There's a lot of talk about the rapid changes facing marketing, and how marketers should become more social, data driven, aligned with revenues, and accountable. And there's a lot of merit in these recommendations. However, it's also important to separate the tactics from the strategy, align strategy with stakeholder objectives, pursue a plan that delivers the highest results first and keep in mind how Chief Marketing Officers (CMO) can provide the greatest value to the company. Having been a CMO and managed CMOs for more than a couple decades, here's my take on how marketing leaders and CMOs can rise to the occasion and deliver the strongest contribution to the company's top objectives.
A Threefold Approach to Maximize Stakeholder Interests and Marketing Value
Align Company and Customer
In this role your primary stakeholder is your customer.
The rapid rise of social media requires businesses to transition from product-centric to customer-centric organizations. Customers can and do call out non-responsive companies in public venues with comments or rants which reach thousands or millions and have a durability of quarters or years. Simply speaking to customers, and not with customers, will negatively impact new customer acquisitions and existing customer affinity. But on the flip side, customers want to align with their favorite brands and will evangelize and reward those suppliers that engage them and deliver products or services that meet their needs.
Companies are adopting changes in technology, but changing culture is much more difficult. Voice of the customer (VOC) tools are plentiful and CRM has transitioned into social CRM, which really just means that CRM technology has evolved from customer data management to engaging customers in a dialogue for mutually beneficial purposes.
Customers are not homogenous and will have to be identified by persona and accurately segmented to understand and respond to their objectives. And customers are not just those who purchase your products but also include industry influencers, social advocates, referrers, and media which your customers subscribe to.
Smart CMOs will most certainly leverage data and technology to identify profitable customer relationships, changing trends or supplement company transactional data with social and other data in order to better understand their customers' wants and needs.
The CMO is in prime position to sponsor and refocus the company culturally from the all too common inside-out thinking to the outside-in thinking that is now an unmistakable mandate. The CMO is the point person to research and deliver data driven analysis such as top customer buy criterion to the CEO so that the company can better align its resources and solutions with customer objectives. From here, the CMO can create the messaging to enhance the brand and the buyer journey maps to position the company's products in ways that will be more enthusiastically received by customers.
Deliver the Volume and Quality of Leads Needed to Achieve Revenue Goals
In this role your primary stakeholder is the salesforce, and while sales and marketing share a symbiotic relationship, marketers should not lose sight that the sales team is their customer and sales and marketing alignment usually needs a lot of improvement.
The goal is not to deliver 'more leads' or 'lots of leads', but instead to deliver the exact number of leads at an agreed upon cost per lead to achieve a slated revenue target. You have to start with the end goal to be successful. With management’s revenue target, work backwards through the lead-to-customer conversion model in order to calculate the volume of leads needed.
It's a complex model because as the volume of needed leads rises, so does the cost per lead, so as the CMO you need to demonstrate that relationship and find your company's equilibrium point. If you don't already have the history to show lead volumes and qualities derived from various marketing programs, and how those leads traverse through the pipe, this goal will be a work-in-process as you develop your programs and learn your metrics.
And while generating sales-ready leads for the sales team is always a top mandate, the use of less than obvious strategies, methods and technologies separate top marketers from the rest of the pack.
Marketing leaders must find the optimal integrated marketing mix of campaigns and programs across the demand generation execution model. This is a continuous journey which starts with a baseline, demonstrates continuous process improvement and where every small incremental gain delivers more top line revenues and ROMI.
In my own experience in the B2B technology space, it's become patently obvious that many traditional campaigns are giving way to more innovative, measurable and productive programs such as inbound marketing, content marketing, social marketing, digital marketing and influencer marketing. This doesn’t necessarily mean that events, trade shows, alliances and the programs that have become commonplace over many years should be disregarded entirely, but unless they can be integrated to add value with campaigns that acquire more qualified leads at a lower cost per lead, they should clearly be deprioritized in order to allocate limited marketing budget to the most productive campaigns.
Also, while campaigns targeted at net new customer acquisitions get the attention, it's generally a big mistake to ignore farming the existing customer base. Every marketers' strategy should have programs to retain and grow the customers they already have, and recover customers that have churned.
Lastly, too many marketers continue to send unqualified leads to the sales team, which exacerbates the all too prevalent breakdown between marketing and sales. In the B2B space, research consistently shows that about 25-30% of new leads are sales-ready when received, about 45-55% are not sales-ready when received but most will eventually become qualified, and about 25-30% of new leads are not sales-ready when received and never will be.
When marketers transfer unqualified leads to the sales team, they are effectively changing the sales role from lead verifier to lead qualifier, forcing sales to nurture unqualified leads one at a time, zapping sales productivity, and increasing the divide between sales and marketing. Marketers must instead automate lead nurturing processes to manage top of the funnel leads until they are objectively scored as sales-ready.
Integrate Marketing Art with Marketing Science
Now your stakeholder is the C-suite. Too many marketers justify their existence with activities that don’t directly correlate to revenues. The CEO doesn't care what your email conversion rate is or how many Likes your Facebook page has. Sure, these benchmarks matter and must be measured to improve campaign performance, but unless marketers are speaking the same language as the rest of the C-suite, they are not going to get a seat at the executive table.
If marketers expect to keep their budgets and their jobs they're well advised to tie their efforts to revenue performance accountability. To do this, they must align with sales (to be one team, not two teams), integrate the marketing and sales funnels, and demonstrate how precise changes to the marketing mix directly impact revenue achievements. They must first demonstrate how marketing performance achieves revenue visibility, and then revenue predictability.
This is an area where marketing software technology is needed to bring measurability and scale. Marketing software systems such as Adobe Marketing Cloud, HubSpot, and the Salesforce Marketing Cloud automate lead management processes (i.e., the tracking, acquisition, scoring, nurturing and transfer of sales-ready leads) and help bring visibility and metrics to the lead-to-customer conversion process. Like all technology, these systems must be preceded with solid strategy, but are specifically designed to enable the strategy I'm speaking of.
I have long suggested the strategy of an integrated revenue cycle to link marketing investments to revenue outcomes, empower management with the views, tools and levers to model and manipulate marketing input and forecast the cascading lead to customer conversions and impact to revenue, and bring science to what too many marketers believe is purely an art. I'm not suggesting that artful techniques such as creative copy are somehow belittled, but instead that they must be integrated into a measurable process.