A Guide to Sales and Marketing Alignment

For most growth organizations, marketing has only one function, which is to attract, acquire, grow, retain and recover customers. If you consider this to be five functions, you risk creating a piecemeal marketing operation. Done correctly, they are joined steps in the customer life cycle continuum.

Of this five-step continuum, marketing can only control the first step. The last four steps require alignment with the sales organization. Sales and Marketing alignment defines a symbiotic relationship and orchestrated effort among the company's two top revenue contributors using shared strategies, integrated processes, common technologies and joint success measures. Sales and marketing are separate but synergistic and should be in lockstep to achieve the company's vital goal of revenue growth.

A Problem Worth Solving

The reason for this blog post is that most marketing and sales groups are misaligned.

In a Forrester survey and report titled Master The Mechanics of Analytics For Revenue Growth, only 30% of marketers believed marketing and sales goals are well aligned. Aberdeen research validates those findings and reports that "Over 80% of B2B organizations struggle with a lack of synergy between the sales and marketing functions." And to reinforce the consensus with one more analyst firm, a SiriusDecisions alignment and efficiency survey found that 58% of marketing and sales operations leaders rated their marketing and sales alignment as "poor."

This misalignment contributes to fewer leads, revenue leakage, longer sales cycles, smaller pipelines, lower sales win rates and overall revenue decline. According to IDC, "B2B companies' inability to align sales and marketing costs 10% or more of annual revenue."

Sometimes the problem stems from poor or distant relationships. In helping companies accelerate their revenue, I've been introduced to many organizations where there is an underlying sales and marketing cultural friction which stands in the way of cross-departmental reliance and cooperation. These are often the organizations where marketers suggest sales people are the guys who work the least and get paid the most, or sales people suggest the marketing staff are the people in the arts and crafts department.

Sometimes the problem stems from ill-defined roles and cross departmental contribution. The problem is exacerbated as sales and marketing often have near opposite activity and goal measurements. Marketing is often measured by activity as it is easy to report, while marketing results are hard to measure. In contrast, sales activity is hard to measure, but sales results (revenue) are easy to report.

Their objectives also have different time horizons. Sales is charged to focus on this month or quarter. Marketing is largely focused on next quarter and beyond.

Even their customer focus is different. Sales looks at customers individually, while marketing looks at them by segment.

When the two are not in sync and co-contributing to shared revenue objectives, neither are likely to be as successful and both are likely to become problem areas for the company.

Solving this problem delivers a large and sustainable payback.

The Payback

Marketing and sales alignment will most certainly reduce friction between cross-departmental staff and improve the customer experience across the customers' buy cycle. And while these goals are paramount, I recognize more measurable goals are needed to justify an investment with a forecastable payback.

Here are some research points that contribute to this justification.

SeriusDecisions advises that when sales and marketing are aligned, they achieve 24% faster growth and 27% faster profit growth over a three-year period.

MarketingProfs has also done significant research on this topic and reports that tightly-aligned sales and marketing organizations achieve 36% higher customer retention rates and 38% higher sales win rates.

The final perspective I’ll share comes from the Aberdeen Group research report titled, What's In It For Sales In Achieving Strong Alignment With Marketing, and demonstrated the measurable differences among aligned and misaligned marketing and sales organizations:

  • Aligned groups achieved 97% greater annual growth in team quota achievement (8.36% compared to 4.25%), and
  • Aligned groups achieved 3.4 times faster-moving sales cycles year-over-year (0.88 decrease compared to 0.26% increase).

A Proven Sales and Marketing Alignment Framework

Most sales and marketing leaders know they need alignment, but few have a proven process to make it happen. The Johnny Grow Marketing and Sales Alignment Framework is a 5-step process that has been used for more than a decade.

Sales and Marketing Alignment Steps


Alignment starts with joint planning. SeriusDecisions reports that "Only 14 percent of survey respondents reported that their organizations have integrated sales and marketing planning processes." Planning should begin by recognizing the other's performance measures and priorities. Clear recognition will uncover shared and inter-dependent goals. Once the goals are identified, each group can commit to a plan, budget, reporting and periodic review points.

Shared and co-dependent goals may also be reinforced with shared incentives. Collaboration and support are dramatically improved when marketing and sales incentive compensation are tied to mutual goals. In most situations it should be impossible for one to be successful and the other not, as that would suggest the two groups are not aligned to mutual success measures or the company's primary success measure (revenue).

Sales and Marketing Alignment Tasks

Integrated Revenue Funnel

Marketers normally manage a lead funnel that begins with new leads and concludes with the lead transfer to sales. Sales normally manages a funnel that begins with qualified leads and ends with sales wins or losses.

Merging the two departmental funnels into a single integrated revenue funnel creates a closed loop cycle that improves revenue velocity, visibility and predictability.

With an end to end integrated funnel, sales and marketing leaders can better measure, model and manipulate any factor in the cycle with a predictable result to conversions, customer additions and impact to top line revenue. In fact, only with an integrated revenue cycle in place, can managers truly understand how making a change anywhere in the lead-to-revenue process will impact revenue performance.

Sales Pipeline

An integrated funnel also identifies sales stages and conversion points. And while marketing will distribute leads to sales when those leads reach sales-ready scores, it's no longer a linear handoff that relieves one side from accountability or continued contribution.

When leads stall, even after the distribution to sales, marketing may recommend messaging, campaigns, offers or other engagement or action to induce those leads to reengage, or to recycle those leads that don't act and are otherwise over-stating the sales pipeline. An integrated pipeline permits either side to induce action when leads stall, conversions decline or velocity slows. However, a well-defined lead management process is needed to do this in a coordinated manner.


A Lead Management Process That Works

There's a lot to say about how to create an automated lead management process, so too skinny it down, here's the essential steps.

  1. Define or refine the lead management process. The process must show how leads progress through the integrated revenue funnel. The funnel stages and sequence must be clear. Sure, not all leads will traverse through each stage sequentially, but all leads must be tracked in stages so we can measure progress and induce action.
  2. Objectively define a sales-ready lead. Sales teams favor lead quality over quantity. The increased focus improves sales efficiency and win rates. Marketing must work with sales to mutually agree to a common definition for a sales-ready lead. The initial definition is only the starting point and should be updated periodically based on learning and results.
  3. Nurture unqualified leads. Most leads are researching. Forwarding unqualified leads to sales annoys the buyer, frustrates sales reps and contributes to the oft cited remark, "marketing leads suck." It also contributes to lead leakage, as sales attributes all leads to be of the same poor quality as the unqualified leads and therefore doesn't follow-up with all leads timely or at all. Nurture campaigns will cultivate leads with education and similar communication content until they become sales-ready.
  4. Consider a Sales Development Representative (SDR) qualification confirmation. Sometimes called Inside Sales, these people identify, qualify or confirm leads. They engage leads in telephone conversations and provide the human verification that a lead scored as sales-ready is really sales-ready and should be forwarded to a sales person for sales cycle pursuit that leads to closure. SDRs dramatically improve lead quality and alignment. The SDR team can report to marketing or to sales.
  5. Only forward sales-ready leads to sales. Nurture campaigns will identify when a lead is sales-ready pursuant to an engagement score. Use lead scoring to trigger the automatic lead distribution from marketing to sales. Lead scoring will result in passing fewer, more qualified leads to sales. When sales people focus their time on the most qualified sale opportunities, sales productivity and win rates go up. Here's some recommendations for lead scoring best practices and lead distribution best practices.
  6. Support the lead management process with a Service Level Agreement (SLA). SiriusDecisions reports that only 43% of survey respondents have lead management SLAs in place, and only 11% reported having jointly managed SLAs. An effective lead management process requires governance. At the minimum, lead management SLAs should require marketing to enforce the quality of leads they forward to sales, and sales to enforce the timely and systemic follow-through of leads received. SLAs should also require that leads forwarded to sales are returned to marketing for continued nurturing if the leads fail to engage or become sale opportunities within a designated time period, or if they stall anywhere in the sales cycle.The number 1 reason SLAs fail is lack of enforcement. The number 2 reason is trying to enforce too much too quickly. An SLA best practice is to start small with only a few SLA metrics (lead quality, lead follow-through, lead recycling) in a limited pilot approach. It's important to clearly state the intended benefits which support the SLA program, begin with education and training for the pilot participants, and frequently review progress and reporting. Measurable results will then drive wider adoption.
  7. Coordinate technology enablement. Technology alignment and data governance are needed to automate agreed upon processes and deliver information reporting. Marketing's Lead system of record is the marketing automation software (MAS). Sales customer system of record is the Customer Relationship Management (CRM) system, or more specifically the Sales Force Automation (SFA) module. Syncing the two systems is simple. The issues that will challenge alignment are related to process and data governance, such as the assignment of survivorship rules. For example, if the sales person updated an account's address in the SFA, and a new marketing list updates the same account's address in the MAS, which system prevails? In this case, it's more likely the SFA prevails, but there are many updates between synchronized systems that should be considered. It is also important to assign data stewards who will be responsible for data quality, updates and purging.
  8. Implement closed-loop reporting. Analytics provide a trust but verify approach to marketing and sales accountability and co-contribution. Sales and marketing measures should deemphasize activity-based metrics and align on the measures that most directly impact revenue performance. Marketing will still need tactical campaign, conversion and similar metrics; however, these must be extrapolated to sales priorities to show direct revenue contribution value. Marketing metrics that don't directly link or correlate to revenue contribution should be deprioritized and confined to the marketing department.
  9. Perform frequent periodic reviews. Periodic joint reviews remove impediments, fix problems, adjust priorities and drive continuous process improvement. At a more tactical level they are needed to refine or adjust the definition of a sales-ready lead; review SLA compliance and take action on deviations; review revenue cycle health, conversions and velocity and collaborate on improvement recommendations; measure progress of inter-dependent and shared goals; and identify and resolve other lead management gaps or exceptions. Joint reviews should adhere to a cadence and include marketing and sales leadership. I normally recommend these reviews occur weekly for quick triage and monthly for long-term continuous improvement. I've found it to be very helpful for sales and marketing leadership to schedule some of these joint reviews out of the office and in an informal setting to aid both performance improvement and relationship building.

Sales’ Contribution (aka What Marketing Wants from Sales)

Being a good partner requires knowing what the other half expects from the relationship. Here's what marketing wants from sales.

  • A thorough understanding of sales' goals. Not just the period-end target number, but the methods or mechanics of how sales plans to reach its goals.
  • Continuous feedback on quality and volume of distributed leads. When leads are good, marketing wants to know why they were good so that intelligence may be included in prospecting, nurturing or scoring. Or when leads are bad, marketing needs to know why they are bad to make adjustments.
  • Content analysis. Marketing spends a lot of time and effort creating assets and content. That investment is lost when sales chooses not to use marketing content. Marketing wants to know what content works, what content doesn't work and why sales chooses not use marketing content.
  • Sales win and loss retrospectives. Reviewing sales win/loss analysis permits marketing to understand the factors that contributed or didn't matter to the end result. It also allows marketing to refine or adjust the ideal customer profile to better target and acquire leads with a higher propensity to become customers. Successful selling is not just about pitching the best solution and closing the deal, it's also about engaging the right type of customer. Marketing can steer efforts to acquire the right customers.
  • Feedback for market research, competitor analysis and customer insights.

Marketing’s Contribution (aka What Sales Wants from Marketing)

On the flip side of this relationship, here's what sales wants from marketing.

  • Sales wants qualified leads. Lead quality matters more than quantity.
  • Sales wants marketing programs they can launch themselves. They also want control of marketing initiatives targeted to their accounts. This includes allowing the sales person to designate accounts for suppression lists (which remove the accounts from marketing campaigns), select middle or bottom of the funnel campaigns for their accounts and return stalled accounts to marketing for continued nurturing.
  • When leads are transferred to sales, sales people want to see the history and behaviors that drove the lead to be designated sales-ready. Transferred leads should display online engagement, content consumed and other digital footprints.
  • Sales people want customer insights. Sales methodologies such as the Challenger Sale and target programs such as Account-Based Selling are dependent on insights. Sales people don't have the time or budget to perform the market research. Research is marketing's job.
  • Sales wants marketing activities to align and support their account strategies. They need content that can be applied to accounts in the middle or bottom of the funnel. This may include competitor comparisons, customer case studies, payback models, ROI calculators or the measurable cost of not making a decision.
  • Sales wants marketing content that can be contextualized for individual accounts. High level pie in the sky marketing content is of little value to sales people. Marketing content must also go beyond lead generation and help advance accounts through the sales pipeline. To accomplish this, marketing will have to work closely with sales to find out what types of content move buyers through the sales cycle. There's no better way to do this than have marketing get into the field for some ride-alongs or attend some sales presentations. Good content can be more succinct and persuasive than an average sales rep. But to be effective, content must be easily accessible at the point of applicability. A McKinsey Global Institute report advises that sales people spend 19% of their time searching for information. On the flip side, SiriusDecisions reports that 60% to 70% of marketing's content goes unused because it's not found. Tying content recommendations to sales stages in the CRM software system can trigger relevant and contextual content recommendations.

The Point is This – Separate but Symbiotic

Despite the sharing of a common objective (revenue), it's a mistake to try to merge the two disciplines together or position them under a singular leader.

Sales and marketing differ in goals, time horizons, performance measures and skills.

Sales is focused on the month or quarter. They are relentless in getting deals done this period.

Marketing is constantly looking ahead - monitoring market movements, changing customer demographics and shifting buyer behaviors – all with the intent to position the company for growth, promote the brand and align the company's value proposition with buyer demand.

There is a need for sales resources to get deals done this quarter, and a need for marketing resources to acquire leads for next quarter. The two roles are aligned but their common goals span different time lines.

Sales excels in building one-to-one relationships and creating a personal rapport with buyers.

Marketing excels at one-to-many communications, automated processes, and harvesting data to improve relevancy for the highest number of customers.

While sales is celebrated with each won deal (and rewarded with generous incentive compensation), marketers are more often the unsung heroes. But that's part of the challenge. When marketing efforts are not attributed to sales results, marketers are relegated to cost center status and further perpetuate their position as second-class citizens. It's critical for marketing to demonstrate their direct and indirect contribution to revenue performance.