“ Markets are less forgiving than they were in the past. A few years ago a private company like ours could go back to the venture capital well, but in these days the money may not be there, so accurately forecasting well beyond a quarter is more critical now than it is ever have been. You need at least a six month forecast to solidify the investments the company is making in people, projects and markets. You can’t afford to be wrong anymore.” “ Longer-term visibility into the pipeline buys us a level of credibility with the board as well as with our investors to make sure we aren’t hiring too far ahead of plan,” said the VP of Sales. “If you can’t see what’s coming, there is no confidence and it puts too much risk on the company to make a decision to put 10 more people out there.” Another executive from a $500 million plus organization categorized the longer term visibility as adding “new headlights” on an old car. “Before we were driving down the dark mountain road by the moonlight and we couldn’t see far enough to swerve and avoid the moose. We couldn’t see far out enough to be predictable and adjust our business plan based on changing conditions.” Where the ability to convert opportunities to closed business used to be a top priority, these executives said the emphasis has shifted more to the top of the funnel to understand what is driving new prospects into the pipeline and how those trends are shaping both customer acquisition costs and new market opportunities. “ When it comes to the ability to close an opportunity once it is in the pipeline, we know that. We can train our reps and build a sales methodology to address that,” another VP of sales said. “My focus over the last few years has changed from managing my pipeline to backing up and saying how do I get people into my pipeline. How do I put new deals into the pipeline. It’s now a matter of how do I find more prospects, identify the right prospects and get them into the pipeline.” Another sales executive said the intelligence gathered by analyzing the early stages of the pipeline is critical to other areas of the business. “Where my dashboard may have been opportunity to close in the past, now it has backed up to the earlier stages of the prospect cycle. Now I’m analyzing everything from a prospect: what’s the right message? what tactics can I use to get them in into my pipeline?” This expanded focus on the earlier stages of the prospect cycle also has more sales executives focused on campaign reporting tools, so that they can track campaign ROI, conversion and revenue influence
According to the Yearly Sales Strategy Review conducted by Sales Benchmark Index (SBI), key performance metrics for sales teams were all down in 2009, including a decline in revenue/head and average sales price. Further compounding these negative trends, SBI’s analysis showed cost per rep and sales cycle length increasing.
Andrew to set the stage on the variation in how buyers want to engage and the way marketer’s perceive the engagement process is happening. Over-reliance on sales to bring prospects into the conversation.
We usually see objectives built around waterfall conversion metrics – and from the onset – it’s imperative that you have tight definitions that everyone agrees to on stages of the waterfall. In our view this is mission critical stuff. This speaks to the communication and alignment requirements that are so critical. The intent here is to establish a clear set of nomenclature and objectives that sales and marketing use to set expectations and describe outcomes. Here is a good example from SiriusDecisions. Both sides need to agree on a tight definition, because otherwise, you’re not even speaking the same language. And that’s how you get situations like marketing thinking they are working hard to deliver leads and sales unhappy with the leads being delivered. Now, at Bulldog we adhere pretty closely to these terms for our own sales pipeline although we’ve tweaked them a little bit to take our specific process and goals into account. You can see there is wiggle room, in terms of, for example, what makes a lead “ready.” I’d also add that we have a “Closed Lost” stage as well, because we want to continue to nurture people who maybe were not ready to buy right now. That’s something we want to track and count and understand. The point is, take these definitions to start with and make them your own.
Sophisticated marketers migrating from simply generating leads to being active in the entire revenue generation process With deals getting stuck in the pipeline and taking longer to close, there is an increased emphasis on making sales efficient as possible. Therefore, they can’t waste time on leads which are unqualified. Also, sophisticated marketers becoming more involved in nurturing leads and developing content that maps to the specific pains/concerns of the buyer—whether they are a new lead or somebody re-engaging and asking for more information/validation. As buying behavior has shifted, the revenue generation process is being transformed. No longer a linear process.
Stages where there are leaks in the funnel—may be due to breakdowns in the handoff process or a lack of content to support different stages of the buying process Inability to measure past initial lead qualification puts companies at a severe disadvantage. While those marketers that can source and track leads all the way from cold to close will be able to use that intelligence to better engage new prospects and increase their lead flow
Marketing's New Metrics - Pardot Users Conference
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Launched in 2009 to help BtoB marketers “map content to different phases of buying cycle” • Content That Connects Buyers & Sellers • Converts Leads To Opportunities • Leads To Closed Business www. DemandCreationSpecialists .com
Measurement = Visibility “ Where my dashboard may have been ‘opportunity to close’ in the past, now it has backed up to the earlier stages of the prospect cycle. Now I’m analyzing everything from a prospect: What’s the right message ? What tactics can I use to get them in into my pipeline?”
Scientific Approach to Demand “ We’re seeing scientific, mathematical equations being applied to determine how to match sales capacity with market demand . Prior to the recession, there wasn’t a lot of science placed on this area. Since demand was strong, the thinking was ‘let’s throw bodies at it and we’ll get our fair share.’ That’s not happening now.” --Greg Alexander, CEO, Sales Benchmark Index (SBI)
<ul><li>Quantitatively track marketing and sales funnel (shared) </li></ul><ul><li>Understand bottlenecks </li></ul><ul><li>Understand costs that drive leads to each stage </li></ul><ul><li>Reduce cost per sale by prioritizing marketing and sales resources </li></ul><ul><li>Engage with prospects digitally and gain intelligence about message effectiveness, market opportunities </li></ul>New Priorities for the Pipeline
2 Views of Engagement <ul><li>The Buyer’s View </li></ul><ul><li>Only 10% of recent buyers said they were contacted cold by the solution provider they chose </li></ul><ul><li>Marketer’s Reality </li></ul><ul><li>35% were attributed to cold call from sales was the initial engagement in recent customer wins </li></ul><ul><li>50% responded to marketing campaign or website visit </li></ul>
Fumbling The Handoff Recent research from the Sales Lead Management Association (SLMA) found 58% of BtoB marketers do not qualify inquiries prior to lead distribution.
Develop a Simple Scoring System <ul><li>Need to Prioritize Leads </li></ul><ul><li>Focus on “In Profile” leads </li></ul><ul><li>Incorporate both activity and demographic factors </li></ul>
<ul><li>Marketing Sourced Leads </li></ul><ul><ul><li>Engaged through marketing, qualified by marketing, accelerated to close by marketing </li></ul></ul><ul><li>Marketing Influenced Leads </li></ul><ul><ul><li>Nurture campaigns help to re-engage </li></ul></ul><ul><ul><li>Maintain content during buying cycle </li></ul></ul>Categories of Contribution
Last Touch Attribution <ul><li>Implement a lead tracking system . </li></ul><ul><li>Track leads not only based on their source but also disposition. </li></ul><ul><li>Conduct win/loss analysis </li></ul><ul><li>Questions to ask: </li></ul><ul><li>Did leads convert to sales? </li></ul><ul><li>What was the conversion percentage ? </li></ul><ul><li>What was the conversion timeframe? </li></ul>
Freshness Dates for Your Leads <ul><li>Consider the “age” of the leads in your database </li></ul><ul><li>Put emphasis on “net new” leads </li></ul><ul><li>Plan append or refresh programs for your contact database </li></ul>
Need for Nurturing <ul><li>Less than 10% of leads convert to closed business </li></ul><ul><li>Typically means that 90% of leads “leak” out of your funnel </li></ul><ul><li>Marketing should be engaged at all phases of funnel </li></ul>
Thank You The Scorecard for Sales & Marketing Automation www.DemandGenReport.com Content that Connects Buyers & Sellers www.DemandCreationSpecialists.com