Dan Slagen is SVP of Marketing at Nanigans, and a former co-worker of mine. He agreed to hop on Gchat with me so I could learn what it's like to be a marketer with limited marketing budget at his disposal. Here's our conversation.
Me: Hey Dan! Thanks for "sitting down" with me. We used to work together, and now you're off on a new exciting venture. What's your day-to-day like?
Dan: Indeed I am! I recently moved over to Nanigans, which is the only advertising software focused on lifetime value-based performance marketing at scale. My day-to-day includes a few core concepts which consist of PR, content, co-marketing, lead gen, marketing partnerships, working across the sales, product, and customer success teams and anything else that comes up along the way.
Me: So you wear a ton of different hats, and basically have like 10 jobs.
Dan: Well, I've never been good at focusing so it's the perfect job for me!
Me: Ha, good answer. And also pretty standard for a start-up. I've been in "start-up mode" a couple times myself, and it's always been pretty hard to secure marketing budget. Do you find yourself in that pickle, too?
Dan: Well let me put it this way -- I've historically worked on both the client and agency side leading marketing efforts and have had annual budgets in the tens of millions, millions, hundreds of thousands, and so on ... but in "start-up mode" annual marketing budgets are typically quite hard to come by comparatively.
Me: So it's not totally accurate to say you have "zero" marketing budget, but you're not rollin' in it.
Dan: Correct. Basically the way it works is if I feel that there's something "worth" investing budget in (outside of new hires or machines for employees), then I need to present the case to my manager.
Me: So you have to actively secure budget for any new initiative you want to take on.
Me: How do you do that? Who do you go to? Is it like, you walk into your boss' office and casually ask, or are you making big presentations to a board? Or something in between?
Dan: Well first and foremost I make sure to always be asking my team what they think is interesting to invest in from a marketing perspective. Once I've found something that I think is worth investing in, I schedule time with my boss and we have a quick conversation about it. If we agree that it's a big enough initiative to truly move the needle for us, then I'll write up a plan from start to finish. The plan will consist of the investment and the return, along with all the details around who is doing what and when.
Me: And you said new hires and machines for employees don't count in that. How do you get budget to hire a new employee when you need one?
Dan: Just like any growing start-up, we take a look at all our departments and make a decision as an executive team which teams need additional head count. For instance, we recently raised $6M in a series A-1 of funding, and with that we'll be able to bring on additional hires across specific departments.
Me: Historically I feel like people are more likely to hire in Sales or Dev ... or almost anywhere else ... before making a Marketing hire. Do you find that to be true? Is it difficult to convince a bunch of cross-departmental execs to spend budget on a new marketing hire?
Dan: Actually no!
Me: Really? That's ... awesome. Tell me more.
Dan: The members on my marketing team have an incredibly high output, and marketing today is no longer a "we think" department when it comes to reporting on results. When we present our performance at the end of the month we know exactly what we did and what it produced, from leads to customers to revenue. For me, adding even one additional headcount makes a HUGE difference in terms of output.
Me: So you're coming to the table with objectivity. You can hang with the other numbers dudes and dudettes.
Dan: I wouldn't come with anything less
Me: That's the Dan I know. So how do you decide what is worth requesting budget for? There's so much you COULD try ... how do you decide what's worth bothering your boss about?
Dan: Finally, an easy question!
Me: I don't know if that's sarcasm or not. So I see you haven't changed much.
Dan: We only spend budget if it's driving toward revenue, and the lifetime value of that revenue. Now while I don't have lifetime value based algorithms at work when making marketing decisions, it's the end value that is what I focus on. For instance, if I'm going to spend $5K to sponsor an event, what am I going to get back? A new customer? How much can I project we'd make in revenue from that customer? At the end of the day, I just need to be able to financially justify my investment.
Me: So the best you have is an educated guess, right? But your boss is okay with some experimentation, as long as you're tracking whether that experiment worked or not?
Dan: Well I do have a few years of experience under my belt, so I know where to stay away from, where to test small versus what I know will work based on experience. There is some risk with the small tests, but that's why it's imperative to win the majority of your small tests. Those build trust so that over time, your CFO (or whoever you need budget approval from) trusts that what you spend will have an overall positive impact on the company.
Me: Has there been anything for which your experience led you astray? Something that historically worked for you, that you were confident it was worth spending money on, and that flopped?
Dan: You mean have I ever made a mistake? Good Lord, yes. I think what's important to keep in mind is that things always change. What you say is "correct," just because it worked historically may not work now. Or sometimes what worked at an old company doesn't at a new company, for whatever reason, no matter how bad you want it to. So the important thing is to ALWAYS start small, even if you "know" something will work. Make sure to prove it out at your new company before looking to scale.
Me: What's the craziest thing you've requested budget for?
Dan: Weird request for budgets ... let me think.
Me: This long pause either means your list is really short, or really long.
Dan: I once asked my boss if I could rent out a penthouse for a few nights, and his response looked like my mother when I came home with my first bad grade.
Me: Haha, well ... did you get the budget?
Dan: He was confused, somewhat disappointed that I'd even ask, and I think was questioning if he made the right hire. I did end up getting the budget, because there was a grand strategy behind getting the penthouse.
Me: There always is.
Dan: We were attending an event and it was VERY expensive to sponsor, so instead, we rented out a penthouse at the hotel across the street which was about 1/10 the price and we held meetings there. We ended up exceeding our sales goal and making the event profitable. Had we sponsored in the traditional manner we would not have met our goal.
Me: So you proved the ROI and everything was cool.
Dan: Yes, but my boss asked me that next time I have a wild idea that I let him know to "get ready to hear something a little different."
Me: Fair request.
Dan: My favorite request though ...
Me: Oh here we go.
Dan: Was when I was at a SUPER small ad agency start-up. We could bring our dogs to work so I brought my beagle; I was so happy to bring my dog to work. Within his first hour of being there though, he left a "gift" on our conference room floor, and we have a client coming later that day for a sales pitch. We didn't have any carpet cleaner, so I asked my boss if we should invest in some in case this happened again.
Me: Budget: Denied?
Dan: He said yes and we had the room cleaned up prior to the pitch, which we ended up winning. So again, spend to buy carpet cleaner justified, because I don't think we'd have won the pitch if we hadn't cleaned the room.
Me: Can't argue with that logic. Okay, just one more question for you. Since you've worked with enormous budgets, tiny budgets, and everything in between ... what do you prefer? The seemingly endless marketing budgets, or the tiny-to-nonexistent ones?
Dan: Honestly, I love both. Marketing is all about connecting with your target market, and you can do it with budget and without. Both are hard in their own way and require expertise and dedication, so making sure you have the right team in place is what I like more. At the end of the day, I love marketing.
Me: Wow are we really ending on "at the end of the day I love marketing"?
Dan: Okay, how about ending on this. Always be ready to explain any budget you spend in a future setting, and have a plan in place to execute on your decisions to make the most of the budget you're spending. If you can't justify the spend, don't even consider spending it.
Me: Gotcha. Well thanks for hanging out with me for a bit, talkin' budget!
Dan: Looking forward to our next chat!
Who else would you like to see a conversation with? The C-Suite? Advertisers? Business owners? Other inbound marketers? LOLcats? Share who you'd like to hear more from in the comments!