As data analytics, sales, and marketing converge in new ways, the industry is taking a fresh look at how this fundamentally new marketing approach is impacting the modern role of the chief marketing officer (CMO).
During a recent panel discussion we hosted, CMO Confessions: The Future of Marketing Measurement, I had the opportunity to chat with seasoned marketing leaders on how they see the role of the CMO changing as well their raw outlook on all things B2B marketing. Take a look at the highlights below.
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Individually, sales and marketing teams have their own internal goals they track and work toward achieving. It’s no secret that one unit’s efforts often impact another’s. However, the reality is that most companies evaluate each department’s effectiveness through internal and separate goals/quotas. Unfortunately, this reality leads to a siloed structure. Sales will continue working toward sales quotas, and marketing will continue working toward their own benchmarks. The modern CMO is driving alignment and overlap of the goals between sales and marketing, leading to even greater sales and marketing alignment than we’ve seen previously. Imagine a world where both teams are accountable to pipeline generation and ultimately revenue for the company. Working together, hand in hand. Hallelujah!
One of the panelists, Alex Poulos, had recently published a great article about the brand v revenue CMO. This led to a great conversation about the difference - and importance - of each skill set. While they hold the same role, they approach it differently. A brand-focused CMO is more creative and centers her benchmarks around storytelling and connection, while a revenue-focused CMO is more analytical and focuses on high-growth and urgent ways to drive conversions. The real question each company needs to ask themselves is… “what type of CMO is best suited for us given our growth priorities, philosophy on marketing, CEO’s background, etc?”
A marketing tech stack contains the tools marketers leverage to arrive at the most effective marketing decisions — things like your CRM and your collaboration tools. Data is undoubtedly integral in using these tools effectively.
However, the panel posed the idea that tech stacks are distinct from data stacks. A data stack is the collection of tools that essentially translate companies’ vast pools of collected data into actionable insight.
When it comes to the natural and ongoing transition between building a marketing tech stack to building a marketing data stack, CMOs need to explore questions like:
Talk about a controversial topic - you can google ‘Is the MQL Dead?’ and be presented with thousands of articles of varying opinions on the matter! According to the panelists, it seems many companies have shifted their focus to pipeline creation and influence, with few remaining focused on lead-related metrics that people have described as “dead.” Whether or not the Marketing Qualified Lead (MQL) metric is dead, every goal must be aligned on a single ultimate focus: revenue. At the highest levels, this is how each team’s success is measured. Other metrics - like the MQL - can have their own place as either leading or lagging indicators of success.
For this reason, it’s in the best interest of sales and marketing executives to align their goals.
Elevating pipeline helps both units achieve benchmarks. However, pipeline metrics are not particularly relevant if revenue targets are being missed. Obviously, quarterly revenue targets are more likely to be missed when sales and marketing are not in alignment.
Getting sales and marketing on the same page can be challenging, especially when each unit tends to measure and interpret pipeline metrics differently. So, again, shared goals are essential.
Ideally, both teams should “own” their part in the process but also work together. This becomes difficult when teams are not coordinating and sharing the same data. When sales and marketing are in alignment, pipeline metrics will improve alongside growth metrics.
Velocity is a metric that measures sales output in dollars per day or month. Sales teams sometimes use the term velocity to describe the number of signed contracts in a given period. However, this metric can provide much deeper insight into the speed of sales as they move through the pipeline.
Many factors impact velocity:
To paint the best picture possible, we’ll let the panelists speak for themselves with this video clip:
If you haven’t heard about how important sales and marketing alignment is, you’ve probably been living under a rock at this point. CMOs have a pivotal role to play in building this vital relationship. While all of our panelists have solid relationships with their sales counterparts, they all know from experience and through their connections that sales’ perception of marketing isn’t always puppies and rainbows.
There are several ways CMOs can help their teams build the bridge between sales and marketing, as advised by our expert panelists:
Sales and marketing alignment. Check.
What about marketing’s relationship with product?
With product-led growth (PLG) on the rise - many companies providing a free trial or a free version of their product - the relationship between marketing and product is becoming more and more crucial. But why?
In a PLG motion, marketing’s first goal is to get people into the product by starting a free trial or signing up for the free product offering. But, there is a point in this PLG funnel that can be considered outside of marketings’ role and responsibility. It really depends on the product experience (how easy is it to use, for example).
At the end of the day, it doesn’t matter if product or marketing owns the product experience, but it is important to have a clear owner to ensure a poor product experience doesn’t impact conversion rates and revenue.
A discussion about sales and marketing alignment would not be complete without diving into the competing goals of acquisition and retention - how much should your marketing team be focusing on each? We all know that in SaaS, retaining a customer is generally cheaper than acquiring a new one.
This is one area where access to data is crucial for all team members. For example, if the majority of your revenue growth comes from customer upsells, it is likely that you’re allocating a decent amount of your marketing resources to retention. On the other hand, if you’re just getting started and approaching hypergrowth, you might be focusing more heavily on acquiring new logos before you shift some resources towards things like community and customer programs.
How has this changed during Covid? I’ll let one of the panelists, Eric Keating, share his views on the matter:
As our panel discussion revealed, most companies would agree that sales and marketing alignment is tightly correlated with revenue and growth. It’s reaching that alignment that poses the most significant challenges.
Any attempt to align these teams must be data-driven. Tools like automation and predictive analysis will be vital as companies move into the next era.
Listen to more CMO confessions from our industry-leading panelists in the on-demand webinar.
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