I had the pleasure of hearing the keynote Andre Pino, principal analyst for Forrester Research, delivered at our recent Marketo User Summit, coining himself a “Recovering CMO” and giving insight into the changing dynamic for companies trying to achieve top-line growth. Having been in the trenches for a number of years, Pino acknowledges that, until now, marketers didn’t have the tools to monetize their efforts.
As Pino noted, the traditional gap between marketing automation and sales effectiveness has been wide, particularly in that marketing has been a low-visibility function difficult to measure quantitatively, whereas sales has obvious visibility and endgame. The criticism of marketing has been that it concentrated too much on lead generation without closing the deal, whereas sales demonstrates immediate, positive impact on revenue.
Indeed marketers have been forced to generate even more leads to compensate for sales cherry-picking among leads and not closing the sales, resulting in a vicious cycle. The wasted resources—leads and time specifically—coupled with missed revenue targets and ineffectiveness led to marketing’s value being questioned in the past. As a CEO, I can speak from experience when I say we are continually challenged to drive growth and revenue performance, and a perceived drain of resources and energy is the first casualty in the name of that objective.
Transforming Marketing to Revenue Performance
The key to transforming marketing, simply, is revenue. Moving from generating to managing demand is what will focus the marketing lens on what’s important. As Pino points out, following the continuum as it develops from lead to actual revenue is the only true way to integrate marketing and sales, and provide an accurate measurement of marketing’s impact and ROI.
Once processes, metrics, goals and especially actions have been focused on revenue performance, marketing and sales—and, most importantly, company goals—become aligned.
Defining the continuum from lead to revenue management inherently establishes goals and measures progress. As marketers we must use available tools to understand buying behavior, which will enable us to continue nurturing prospects not ready to buy and keep them in the pipeline.
These tools were unavailable previously, and marketing developed in a way that was more qualitatively focused and not outcome-oriented. Quantitative analysis informs strategy more effectively than perception, instinct and anecdotes. And as Pino pointed out, this analysis shows that event-driven initiatives that foster interactivity and response far out-produce the one-way campaigns of the past, and lead to measurable results in the form of delivered leads and customer retention and profitability.
Notably, marketing’s impact on revenue performance must be communicated to the CEO, the board and other stakeholders in the form of regular reports of results. By showing an interest in revenue and becoming a leader in Revenue Performance Management instead of a reluctant impetus, the CEO will take an interest in marketing.