Revenue is the most important process in any company. Yet typically this process is split across separate sales and marketing departments.
As companies grow, this division can result in misalignments leading to lost revenue and increased costs.
McKinsey & Co. have found that 65% of buyers are frustrated by inconsistent experiences resulting from such misalignment. The expectation is set by the Swipe Left Economy – an insistence on an immediate response, or move on.
It’s the number one scaling problem growing companies have. So, let’s take a look at how you can align your sales and marketing to avoid this split.
Why align sales and marketing?
Almost every executive staff meeting I’ve been in has witnessed the unedifying spectacle of the marketing team blaming the sales team for cherry-picking leads, and the sales team blaming the marketing team for poor lead quality. Leads (sometimes dressed up as Marketing Qualified Leads – MQL’s) are ultimately nothing more than a waypoint in the overall sales funnel.
What ought to be a seamless process from the buyer’s perspective is fractured along an artificial division and handover. It’s artificial, since in many cases the marketing team can help push more deals over the line if they remain involved. It’s artificial as the sales team can help tune marketing campaigns to deliver the true output – revenue – rather than abstract leads.
This siloed approach becomes entrenched with cartoon caricatures of marketing as the “colouring-in department” and sales as the post-factual home of the unscrupulous.
The importance of aligning sales and marketing is not just about making sure everyone can play nicely together. The lead handoff causes confusion and delay as prospects getting conflicting information. Whilst this is seldom a problem for small companies where the marketing guy and the sales gal might sit side by side, as your company grows, organizational necessities start to fragment sales and marketing.
This is exacerbated as sales and marketing start to implement different systems, with additional integration costs and hassles. Growing companies face a step jump in systems/staffing in terms of the cost and usability of these systems designed for large enterprises. You find out the CRM system you bought to improve productivity now needs a full time administrator!
If customers don’t get the immediacy they require from a joined-up experience, they’ll move to a vendor that does, losing you revenue in the process. Significant costs are incurred and integration and adoption issues leave expensive systems under-utilized.
How do you align sales and marketing?
The strategy to fix is made up of 3 parts: Process, People, and Systems.
1. Revenue is a single process
The most important thing is to start by looking at how your customers buy, and drawing up a buying funnel. Whilst every industry will be different, there are two key points to bear in mind.
- There is no change of personnel or cadence as the buyer moves from the marketing to the sales part of the buying journey.
Paying for the solution is not the end of the project. Not even implementation is the end of the project. Only once implemented and bedded in can victory be declared. This means it’s not enough to align just sales and marketing, but support has to be included too.
2. Only metrics with a currency symbol count
Dollars and cents. Or Euros, Pounds – any currency really, but it needs to be revenue or cost – not a waypoint. The traditional way of evaluating the relative success of different campaigns with “leads” can be highly misleading.
As you can see in the chart below, the pink campaign is 50% better than the blue campaign for leads. But look at revenue and we see in fact the true situation is that the blue campaign is almost 5x the pink!
If you can’t take your metric to the bank, then it isn’t a metric you should be paying bonuses on. The other advantage is that now, all your bonuses are self-funding.
3. First touch, One touch resolution
There is nothing worse than being passed around from department to department, so instead make sure everyone is empowered with skills, systems and responsibility to respond to customer enquiries at the first touch. This means knowing the complete status and every communication. It’s a need to know basis, and everyone needs to know.
1. Get everyone customer facing (at least a little bit)
I had to tone this down from the usual way I explain it: “everyone now works in sales and marketing”, but it remains a fundamental truth regardless of the constraints of skill sets. If B2B social means anything, it means each and everyone of your employees is a brand ambassador, sales representative, and support agent, all in one.
But back to the “constraints of skill sets” – how do you encourage sales awareness amongst support agents for example? There is a great article here by Dave Grow (no pun intended!) of Lucidchart, about how he extracted and distilled his own sales expertise to then package in a form that his support staff could reliably use to generate sales opportunities.
2. Manage sales and marketing jointly
One of the least illuminating metrics is “how many leads did you get last month?” A far more useful approach is to look at those leads from a funnel perspective. How big were those opportunities? How fast did they move? Which ones are closable? Of those leads, which types of leads do we want more of? What do sales representatives think about these?
There is little point in reviewing leads without the sales team being present since you cannot evaluate the quality without their input. Remember, we’re not trying to get more leads. We’re trying to get more revenue.
3. Organize sales and marketing jointly
It’s traditional for the head of sales and head of marketing to both report directly to the CEO. But this then places the whole burden of alignment on the CEO. As we’ve seen, “alignment” means detailed execution in processes, systems, and people. The devil is in the detail, and often at a lower level than you’d expect a CEO to operate at.
An alternate approach to consider is to instead have what is in effect a Chief Revenue/Customer Officer – effectively making sales and marketing a single department. Job titles like “Officer” can appear a little grandiose in smaller companies, but the principal remains by bringing together these under a single head. This not only brings practical benefits, but also sends a strong message internally about the importance of alignment.
1. Operational layer for visibility & interoperability market-to-cash
Today, SaaS has become the new normal, but can be a confusing landscape with a variety of different tools. You can split a company’s systems in to 4 main elements – Product/Service delivery (for FedEx this is logistics, for Toyota, manufacturing), Sales & Marketing, Finance & Administration, and Office tools. The revenue process straddles S&M and F&A and needs to be combined into an operational layer.
Today, most sub £/$/€ 1000 B2B purchases, short circuit the traditional Purchase Order / Invoice route, and instead are directly charged to company credit cards. This brings finance and payment status right into Sales.
The purpose of an operational layer is to streamline the market-to-cash process. Practically speaking this means alerting sales when a payment is made, and alerting finance when a new customer signs up. Visibility and workflows are required right across marketing, sales, and finance.
2. Open API for integration without platform lock-in
Some vendors would have you buy everything from them, or promote a platform approach that locks you into the platform, even if you can swop out some of the partners. As business changes and you grow, it’s likely all your systems will need to adapt, evolve, and even change at some points. A key architectural concern is to avoid lock-in by having an open API approach. Steer clear of vendors who “upsell” on API access. What’s needed is an open API approach that puts you, not the vendor in the driving seat.
3. Consumer UX – adoption is critical
We’ve seen an increase in BYOA (Bring Your Own Application) as frustrated users abandon fin-de-siècle enterprise systems and instead pass company data and workflows through tools like DropBox, Google, and Evernote. These are designed with ease of use primarily, and it’s this that drives adoption.
The days of forms-based applications that require formal training are over. Whatever systems you employ, they can only be as effective as the use they get. That is 100% predicated on the user experience.
Anything that looks like hard to use will simply be left unused, and it’s the major cause of CRM implementation failure.
The Swipe Left Economy
Nobody wants a relationship with your company. They want results. They want one-day shipping, not for you to remember their birthday. The Swipe Left Economy places immediacy over intimacy.
B2B buying is changing, becoming more online, utilizing a broader range of inputs, and decreasing timescales. B2B is becoming consumerized and swipe left is the default behaviour at the first sign of friction.
Aligning Sales and Marketing is about making every touchpoint count, reducing your costs, and driving your revenues.