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The SaaS Winter and the CMO

Alex Poulos

SaaS Winter is Upon Us

A CMO's Playbook to Weathering Any Down Economy

No department is impacted faster from a downturn than marketing. Regardless of how well you, as the CMO, are running your side of the business, you will face pressure to proverbially do more with less.

  • Let’s cut our ad spend by 50% for the next quarter and we’ll take it from there.” 
  • Do we need all four of our content writers right now?” 
  • “What has our PR agency done for us lately?” 
  • What is the charter of our product marketing team again?

I have heard the term “SaaS Winter” a few times over the past weeks. To be honest, I like the term. While markets are in an economic winter already, some companies do find opportunities in winter time. Some even thrive in cold weather. And there’s some good advice to startups out there (mentioning Kyle Poyar’s post from OpenView and NfX’s ). Based on my experience as CMO having gone through both prosperous and tough times and having to survive with meager resources more often than not, here is my playbook of sorts on what things to get ahead of in a downturn.

1. Alignment

Make sure that key priorities are aligned with your CEO, C-level peers, the exec team, and the Board. You should all be in agreement that you are entering war time. Yes, I know the people team has been planning this team offsite to celebrate the latest product release for months, but should we maybe reconsider? On the flip side, this product release is really important for closing new business, so shouldn’t we still make sure we hold the prospect and customer launch webinars we had planned for it?

Next, ensure the same alignment within your organization. Every marketing team should be focusing on the same things. Even more importantly, they should also be defocusing the same things. In my opinion, this is the time to be strict with your OKRs and have few but crystal clear & unambiguous KPIs (where it’s ok to be focusing on different metrics during these times). Make sure the KPIs reflect the current priorities (no more, no less). Feel free to still celebrate wins in line with these priorities. But if anyone is working on something that is not connected to one of your key results, have them stop and reassess immediately. 

2. Budget

In a downturn, marketing spend will be scrutinized. It always is. There is no way around that. Connect with your team and listen to them. But you will have to be the one to make the decisions as to what needs to stop, what needs to scale down, what needs to be fixed, and what needs to (yes) be scaled up. A downturn is also an opportunity. Clarity and speed of making these decisions will be important. Executing a budget decision in a matter of days vs a matter of months can be crucial in terms of cash flow impact. 

Personally, as I have been working in startups most of my career and have seen a fair amount of wild swings, I always maintain a mental map about marketing’s contribution to pipeline vs. spend. I weekly ask myself what if I had to run marketing with 50% of my current budget tomorrow? (I also ask what if I had to run marketing with 500% of my current budget tomorrow, but this is not the point here.) Where would that spend go so we don’t bring growth to a halt? I have found this to be a good practice even during normal times as it forces me to always be challenging what works and what doesn’t, and be re-inventing myself and the marketing org accordingly. 

In general, I try for every budget item to have a Sure Bet vs Wild Bet denomination, meaning what are the efforts that we know enable us to win in our current TAM (Sure Bets) vs the ones that will help us expand our TAM (Wild Bets). This is something we pioneered at DocSend and the marketing org’s thinking of how we approach budget asks changed completely. As a rule of thumb I tend to prioritize defending our position in the current market position during a downturn, vs finding opportunities to expand to new markets. Hold your fort first and be opportunistic second.

3. Pipeline

Even if you have solid attribution and strong MOPS & analytics literacy, some questions here are hard. Will my demand be affected if I kill paid search for all of my brand keywords? If so, by when and by how much? How quickly will I be able to recover afterwards? Bring your best attribution and analytics forward!

As a CMO, I have a view of the quality of my pipeline over time on aggregate and by channel. The quality of the pipeline is determined by the fit of every new lead or user brought into the product. Here’s an example of a pipeline generated by organic search over time. Not only the quantity is increasing, but the quality (measured as pipeline health via % of leads or users with a good or very good fit over total number of leads or users) as well.

Bar chart of Pipeline Generated by Organic Search - Aggregate View Month Over Month
Pipeline Generated by Organic Search - Aggregate View Month Over Month

Line graph measuring pipeline from organic search month over month
Pipeline Quality from Organic Search - Aggregate View Month Over Month

Now is also the time to prove you have a great relationship with your CRO. Sit down and prioritize together. Some things will be tactical and some will be strategic. But remember that the CRO will likely have to scale down as well (usually in terms of headcount, contractors, or sales pod resources). At the end of the day both marketing and sales will be focusing hard on efficiency at these times. Here’s a great podcast of the team at Sendible being able to generate 50% revenue with less marketing & sales resources.

4. Channels

If you don’t have a clear understanding of pipeline impact (in $), CAC, and payback for each of your channels & campaigns, you’re in a tough spot (and frankly, you have not been doing your job as CMO). It’s so easy to cut down on the channels and programs that are the most expensive (either as a budget line item or based on unit economics). But what if these are the channels that have the best ROI in terms of payback?

Bar chart measuring pipeline quality by marketing channel
Understanding Pipeline by Source and Pipeline by Quality

Barchart measuring the payback timeline for marketing channels
Measuring the ROI and Payback Timeline

This is a great time to take a deep look at your current database of leads or users and customers. There is excellent potential to find new opportunities in your existing funnels to better monetize contacts and accounts that you are already connected to. For example:

  • Revisit closed lost opps and reach out with a message specific to how conditions might have changed and is worth reconnecting.
  • Rank your database of leads by behavioral engagement and reach out from most active to less active with a specific message about your value during a downturn.
  • Ask your champions and advocates for possible referrals to companies that may need your solution during these times.
  • Better monetize your customer base by seeing what accounts are a fit for expansion with specific solutions for the current situation.
  • If you are a PLG company, you are at a great place to leverage your users. PLG-sourced deals are faster and with lower acquisition costs, so it’s a great time to prioritize those.

5. Headcount

This for me is the hardest one. Because people are what make or break a top-class marketing team. I tend to always be very careful with headcount changes given the impact on individuals, the impact on the rest of the team, and how long it takes to replace talent back into the organization. My approach here is to make decisions and any changes quickly. I also want to make sure that after any changes I have kept the right team to go to war and turn things around. No nice-to-have roles, but the ones that matter to the current situation. No complacency in the team either. I want to go to war with the people that understand they are going to war and believe we can win.


At the same time, there is usually some excellent talent in the market during these times. This gives you an opportunity to upskill or backfill positions with great caliber of talent that otherwise wouldn’t be available. If you plan to hire, be prepared to still move fast for professionals who are good fit. Even if you are not planning to hire, be available to help people in your network as they go through downsizes. Being nice to others comes around later.

6. Customers

Your customers’ priorities and behaviors are changing too. Please start by acknowledging that and start working with them to understand how they are navigating the downturn themselves. The earlier you are part of these conversations, the more likely that you will be part of the path forward. This is a great time to have some exec-to-exec connections with your customers since some of these topics could be sensitive. Be prepared to come with specific solutions as to how you can help them during these times. Be prepared to show some flexibility as well. It may be more relaxed pricing terms or overlooking some overages or offering some free implementation help if needed.

Now is a great time to leverage customer referrals, reviews, quotes, and social proof in general. Not only is this a good way to potentially get new business but it’s also a way to accelerate sales cycles that may be slowing down as things get scrutinized more during a downturn. As CMO, feel free to reciprocate these referrals and endorsements with your customers, partners, and vendors as well.

It may also be a good time to work with your CRO or CCO to fire some customers. By now you should have stratified your customers into tiers and you need to consult these tiers. There are customers you definitely want to keep, but there are also customers you are ok losing. This is the time for profitable revenue, so you should probably renegotiate with those customers who are not strategic partners, not a great fit with your solution, or loss making overall. During this process it’s ok to lose non-profitable customers.

7. Competitors

Pay close attention to your competitors during this time. Most will alter their strategies. Be ready to adapt and capture mind share or market share when others falter. Some competitors will not survive the downturn. Be opportunistic for a potential partnership or acquisition depending on how things pan out.

8. Board

There is likely a lot of uncertainty within your Board as well. VCs tend to over-react (Sequoia, YC) and use the same advice across all their portfolio companies. But each company’s situation is different. This is a good time to communicate a clear plan to your Board and work with your Board members to pressure test the plan. Assuming everyone in the exec team is aligned with the plan (see #1 above), this instills some level of confidence at the Board that the team has done some analysis, made some decisions, and have a path forward. At the same time, be flexible and open to revising the plan as things change.

9. Tech stack

All CMOs should use this opportunity to take a hard look at their stack. Here’s a simple prioritization template:

  1. Do I have technologies and tools that are not being used? Drop them.
  2. Do I have technologies and tools that are not implemented to their potential? Evaluate them.
  3. Do I have technologies and tools that are integral parts of my GTM engine? Keep them.
  4. Do I have technologies and tools that impact my effectiveness and efficiency? Leverage them more.

Another prioritization template is to plot your tools in two dimensions: impact on the business vs disruption cost to replace. This yields a 2x2 table with some obvious quadrants.

Scatter Chart of Tech Stack Impact
Scatter Chart of Tech Stack Impact

One question that comes up a lot is around PR. Most companies tend to cut PR budgets and fire their agencies. If the return of your PR is unclear (which is, unfortunately, the case with most traditional PR agencies), then this is a good way to save on budget. But I can share a different perspective: while at DocSend and in the eve of the Covid slowdown, we doubled down on our strategy to publish data-driven content by repurposing this content to be relevant to Covid’s impact on business (in our case, impact on startup fundraising). Our PR agency (104 West) was pivotal to this effort, so we ended up working with them during those times as we aimed to push out more content and faster while still maintaining top quality and relevancy.

10. Leadership

This is the time to show C-level leadership. From market acumen to decision making velocity and from analytical mindset to team empathy. Personally, I am super strong on transparency at these times and I have learned to over-communicate until I am fairly confident everyone is on the same page (boat). I prefer my marketing org getting ahead of a downturn and owning our strategy by proactively doing things differently, rather than waiting to see and finding excuses afterwards. While we don’t necessarily control the timing of a downturn, we certainly control how we respond to it.

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