enough awareness and alternative perception to really think through what I was asking and what I was trying to work with there. But the reality is I had plenty of budget to work with at that point. Certainly you can make the case that these organizations that do have larger budgets are often the ones with the largest amount of revenue. And so there is sometimes a need to have those larger budgets.
But going back to the original question, I don't know that there's any true correlation between top talent having those large budgets and the budget itself having anything to do with how strong the marketer they are. What's your experience been? Have you spent more of your career working with smaller budgets and the start of scale of space or more experience? I just mentioned where I was really a green marketer but had a very healthy budget that I was probably a little bit wasteful with.
What's your experience been? It's easy to take that big budget for granted when you're in the moment. So first off, I love you saying about forcing that creative. I've always loved the quote, creativity loves constraints.
Sometimes you need a box or you need a blank piece of paper or some sort of prompt to get that creativity out of you. And so my experience as kind of mirrors a little bit of yours except mine's been a little bit more of a roller coaster. Starting off in-house early in my career, we were really creative and I feel like we did some of the coolest things but I wasn't really looking through a marketing lens. I was more of just like a creative.
So we didn't really have like an impact on the org. And then as I've grown my career a couple of years ago where I was working, we had a really large team, 50, 60 marketers, multi-million dollar budget every month. We just spent a lot and we had a model that we really trusted and felt like we could responsibly spend that money every month. And it was easy to go say, hey, look at what we did here, keep giving us money.
And then I feel similar to you. I took that for granted and then when I left that company and took a much like a huge, huge, huge, huge cut in budget, it was kind of a reality check for me. I was like, I don't know. Can I still do this with this small of a budget?
And that's when I started about like, okay, A, I took things for granted and I don't think we were wasteful. But I definitely know that there's some areas where we could have ratcheted it down on efficiency. And I also realized that I was not being as creative as I could have been. I was just relying on platforms that existed and relationships existed and really just a numbers game.
It was a legion play. And I was thankful that for that start contrast because looking back at those experiences back to back is really I feel like been huge for me in my careers is I had to see one side of the coin on each side. And now that I'm not in either of those spots, I can kind of look and see where that sweet spot should be. Let's talk a little bit about that creativity that was almost kind of forced out of you when you had your budget cut.
I think what would be helpful for anyone listening right now is for us to get a little bit tactical with some of the things that we've done or experienced when put in the situation previously. And I'll kind of kick that conversation off by saying, when we look back on this period, right, when we're a couple of years out and we're looking back on it, there might be a little bit of a realization that perhaps this economic downturn did force us to make some more informed and better choices about what to do with our budgets. I think the good that comes out of a situation like this is that marketers are all of a sudden getting a lot more responsible with their budgets. Now I love experimentation and innovation and there certainly should always be a part of your budget that is allocated to that.
Hopefully it doesn't get shrunk too much right now. But more than anything, these budget reductions often prompt people to start doing an analysis on where they're having the most success and doubling down on those areas. And maybe where they're not seeing any fruit from their investments and their efforts and pull back on areas like that. And so at the highest level, right, that sounds like a smart approach.
And it's probably something that a overwhelming majority of marketers are going through that exact exercise right now. But here's the bad that the alternative perspective that comes with that. And I'm seeing this play out across a number of our clients right now is that because these marketers are saying, okay, I've looked in and looked at the data and I know what's working, oftentimes that becomes an attribution conversation. And we know around here attribution is often a four letter word.
But one of the things I'm seeing most frequently is marketers are sacrificing the strategic longer term place, right, the brand awareness, the demand creation in exchange for doubling down on the demand capture place, right, because they feel that this is what's going to help me navigate through these tough times. If sales dips, you know, it's not going to be because of my work I'm doing in marketing, we're going to make sure that we can continue to maintain some level of inbound and keep this thing afloat. But the reality is Google in general will just say, you know, search Google, whatever, it's the CPC channels, they're an auction, right. And so the more companies that are now putting their money into these auction based channels, the more expensive it gets.
And all of a sudden, our dollars are going, they're not able to yield as much for us. Everything is getting more expensive. Everything is getting more competitive. And so, you know, I think that it's an interesting paradox that's happening here where, you know, people are scrutinizing their budgets and somehow coming out of that analysis with the wrong actions to take.
So what are your thoughts on that? Yeah. And I totally love how you put that. Like we're looking at analysis and then we're kind of like, let's just send more here or switch more of a spend to demand capture channels.
Like, absolutely not to write a pressure. Like, I get where that comes from. So like if we're getting tactical, I won't break up this thought into two streams of thought. One is if you're in the broader organizational like leadership or finance, probably not a lot of finance people listening here.
But if they are, I'd say rather than just looking at marketing as this cost center or this, you know, it's easy for my accounting perspective, I get that it's a variable cost and all that. But like, rather than look at this as a variable cost center and just saying, oh, that's an easy budget, like line item to just, you know, eliminate or ratchet down would be like, issue some budgets. I think one of the best things that happened in my career was getting a challenge like this years ago when they said, hey, rather than this, you know, really large budget, we're going to keep your budget about the same or actually lower a little bit. But then your goal is going to double.
And that was like the directive. So I didn't have to worry about losing budget, but I had to figure out how I could use existing budget more efficiently. So I think that was like kudos to that finance team who kind of issued that challenge. I still felt at least I had that budget, but then it forced me to be really creative.
So that's just a tip. Anybody who like is mandating those kind of budget discussions, that was really, really helpful for our team. On the other side of the coin, if you're a marketer and you're looking at this, I think this is a good chance to do a couple things. One is it's a good chance to take a step back and look at the mirror.
Maybe it's good to cut programs. You never want to like say, oh, we're just going to like cut this spend now that we're in like these budget discussions, but maybe sometimes it's good to do that because you can look through the overall, you know, contribution and find out that those deals are not leading to opportunities or pipeline or revenue. And then I think so, yeah, look in the mirror and realize if you are expendable. Hopefully you're not.
But if you look in the mirror and say, you know what, like what we're doing, I can't track a revenue. That is just like this giant giant red flag. And I think that's a really huge opportunity for you to say, okay, what can we do to make sure that we are revenue aligned and that we're revenue focused and obsessed and everything we're doing tracks through two revenues. So that's just like high level.
I think you got to focus on those items. It makes a lot of sense. And you know, what you're suggesting here, right, is being data informed. That's always a smart approach in marketing is being data informed.
Some call data driven. I prefer the data informed. Okay. Here's a counter to that, right?
You know, a lot of what we talk about at Refine Labs with demand creation is that there is not direct line attribution for what we do. And because of that, if you were to analyze, let's say some of your campaigns and investment in your demand creation programs right now, it might not justify, you know, spending in the right areas. We'll say the right areas acknowledging that we both believe that demand creation is the right area to always be investing in the amount of the current economic state of the world. And so, you know, here's how you can kind of navigate around those, you know, that pushback a little bit.
So right now, what we're seeing across our client base is that I mentioned this just a moment ago, right? The search channels, those CPC channels, CPMs are rising consistently over the past couple months as more companies put their money in these, you know, short term investments we'll call them. But conversely, the demand creation channels, we're actually seeing CPMs are dropping there across LinkedIn, across Facebook and Instagram. That right there, it might in fact actually be the data point to go to bat with, you know, the quote that comes to mind, it's a Warren Buffett quote, I think I shared it on a recent second growth live podcast is be greedy while others are being fearful.
So I think really the time is now to be investing in demand creation because you can stretch your dollar even further. And as we're all in these kind of cost reduction modes, if you look at it in terms of a, you know, pure economic play, my dollar is going to get me, let's just say this many impressions for my target audience. Well, right now your dollar is going to get you more impressions for your target audience than it did two or three months ago. And so that is in fact a good way to justify, you know, if nothing else continuing to invest in demand creation, I think it's a good time to be even putting more in there as other people are taking away their funds, you know, that the competition is showing away.
So now's a great time to be out there, you know, being at the forefront of, you know, a lot of the conversations in your industry and trying to get ahead of your competition. It's a very opportune time for something like that. Yeah, I think, you know, you can effectively increase your share of voice by investing in the exact same amount of money that you were previously. And we don't come across situations like that very frequently as marketers.
So yeah, just a little food for thought for all the folks listening out there. But I think, you know, the other area that we could talk about for a few minutes here, Darren, is like outside of just, you know, our typical demand creation, demand capture conversations that many of us at Refine Labs are having at Nauseum. What are some other areas that, you know, you think make sense for marketers to be considering or investing their time and energy and resources in during a time when they might be having a reduced budget? So one thing kind of the action was going to chime in to your last comment was on this, the CPM conversation kind of costs are increasing in certain areas, lowering in other areas.
I guess one caution I would have to answer your question here is it's tempting to say, you know what, like as a capture channel, we can go and spend that money in Google. And I think there's this notion that a lot of people view this as like this low heat fruit. Like, oh, like, look at these people are, you know, it's intent based and they're ready to go. I definitely think that's true.
Like it's definitely a capture channel. I'm talking about Google specifically right now. But what I think you have to be careful of is if you're going after these capture, like think of really branded terms or really like focused by your intent terms with like the right tokens and triggers and stuff like that. Right.
Keep that 1% of people who are in market, you do want to capture those. And if you're not capturing all those, I think that's low heating fruit and you go for that. But what I've seen right now is a lot of people expanding that budget. And this is what you said too, but they're expanding that budget on Google because they think that that low heating fruit expands past a certain limit.
And what they're actually doing is they're lumping everything into Google and then they're actually seeing efficiencies go down. And that's because they're, you know, they're spending money on content downloads or webinar registrations along with their branded terms and their, you know, pricing campaigns and things like that. Those are not the same intent from a buyer. But it's in Google and when you're a marketer trying to get your budget, you're like, hey, you can spend all this in Google and it's, you know, way better for demand capture.
I think you're just doing yourself in the foot down the road. So just a cautionary tale. Like I see people asking that a lot, they'll do it because it'll be bad down the road. I wish I had like this brilliant, like, oh, you should try this idea that you've never heard it before.
But really, as I'm thinking of this and where we had success in the past when we were supposed to ratchet down or an increased goal at the same time, I bet, whatever it is, efficiency and strategy. Those were two areas that we really, really looked at. So when you're talking about just kind of noting down some things, like when's the last time you looked at your conversion rates through every step of the funnel, right? Like from a high intent, demo lead all the way down to a close win.
So those conversion rates, usually there's a huge opportunity to go in and qualitatively look at those and identify patterns in your funnel, I guess you call it, in fine areas that you can double down or areas where you're struggling. So I think that's huge. I think looking at your, your, your TAM, like your total addressable market and any changes in audience, we talked about CTMs, a lot of people don't know that, but like a lot of people are not looking to see if their audiences are changing or, you know, like if their TAM has changed at all. And they just kind of have built this audience and they've just let it run forever and they try and change different things, but they've never like gone back and really like chiseled out their audience and seen if there's optimizations there.
Some other efficiency things like when things get a little tight, typically you'll see things kind of get a little stressful in the marketing and sales realms. And so one thing that's helpful for me is to go and see like how quickly are sales teams dealing with, you know, the opportunities that we're handing them? Is it slowing down? Is there any sort of trend that I can identify for them?
And that's usually pretty helpful for them to kind of realize like, Oh yeah, like we're a little slower or we're not addressing lead sources with this value, but we are dressing this. So kind of really getting in locks up with your sales team. Another huge, huge opportunity to spend, you know, days and days and days doing that. I like that tip.
So I'm going to, I'm going to throw a little bit of a curveball here just following a thread that my buddy Sam keenly started in our conversation about a week or so back about marketing and an economic downturn. Now is maybe the best time for marketers to be spending time talking to their customers, because you know how much money it costs to talk to your customers? It costs $0. And there is so much that can be had just by having regular conversations with your customers.
But I think that for the purpose of what we're talking about right now, right, which is trying to do more with less, trying to find ways to hit your goals with a reduced budget, customer marketing, I think is a great way for marketers to be pivoting right now. And so I'm not suggesting that your customers have more money to spend than anyone else in any region of the world that's experiencing some type of economic downturn or recession, whatever you want to call it. But what I am saying is that it might be equally, if not more valuable in a time when sales are expected to dip for marketers to be focused on retaining their client base. And maybe instead of the all of the focus being on growth metrics, instead, there should be a focus and a time like this on retention metrics, because yes, we all know that it's going to be difficult to see increases in sales at a time when people are spending less money.
But what is much more within your control is what happens to your existing client base. And so I'm not sitting here telling you that you need to be running upsell and cross-sell programs at your clients. I don't think that they're going to appreciate it all that much. But what you can do is be, you know, reaching out to them, having conversations with them, trying to encourage, empower them, promote togetherness, you know, these are things that are just always a good play to be running with your clients.
But the other part of it, right, is that if you are able to navigate through, you know, however long this potential recession period lasts, and you are able to maintain, you know, all or a very good portion of your client base, chances are your company is going to be able to survive this downturn. And so I think that that's something that marketers need to be considering right now, and to take it a step further and to find ways to best utilize the time that you're spending with your clients, see if they're open to, you know, just recording some of the conversations. Like an informal interview, the low production value content, I think, is super underrated. There's certainly, you know, a lot of value that can be had from high production value content, but the low production value stuff can be stretched just as far.
It's authentic, it's genuine. And again, it's extremely low cost or even no cost. And so right now, you know, if you are having your budget slashed or completely stripped away, that doesn't mean that you should totally stop trying to produce high quality content. You know, and you can do something like that just with some customer interviews.
You know, you might get some good snippets for social from it. If nothing else, you're going to get some great insights that you'll be able to utilize maybe at a time when you do have a little bit more discretionary budget that you'll be able to spend. Yeah, no, I love it. I think of that in the terms of efficiency, like product, product will win.
And if the better you know your customers, the better you know your product, there's like, it's a win win. So I love that. I was thinking like that play on content is really cool idea. Customers who are happy want to talk about their experience with the product.
If they're not, that's a good sign that there's price and area for growth. But yeah, like why not create some kind of low budget content? I think a lot of people think content is going to be so expensive to create. But honestly, it's way cheaper than any other marketing channel you leverage anywhere else.
So I think that's huge. I think another maybe just give like a real tangible tactic that I've seen working the past is you think about demand creation and capture when people, the modern buyer cycle, right, is changed. We know that we talk about all the time. But now people come and they do their own research.
They love talking to their friends, community. They talk about they look at research on G2 crowd and press raise like these review sites. Here's the tactic. Try this out.
We're just talking about this other day, actually. So figure out who your happiest customers are. You should know that or your product team or CX team should know that within your platform, whatever users ways to build triggers to say, okay, this customer is using the product this often. And their NPS score is, you know, at nine or whatever it is, like they're really happy.
So this to me tells me that this customer is like stoked about the product. They're really happy. They're not at risk of churning or anything like that. Why do we have a conversation with them?
But to also kind of help in the dark social world, why not see if we can get those folks to kind of talk about us to others. And so this company that we were talking to, what they did is they went and they just triggered all those people, those customers, and then just simply like automated an email and said, Hey, would you mind leaving a review on this review site? And then that kind of like just that sheer volume led to, I think I can't remember the numbers, but it led to the most of like the highest percentage of their total opportunities and close one deals. So really like the process they got to know their customers and it was it just helped on all for us.
And it was free, like completely free. I'll say to take that one step further. I think that's a pro tip right there and it doesn't necessarily need to be utilized only during times of economic downturns because that's something I've loved that play for a while, right? Is trying to set up some type of triggers or workflows based on an NPS score, hitting a certain threshold immediately prompts some type of email or at least paying the customer success rep to reach out to that client and ask for a review or even a referral perhaps.
But yeah, I think that that's a great tip there. So I think we're probably reaching the end of the conversation here, Darren, and just in terms of continuing to keep things tactical and helpful for our audience. I always like to wrap up these episodes and see if we can provide some type of actionable takeaways for our listeners. And so I think based on our conversation today, based on what we know about past recessions, right where sales cycles are going to get a little bit longer, price sensitivity is going to increase your contract negotiations, especially those for longer, multi-year deals, or they might stall out, but this is not going to last forever.
We've discussed it earlier. It is an opportune time to be investing in more of your brand awareness and demand creation, especially on digital platforms where there are some current efficiencies that you can take advantage of. But the other tip I think I would say is really get aligned with your leadership team. It's always a good practice as a marketer to be aligned with your leadership team.
But especially right now, try to get those leaders in a room together with you on a call, whatever, and get an understanding of how they're looking at this current economic state, how they believe it's going to potentially impact the path ahead, and get an understanding on if there is going to be any type of movement as far as some of those target KPIs. Because if you are able to influence that whatsoever, now is a great time to be suggesting things like, you know, maybe easing off of those growth metrics just a little bit and doubling down on customer retention metrics. Oftentimes, that is going to drive the best behaviors. And certainly those that we know are going to be a little bit more cost-effective for marketers.
And so I think that that is a great approach. If your team is expecting that sales are going to dip and hypothetically, your marketing spend is going to say somewhat level, that means your cost to acquire customers is going to increase. And I'm sure that there's going to be a lot of executives that are going to be a little bit uneasy with that. And that's where you can kind of counter with something like focusing on some different metrics.
I can still have an extremely positive impact on the business. I'm not going to set you back as a company if you can find ways to just get a little bit more creative with what you're doing, perhaps alongside some of your customers to do some real kind of grassroots style marketing and content production. So what do you got there? Any key takeaways or recommendations for our audience today?
Yeah, no, I'll echo what you said. I think it's a great opportunity to get ahead of things and have those conversations up front. But the worst thing that could happen is, worst is they could say no. But typically what will happen is you don't do anything and you just get painted into a corner with metrics that are unachievable and not efficient.
And then that just has spelled out long term disaster for you and for your company. So don't do that. Get ahead of those conversations. And maybe another time I'll talk more about some of the ways you can kind of dig deeper into the data.
I have all sorts of things for my head that I think markers should know and basically be able to bring to the table to help kind of help those conversations because I think they'll just go better that way. All right, we'll get them out of your head down onto some pen and paper there. It sounds like our audience might be hearing from Darren again. We might have to have him back to share some of these big ideas.
I'm seeing the light bulb go off on our zoom call right now. But great. Well, this has been an awesome conversation. Darren, I enjoyed your perspective, enjoyed chatting with you about the stuff.
And hopefully to all of our listeners out there, I hope you enjoyed listening as much as we enjoyed recording it. So until next time, thanks a lot. And Darren, you want to give us a goodbye send off here? No, thanks so much.
Thanks for having me. And keep on keeping on there. Everybody appreciate it. There you go.
All right. Thanks, all.