We’re in the middle of conducting a survey about sales and marketing sentiment – what do sales people and marketers think about processes and people and technology. It’s a fairly short survey – if you’re in sales and marketing, we’d be very pleased if you’d spend a couple of minutes taking it. We’ll write a report about the findings and send it to you when the survey reaches its conclusion.
Part of the idea behind the survey was to track how sales and marketing alignment is evolving and changing. The hope is that when we repeat the survey – and we plan to at regular intervals – we’ll see sales and marketing working together more effectively, sharing data as a matter of course, and smoothing communication between the teams as a matter of course.
We hope that will happen. But, as Dr. Phil says, the best predictor of future behavior is past behavior. And if that holds true, we may be doing this survey for many years to come.
The state of alignment right now is rough indeed – and it’s expensive. According to IDC, B2B companies’ failure to align sales and marketing teams around the right processes and technologies costs them more than 10 percent of revenue per year. For a billion-dollar company, that’s $100 million left on the table.
The flip side of that getting it right is lucrative. A 2013 study by Aberdeen Group showed that less well-aligned companies saw a 7 percent annual decrease in revenues – while highly-aligned organizations saw growth of 32 percent.
Sirius Decisions echoed this. They found that B2B companies with highly-aligned marketing and sales operations achieved 24 percent faster three-year revenue growth and 27 percent faster three-year profit growth.
All these research firms are discovering the same thing: if you get sales and marketing aligned, you’ll make a lot more money. If you don’t, you’ll fall behind or even go backward. So how are businesses responding? In most cases, not particularly well.
Sales and marketing can’t even agree on how well they do things together. Demand Metrics studied this late last year; according to their study, 47 percent of marketers claimed good collaboration with sales in the development of marketing assets, but only 24 percent of salespeople felt the same. Meanwhile, the majority of marketers – 76 percent – felt their marketing assets were effective. Only 46 percent of salespeople felt the same way.
This failure of perception carries over into the ways leads are handled. A survey from the CEB Marketing Leadership Council revealed that nearly half of sales reps ignored more than half of all marketing-generated leads. The 2013 Lead Management Optimization Survey by CSO Insights uncovered a similar but slightly more optimistic nugget (but only because of the way the question was phrased): 42.6 percent of salespeople reported that they pursue less than 75 percent of marketing-generated leads.
So, how can it be that businesses know that sales/marketing alignment pays off, they have data from multiple studies that confirms it – and yet they take few steps to remedy the problem? I was chatting with Jill Konrath, a noted sales expert, and the issue came up. She pointed out that, if you’re in sales and you’re meeting or beating quota, you have little incentive to change your processes. Breaking through that all-too-human tendency to reach a performance plateau and then stick with what works is Jill’s big focus right now – and it’s a very interesting one.
I’d add to that the issue is often framed in such a global way that it’s tough for leaders to understand how to start approaching it. The problem is so large that it sounds like a business would have to shut down sales and marketing for a week, re-engineer all its processes and radically alter the team make-up to deal with personalities, conflicts, and role changes, then spin sales and marketing back up. Can your company afford a week with no sales? Mine can’t.
But the alternative to change is to keep leaving money on the table, to waste marketing budget, and for sales people to sputter along with little opportunity for growth.
There is another way – to move little by little toward alignment, steered by technology that’s designed to help marketers and sales people use and share data. It’s an alignment evolution: a conscious, deliberate, step-by-step reorienting of processes, technology and mind-set – with the latter being the most difficult to achieve, and the one best influenced by the results the other two components provide.
We’ll be talking more about this topic in this blog in the coming months – especially as we approach C3. The session proposals are suggesting a real desire for better alignment and offer some concrete ideas for getting there. In the meantime, if you want to see what CallidusCloud is doing to attack the alignment issue, a good place to start our page on marketing automation.