Ten Truths about Inbound Marketing vs. Account Based Marketing – What’s the Same, What’s Different and How Do They Work Together?

Update May 15 2017

The topic of this post comes front and center with news that The Inbound Marketing Company HubSpot is investing in Terminus, a key player in Account Based Marketing and the originators of the #FlipMyFunnel event series. With forthcoming product integrations, it also represents a marriage of sorts between #MarTech & #AdTech, top of mind for me following conversations at last week's MarTech Conference in San Francisco. 

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Inbound Marketing and Account Based Marketing are usually seen as opposite sides of the spectrum of B2B demand generation strategies – but in reality the two have much in common and complement each other well.

The best Inbound program benefits from Account Based Marketing (or similar targeted outbound strategies) to feed short-term demand until Inbound results are realized, while the best Account Based Marketing programs will leverage key principles of Inbound Marketing.

With that in mind, I present Ten Truths about Inbound Marketing vs. Account Based Marketing, to understand the differences, the overlap and how they can work together for scalable demand creation.

#1 - Once fully realized, an Inbound Marketing strategy should yield lower customer acquisition costs than Account Based Marketing…

The main business rationale behind an Inbound Marketing strategy is significantly reducing cost per lead and customer acquisition costs. Account Based Marketing on the other hand says that there is value in investing more resources and program $ to build more in depth and targeted programs that puts a premium on a very specific target audience.

#2 - …. So therefore Inbound Marketing is attractive for companies with a lower average order value.

For this reason, businesses whose economics demand low customer acquisition costs based on their AOV should strongly consider the merits of what an Inbound Marketing strategy can deliver. The threshold for this will depend on multiple factors including the company’s ability to invest $ and resources for a long term payoff; I’ve generally considered the thresholds for Inbound vs. Account Based marketing as the leading strategy to be somewhere between $10-20K average order value for licensed software or $1-2k/month recurring for SaaS software.

#3 - Account Based Marketing should yield higher conversion rates through each step of the marketing funnel.

Both account based marketing and inbound marketing make strong cases for their method to yield strong conversion rates through the marketing funnel (e.g. MQI to MQL, MQL to Opportunity, Opportunity to Win).

Account Based Marketing suggests that a highly targeted audience will yield high conversion rates because there is full alignment with sales that this account is one who has a strong fit for your product or service.

Meanwhile Inbound Marketing suggests that conversion rates will be strong because a prospect who comes to you will be already educated and more ready to accelerate through their buying process.  A counter-force on Inbound Marketing conversion rates however is that inbound marketing casts a wider net such that a lower percentage of leads will be in your true target profile. So for that reason conversion rates should be higher on the Account Based Marketing side.

#4 – The impact of Inbound Marketing is on a longer time horizon than Account Based Marketing.

Inbound Marketing is not the right strategy to drive short term results – if you are looking at driving results say within a 12-month time frame, temper expectations on Inbound and ensure there are other demand strategies to complement it while the Inbound tailwind can be built.

That said, Account Based Marketing isn’t an overnight fix -- as strategies, data, assets and programs need to be developed -- but in the category of expected timeframe for impact on Pipeline I’d rank Account Based Marketing a step ahead of Inbound.

#5 – Both Inbound Marketing and Account Based Marketing require a tight definition of target audience.

Now we get to some of the key attributes these two approaches share. A tight definition of target audience is critical to success for both.

In the case of Inbound Marketing, this is a market segment (usually defined by a set of people – roles, within certain types of companies) for whom there is an opportunity for the business to develop a stronger community within that segment with their brand as a central resource. Being crystal clear on that audience is a prerequisite to success.

And in the case of Account Based Marketing, working with Sales to define a set of target accounts for whom your product/service can offer significant value is a key input to build demand.

#6 – Both Inbound Marketing and Account Based Marketing require an in depth understanding of how customer’s buy – the customer buying process.

It’s more than just knowing who you want to target – and in the case of both of these a truly winning strategy will be differentiated by just how well you understand (and have aligned your go to market team) around how and why customers buy.

In the case of Inbound, these insights will inform what questions customers need to answer for every step through their buying process – starting with the awareness phase of just getting to understand their problems and then why it’s important to change. This content and the way it’s architected to nurture buyers through their buying process will be what creates scale and velocity for the Inbound program.

In the case of Account Based Marketing, understanding the buying process, the roles involved and how they interact – will be key for both breaking through the clutter and getting the attention of that company. And then once engaged, this will also be key for creating velocity through the buying process, by engaging the various roles to ensure they understand problems they are facing, how they are relevant to them and how to address most effectively.

#7 – High quality, relevant content is crucial to success for both Inbound Marketing and Account Based Marketing.

No matter how you cut it, high quality content will be required for both. In the case of Inbound, it’s the content that serves as the bait to attract your audience and move them through the buying process. The exact same principles apply to account based marketing – there is just typically more investment applied to attract the attention of that audience to initiate awareness vs. relying on them to find you when they are ready.

#8 – Both Inbound Marketing and Account Based Marketing require close alignment with Sales to be successful.

Another must-have for both.  Inbound Marketing is more than just generating that inbound lead – it’s every step through that buying process to ensure buyers are accelerated through their buying process. Alignment with sales is critical both around expectations for the time horizon for the impact of Inbound and how to most effectively engage Inbound leads.

In the case of Account Based Marketing, alignment on who to target and how to engage them is a fundamental – the premise is hyper-targeting will yield overall efficiencies and pay off what will be a higher cost per lead.  

#9 – Companies employing an Inbound strategy, should look to complement that with an Outbound strategy (that may or may not involve the extreme of account based marketing) to drive demand while Inbound impact develops.

Here’s the rub. For those companies employing an “Inbound First” strategy, there’s a time horizon, often more than a full year associated with seeing meaningful results – so ways to leverage their inbound content through outbound programs such as account based marketing or similar will be crucial to drive short term demand.

#10 – Companies employing an Account Based Marketing strategy should leverage “Inbound principles” for account based success.

And likewise Account Based Marketing success will require many of the same principles of Inbound Marketing –in fact much of the content one creates for an Inbound marketing strategy can be applied and leveraged for an account based marketing strategy – while it doesn’t “speak to the account” it will be effective in speaking directly to that role/persona through each stage of the buying process.

For more on the interplay between these two strategies, see my article “When Inbound Marketing Isn’t Enough”.

How to Get Profitable Return on your Paid Search Program - A Four-Step Framework

Paid Search is a necessary component to a growth mix for B2B marketers. It should prove to be a source of solid cost/MQL and cost/opportunity leads, and one that helps reach Google search audiences in an important way to compliment organic/inbound efforts.

Let’s be very clear on one thing though - paid search is tough.

Unlike a well-executed organic search program, which over time can drive exponential growth and significantly reduced cost per lead metrics, the ‘natural course’ of a paid search program is increasing cost per lead.

Why?  Two reasons:

First off, Google is always looking to make more money. Google is always going to be acting in Google’s best interest, which means looking for ways to siphon off more dollars from advertisers. This past year it’s been hiking up branded search rates.

And secondly, successful terms are likely to get more and more spend from competitors. Meaning what’s working for you today, is likely to cost more money to work for you tomorrow.

So how do you get this Paid Search beast to work for you?  Here’s a four-step plan to get payoff:

#1 - Ensure you have the right measurement in place (HINT: Google AdWords is not enough).

Optimizing a paid search program for form-fills alone is a surefire way to drive a high number of ‘conversions’ (leads) that  have a high noise level for sales, and low pipeline return.

A proper measurement framework is critical to success. Specifically here's what to do:

• Setup SalesForce campaigns for each AdWords campaign to enable tracking opportunity and pipeline return
• Pass a Google click ID (GCLID) into marketing automation/CRM systems and pass opportunity values back to AdWords. This will allow for cost/opportunity and pipeline $/investment to be calculated at the keyword level – crucial for the optimization needed to drive success
• Setup ‘stacked cookies’ so that latent conversions can also be measured and attributed back to the paid search investment – to give you a full picture of the impact of your investments

#2 – Target long tail, use case driven keywords

Driving profitable pipeline from PPC investment is a numbers game – and as I mentioned above it gets harder and harder. So eeking out every efficiency is vital.

Long tail, use case driven keywords are vital to this.  Rather than investing in broad category based searches which will be expensive, and tend to be more ‘top of funnel’ research terms – the searches that will drive returns are going to be more long tail (both longer search phrases, and lower volume) which are more likely to signify "intent." and lead to action -- both conversion and follow-on engagement with sales rep. This will be lower cost, lost volume and higher converting terms.

Your job as a paid search marketer looking to optimize pipeline return is to identify more and more of these terms, and invest in those.

#3 - Tailor landing pages for these use cases

Back to the point of eeking out every efficiency, as you identify these terms, build landing pages tailored for these terms. Landing page conversion rates will go up based on having more relevant, tailored content which align ads to the specific search phrase and landing pages. 

This payoff of this work will be higher conversion rates, which therefore lead to a lower cost per lead and cost per opportunity. There will also be a double positive hit as more relevance will increase your Google quality scores and help to further reduce cost per lead.

#4 - Optimize, optimize, optimize

The above framework will give you a framework for success. Then the key is optimize, optimize, optimize.

Watch the results every single day, and align with sales on what’s working and what’s not working.

Optimize for pipeline $ and opportunities created, leveraging the reporting capabilities on #1. Constantly work #2 and #3 above to identify the right terms and take all the steps possible to minimize costs per opportunity while driving quality. 

As you identify low performers, either get rid of them or work to improve them.

As you identify high performers, invest fully in those, and look to spin off other ideas from those performers that could lead to new potential winners.

The “Google PPC pill” is a tough one to swallow – when you realize the size of the check you’re writing to Google each month – but it’s much easier to do so when you know you are running the program in a way that is driving profitable return.  Because then at least, it’s a win for Google and a win for the Marketer.

Five Specific Actions Sales & Marketing Can Do Together To Drive Alignment & Business Performance

We all know sales & marketing alignment is extremely important. This Kapost article references an Aberdeen Group stat that “Companies with strong sales and marketing alignment achieve 20% annual growth rate, and companies with poor sales and marketing alignment have a 4% revenue decline.” (Now if I could just find that pesky Aberdeen stat... although this stat is referenced everywhere, I’m citing the Kapost article because I couldn’t find  a public version of the original stat from Aberdeen).

Knowing it’s important isn’t enough though, as actually attaining true sales & marketing alignment is challenging.

To that end, these are five specific actions that I’ve found sales and marketing can do together to drive alignment, and achieve the resulting business performance. I choose the word “sales and marketing” and “together” very precisely, as the key to this is that equal responsibility and commitment is taken from both groups within the company’s revenue team.

#1 - Be overly transparent with each other

Within pockets of sales and marketing teams, the “default” mentality towards the other group may be that of mistrust. The best way to address that proactively is to be overly transparent.

From the marketing side, share regular communications around strategies, program plans, program performance, program optimizations and what’s working and what’s not working.

From the sales side – same thing. Share insights around what’s working and what’s not working, identify areas to improve opportunity conversion rates and win rates, and also over communicate around how the business is trending towards meeting its monthly or quarterly revenue/bookings targets.

#2 - Diligently focus on opportunity creation targets as a KPI

I’ve seen sales and marketing relationships stumble when marketing drives attention to MQLs as their KPI. That can lead to friction if marketing “celebrates” MQL performance that isn’t translating downstream to opportunities or deals.

MQLs should be seen as a “means to the end”, and if both sides are laser focused on opportunities created it has several benefits:

• Marketing drives towards MQLs, but also has a keen interest in working with sales to ensure MQL to Opportunity conversion rates improve
• It opens up the perspective of Sales Management to focus both on what’s closing (what they would typically be monitoring each day/week/month), and also using Opps Created as a KPI for them to also monitor to ensure that a healthy pipeline is continually being built to feed the months ahead.

#3 – Regularly dialogue on how to improve opportunity conversion rates

With Opps Created as a KPI, marketing and sales management should openly dialogue about how to improve conversion rates from MQL to Opportunity.

When I say openly, it should be done acknowledging that there are always improvements needed, and it’s not a criticism of either group.  Specific areas to look at:

• How are MQLs specifically being generated? (e.g. forms, webinar responses). Is prospect intent made clear? Are there any improvements to that process that can help how sales follows up?
• What is the systematic lead handoff? Is it real time? Do the sales reps have clear visibility into the right data they need to best follow up?
• What is the response time to follow up? This is where SLAs come in to ensure there are standards across all of the reps.
• Is there a defined follow up approach – both number and frequency of touches, as well as guides for the conversation?

These are all areas that require consistent attention and improvement.

#4- Create an aligned approach to lead scoring

The SiriusDecisions Research from their 2015 Summit reinforces the need for approaches to engage buyers at the earlier phase of the buying process, when they are most open to support  and guidance from people (reps).  I’ve been outspoken in cautioning the perils of attempting lead scoring before you’re ready, and the key is that sales and marketing both need to be fully bought into lead scoring and design it collaboratively. Keep the initial lead scoring models simple. The types of questions to answer during a lead scoring creation exercise include:

• What’s the profile of prospects that we want to talk to?
• What content would a prospect consume that would lead us to think he’s most open to a conversation?
• What content would a prospect consume that would lead us to think he’s in a buying process?
• How do we want to consistently follow up with prospects for each of these scenarios?

#5 - Build joint programs

Finally, a great way to build alignment is to build programs together. There does not need to be one recipe as to how sales and marketing share responsibilities in executing programs.

In addition to traditional marketing executed programs, ways to build joint programs include marketing sourcing the data for a given target audience and sales leading the outreach (email, phone, social media) to the targeted list.  Another scenario could be marketing sourcing the data and designing integrated email & phone outreach that is executed by Sales or SDR/Teleprospecting resource. Monitoring the success of these joint programs, and improving them, helps to build the alignment.

What do you think? What are some specific ways you’ve seen sales and marketing teams effectively align?

#SDSummit Takeaway: SiriusDecisions clarifies a misunderstood statistic – and opens up a whole world of possibilities for integrated digital demand generation

Today is the day SiriusDecisions set the record straight.

Jen Ross & Marisa Kopec unveiled SiriusDecisions new research on B2B buying process and in doing so made a simple but powerful clarification that should open the collective eyes of sales & marketing organizations around the possibilities of digital marketing supported sales prospecting as a competitive difference maker.

The original 67% stat was “67 percent of the buyer’s journey is now done digitally”.

However it often got spun colloquially as: “Buyers are 67% of the way through the sales process before they want to speak to a sales rep.”

The implications of the misinterpreted stat were:

• Buyers don’t want to talk to reps
• By the time a buyer wants to talk a rep, they are 2/3 of the way through their buying process

The overall message to sales was one of helplessness and disempowerment.

It was WRONG. WRONG. WRONG.

Today at the SiriusDecisions 2015 Summit we learned about the recent SiriusDecisions study of over 1,000 different B2B buyers from actual purchase processes and we got clarification that: Buyers aren’t 67% through the buying process when they want to talk to a Person/Rep. 67% of the buying process may involve digital content consumption, but the sales/rep engagement is threaded throughout that buying process and spans all stages.

And here’s where it’s most interesting, as I live Tweeted as the event.

"Buyers interact with sales reps the most in the education phase" says @Jenross17 #SDSummit Why SDR/Teleprospecting program is so crucial.

— Zak Pines (@MoneyballMktr) May 14, 2015

The sales and marketing organizations who can partner and enable reps to leverage digital tools to get visibility and engage with prospects will create a massive competitive edge. What we are talking about here:

• Expanding data sources of potential prospects
• Leveraging scoring to prioritize best fit leads based on company attributes, web behavior and social interaction
• Leverage social marketing, content and teleprospecting techniques to build credibility as authority and engage with prospects as early in the buying process as possible
• Use tools to best tailor conversations and understand where buyer is in the buying process
• “Rinse and repeat” to deliver useful content to support them through their buying process, wherever they may be

The impact will come from properly harnessing reps around digital interactions. It's about Sales AND Digital and how they work together through the ENTIRE buying process.

Much more empowering for sales reps and teleprospecting.

Much more inspiring for aligned sales and marketing teams to go after this together.

And great news for all the great digital technology vendors at #SDSummit who can add value to help companies build that aligned sales and digital marketing demand generation machine.

Related Resources:

• SiriusDecisions BusinessWire press release summarizing these findings on B2B buying process
• OpenView Labs Recap - Debunking the myth that buyers are 67% through the buying process before engaging with a sales rep
• OpenView Labs Infographic - Top stats from SiriusDecisions Summit

Choose the marketing and sales performance levers to fuel your growth (and here are 20 to choose from…)

In 2014 SiriusDecisions introduced their Intelligent Growth Model which detailed five pillars of growth that companies could choose from or combine as part of their business growth strategy. The five are:

1. Expand into new markets – geographical expansion, vertical market expansion
2. Introduce new offerings – add additional product offers with new revenue streams
3. Sell to new buyers – sell existing products to those you haven’t reached before
4. Increase productivity – improve effectiveness in marketing & sales
5. Acquisitions – acquire businesses as a source of expanded revenue

Taking a closer look at these, I’d segment them into these two categories:

• Growth via Business Expansion: includes #1 (expanding into new geographies or verticals), #2 (expanding with additional products) and #5 (expanding by acquiring other businesses).
• Growth via Business Improvement / Optimization: These apply to growing an existing product in an existing market, and in this case the two options are #3 (new buyers) or #4 (productivity).

The second category is more universally relevant, as every line of business can relate to it as management teams plan growth for existing products in existing markets typically as part of an annual business planning cycle.  When planning business growth in these scenarios, teams can categorize growth drivers into two high level buckets:

#1 - Growth in marketing qualified leads and opportunities

And/or

#2 - Improvement in sales performance metrics (e.g. win rate, average order value) – I use the term ‘sales’ to describe the business process, not the department, as sales performance metrics are influenced by sales, marketing and product management – as you’ll see below.

When planning for growth within a product line, management teams should agree on to which degree these two areas will contribute to that growth – as that decision will foster alignment, and may impact other investment decisions including resources and budget.

As part of that decision, there are many potential levers to consider within each of the two buckets – let’s take a closer look.

To grow marketing qualified leads (and resultant opportunities) here are 10 levers to consider:

1. Grow web traffic (via SEO, SEM, Social Media, Influencer Marketing, PR programs)
2. Grow website conversion rates (make website more effective in converting visitors from #1 to MQIs or MQLs)
3. Improve web conversion rates through post-visit tactics such as abandonment techniques or retargeting
4. Grow MQIs through expansion of or improvement in MQI generation programs (“Growing the top of the funnel” – e.g. content, webinars)
5. Improve MQI to MQL conversion rates and velocity via optimization of lead nurturing programs and/or expansion or sales development / teleprospecting resources (more MQLs via "optimizing middle of funnel")
6. Grow incremental MQI/MQLs via highly targeted account-based sales and marketing programs (“small net fishing”)
7. Improve the effectiveness of sales development / teleprospecting resources through tools including lead prioritization engines, predictive lead scoring or training
8. Generate more upsell MQLs from customer base via educational programs or specific upsell paths
9. Generate more MQIs/MQLs through harnessing customer base via community, advocacy or referral programs (typically a longer term strategy)
10. Grow partner generated leads by expanding number of ‘push’ partners actively marketing your offerings and/or adding additional marketing programs implemented via partners

And to improve sales performance metrics, here are 10 levers to consider:

1. Grow MQL-to-opportunity rate via improved lead response times
2. Grow MQL-to-opportunity rate via developing, improving or optimizing MQL follow up programs (conversation guides, email messaging & sequences)
3. Grow MQL-to-opportunity rate via follow up techniques or data (e.g. leveraging of multiple contacts at an account)
4. Grow win rate through applying sales process around ensuring the right criteria is applied to choose which deals are qualified
5. Grow win rate through more effective enablement of a champion buyer (enabling that buyer to more effectively sell up/across their organization) – this could be via conversations, content and/or technologies
6. Grow win rate through focus on urgency drivers (including content to position the buying decision vs. the downside, risk or pain attached to the status quo)
7. Grow win rate through the development of specific competitive content or positioning vs. key competitors
8. Grow win rate through development of new product functionality to address top loss or no decision reasons (a process for win/loss analysis will help uncover and prioritize these)
9. Grow average order value through product packaging or bundling  
10. Grow average order value through price increases (hey, you gotta consider it right!)

Aligning around the how of growth, first at the high level and then into the specific growth drivers, is a key step to achieving the growth that every business wants.

Seven-Step Plan to a Demand Generation Turnaround

As boards, shareholders and executive teams seek predictable revenue, they apply pressure on sales and marketing leaders to drive sustainable growth. Today with buyers  in control and sales organizations increasingly blind to the first two-thirds of the buying process, demand generation teams have moved front and center as the key driver of this growth. And most have a ways to go in putting a demand generation machine in place to predictably drive growth requirements.

This is a seven-step revenue growth marketing approach to provide a measured, well-paced and action-oriented blueprint for the demand gen turnaround that so many businesses are demanding today.

1.       Agree to Lead Definitions

Maribeth Ross covers the key revenue stages in this article; the Marketing Qualified Lead definition is absolutely vital. By establishing a joint MQL definition with Sales, marketers create a quality metric for leads and establish a clear handoff point to the sales team, which in turns helps sales perform better with the MQLs that marketing generates.

I find that most struggling demand gen teams have a lack of clarity around this definition which therefore means there are wild fluctuations historically in lead quality that make results difficult to measure, and also make sales’ job more difficult in following up the leads they receive.  The MQL definition  provides a building block foundation from which to grow.

The second crucial definition that is a consistent Opportunity definition, which will enable you to use the MQL-to-Opportunity conversion rate to identify top quality lead sources. 

2.       Get Quick Wins On Board – Here’s Five to Get You Started

While most of these steps work sequentially, this one should occur in parallel to the rest. As a Demand Generation leader, you want to make short term impact to support the sales organization and demonstrate that you are able to simultaneously consider short term lead and revenue objectives while building long-term marketing strength.

These are five “quick-wins” that can bridge the gap while demand generation fundamentals are being developed

Quick Win #1 – Late Stage Content

In a Demand Gen turnaround you can’t do everything all at once. So I first prioritize late stage content to help identify and move prospects entering a buying process closer to sales. Look to reface or repackage late stage content, feature it on your website as a means to capture MQLs and drive these assets through syndication programs to bring in later stage prospects. Late stage content include vendor comparisons, evaluation guides and product webinars both live and on-demand.

Quick Win #2 – Website Conversions

Your website is your last step in converting leads for sales, so any improvements you can drive there will have immediate impact. Look at forms and user paths to eliminate friction and improve conversion rates. Ensure forms driving MQLs to sales don’t have any extraneous fields or unnecessary distractions.

 Quick Win #3 – Invest in a Paid Search Agency

If you have been running your paid search account in-house, chances are you would benefit from bringing in an agency expert to help you improve performance. I find some marketers are reluctant to pay the 13-15% management fee, however with the ever growing complexity of paid search and varied opportunities within it, don’t be short sighted and rather challenge an agency to double your paid search performance for the 15% investment you make with them.

Quick Win #4 – Align Webinar and Content Topics to the Problems You Solve

Lead Gen webinar topics need to walk a fine line. It’s well understood today that lead gen (earlier stage) webinars can’t be about you and your products… they need to center around compelling topics of interest to your prospects. However I find some marketers swing the pendulum too far in the other direction, whereby the webinar topic will fail to connect it to the problems their company/product solves so therefore it’s ineffective in driving leads for sales. Adjusting webinar topics (as well as other content including PR) to speak to broad topics and connect these topics to the problems you solve should increase yield from these programs by a multiple.

Quick Win #5 – Nurture New MQIs

If you don’t have a lead nurturing program in place to nurture new MQIs, put one in place. Start simple – it can be a series of emails driving to a single landing page or microsite, as having that initial nurture program in place is essential to establish a baseline from which you can grow. You will need lead nurturing in place to extract full value out of your lead gen programs.

3.       Benchmark Performance by Channel

Benchmark your historical performance to create the picture of how demand is being generated today and what metrics need to move and by how much to drive the required business growth. Benchmarks should include:

• MQL to opportunity conversion rate
• Opportunity to win rate
• Website traffic by channel (organic, referral, direct) and conversion rate
• Size of active marketing database and conversion rate
• Paid Search account performance, split out by branded & non-branded search, retargeting and display network ads

4.       Build a Revenue Growth Calculator

Using the benchmarks you’ve established, build a revenue growth calculator which shows how these numbers need to move in order to meet the revenue growth plan for the business.  To do this you will also need to know the required future bookings (based on average sales cycle), the average order value and the % of business you are looking to drive from net new vs. existing customer.

Take the current baseline, and create an outward plan showing to where the metrics need to move. Ideally you can do this such that you set metrics that exceed your MQL requirements by 10-20%. This becomes a plan which sales and marketing can partner on with clear ownership and accountability.

5.       Closed Loop Tracking of Lead Stages & Programs

To manage the metrics you set out in #4, you will need a closed loop marketing system to track the effectiveness of programs and lead progression in general. I discussed the ‘how’ around this in a previous article Six essentials to setting up a closed loop marketing system.

6.       Help the Sales Team “Beyond Just Leads”

This is a parallel set of activities which will help in establishing demand generation as “more than just leads” and driving impact on demand at all stages of the buying process. The types of programs are crucial as they can help the sales organization overcome a near term lead shortfall, and as leads grow ensure that are best converting leads into opportunities and wins. 

Areas to consider helping sales include:

• LinkedIn Coaching – Encourage sales to connect with all customers on LinkedIn so as customers switch jobs the reps are the first to know; this also grows their network so they can best leverage LinkedIn as a prospecting tool; encourage the rep to set up their profile from a consultative, customer-centric standpoint so when prospects view their profile, the rep leaves a strong impression.
• Personalized Landing Pages for the rep to use with prospects and customers – Build a personalized landing page such as this one which puts the Rep front and center and wraps useful content around the rep. This is a page a rep can use and apply at various stages of the buying process including their own prospecting activities.
• Coaching on Asking for Referrals – Remind the Reps that they, via the products and services the company provides, add immense value to customers, so asking for a referral is helping and not selling, and part of the sales process should include a follow up process to ask for referrals.
• Help Sales Improve MQL to Opportunity Rate – Ensure system handoff on MQLs is clean, ensure reps are armed with questions to ask to establish pain and value, and consider automated nurturing programs for free trial evaluations.
• Help Sales Improve Win Rate – Inventory and improve the content sales uses during the opportunity phase; look at interactive content such as assessment tools to take this to the next level, and also consider web-based tools that sales can use to share content and best support their buyer champion during the opportunity phase.

7.       Drive Towards the Revenue Growth Plan

With the plan via the Growth Calculator established in #4, the tracking of programs in #5 and the holistic view of helping the reps in #6, now monitor and measure performance towards these goals. Identify high and low performing activities through your closed loop tracking – slice and dice including program types, lead sources, calls to action, and segments by vertical, size, geography, job function or buyer characteristics.

As you identify top performers, assess the possibility of shifting investments in time or resources into these top performers. And as you identify low performers, make decisions to either invest in improving these low performers, or drop them.

The metrics based approach and visibility should ensure you get buy-in and support for the steps needed along the way and keep you well aligned with sales as you build the demand generation required to best drive the business.

3 Ways to Jumpstart Marketing and Sales Alignment (MassTLC inspired)

Last week I attended the inaugural MassTLC Demand Gen peer group headed by Christine Nolan of MassTLC and Jonathan Burg of Apperian – it was a vibrant discussion with 35 of the top revenue marketers in the Boston area.

It was striking that with a group of that experience, sales alignment (or lack thereof) was the most common area of frustration shared by many.

We were only able to cover some of the potential remedies in the discussion, so it inspired me to write and share this post – 3 Ways to Jumpstart Marketing and Sales Alignment.

What these three practices have in common is they should help build that alignment by putting marketing on the same side of the table as sales by aligning around common goals.

1.       Build a metrics-based MQL Plan

Also discussed in detail here, you, the demand generation marketer, should work backwards from the revenue forecast and use assumptions around conversion rates to show to both marketing and sales the number of MQLs required to meet the plan.

This accomplishes two things for you:

• It demonstrates to sales that your demand generation / marketing plan is aligned to their sales plan
• It solves another problem expressed by a number of the marketers in the room – which is how do you govern processes such as sales acceptance of marketing leads? By building those assumption into your plan, it gives you a leg to stand on when reviewing numbers with sales management… if the metrics such as sales acceptance rates dip below the plan, it should become clear to sales management that the issue should be addressed. It’s not you, marketing, telling sales there is an issue -- it’s a lack of alignment to the plan which should flag the issue.  

2.       Build marketing programs around the sales reps

This next one is a win-win -- make your marketing programs more effective AND build alignment with the sales team.

Here’s an example and here’s how it works:

• Create “Rep Web Pages” which position each rep as an expert in their field. We demand gen need to remember that -- assuming our products are sold through sales reps -- then we not only need to market our products but also the reps whom prospects need to buy from – because nothing will be bought without a conversation with the rep.
• The pages include content of value to prospects and provocative questions representing a discovery conversation the rep wants to have with the prospect -- these are both credibility builders for the rep.
• The page also links to the their LinkedIn profile with similar messaging around the rep for social validation.
• Email programs both for outbound prospecting and nurturing are emails from the rep (plain text emails with their photo at the bottom), anchored by these rep landing pages aimed to attract the attention of the prospect and move them through the buying process.

The Reps not only should feel good about seeing marketing putting them front and center, but the personalized approach to connect with prospects is a highly effective technique to break through today clutter of information overload. 

Other extensions of this including reps adding this page to all of their email signatures, accompanying emails with calls/voicemails directing prospects to their page and providing intelligence to the reps on who has visited their page to prioritize follow up efforts.

3.       Provide more direction for sales on how to best leverage marketing’s content

In his book “The New Rules of Sales Enablement”, Jeff Ernst of Forrester Research quoted an American Marketing Association stat that 90% of marketing deliverables are not used by sales.

A significant piece of this 90% comes from assets not being packaged and served up with clear direction to sales for how to use them. It’s a pain point for every sales organization and solving that pain point is a great way for marketing to achieve that “same side of the table” status.

I recommend providing both email templates and the related content assets, grouped in categories that are actionable for sales.  The first grouping would be buying stage, then by role, industry and/or topic.

• Prospecting  – assets used to attract attention and establish need
• Discovery – assets used to educate prospects during the discovery phase
• Opportunity – majority of assets for sales use will be during the opportunity phase. An area which marketing can help sales is providing sales with content that reps can provide their primary buyer to share with their buying team – content which help cement the value for the solution for each member of the buying team. Another asset type which sales will appreciate are objection handlers… content that they can share with prospects to address common questions that could otherwise stall out their deals.

So what do you think? Please share other tips and tricks you've found for alignment between marketing and sales.

CEOs and Boards of Directors: Should your marketing team be paid on variable compensation?

Mike Volpe, the CMO of HubSpot, recently published this article entitled “CMO Warning: Don’t Tie Marketing Incentive Compensation to a Metric.” Mike shared six reasons why tying marketing compensation to a metric could have adverse impact on the marketing team and the business.

I shared the article with my Sales Operations colleague who is often championing for metrics-based compensation for marketing, and she asked me “So what do you think?”

When I paused to think about it, what I realized and shared back with her is that for performance-based marketing compensation to have a positive impact, you would need these five things to be in place:

1. Strong Marketing Leadership - to communicate and manage the program
2. A clearly documented & agreed to MQL Definition with sales
3. MQL goals aligned to the business plan, based on revenue targets, forecasted win rate & forecasted MQL-to-Opportunity conversion rate – I have discussed a planning process for this here
4. A plan for how the MQL numbers will be attained – I have discussed building a bottoms-up MQL plan here
5. Closed loop reporting visibility to measure effectiveness of each vs. goal – in this Aberdeen CMO Essentials article I discussed how to do this with six essentials to setting up a closed loop marketing system.

Now here’s the rub - the marketing organization that has these five components in place should be set up to meet and exceed their target numbers, so the performance based conversation should be seen as a massive positive (not a negative) provided that like Sales there is no cap around the upside marketing can attain based on their performance. So it shouldn’t be seen (by either Marketing or the Business) as attaining a % of your bonus based on meeting MQL objectives, it should be seen as earning a % of the revenue growth driven through marketing’s efforts to meet and exceed the revenue growth plan.

And for those organizations that don’t have the five aforementioned points, any attempts at performance based compensation will surely lead to conflict and negative ramifications like those detailed by Mike Volpe.

So for marketing management, whether or not compensation is tied to specific MQL metrics, having an approach like it is, will help ensure the process and systems are in place to best ensure success.  

And the best case scenario for boards of directors, executive teams and marketing teams alike – and the whole business for that matter –is that marketing drives the pipeline at the pace required for the target business growth (and beyond) and is rewarded for doing so in line with the performance.

Answering the question, “How many MQLs do we need?”

A data driven marketing plan needs to start by answering the question, “How many MQLs do we need?”

Although it can be calculated with straightforward arithmetic, ambiguity around some of the details has thwarted many a marketing team, so let’s walk through it.

Here’s the assumptions that you’ll need – for each product line x country or geographic region.

• Revenue Target – If it’s a high growth business, you could calculate each month with the appropriate # of leading months based on the average sales cycle. Alternatively if you are planning this annually you could take the monthly average over a 12-month plan.
• Makeup of Business By – Here’s where this can either get complex or stay simple. Marketing and Sales will want to agree where the source of business is expected to come from these sources, or all that apply to your go-to-market strategy:
• Net New Customers (Inbound / Marketing Programs)
• Net New Customers (Outbound) …. Worth splitting out for two reasons – conversion rates and deal size will likely vary, and the responsibility for generating the business will likely vary vs. Inbound/Marketing Programs.
• Existing Customers
• Cross Sell (e.g. from other product lines)
• Partner Driven Deals

For each of the above you will want to then have these assumptions:

• Average order value (based on how the above number split this will then allow you to calculate # of wins you need over the time frame)
• Win Rate (this will then allow you to calculate # of opportunities you need)
• MQL-to-Opportunity conversion rate (this will then allow  you to calculate the number of MQLs)

The next step is then taking your MQL target and building a bottoms-up MQL plan.