CMO50 2016: #13 Andy Lark

  • Name Andy Lark
  • Title Chief marketing and business officer
  • Company Xero
  • Commenced role August 2015 (with Xero since Nov 2014)
  • Reporting Line CEO
  • Member of the Executive Team Yes
  • Marketing Function 162 marketing staff globally, 6 direct reports
  • Twitter @kiwilark
  • Industry Sector IT and telecommunications
  • 2015 ranking 3
  • Related

    Brand Post

    The key metric Andy Lark uses to demonstrate marketing’s effectiveness is new customer growth.

    “It’s that simple,” he tells CMO. “We grew our global customer base 51 per cent between 2015 and 2016, and that tells me our marketing strategy, and everything that goes along with it, is working.”

    One of the key strategies for Xero’s marketing team over the past 12 months has been to improve the way teams operate globally by employing marketing automation to increase engagement at scale. This has resulted in an always-on program that uses data on customers’ usage and behaviour of its accounting software products to identify segments within the customer base where marketing efforts would be most impactful.

    As an example, Lark points to Xero’s Discover Series, where the brand communicates key product features to improve customer engagement to two key customer segments: Active users, and those who aren’t.

    “If we know customers are using features, we can provide more targeted education. And if they aren’t, we can provide more messaging around their usefulness, how to get started and why they’re useful,” Lark explains. “Since it began, we’ve seen an 18 per cent conversion rate in downloading the Xero app.

    “We can then target relevant communications throughout the customer lifecycle to further drive product usage and expand the users’ capabilities in Xero. For instance, we could target that messaging to small businesses who hadn’t yet thought of cloud accounting with our above-the-line Xerogami campaign, which resulted in a 41.5 per cent year-on-year growth for direct/online channel trials.”

    This program has proven to have a direct impact on customer churn, which in turn has an impact on lifetime value of subscribers and ensures Xero continues to have a loyal and enthusiastic customer base, Lark says.

    It’s this mix of tech and creativity Lark hopes to keep fostering as a core attribute in the marketing function.

    “That mix of data, efficiency and creative thinking is hugely important and ultimately unstoppable in any industry,” he says.

    More from the CMO50 submission

    Empowered business thinking

    Several business initiatives outside of marketing are also helping drive significant change and growth in Xero. One is continuing to drive in-system growth across the accountant and bookkeeper partner channel as part of a vital strategic initiative that helps accelerate customer acquisition rates.

    “Accountants and bookkeepers are a hugely important sales channel for small businesses as their trusted advisors, and we ensure we keep the partner channel at the heart of our outreach to the market,” Lark states in his submission. “We do this by driving our use of marketing automation to increase the viral effects of Xero adoption across product, the personalised partner journey, on-boarding, and trial to customer automation.

    “We also look to grow the love of the Xero brand by expanding our partner community through affiliate referral marketing and a ‘switchers’ program from competitors. This form of marketing is working across sales, product, partner and infrastructure teams to help drive this change in the partner channel.”

    In addition, Xero has been working to push platforms to create individual revenue streams from its ecosystem, driving value-added partnerships across strategic industry verticals. This includes the financial web, a concept Xero has driven over the past 12 months to connect small businesses with major global banks including Wells Fargo, Commonwealth Bank, National Australia Bank and Barclays.

    “By doing this, we can provide our small businesses and their accounting partners with greater value in what they do with their accounting data, and ensures that Xero becomes the system of record for all of our customers,” Lark says.

    Data- and technology-driven approach

    Like many marketers, Lark has optimised complete digital spend across the Xero platform to better determine and ensure effective marketing ROI across the entire customer journey.

    Across the brand’s owned channels, It recently replatformed on a modern, responsive platform that ties directly into the group’s marketing automation and CRM systems. The replatforming was a significant project that saw 80 per cent of traffic to serviced by the new marketing platform within three months of funding approval.

    “This has enabled us to better segment our prospective customers and create new experiences that drive conversion and decrease customer acquisition cost,” Lark says. “We have deployed new teams that create these experiences based on customer behaviours, and help to drive conversion through video, animation and audio marketing, enabling us to respond to changing customer behaviour.

    Marketing automation software is now being tied more deeply into Xero’s display channel to develop a new digital spend optimisation model, connecting to both Facebook and Google to optimise ads based on customer segments and where they are in the purchase flow.

    Since launch, the group has seen a 49.6 per cent year-on-year decrease in the acquisition cost of free trial signups through its display channel. The model is used by online sales teams to determine the most efficient and scalable digital campaigns, and to change tact accordingly as customer behaviours change, Lark says.

    Customer-led approach

    Lark says Xero has been a customer-focused business since its inception, seeking to change how small businesses and their advisors do their accounting in the cloud and solve the problems left by incumbent software providers.

    “We constantly listen to both our small business customers, and the accountants and bookkeepers who they work with, to ensure the features and products we develop for them meet their needs simply and more beautifully,” he explains. “Much of this customer feedback loop happens online in our forums, on our blog and through social media, however, we regularly hold customer roadshows in each of our core markets to better hear from them on what they want and need from their accounting software. That feedback then becomes a core part of our messaging and value propositions to customer segments.”

    Championing customers in all marketing, using videos, testimonials and case studies to ensure their voice is a core part of Xero’s storytelling model, Lark continues. These stories sit front-and-centre on online display advertising and are weaved through all marketing programs.

    He points out that on YouTube, Xero’s Best Business Apps series has collated more than 9300 minutes of view time, with an average 82 per cent completion rate. A video on Xero customer Petal Cupcakes also landed on the first page of YouTube organic results for the search term ‘best business apps’.

    Fostering team capabilities and agility

    One of the ways Xero is striving to keep staff skilled up and motivated is through a Marketing Bootcamp program. These are regular, one-hour sessions covering a range of topics, from ‘Fundamentals of a SaaS Business’ to a session on creating great marketing briefs. All marketing teams are invited to participate, and each session is recorded and available for playback at a later stage should they not be able to attend.

    “This training program is fantastic for marketing starters at Xero as part of their induction but also ensures existing staff are constantly on their toes in what is a constantly changing marketing landscape,” Lark says. “We want to build best-in-class marketing skills, and improve any deficiencies. This program helps increase overall marketing performance and campaign effectiveness across Xero. This is combined with employee communication tools like Yammer and Officevibe.

    “We also have a mentoring program to develop our future leaders, ensuring our talent is nurtured and we can continue to build the best skills we possibly can across the company,” Lark says.

    And the core of Xero’s marketing strategy is an effort to scale efficiently as it grows. “We’ve reached more than 700,000 customers in less than a decade, and as that growth trajectory continues, we want to scale our marketing efforts to ensure we don’t lose our touch,” Lark says.

    “To remain agile, we have implemented core marketing systems and platforms that help automate and scale our efforts efficiently as we grow.”


    Xero’s focus on enabling the small business economy means it’s constantly looking for ways to champion customers, Lark says. As an example of such creativity in action, he points to the marketing campaign in Australia called ‘Cloud Street’.

    Many of the small businesses who adopt Xero’s cloud-based accounting software do so because they are purely online, operating ecommerce stores without any bricks-and-mortar front, Lark says. To bring them to the fore, the brand decided to turn that upside down, opening a pop-up storefront in Melbourne in the busy lead-up to Christmas 2015 and inviting several select Xero customers to open their store each day.

    Industrial furniture designer, Holy Funk, beauty box subscription business, Bellabox, online florist, LVLY, underwear store, PocJox, and trinkets store, Homely Creatures, all joined in to sell their products for several days at a time. This provided an opportunity to reach new potential customers and have a feel for the impact that a physical presence can have on their business, Lark says.

    Over the course of the campaign, there were more than 9000 views to the Cloud Street campaign landing page, 2.5 million impressions across social media and more than 500,000 impressions across display advertising for the campaign. More than 98 per cent of chatter had positive sentiment across editorial and social media.

    “This creativity enables us to champion our most enthusiastic and loyal customers while providing an opportunity to amplify the Xero brand in public during a peak period,” Lark adds.

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