As long as there have been marketing and sales departments, there has been tension between the two.
A typical sales complaint about marketing is that the leads they generate are worthless ("marketing's leads SUCK!"). Conversely, marketing will complain that sales doesn't follow up sufficiently, if at all, on the leads they are given.
In a Corporate Executive Board survey, 87% of the terms that sales and marketing use to describe one another are negative.
Sales may describe marketing as "arts and crafts," "academics" and "irrelevant." Conversely, marketing describes sales as "simple-minded," "incompetent" and "lazy."
Pretty strong language, either way you look at it.
But marketing and sales CAN work better together and be aligned. And the benefits are worth having: according to a 2010 study by the Aberdeen Group, companies with strong sales and marketing alignment get 20% annual revenue growth.
The most fundamental building block of sales and marketing alignment is agreement on goals, where the marketing pipeline and sales quota become two ends of the same stick.
For sales and marketing alignment, there are a few key things that have to happen:
Sales and marketing need to speak the same language - it's called revenue. For Marketing to speak this it needs to do some math and work backward from sales:
1. What is your company or division's revenue goal?
2. What is your average deal size (current revenue/current customers)?
3. How many customers do you need? (revenue goal/average deal size)?
4. What is your lead to conversion rate (current customers/current leads)?
5. Calculate the number of leads needed (customers needed/average lead to customer)
Now marketing starts to have a goal that is more closely tied to sales. But there's more.
Marketing and sales need to determine the characteristics of a sales ready lead. It's generally a combination of "fit" and "interest." If there is a fit but low interest, marketing needs to nurture the lead. If there is a fit and interest, sales needs to follow up quickly.
This is also where the agreement on a buyer persona is crucial.
Sadly, only 45% of businesses have established a company-wide definition of a sales-ready lead, according to a 2009 survey by MarketingSherpa.
Once sales and marketing have zeroed in on defining a sales ready lead, the hand off can improve dramatically.
As part of that, marketing should define the different stages of the funnel (website visit, lead, marketing qualified lead, sales qualified lead, opportunity, sale).
Then, marketing and sales should agree on who owns which parts of the funnel, understanding that the process is not linear and the prospect will go up and down the funnel.
If marketing is tossing leads to sales and doesn't hear anything back, the system is outdated and/or broken. With marketing automation software and a CRM (like HubSpot and Salesforce.com), companies can avoid that.
With closed loop reporting, marketing is able to send more information to sales (such as additional lead intelligence), and sales is able to provide feedback and sales activity reports to marketing.
Some of the things that marketing should be looking at via closed loop reporting include customers by marketing source and conversion assists.
If sales and marketing don't have a service level agreement (SLA), they need to get one. Now.
An SLA is a written definition of what marketing and sales agree to do for each other.
For instance, marketing would agreed to provide a specific number of quality leads within a given time in order for sales to reach their quota. Conversely, sales will agree to a certain speed and depth of lead follow up that makes economic sense.
Marketing and sales need to have weekly meetings. At these meetings marketing should update sales on campaign activity and plans and product updates. If marketing and sales sit together at work, it helps communication dramatically. Try it.
This goes back to marketing and sales disparaging one another ("marketing's leads suck" and "sales isn't following up on the leads").
Instead, use data that is frequent, public and transparent. Marketing needs to have an always-on dashboard with website traffic and leads. It needs to be reviewed every day.
Additionally, the leads should be tracked by source and by campaign. The number of marketing qualified leads should be tracked on the dashboard, too. Similarly, with closed loop reporting, all the sales activity should be visible and analyzed.
What barriers to marketing and sales alignment do you face? Please join the conversation below. And if you found this helpful, please share it with your network.
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