Creating a Profit-Center Marketing Department – An Interview with Matt Heinz (Part 1)

In this episode of the Rethink Podcast, Act-On CMO Michelle Huff interviews Matt Heinz about building a profit-center marketing department. As Matt says, you can’t buy a beer with an MQL, but you can with a closed deal.

Matt is president and founder of Heinz Marketing, a B2B marketing and sales acceleration firm. Matt is often recognized as among the Top 50 Most Influential People in Sales Lead Management and among the Top 50 Sales & Marketing Influencers.

This is Part 1 of their conversation. Matt discusses operational versus business metrics, sales and marketing alignment, the buyer’s journey, benefits versus features, and marketing tactics.

This transcript has been edited for length. To get the full measure, listen to the podcast.

Marketing’s Operational Metrics vs. Business Metrics

Michelle Huff:

Matt, for those of us who aren’t familiar with you, maybe you can spend a few minutes on who you are and who is Heinz Marketing.


For those of you who don’t know Heinz Marketing, we are a B2B sales and marketing consulting firm. I tend to describe us as ‘sales pipeline people,’ even though we really are working primarily in the marketing side. We’re working with companies that want to grow their business, want to increase the sales output of their sales and marketing efforts.

We think a lot in terms of creating profit-center marketing departments, helping marketers be measured based on the sales and revenue and business output of what they’re doing, as opposed to the traditional operational measures like open rates, and click rates, and even MQLs that a lot of companies are rightly focused on. But at the end of the day you can’t buy a beer with an MQL. You can buy a beer with a closed deal. And so the more we can help marketers align behind metrics you can buy a beer with ‒ and ideally how that changes the way they operationalize and prioritize our efforts ‒ the better.


If someone’s trying to shift how they’re perceived and viewed, how do you really do that? What would be that first step to be moving toward being a profit-centered marketing organization?


Well, there are a couple things. First, you have to understand that your job in marketing is the same as the sales team. The sales team may be sitting at the table when the prospect signs on the line that is dotted. But marketing needs to be responsible for the same metrics. And when you can align and prioritize what you’re doing based on the right outcome, it starts to align the metrics you’re focused on and need to be focused on as well. There’s a big difference between your operational metrics and your business metrics.

A lot of marketers stop at the operational side. You look at the dashboard for most marketers, and it talks about open rates, and click rates, and social engagement ‒ and that’s all fine and good. It’s all important. But the business does not think that marketing’s job is to squeeze more value out of Facebook ads or get a higher open rate. I think to know that your job in marketing is to drive revenue, and to then start to report on metrics that matter, metrics that your CFO will easily recognize as business metrics … If you have to teach your CFO and CEO what your dashboard means, what your acronyms are, that’s probably a sign that that’s an operational dashboard that you mostly keep to yourself and use to manage and improve your marketing. The executive dashboard you take to the C-suite needs to be metrics they already care about.

Sales and Marketing Alignment


I agree. It’s that everyone should really understand their impact, not just on leads generated, but how they’re contributing to the business and to the revenue. And it’s interesting that when my heads of sales and I talk about it, he says it’s not the sales pipeline, it’s our pipeline. It’s marketing and sales. And, I guess from your point of view, when you provide a lot of insight to other organizations, you really think about it as shared. You always hear about this dilemma of sales versus marketing, when it really shouldn’t be one versus the other. What do you think contributes to that? And how do people get toward alignment and practice not just in spoken words?


Well look, I’m a lifetime marketer. I’ll be the first to say, this is our fault. We have perpetuated this perspective from sales that says, no matter what you say, no matter what you do, marketing, we know that at the end of the month, at the end of the quarter, we are on our own. I say this as a joke, but it’s a true story. Sales, at the end of the month and end of the quarter, is out grinding it out trying to close a number, trying to get deals across the table; meanwhile, marketing’s already at the bar celebrating that they met their goal for the quarter. And I wish that was a joke, but that’s an actual true story from a company that shall go nameless.

I think we have trained the organization to think that we care about things that are not metrics driven and not revenue driven. And we’ve trained the sales team to believe that they’re on their own. I’m not saying that marketers need to be paid on a commission basis, but for you to have the same metrics, at a minimum for marketers to start believing their job is not done when the lead is generated and the sales collateral is created. If you think about the late stages of the buying process and the sales process, and you start to think of the marketer: How do I impact that? How do I help the sales team be more efficient? How do I help the sales team be more effective at those late stages? What are the insights? What are the processes? What are the tools? What’s the content that can help get more of those deals across the line?

That’s where you start to get a real partnership between sales and marketing, where you put egos aside, and you put traditional lines aside, and you say we are a coordinated, integrated team reinventing how sales and marketing is done, such that it isn’t a pass-off of leads, it’s a partnership through the entire buying journey.


That really speaks to me. And there’s a lot of my background that’s from a product-marketing standpoint, where it’s a little bit of enabling and helping toward the later stages of the funnel. And there’s kind of this dilemma sometimes where it could be marketing throwing things over the wall and seeing if anyone’s there to catch them. What are some things that people need to do from a marketing standpoint, and programs, and actual advice to the people who are wanting to not just throw it over the wall, but to take it forward through the rest of the funnel? What are some programs they should put in place, or tools, or what have you seen that works?


I’d say there are three foundational elements I find really, really important for marketers to really nail this. And these are things anyone in the organization can drive, but I think for marketing to drive them, it starts to demonstrate and be a proof of the concept that marketing really cares about driving revenue and changing the way they operate.

Number one is just knowing what the right metrics are, having one spreadsheet that defines what sales numbers need to be hit and what marketing and pipeline input needs to go into that. I’ve seen a lot of marketing organizations that have an MQL goal. But that number has nothing to do with the sales number. This should be one simple spreadsheet. How many deals need to be closed? How big a pipeline do you need to get there? How many qualified leads need to go into that? It’s basically three numbers. And those need to align with an understood or an accepted or a perceived conversion rate that you can use as a baseline and then it can improve. But you start with that single spreadsheet. That’s one.

Two is to have agreed-upon definitions of leads and opportunities at different stages. What is a qualified lead? What is a qualified opportunity? Not only so you’ve got commonality between how sales and marketing think about that, but to ensure that everyone then in sales is thinking the same way so that there’s accuracy in your forecast, in your pipeline.

And third is to have a common understanding of the target audience, both from a company standpoint and from an individual decision-maker standpoint. Your target audience, whether you’re doing ABM, account based marketing, or not, understanding who you’re going after and why. Which companies should you be selling to? What are the demographic, firmographic details of companies that are in your purview? But then what are the individual characteristics that make some of those companies potential early adopters, that make them more likely to engage with your value proposition?

And then further, who are the people in that company that make up the buying committee? The CEB now says that the typical B2B sale involves 6.8 people inside the company to make a decision. And so if we treat the company as a unit, or if we think there’s one decision maker that we want to talk to, whether that’s the senior person or whoever, then we’re ignoring and failing to align behind the reality of the consensus building that happens inside companies that make group decisions today.

So at the risk of belaboring the point, the three things are: having the right metrics and a common set of metrics, having the right definitions and nomenclature between sales and marketing, and then really identifying the corporate and individual targets you’re going after. And there is all kinds of operational and execution and campaign work beyond that, but those become far more efficient and far more aligned if you’ve got those three things in place first.

The Buyer’s Journey


You’re speaking of the buyer’s journey; what’s your take on the 6.8 people? Do you think of a different journey for all the different people? How do you think about content marketing within that context?


I still think a lot about the SiriusDecisions model where they’ve got six stages. And stage one for them is challenging the status quo, getting someone to think a little differently. It’s a very challenger type notion, like getting someone to [think about] the problem they did or didn’t know that they have. And then stage two of that buying journey with SiriusDecisions is to commit to change. It’s one thing to say, ‘Well, you’ve helped me think differently about the world I live in.’ And it’s another thing to say, ‘It’s important enough and it’s urgent enough for me to do something about it.’

I tend to think there’s a stage zero. Maybe it’s the first stage, maybe it’s stage zero. And that is attention. What can you do to get and earn and keep that prospect’s attention? And all three of those stages, by the way, have nothing to do with what you’re selling. It has nothing to do with your product or service. It has to do with the prospect, what they care about, what they’re interested in. That attention stage, it might have nothing to do with the industry they’re in. Someone wants to come talk to me about raising backyard chickens, I’m all over it. I can tell you all the things I say, like on certain days don’t let them out because the coyotes might come get them. I could go on for a while about that one. We used to have seven chickens, now we have five. The reason: coyotes.

People that come and want to talk about chickens are going to get some of my time. Does that mean that I’m going to sign a PO on that day? No. But now there’s some attention building there. Understanding our humanity, our interests, our personalities, as a way of getting into that buying journey conversation is interesting. I think also you mentioned the buying committee. Understanding the roles people have is important: Who are the decision makers? Who are the stakeholders? Who are the influencers, and what part do they have to play in the process? Too many sales people want to go immediately to the decision maker. And too many times today that decision maker is just delegating research and delegating decisions to other people in the organization.

Your ability outside the organization as a seller to drive influence with that decision maker will always pale in comparison to that internal buying committee, building and creating consensus, and then them going upstream to say, ‘We all believe we need this.’ That is always going to be more powerful. It’s harder, but if you try to swim upstream against the way companies are making decisions today, you’re going to be frustrated.

Benefits vs. Features


You’re often quoted saying, ‘sell the hole, not the drill.’ Can you expand on that?


Earlier today someone on LinkedIn sent me a little direct message and said, ‘Hey, I’ve got this service. Here’s what it does ‒ do you want to learn more?’ And maybe I was just feeling cheeky after lunch, but I’m like, ‘Okay, what’s in it for me?’ And she wrote back and said, ‘Well, you get these benefits.’ I’m like, ‘Well, I know ‒ I get that ‒ but why do I need that? Why am I spending time on this conversation?’ But I just wanted to see if she could peel back the onion and say, ‘Why is this important? Why is this important? Why is this important?’

Literally, you hear some people say, you’ve got to ask three-to-five ‘whys’ before you get to the real reason. And that reason ‒ we talked about that commitment to change that SiriusDecisions uses ‒ that commitment to change is the foundation of the sales process. It becomes the sense of urgency that keeps your prospect engaged. It’s what allows you as a sales person, in the challenger nomenclature to take control, to be a little pushy. You are not advocating for your sale. You’re advocating for the customer’s objectives. And because you’ve identified that and because you’ve agreed on that together that something’s important, and for what reason, and based on what outcome, and if you don’t do it, with what opportunity cost? When you’ve got all those enumerated, and ideally quantified, now you’ve got something.

Your ability to come around and provide a solution to that problem, to provide a bridge between need and outcome ‒ the hard part of the sale is done. The hard part of the sale is convincing someone of the problem and getting someone to commit to change; that is the heart of the sale. And what’s exciting to me as a marketer is that marketing can drive that entire process. The hardest part of the sales process is completely within marketing’s purview to maintain and manage. It’s exciting.

Marketing Tactics


What tactics do you see working best? Is that typically a content marketing thing? Is it physically an inbound thing? How do you think about addressing that from a marketing standpoint?


Well the beautiful thing is that if you’ve got the right approach, if you’ve got the right message, the channel you use needs to align with who you’re targeting and what they tend to want to engage with. I’ve talked to a lot of folks who are selling an enterprise at Salesforce. And oftentimes when I’ll say, ‘What are the best channels to reach your enterprise targets, your C-level enterprise targets?’ the answer I hear is it’s not direct mail, it’s not email, and it’s not Twitter ‒ it’s dinners.

Go into a market you care about, find a great place to eat, a great meal, some great wine, and invite 30, 40 people in the room ‒ 70 percent prospects, 30 percent customers and partners ‒ and have an agenda, have things you want to talk about. But do not bring out the projector, do not pitch; have an interesting conversation with people that are birds of a feather, that can learn from each other. You network with some peers and you get some good wine. Plenty of time to have the business conversation later, but you set the foundation, you get the attention. And ideally in that dinner you’ve got their attention, you’ve done a little bit status quo challenging, and then you can take things from there.

Now that doesn’t scale. You’ve got a bunch of system administrators, or, if you’re trying to sell Dreamforce tickets, you’re not going to take everyone to the best place in town just to get a Dreamforce registration. You’ve got to understand the economics of your sales process and what it’s worth to get someone in the door. But I think the tactical opportunities, the channel opportunities to marketers are wide open right now.

What if you were to increase the cost and time and attention it took to get people into the pipeline, but you were doing that in a category or in a vertical or with certain attributes of prospects that led to triple the lifetime value of those signed deals versus others you had before? What do you really care about? Do you care about cost per leads? Or do you care about lifetime value, and profitability, and margin for the business? I’ll guarantee that if you go to your CFO’s office, your CFO doesn’t care about the MQL.

Stay tuned for Part 2 of Matt’s interview with Michelle.