The Four-Letter Marketing Formula That Pays You Back
Welcome to Week 2!
Last week, we learned why most startups’ marketing programs fail before they have a chance to get off the ground. This week, we’re learning how to lay a solid groundwork for developing a holistic marketing program that takes table stakes, your industry, and the stage of your business into account. Get ready for one of my favorite marketing theories to discuss: the PESO model!
LET’S GO →
PESO stands for paid, earned, shared, and owned. It’s a way to categorize every marketing channel into one of four buckets and to understand how they work together.
Here is the one-line version of each:
P = Paid: Channels you pay for. Ads, search, affiliates. Fast, but expensive.
E = Earned: Validation that you have worked for. PR, word-of-mouth, reviews. Slow to build, but powerful.
S = Shared: The social layer. Where communities engage with your brand. Organic reach plus amplification.
O = Owned: The foundation you control. Your website, blog, and email list.
The magic is not in any single channel; rather, it’s in the compounding effect when all four work together. Paid drives traffic to your owned content. Owned content earns you PR and reviews. Earned credibility fuels your shared social presence. And the cycle continues.
The Rule Most Startups Break
Many early-stage companies jump straight to paid because it is fast and measurable. The problem? Paid media amplifies what already exists. If your owned foundation is weak and lacks a strong blog, an email list, and a clear value proposition, you are paying to send people to a leaky bucket.
Instead, build the foundation first.
The full blog post this week goes deep on how each PESO layer works, with a real-world SaaS example of all four channels compounding.
Action of the Week
Review your current marketing activities and assign each to a PESO bucket. If everything lands in one or two buckets, that’s your gap. A balanced PESO mix is the difference between a one-time traffic spike and a self-sustaining growth engine.
In Part 3, we will break down each of the 8 core marketing channels and give you a one-line verdict on which ones make sense for an early-stage SaaS or tech company.