Revenue: Both a Sales and Marketing Metric

Revenue: Both a Sales and Marketing Metric:

Twelve days ago I posted the following question on a LinkedIn discussion group. “Why do so many Marketing VPs refuse to have revenue on their goal sheets? Isn't this a necessary component for sales and marketing alignment?” I was surprised by the number (45 at last count), variety, and quality of comments. The comments can be summarized in 3 different positions: 1. Some people see Marketing as nothing more than a support organization for Sales, and easily outsourced. 2. Others pointed out the value and importance of strategic marketing roles, such as identifying target segments and positioning and differentiating the product or service. 3. The final group emphasized the impact of the internet and social media driving integration across the Marketing and Sales functions, along with the necessity of shared goals. Here are a few that illustrate some of the different perspectives expressed. 1. Organizations should stay separate in roles and accountability. A Government Sales Director from a major software vendor started it off with, “Marketing is merely a tool for Sales, i.e. they provide the collateral and materials to support sales. . . And so in the end, Marketing is and should merely be perceived as an outsourcing vendor or "consulting arm" even if within the organization." A CEO added, “Accountability and metrics are directly tied to responsibility and ability to control the result. Many, if not most, Marketing people do not have the ability to control a revenue figure because the process requires their "throwing the ball over the wall" to a peer in sales who is charged with closing deals. . .” The lack of value and respect these and several others have for the marketing function is eye opening. The idea that a CEO would expect one group to “throw it over the wall to a peer in sales, brought the following image to mind.

2. Then an independent marketing consultant pointed out that marketing has both a strategic and tactical role. “As someone who has run both Marketing and Sales, there seems to be a distinct lack of understanding of what the real role of Marketing is in any organization. It has both strategic and tactical roles. If run properly, it leads much of the organization in defining what the strategy is, what the most profitable opportunities are, . . what the priorities for the product development, service and geographical distribution organizations should be. Then there is the tactical role of managing the product life cycle from development through retirement, developing leads and building the brand, and defining the competitive differentiation needed in sales tools and positioning.”

Hurray!!

3. Internet and social media are forcing the integration of marketing and sales A V.P. of Sales pointed to the need for integration between Sales and Marketing and suggested using incentive compensation to drive this. “[T]he traditional separation of sales and marketing is dying. With the growing influence of the web, e-commerce and social media within the information-gathering and decision-making process for customers . . ., there is no room for a division between Sales & Marketing. If you want your Sales & Marketing teams to be working together to deliver the optimal offerings, services, and experiences to your customer base, having certain shared goals is really necessary. Yes, they may do different things to contribute to the end result, but those different elements must all work together seamlessly to deliver the experience and revenue results we desire." The role of marketing as a strategic partner to sales is still an uphill battle. Lead management and the marketing/sales connection is a major battle ground. In fact a study done in July 2011**, found that only 35% of the companies responding had a formal process for sales to provide feedback on the quality of the marketing leads. Roughly 2/3 are still throwing it over the wall. In our work with clients, we focus on making sure that the processes get put in place with ensure Sales is giving feedback about the quality of the leads and sales is following up on the leads in a timely manner. A final advice to marketing from one of the people who left an insightful comment, “Be accountable. This not only reduces the perceived ambiguity associated with Marketing, but will strengthen the critical connection between you and Sales.”

* Sales and Marketing Alignment: the New Power Couple, The Aberdeen Group 2011 **Source: ITSMA Online Survey: Lead Management, July 2011