Made by
Made by
Director of DevRel and CMO
Directus and Garden for Wildlife
DevRelCon London 2023
In this talk from DevRelCon London 2023, Kevin Lewis and John Booth look at how marketing metrics can help us in developer relations to demonstrate the value of what we do.
Kevin and John discuss the importance of understanding customer acquisition cost (CAC) and lifetime value (LTV) in developer relations. They explain that knowing these metrics allows developer relations teams to be more intentional in their work and make informed decisions about where to focus their efforts. They also emphasize the need for developer relations professionals to be part of the conversation about revenue and to track attribution to demonstrate the impact of their work. I
In short, when DevRel people understand their work’s relationship to CAC and LTV it can help secure funding for projects and contribute to the long-term success of both the DevRel and the wider company.
Feu Morek:
We’ve got a really interesting topic coming up now because as you know, DevRel work is really difficult to measure, and our next talk is going to be aiming towards making it easier for us and approaching it from a marketing perspective as well as our typical DevRel analysis. And we’ve got a really nice dynamic duo speaking for us. So that is for one, the developer relations person at directors, who’s also the director of You got this, I think you spoke to us yesterday as well. And from the more marketing side or sales side of the perspective, we’ve got the chief marketing officer at Garden for Wildlife who has 25 years of marketing and sales under their belt. And on the other hand, we have 10 years of Deral experience. So please, a warm welcome for Kevin Lewis and John Booth.
Kevin Lewis:
Thank you so much.
John Booth:
You. Okay, thank you for spending some time with us here today, this afternoon in that warm welcome. My name is John Booth. I’m currently the CMO of Garden for Wildlife. And before that I was at Directus. So before Directus, I had no experience or exposure to DevRel teams. I had no idea the value they brought, what their goals were. And while at Directus, I realized I wasn’t alone there, that my peers also did not understand the value that DevRels brought and that this highlighted a need to educate my coworkers and colleagues. And also it created the opportunity for Kevin and I to work together to build a DevRel team that could then create value for the other teams within the Directives organization. A few, just a couple of words. Obviously we put this pitch together when I was at Directus back in January. I’ve since left and I’m now the head of marketing at the Garden for Wildlife, which is not technical. We are all about promoting and increasing the awareness, the access, and the adoption of native plants. So if you’re interested in promoting native plants, come see me afterwards.
Kevin Lewis:
My name’s Kevin. I run developer relations at directors. Where I met John, I also run, you got this, which is a core skills education initiative. We ran the core skills track downstairs yesterday. If you’ve not heard of directors, we’re an open source data platform. You connect it to a SQL database. We spit out developer APIs and a nice web UI to make sure everyone across your organization, regardless of their technical skill, can make the most use out of that data. We are really interested in partnering with other developer relations teams around content and building extension. So if you want to talk to me about that, by all means do after our talk.
John Booth:
Okay, so let’s talk about the goal of marketing, which is somewhat dependent upon your company’s business strategy. If you are a PLG led organization, you might have a marketing goal where you’re generating revenue through credit card swipes or self-serve activities. If you’re a part of a larger organization, the marketing team might have a responsibility of generating qualified leads for the sales team to turn into revenue. But so while some of the goals may differ, the activities that you do are predominantly the same. So think about your creating content, often educational content, you’re forming messages, messaging around your product and how your product solves your customer’s problems. And then you’re distributing that content and that messaging throughout the different channels that you have effectively to your customer base and your prospects or your future customer base.
Kevin Lewis:
And the goals of developer relations teams are largely the same. We also create content including education. We form messaging around products including how it solves developer needs, and we distribute that to our communities. Now, there are a few differences of course. Firstly, we act in the capacity of peers to the people we are speaking to as developers ourselves. And also the way we are assessed is also rarely against those same sales goals. But in reality, what we are assessed against is often a lot more subjective and unclear, which is a kind of uncomfortable place to be in. There are of course other contributions we make to the business around product and tooling. But in large we are very, very similar to our colleagues in marketing. And this is the 18th we think edition of DevRelCon. But there are still some challenges that are common between our teams and by standing on this stage, we’re basically obliged by law to remind you of them. Once again, one of them is understanding who the ideal community member is in the eyes of the business. Secondly, how do we drive positive behavior from the community? That could be generating revenue and getting their credit cards out. It could also be creating a community of peer support.
John Booth:
So third is how does DevRel establish or contribute to the revenue within your organization? And then lastly, how do you know that your team is doing the right things at the right time?
Kevin Lewis:
So the main goal of this talk is to give you the tools and terms that will help you in the parts your job that are known for being difficult, and to show you how other areas of the business are able to show and track their success a little more objectively.
John Booth:
So what we’d like to do is create a shared vocabulary that your team can use with other teams, in this case sales and marketing teams within your organization. So we have 19 minutes and 50 seconds to do that. So it’s going to be a whirlwind tour and we’ll start right now.
Kevin Lewis:
So first we want to start with some terms used to describe who is in your community and who you should be targeting. The same way that marketing and sales teams target a persona for selling, you should be doing the same, building a community that ultimately will prove business value. Bant is a sales tool that helps salespeople determine the likelihood of a successful business relationship with a person or an organization. And we wanted to talk to you about it. So you are thinking about these characteristics and gathering information in a way that not only equips you to help that person more effectively, but also equips your salespeople to have the most productive conversation at the time of handoff. So BANDT stands for budget, authority, need and timing. And we’re actually going to start with authority. Most decisions in a business around adopting technologies or paying for things are made by more than one person. So when you’re chatting with someone, try and map out what that decision-making group looks like and what this person’s role to play in it is. And dependent on that mapping, you can then be more adaptive in the conversations that you have with them. Being adaptive could be the level of detail that you use.
John Booth:
It could be talking about the business value that your solution brings, not just the technical value.
Kevin Lewis:
And it may allow you to equip the person you’re speaking to with the knowledge and the materials that they need to go back and ultimately be your champion when talking with the rest of the people who make a decision.
John Booth:
So you want to try and determine who the stakeholders are and ask who’s going to be using that technology, those end users of either the project or whatever it is that you’re building.
Kevin Lewis:
Next we’re going to talk about need and the need describes the importance of the problem that you and your technologies are helping to solve. So firstly, you want to understand what that problem actually is, what the pain points are, and then you can ask what happens if you don’t fix it. And when you start to unpack this, you start to understand the urgency of the problem. You also want to understand what else is on this person’s plate and their team’s plate. Are there other initiatives that may eventually compete for their attention and their ability to make a decision to use your technologies? You should be asking all of these questions because it’s quite often that when developers are coming to you and asking you questions, they’re not doing so just for study, just to learn another tool for their toolkit or a skill for their skillset. It’s often because there is a need. And when there’s a need, there’s often a project.
John Booth:
So when talking about timing, this one is a little tricky and a little different because bant is traditionally used to talk about timing. It’s a decision or a buying timeline. So when is the purchase going to be made? But we can kind of extrapolate it out and talk about a project timeline, including maybe where your product fits in to that timeline. So you could also use it to maybe help understand how best you can help that person that you’re talking to, where they are in that decision-making and what’s the level of urgency of the tasks that they’re trying to solve.
Kevin Lewis:
You can simply ask something inquisitive. So when’s the project going to launch? When you’re hoping to get it out the door, it at least equips you with some kind of order of magnitude as to the length of the project. So all other points in ban the authority, the need and the timing are ones that we can use our unique position as inquisitive peers to access. People are less suspicious of us, but also it genuinely helps us do a better job at helping the person we are speaking to if we understand all of this additional context. Now, budget is an interesting one. If someone wants to just give you a number, fantastic. Note it down. But that’s exceedingly unlikely. And my personal belief is that the budget item is probably something best not touched as a developer relations professional because it fundamentally changes the type of conversation you’re having from one of an inquisitive peer to one of a sales person.
John Booth:
So while you might not come out and just ask for a budget much like a salesperson would on a call, you could still ask things like, has budget been assigned to this project yet or is it a part of the already approved budget? Yeah,
Kevin Lewis:
So if done well, gathering someone’s ban allows you to do a few things. Firstly, it allows you to understand with data how much of your time, what proportion of your working hours you are able to spend on an individual or individuals from a company. It helps you be a more active party in the customer journey.
John Booth:
It is also important to remember that when helping someone buy something or selling something to someone, that in itself is a very noble cause. So if you are the right solution and you’re helping someone solve their problem, that is something that has value and is a positive thing. And I think that sales tends to get a negative connotation to it. But I think that that’s more because they’re bad salespeople and not because the activity of helping somebody solve their problem is a bad thing.
Kevin Lewis:
Yes, absolutely. And it reminds me of Wesley’s talk yesterday, including integrity. So as long as you are doing this well and with integrity and your salespeople are good and also have integrity, you can help your salespeople ride off of your authenticity. And at the point of handoff, handoff, a more educated, a more educated, and I suppose disarmed prospect. There we go. Next we’re going to talk about the ideal customer profile. And this is the perfect customer for everything your company has to offer. It’s a document that contains things like demographics, company size, location, sector, funding, also a person’s role, seniority experience, tech stack, things like that.
John Booth:
It can also include things like their objectives, their desires, the challenges and the pain points that they’re experiencing right now where their trusted sources of information are
Kevin Lewis:
Developing. An ICP really means understanding why your current customers are using you. And that might mean chatting with them and gathering this data if you don’t already have it. It might not be our job as developer relations professionals to do this, but someone has to do this job if you don’t already hold it.
John Booth:
So there are many things that people often forget about the ICP and one is that this is not a real person, this is the ideal. So this is what would be the perfect. So what we don’t want to do is focus on the probable prospects or the possible prospects. That often is a trap that salespeople fall into when they’re trying to sell something to anyone. So you really want to have as many matching points within your ICP as your community member or the people that you’re talking to. So the more characteristics they share, the more qualified, the better fit
Kevin Lewis:
John Booth:
Person might be.
Kevin Lewis:
And for us, it gives us a vibe, right? It gives us something to compare our work against. It gives us a person to build content and community initiatives around. It also helps us identify which communities we should get involved in based on their audience and which ones are probably yes, less likely to yield results for us.
John Booth:
So with each of your ICPs, you should be identifying the answers to these four scenarios that you see here, these quadrants within the matrix. So if we start in the upper left, we’re talking about the before scenario. So this is the current state and then the negative consequences. So what will happen if we don’t solve this problem today? Because we all live with problems that we aren’t able to solve today for various reasons. So next, think about how does your ICP look at the ideal scenario? So this is ultimately a scenario that includes your solution in their future state. And then lastly, and this is important, thinking about the positive, not just the positive business outcomes, but also those positive personal outcomes for that individual.
Kevin Lewis:
So a small and perhaps conceited example, using Directus right before scenario, there’s a database, I’m not a technical person, but I need to run reports against that data regularly to understand whether my team is doing the right thing or not if we’re moving the needle. But at the moment, I have to go to an engineer to generate those reports and just make database queries. In this conceited example, the negative consequences are sometimes I’m not their priority, there’s other things going on, people are sick or on leave, and I don’t get the reports I need to help my team understand what’s happening. Well, an ideal scenario would then be one where I can generate those reports myself. The positive business outcomes is I always have a report. I can always justify the value in my team and so on. Perhaps the personal positive outcomes is at the time of a performance review, I intend on using this successful project to negotiate a promotion raise and so on.
John Booth:
So when you’re putting together or you’re talking about your ICPs, make sure you include not only the demographics and the characteristics that we were talking about, but also the answers toran, these four quadrants that we see here in this matrix.
Kevin Lewis:
Now we believe in the value of working with a wide reaching community. People are all levels of experience, but we are in a market that doesn’t really appreciate that as much as we do. And to have the opportunity to do right by those people later, we have to be more intentional now in the direction of revenue, otherwise we don’t have jobs. And to have a seat at the table that helps everyone, you need to have access to the building. And this is the key reason we’re talking today about BANT and the ICP.
John Booth:
Okay, so we’ve gone through bant and we’ve gone through the ICP. And so now I want to introduce you to a couple of terms that are used to describe your customer’s financial characteristics. And the first one is cac. So this is the customer acquisition cost. So these are the overall costs that your organization spends to acquire one new customer. So it would include things that you would expect, paid advertisements, events, sponsorships, things like that. It might include the cost of producing content. Certainly it’ll include salaries, salaries for your team, your sales teams, your marketing teams, maybe you have consultants, et cetera. And the thing about CAC is that all companies calculate it differently. So they have different categories and they have different percentages that they assign from different teams. So while those are going to be different from company to company, you can look at these categories which often have very large totals with them when you start thinking about marketing teams and sales teams and DevRel teams and all of their salaries. So if we just take an example of let’s say we have a project that has a total cost of $10,000 and through that project or that activity, we generate a hundred new customers. In that scenario, we would have a CAC of a hundred dollars. So what’s important here is as dre’s, all of your activities have an impact on cac, and that is either by increasing those costs or decreasing those costs.
Kevin Lewis:
So what might this look like for a derail team? Well, things that cost money are easy. Things like salaries, tooling and equipment sponsorships and our own events and initiatives, your salary is interesting. It starts to bring your time into the equation. What is your effective hourly rate of your job? And are you spending it effectively? There are also ways, of course, which we can decrease the CAC working on projects that are really popular and bring more people into the awareness of your product or company. And also establishing a community of practice of peer support, meaning you can spend a little less time perhaps answering questions.
John Booth:
So where you spend your time establishing your ICP and your community members’ band, that’s going to go, they’re going to together hand in hand. And if you do a good job in the ICP and BANT work, the odds are that you’re going to spend more time in your community and have a positive impact on your CAC metrics and some other financial metrics that we’ll talk about in just a second. And it’s important here. You don’t need to know all of the inputs of your CAC because it’s a very broad calculation, but you do need to ask and you need to understand what’s the algorithm, what’s the equation that’s being used? Because with that understanding, then you can understand how you can lower those costs. So you’re also not going to have control over all of those costs, and that’s also all right, but just the exercise of understanding the CAC and how it’s calculated is going to make you more intentional in the work that you are doing within your DevRel teams.
So if we think about the impact and being intentional, okay, the next term that we want to talk about is LTV or lifetime value. So let’s take another example. You’re at a software firm, a company that has a software product that you sell for $10 a month. The average customer stays with you for 15 months, you have a lifetime customer value of $150. Okay, so why is this important? Right? Well, knowing the LTV that allows you to strengthen your case for making longer term or larger investments in your team. So if we go back to our $10 a month subscription, you might think, well, I can’t spend more than $10 a month acquiring this customer. My CAC needs to be below $10. But that’s not the case. Once you know that your LTV is $150, you know that you can spend more than just that one month subscription price.
So there are some universal benchmarks that companies use. So if you’re looking at LTV to CAC ratio, so lifetime value to customer acquisition costs, if you are in a ratio of three to 5X LTV to CAC, you are in a good to a very good position. So my ask to you is, if you don’t know what your LTV is right now, this should be one of the first things that when you go back to work that you ask someone within your sales or your marketing or organization, Hey, what’s our LTV? And they should know just off of the back of the hand, like, oh, and be able to tell you this.
Kevin Lewis:
LTV is obviously on the scale of your entire business relationship right through to the end. But there are also smaller periods that are often looked at monthly and annual recurring revenue. They’re kind of what they sound like, but we want to equip you with these terms because dependent on your organization’s age or maturity might not, they might not yet have a solid view on what that entire lifetime value looks like. And these numbers can be used as somewhat of a proxy to understanding what you can spend.
John Booth:
So understanding that the LTV and how you have an impact on that. So if we think about that, so as DevRel, what could that be? Well, it could be getting customers to use multiple products or increasing the usage of your product within a customer. It could be making your product stickier so that your customers stay around longer. DevRel, your teams have the opportunity to impact all three of these different areas. It could be supporting developers and the implementers in the beginning of a project. It could be increasing educational materials. So the important thing here is to, you likely have large projects that you want to fund, and these projects probably have timelines that span quarters or maybe even years. And thinking about those projects and how they’re going to impact your LTV might be exactly what you need to position those projects to make them more attractable and more likely to get funding.
Kevin Lewis:
So just to repeat, again, you don’t need to really obsess over these numbers, but you do need to understand roughly how they are derived and how your work positively and negatively impacts them. And the reason these particular metrics are really important is because when push comes to shove, you will be assessed against the performance of marketing and sales teams who use these very quite objective quantifiable numbers. And so we should be doing the same too. So there is at least a fair chance that our teams are assessed on the same merits. And all of this talk is predicated on the idea that you actually get credit when you do a good job. A good job is one that either makes the business money or saves the business money. So the final quick concept is attribution. From the very, very first time someone hears about your brand through to the end of your business relationship, people in your company are working to increase to support rather revenue. And that could be anything from sales calls, ad campaigns, webinars, but it is also strong documentation, events, community initiatives, and toolings. Your team and your company is well served by understanding what is having an impact along that customer journey. And in order to do that, you need tools and a practice of tracking the attribution.
John Booth:
So there are lots of tools that you can use to track attribution and different teams use different ones. Marketing teams often use HubSpot. Sales teams might use Salesforce. Common Room is another great tool to use. They’re here today. So we’re not here to tell you what tools to use, but what we do want you to understand is that today you company is attributing revenue to activities and it could be something as informal as your CEO’s gut feeling, and that is where the results are coming from. So it’s your job to understand how this is being calculated and use that understanding to go out and fund your projects.
Kevin Lewis:
You need to be a part of the conversation ultimately here to get a slice of the pie. And the pie tastes like keeping your job. And I quite want a slice of that pie, and I think you probably do as well.
John Booth:
So when Kevin joined the directives team, one of the first things that we started talking about was where he was going to focus. And he talked about his team working on these longer term views and longer, larger projects. And one of the first things I asked him was, well, what’s the impact on the CAC for our Directus customers and how does this translate to an improved or a greater LTV? And so we started spending time working on this and ultimately that was the genesis for the talk that we’re giving today.
Kevin Lewis:
We like to use this term, it’s all about the long term. We’ll see the results in the long term, and we know that in our hearts, but our companies don’t really care about that. Having an ICP and understanding your community ban means you are being intentional. And if you are intentional in the direction of revenue, you will positively impact the CAC and the LTV and that when the hard times come is what your companies actually care about.
John Booth:
We thank you for your time here today, and please remember, if you’re in the states and you’d like to plant native plants, come and see me afterwards.
Kevin Lewis:
Excellent. Thank you. Thank you. Alright. Alright.
Feu Morek:
Thank you so much for the talk. I think we have time for one or two questions if there’s anyone in the audience.
Audience member 1:
In very large organizations where this information can be sometimes obscured behind a lot of layers, do you have any advice on where to go or how to find that information?
John Booth:
I would say if we’re talking about large public institutions or enterprises,
Audience member 1:
Salesforce.
John Booth:
Salesforce, okay. So anyone within your finance team is going to know. Certainly your sales leadership will absolutely know your CACs and your LTVs and odds are your marketing team knows it as well because that’s what they’re using to justify their budget and spend.
Kevin Lewis:
You also only have to go up so many levels until you reach a peer at a senior enough level who has a much better insight. So it might not be that your director of dev VP Devra knows it, but their manager might or their manager might just have to keep marching up that chain until you get the numbers that you need.
Audience member 2:
Hello. So a part of the conversation that we have yesterday during the opening was about students and how sticky getting to students in an early stage was for their tools. So I wonder, talking about that, does getting to early stage developers increases their lifetime value? Or how do you measure that?
John Booth:
Personally? I think that you all are the key to the future of sales and marketing. And that’s why I was so excited to be here because it was in a slide presentation yesterday where someone said that developers are a part of the buying decision. And that is so true, and it’s the way that people are building things today. The earlier that you can get introduced to the people that are the builders, the better and the more opportunity they’ll have to then use your product. So I would say yes, that will increase the lifetime value of it. And I think it can even be in those projects that are the hobby projects, because as we saw yesterday, those are often those leading indicators to what is coming into the production environments. I don’t know if you have anything else to add.
Kevin Lewis:
All of this is, all of this working on people who aren’t going to pay off right now is a ratio thing. You can’t throw all your eggs in the basket. That doesn’t pay off for ages, otherwise no one will see return in a reasonable enough time and your initiative could be disbanded. I also believe that kind of building that trust in nice and early does build that loyalty that I imagine could positively impact LTV, but now you have something to measure against. Now you can say, given a sample of people who we haven’t spoken to as students and given a sample that does, are these people more likely to have an higher LTV and use that to justify long-term success? Unfortunately, that whole thing is obviously quite a long-term play, right? So it’s all about ratios. In the meantime.
