Answer Engine Optimization & PR's Return

If you feel like your pipeline is broken, your CAC is bloated, and your dashboards are lying to you… you’re FAR from the only one. 

Joining the show are the Metrics Brothers, Ray Rike and Dave Kellogg! Ray is the Founder & Chief Evangelism Officer of Benchmarkit, Host of Metrics That Measure Up, a Founding Member of the SaaS Metrics Standards Board, and is an LP at Stage 2 Capital.

Dave co-hosts The Metrics Brothers Podcast, writes the incomparable ‘Kellblog’, and is an EIR at Balderton Capital.

Dave and Ray join co-hosts Matt Amundson and Craig Rosenberg to discuss the importance of brand investment in the AI age, overcoming the pipeline generation crisis in B2B SaaS, and how GTM leaders can drain the “metrics swamp.”

Plus, Dave divulges which SaaS metrics he finds loathsome and Ray shares his unique method for calculating Marketing CAC.

Also, Craig airs an ambrosia-related grievance, Matt unveils an old school tactic he’s still using, and Producer Sam falsely announces an exclusive scoop on The Transaction. 

Critical Takeaways

• Treat answer engine optimization (AEO) as a real channel, not a buzzword. As answer engines and generative AI search tools aggregate from dozens of sources but surface only a few. Meaning that you either show up in the top 2-3 responses or you effectively disappear. Teams should build use-case-level content, distribute it widely, and make it novel enough that answer engines want to quote it, while also building their own audience (newsletter, podcast, communities) so they’re not fully dependent on Google’s (or ChatGPT’s) algorithm.
• Inbound hand-raisers are a much better primary brand KPI than ‘share of voice’ measurements. Watch what percent of qualified pipeline and new ARR comes from inbound hand-raisers. GTM leaders should explicitly target a higher share of pipeline from inbound, track its close rates and ACVs versus outbound, and use that to justify continued brand and content investment.
• Focus more on the number of opportunities and cost per opportunity, not just total pipe. Revenue teams should watch both volume and dollars by source, so they can see, for example, whether brand-driven inbound is generating fewer but much better-quality opportunities and adjust their mix and SLAs accordingly.
• If you want overall efficiency, use Marketing CAC (sales + marketing over new ARR); if you want to compare programs, use pipeline generated divided by demand-gen program spend only. GTM leaders should keep CAC reserved for the full go-to-market machine, then use pipe-to-spend for campaign and channel decisions, excluding fixed headcount so they understand the ROI of the next incremental dollar.
• Sales and marketing leaders must acknowledge the current “pipeline crisis” in B2B SaaS, characterized by insufficient pipeline coverage and declining efficiency. Teams should track both the volume and cost of pipeline generated, and forecast pipeline coverage across all sources (marketing, SDRs, alliances, PLG, etc.) early and often.
• Aligning on metrics is a long-term, iterative process that requires persistence and cross-functional buy-in. 

Chapters

00:00 Episode Preview

01:48 Introducing Ray Rike and Dave Kellogg, The Metrics Brothers

05:40 How GTM Leaders can Escape from their ‘Dashboard Hell’

11:08 Which Metrics Matter to Your Board

18:37 Overcoming The B2B SaaS Pipeline Crisis

24:38 The Difference Between Search Engine Optimization & Answer Engine Optimization

29:52 Why Brand Still Matters in the age of AI & How to Measure Brand

45:21 Why B2B Marketers Need to Measure both Opportunity Count & Cost Per Opportunity

47:38 Why Pipeline Coverage Ratio is so Critical for B2B SaaS Startups

51:21 Examining Tantalus & The Cultural Impact of Ambrosia in All of Its Forms

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Epic Quotes

• “The faster growing companies actually are spending more on brand than on demand.” - Ray Rike
• “ My least favorite SaaS metric? Rolling four-quarter pipeline.” - Dave Kellogg
• “ Branding is marketing without a call to action.” - Dave Kellogg

Connect with Ray & Dave

• Ray’s LinkedIn: https://www.linkedin.com/in/rayrike/ 
• Dave’s LinkedIn: https://www.linkedin.com/in/kelloggdave/ 
• The Metrics Brother Podcast: https://podcasts.apple.com/us/podcast/the-metrics-brothers-fka-saas-talk/id1687214133 
• Metrics that Measure Up Podcast: https://podcasts.apple.com/us/podcast/metrics-that-measure-up/id1525571613 
• Benchmarkit Website: https://www.benchmarkit.ai/ 
• Dave’s Blog: https://kellblog.com/ 
• Balderton Capital: https://www.balderton.com/ 

Shoutouts

• Ray’s first Episode on The Transaction: https://open.substack.com/pub/thetransaction/p/harnessing-the-magic-of-metrics-with 
• Avinash Kaushik: https://www.linkedin.com/in/akaushik/ 
• Avinash’s Newsletter: https://www.kaushik.net/avinash/marketing-analytics-intersect-newsletter/ 
• Avinash’s SEO vs AEO article: https://www.kaushik.net/avinash/ai-age-marketing-bye-seo-hello-aeo/ 
• Omar Akhtar: https://www.linkedin.com/in/omarbilalakhtar/ 
• Benchmarker: https://www.benchmarkerdata.com/ 
• Exit Five: https://www.exitfive.com/ 
• Our Episode with Dave Gerhardt: https://open.substack.com/pub/thetransaction/p/ai-idea-starters-influencers-and 
• Carilu Dietrich: https://www.linkedin.com/in/cariludietrich/ 
• Our Episode with Carilu: https://open.substack.com/pub/thetransaction/p/advisor-avengers-assembling-your 
• Jon Miller: https://www.linkedin.com/in/jonmiller2/ 
• Our Episode with Jon: https://open.substack.com/pub/thetransaction/p/building-trust-and-reputation-in 
• Udi Ledergor: https://www.linkedin.com/in/udiledergor/ 
• Bill Macaitis: