By Lora Kratchounova, Scratch Marketing + Media
In many enterprises, harmonious communication between the sales and marketing departments remains an elusive pursuit. While both groups have the same ultimate goal — contribute to the company’s revenue — misalignment between the two in day-to-day operations remains one of the greatest sources of functional inefficiency. The two are often considered to be separate camps operating in silos. While marketing projects are long-term and campaign-based, sales people move fast, chasing their quarterly quotas. Oftentimes, marketing will generate leads — sometimes in great volume — but sales may not be satisfied with their quality and do not find enough value in marketing’s demand-generation efforts to spend the time needed in pursuing those leads.
The 2016 B2B Sales & Marketing Collaboration Study by The Marketing Advisory Network highlighted this misalignment between marketing and sales teams:
- Fewer than 20 percent of marketing professionals agree that their sales teams follow up on 95 percent or more of leads delivered by marketing.
- Almost 70 percent of the sales professionals said their sales teams are not incentivized to support marketing objectives.
- Only 20 percent of marketing and 50 percent of sales specialists believe that marketing increased its value to the sales team in the past 12 months.
Тo maximize the success of marketing outreach and sales efforts, both teams should act as one cohesive organization.
The Account-Based Approach: Eliminating the Great Divide
Whereas the traditional inbound marketing approach focuses on generating individual leads in volume (and therefore does not require close coordination between sales and marketing), the account-based marketing (ABM) approach depends on synchrony between sales and marketing in order to target, cultivate and convert the top accounts identified in a key target list. ABM requires effective alignment between the two departments on common revenue goals and defines a clear role for each of them in reaching these target accounts. Instead of chasing numerous leads, the ABM approach helps focus on the most valuable accounts (as identified by marketing and sales) and their buying committees.
According to Jay Gains, VP and Group Director at SiriusDecisions, businesses that strive for strong alignment between their sales and marketing teams experience 19 percent faster revenue growth and 15 percent higher profitability than their competitors. Marketo’s study found that effective coordination between departments results in 208 percent more value for the sales process and 108 percent less friction. The benefits of sales and marketing alignment are undeniable: shorter sales cycles, improved close rates, more efficient use of resources and eventually increased revenue.
Five Tips to Align Marketing and Sales
But how can alignment between these two groups in an ABM world be achieved and sustained? Here are some tips how to break down the silos and enable better collaboration in an account-based approach.
1. Set SLAs between Sales and Marketing around a joint plan of action. To effectively work towards the achievement of a shared revenue target, each of the teams needs to commit to specific financial goals that will contribute to the business growth. Create service-level agreements (SLAs) between the two departments where the commitment of marketing to the pipeline and the responsibility of sales to provide account intelligence and close deals are clearly defined. Assign deadlines and be sure you identify the key metrics of success against which progress will be measured. Keep in mind that the buy-in of all stakeholders is key to successful execution of the plan, including sales and marketing management, head of finance and other chief executives.
“Marketing needs to embrace revenue responsibility, act like a profit center, and focus on the strategies and tactics that lead to greater sales and higher lifetime value. This requires a major recalibration of how marketing acts, reports and prioritizes their activities and time.”
– Matt Heinz, President, Heinz Marketing Inc.
2. Agree on your priority list of accounts. Prioritizing the target accounts around which sales and marketing will unite forces is a key factor for success in the ABM approach. Use data to generate a list of high-value accounts that your company will pursue and get an agreement from sales and marketing on this final list. Divide these accounts into several tiers — tier 1 will be those of highest priority, while tiers 2 and 3 are still important, will require more nurturing but less sales effort. Engagio’s clients report more than 25 percent better target account coverage, more than 35 percent improvement in target account awareness, and more than 65 percent increase in target account engagement with account-based approach.
3. Clarify roles, accountability and responsibility. As part of your joint plan, it is important to align the roles and accountability rules to prevent confusion. Split the account list between the sales reps. Define at what stage of the journey marketing will hand over the accounts to sales for further nurture. Agree on a commonly accepted definition of marketing qualified account (MQA) and sales qualified account (SQA).
4. Make ongoing collaboration the norm. Collaboration between sales and marketing does not stop at the planning phase, but must become a foundational working principle in the ABM-focused organization. Both teams need to meet on regular basis — weekly or bi-monthly — to monitor progress towards meeting the established SLAs and to share account insights that will allow each group to do its work more effectively and efficiently. Track the performance against the KPIs that both teams agreed on. Optimize the plan and update the list of target accounts, if needed. According to D&B, companies that have aligned and fine-tuned their marketing and sales functions are “67 percent better at closing deals and generate 209 percent more revenue from marketing.”
5. Start small, grow big. Start your ABM program with a small set of high-priority segments of accounts and involve some of the sales and marketing leaders to work on a pilot. You can mobilize a smaller team of people to launch the first ABM initiative and show what ABM can accomplish for your company. Then they will become your ABM ambassadors in the company. As your ABM pilot efforts gain traction, include more team members and grow your target account list.
In the account-based world, sales and marketing are the left and right hands of the same body that act in accord from start to finish to attain the same goal — penetrate the accounts that have the highest propensity to buy and close deals. Silos and miscommunication are their worst enemies in this process, while joint planning and collaboration are their best friends.
Looking to start your own account-based marketing initiative? Scratch Marketing + Media can assist you. For more information, you can contact us here.
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