In previous decades, such as the 1960’s depicted in Mad Men, sales were earned with simple creativity, gut instincts, and lavish dinners. This was the time to be a Chief Marketing Officer (CMO). Today, CMO has been called the most dangerous title around. After all, Don Draper never had to worry about analytics and lead generation growth.
That’s why new CMOs have to be data-driven, build and lead specialized teams without losing track of the day-to-day. Simultaneously, they need to drive revenue i.e. be “sales-focused.” The inability to tie contributions to revenue is the biggest reason why VPs of Marketing and CMOs don’t make it past two years, according to Joe Payne, former CEO of Eloqua (acquired by Oracle).
Here’s why the CMO role has changed and how startups can align efforts for more revenue.
The New Customer (Research) Journey
The past decade of Internet and SaaS growth has transformed the buyer’s journey. One notion is that this shift made Inbound Marketing more important than sales when it comes to conversion. A dated stat from B2B research firm SiriusDecisions was widely circulated: “70 percent of the buyer’s journey is complete before a buyer even reaches out to sales.” This concept was overblown.
SiriusDecisions debunked their own statistic with new research in 2015 after surveying more than 1000 B2B executives. They found that more than half the time, sales rep involvement starts at the beginning of the buyer’s journey. In fact, in complex buying scenarios, sales rep involvement starts at the beginning of the journey two-thirds of the time.
So, the bigger truth is not that buyers complete their process almost entirely online, but rather that they go through a research-intensive process that includes multiple engagements with company reps. Consider the recent research:
- 70 percent of buyers return to Google at least 2-3 times during the course of their research. (Pardot State of Demand Generation report)
- 73% of respondents viewed a case study during their research.
- 96% of respondents want content with more input from industry thought leaders.
- 47% of buyers viewed three to five pieces of content before engaging with a sales rep. (2016 Content Preferences Survey)
The clear opportunity for marketing is to educate through content and nurture prospects until they become qualified leads. The rise of Account-Based Marketing (ABM) can be attributed to this challenge. But while ABM awareness has increased, many programs are in their infancy. About 60 percent of respondents said their ABM efforts were less than a year old according to the ABM Benchmark Survey Report.
In addition to the immaturity of these programs, more than 70 percent admitted that ABM efforts weren’t being measured. This creates a rift with sales, everything they do is measured and sales quotas determine their company standing. A CIO contributor points out how VPs of Sales and CMOs have inherent conflicts about managing the CRM, product market fit, product price, marketing assets (type and frequency), etc.
Marketing and sales should focus on alignment, but cramming them into one will result in a lack of quality content or a lack of sales involvement, both are required for modern buying cycles.
Why Startups Should Focus on Sales
In reality, it’s not always to possible for sales and marketing to have separate leadership roles. According to Jessica Livingston, co-founder of Y Combinator, early-stage startups in this situation should focus on sales.
|“Sales and marketing are two ends of a continuum. At the sales end, your outreach is narrow and deep. At the marketing end, it is broad and shallow. And, for an early-stage startup, narrow and deep is what you want — not just in the way you appeal to users, but in the type of product you build.” –Jessica Livingston|
Livingston goes on to use the example of Airbnb, who was struggling to break into the hospitality market when they entered the Y Combinator accelerator in 2009. Instead of rolling out creative referral specials or growth hacking tactics, the founders flew to New York City to meet with their largest cluster of customers. This hands-on approach provided customer insights (e.g. the importance of nice photos and needed UI changes) that Airbnb leveraged on their way to surpassing 100 million guests.
Other examples include Stripe, Patrick and John Collison performed one-on-one installations for early adopters. Pinterest founder Ben Silbermann asked random Palo Alto patrons to try his new platform.
All of this proves that focusing on sales, or more precisely, doing whatever it takes to work with customers directly is a better growth solution than announcing your product to the world.
So, Can Your CMO be Sales-Focused?
In short, yes. The new customer journey has forced these two roles to align or lose out on revenue. Prospects will expect relevant and useful content along the way. Leads will expect a knowledgeable sales rep who can educate and problem solve.
Organizations can only accomplish this when sales and marketing teams work together through communication and collaboration on metrics and content. Company culture, tech stacks, executive leadership skills and more all have an impact. The solution is not a simple switch – focus on constantly finding ways to better align these disciplines.