Blog #3 of 5 in our Peter Ostrow guest blog series
What Do You Mean, “Margin Matters”?
A long time ago, in companies far, far away, B2B marketers marketed and their sellers sold.
The former were responsible for guarding the integrity of the corporate logo and generating tons of leads; the sales team was left to their own devices, and expense accounts, if they sold enough stuff. Obviously, times have changed. Contemporary marketers have, for a decade or more, been held accountable less for how many bodies, clicks, and downloads they generate, and more around ROMI - return on marketing investment. Considering the well-publicized analyst predictions that by 2017 the CMO's budget will out-pace that of the CIO, ROI had better be part of the equation for marketing leaders hoping to keep their jobs secure.
The problem with shifting the KPI's of an entire line of business from activities to results is evident when we realize that the end-game – sales – is not entirely under the control of marketers. This is why the sales enablement industry is blossoming: yesterday's marketers focused only on brand integrity and world domination; Best-in-Class contemporary leaders hold themselves more accountable for the enterprise-wide bottom line. Indeed, Aberdeen's Sales Enablement research finds that “brand awareness" is only the sixth-most important metric to modern marketers. At the head of the line are distinctly sales-centric KPI's: customer retention, attainment of overall sales quota, accelerating the sales cycle, revenue growth from net-new accounts, and top-line company revenue growth. My, how times have changed.
On the sales side of the house, perhaps surprisingly, we are just now starting to see a similar set of changing priorities among the leadership landscape. Since forever, sales executives and their C-suite sponsors obsessed over basically one thing: how many widgets are sold. Indeed, my Sales Effectiveness research has, since the George W. Bush administration, confirmed that top-line revenue is pretty much all that has mattered to sales reps and leaders alike. Just close the deals, we say, and we'll figure out the paperwork later.
Until now.
My newest data set signals a seismic shift in the self-reported goals of sales management and sales operations end-users: their number-one aspiration is now…wait for it…growing margins, with 44% of all respondents indicating profit as a top-three goal. Seriously? Yes. My read on this data holds that while the stronger marketers have, for years now, adapted their worldview to include business-centric results in determining their strategies, sales leadership is finally ready to sit at the grown-up table. I'm not yet sure why, because sales managerial strategies and executive compensation plans have yet to reflect this change, but perhaps it's just finally time for the sales line of business to earn the respect of their fellow departmental leadership peers. Plus, the ability to run your own business, within the overall enterprise, creates a track record for executive-level career advancement, perhaps all the way up to the C-level.
In the context of sales enablement, what do these new-age focuses on bottom-line productivity mean for the everyday activities of B2B marketing and sales leaders? Consider some of the typical complaints we hear from their staff members: the CRM slows me down, rather than empowering me to close business. The marketing automation and CRM platforms are disconnected. We put out all this content and have no idea what's used, or what's working. What actually goes on in customer-facing sales meetings?
Our research finds that a well-deployed, cloud-based sales enablement platform measurably improves the business performance of organizations that proactively bring marketing and sales initiatives and activities together. Check out the self-reported, year-over-year metrics of our survey respondents, when broken down into properly enabled sales organizations, compared with old-school teams:
Figure 1: Grown-Up Results from Sales Enablement Deployments
Source: Aberdeen Group, November 2014
Growing company revenue at even a sliver of a faster rate will put a lot of stakeholders – not only internal ones – in their happy place. Increasing the percentage of close-able sales opportunities that marketing generates creates great job security for savvy marketers who know where their bread is buttered in the modern era. A faster rise in overall sales quota attainment is a metric even Scrooge would love. And, for you old-school marketers out there, we can even sure you more butts in conference seats, if you’re willing to reduce the costs, while improving the value of, your customer engagement activities.
What about the complaints above? It’s true that too many CRMs are designed for management oversight, rather than rep-level time savings. Companies with active sales enablement platforms in place have a legitimate opportunity to turn old-fashioned, glorified Rolodex CRMs into empowering real-life sales tools, by linking the marketing automation and CRM platforms together through the currency of content. Best-in-Class firms, for example, are 59% more adept than under-performers at creating a CRM-linked, centralized marketing asset library that associates different creative messaging with a wide variety of potential selling situations or sales cycle stages. This empowers reps to provide the right message, to the right prospective buyers, at the right inflection points in nurturing customer relationships.
A well-oiled sales enablement deployment also allows marketers’ visibility into content consumption to extend much further into the sales cycle, when the solution can deliver back specific data on the deployment of, and reaction to, market-facing assets in real-time. This product capability, finally, supports a more holistic, data-driven sales coaching competency that turns mere marketing collateral into a vital component of continuous sales improvement.
Our next blog focuses on sales enablement visibility: Which Half of YOUR Marketing Budget is Working?
Peter Ostrow
VP & Research Group DirectorCustomer Management, Sales Effectiveness
Peter Ostrow Vice President, Group Director | Sales Effectiveness & Strategy
Peter Ostrow is the VP/Group Director, Customer Management and Principal Analyst, Sales Effectiveness at the Aberdeen Group, a leading provider of fact-based research focused on the global technology-driven value chain.
Peter has been focused on sales and marketing best practices for 25 years, beginning with a long-time stint at advertising firm JWG Associates. As JWG’s third employee, he participated in every aspect of the company’s sales growth, from $1M to $135M, until its acquisition by Monster Worldwide’s TMP AdComms division. At TMP, Ostrow deployed additional CRM, pipeline management, lead generation and competitive intelligence practices as VP, Global Sales Administration. He then spent five years as VP, Business Development with MarketOne International, a global provider of lead lifecycle management services to technology sales and marketing executives.
At Aberdeen, Peter oversees research consumed by end-users in Marketing, Sales and Service management roles. He also leads the Sales Effectiveness practice, covering the technology, service and consulting enablers that enterprise sales forces deploy to become best-in-class organizations. His research is widely publicized and covers topics such as sales training, sales intelligence, CRM/SFA, sales performance management and integrating technologies around customer acquisition and retention.
Peter holds a Bachelor of Arts in History and Political Science from Brown University.
