As a follow up to yesterday’s post 5 Things for Every SaaS Founder, the comment about “90% marketing, 10% product” has elicited a good deal of feedback. I do believe the 90/10 ratio is directionally correct, if a bit exaggerated. Marketing in this author’s example really means sales and marketing (in her case a self-service SaaS product that’s all marketing driven vs other SaaS products that require marketing and sales people to sell it).
Here are a few thoughts on the idea of sales and marketing significantly outweighing product:
- Product is 100x more important than marketing when seeking product/market fit
- 3:1 is a common ratio for customer acquisition spend to engineering
- Product-driven entrepreneurs tend to underspend on sales and marketing (see Product or Sales Startup CEO)
- Marketing is often tougher than product because results take longer to achieve and are more hit or miss
The number one reason startups fail is that they run out of cash. The number two reason startups fail is that they don’t aquire enough customers — entrepreneurs need to understand the importance of sales and marketing.
What else? What are some more thoughts on sales and marketing being significantly more costly and time intensive compared to product development?