Connect B2B Marketing to Revenue!

This is the first in a series of posts of tying B2B marketing result to revenue.  This is the framework for the discussion on how marketing drives revenue for their enterprise organization.

A key aspect for business to business marketing to focus on is delivering activity (sales qualified leads or sales ready leads) that close to actual revenue – ‘revenue’ is language the head of sales, CEO, CFO, and board of directors understand.

But what do I measure as someone in a B2B marketing organization?

Too often, marketing teams and leaders measure their internal impact for the sake of measuring and are not making the direct connection from their activities to revenue either by channel type or geographic region.  Some call it ‘activity’ vs. ‘impact’.  Measuring followers on Twitter, Facebook fans, webviews, etc. while impressive to those in marketing really have no true tie to what non-marketers truly understand – the contribution to revenue.  This is what drives business!

Let’s take an explicit example.  The contribution marketing makes can vary widely by the type of company and it’s distribution channels.  I’ve been involved with companies that marketing has sourced 16% of annual contract value and have seen other companies, particularly SaaS companies sourcing beyond 50% of revenue through their marketing activity.  Benchmark companies like Forrester and SiriusDecisions also have similar percentage contributions for enterprise companies – your percentage will vary on company type, geography, and buying cycle characteristics.

Look for this trend to continue of more revenue getting sourced through marketing – prospects today are spending more time in online communities or researching online their needs before engaging with sales organizations.

To do this kind of measuring, automation fundamentals need to be in place (Eloqua, Marketo, Aprimo), processes need to be installed, and an executive agreement needs to be discussed on outcome.  Our next posting will dig into key steps on how we will tie revenue to results in these areas!

http://www.alphainventions.com/

Revenue Traction = Sales+Marketing Alignment

To maximize a company’s revenue result and customer experience, B2B Sales and Marketing teams need to align around similar objectives.  Recent trends point to both sales and marketing are getting increased scrutiny for the following reasons:

1. Suspect to prospect to deal close time has increased significantly these last two quarters compared to quarters past due to the economy.
2. ROI is demanded in all investments – Marketing is an investment (typically 5-7% of revenues of B2B companies >$500M  – or expenditure if you are a CFO  )

In most B2B companies that are $50M+ in revenue size, there are typically separate heads of marketing and sales, thus leading to an increased chance that marketing is disconnected from the sales process, sales people, or customers.   Consequently, marketing could celebrate their own ‘lead quantity’ which is handed off to sales versus the actual impact marketing makes on actual revenue.  So what approach could sales and marketing better work with one another in this economic environment?

• A pipeline commitment: Marketing needs to take a more active role getting involved with the traditional sales pipeline.  With better sales pipeline visibility (ala Salesforce.com), marketing needs to create the right programs to accelerate deals in the later stages of the pipeline.  Specifically, competitive positioning talking points to best arm the sales organization, references of positive customers, or business case tools (Alinean, Mindseye Analytics) that help meet net new objections in the latter part of the selling cycles.

• A Marketing SLA (service level agreement) between the head of sales who is the primary internal customer and her marketing counterpart, initiated by the marketing leader:  Sales should demand lead quality SLA—how many leads and under what conditions are a lead considered a keeper by a sales organization?

• Deal autopsy—figure out how deals become deals (both wins and the rare losses companies experience).  What programs are impacting the selling cycles, what messages, what ROI tools?  Once this feedback is gained, test drive what are the winning concepts with a prospect to calibrate feedback.  The resulting information becomes the genesys of a deal play book to help calibrate new sales efforts.

It’s all about sales and marketing effectiveness in our new economy!  What have you found effective to push your revenue cycles and why is that effective for you?

http://www.alphainventions.com/