{"id":16201,"date":"2018-11-01T11:44:54","date_gmt":"2018-11-01T18:44:54","guid":{"rendered":"https:\/\/foundersnetwork.com\/?p=16201"},"modified":"2018-11-01T14:09:43","modified_gmt":"2018-11-01T21:09:43","slug":"how-to-scale-without-overspending-on-marketing","status":"publish","type":"post","link":"https:\/\/foundersnetwork.com\/how-to-scale-without-overspending-on-marketing\/","title":{"rendered":"How to Scale Without Overspending on Marketing"},"content":{"rendered":"

Claude Schneider has been a member of\u00a0Founders Network<\/span><\/a>\u00a0since January 2018. He\u2019s also been a prominent FN member in our Vancouver\u00a0Chapter<\/span><\/a>. To receive peer mentorship from Claude and over 600 fellow Tech Founders, please\u00a0request an invite<\/span><\/a>\u00a0and join our global network.<\/span><\/em><\/p>\n

You may have a SaaS product, offer services, or run an e-commerce business. All of these will rely on a website to get people interested in what you\u2019re offering, and to convert them from a lead to a customer.<\/p>\n

Say you\u2019re in the lucky position of having some traction. People are finding your website, you\u2019re getting signups, and some people are possibly even becoming paid customers, or repeat users.<\/p>\n

You may think now\u2019s the time to turn on the growth machine, and ramp up your marketing spend. Especially if your LTV (lifetime revenue from each customer) is over 3x higher than your CAC (customer acquisition cost). The more people who visit your website, the more conversions you\u2019ll get, right? And in turn, that will speed up the word-of-mouth effect, and reach even more people.<\/p>\n

While this may be true, there\u2019s one thing you should do first, which may double or triple your growth rate.<\/p>\n

Your Bucket is Leaky<\/h2>\n

Everyone knows the concept of a conversion funnel\u2014 you put a lot of leads into the top of the funnel; at each step of your signup\/onboarding\/checkout process, you lose a few more people; and at the end of the funnel you have a fraction of those leads who\u2019ve converted to paid customers.<\/p>\n

\"pasted<\/p>\n

\u00a0<\/h3>\n

Pirate Metrics<\/h2>\n

Your marketing spend is like a bucket of water\u2014 the more you spend, the more water (leads) you can pour into your funnel. Keep pouring more water into the funnel, and you\u2019ll keep getting more leads. However, your funnel is leaky – you\u2019re losing customers at every step.<\/p>\n

A \u201cstep\u201d is any point where you\u2019re asking a lead to make a decision:<\/strong><\/p>\n