There are two essential components needed for a successful organisation. Both of these components play pivotal roles for business, but cannot function in a mutually exclusive manner. They are two interlinking gears of the business machine that need to work together harmoniously for the system to run smoothly.
Meet Gear One: The Sales Team
Salespeople play the important role of bridging the gap between customer needs and the product/service that fulfills those needs particularly in B2B industries. Without the sales team, prospective customers may never convert into real, measurable sales. While prospects may be engaged with your organisation, if they’re not buying your product/service then you’re not generating any revenue, thus putting the entire company at risk.
Meet Gear Two: The Marketing Team
Most aspects of your business will rely on successful marketing. Without marketers businesses could find themselves with the best possible product/service on the market but with none of your potential customers knowing about it. The role of the Marketing Team is to inform your target audiences that your product/service exists and why it would help them. Marketing generates prospective customers for the sales team. Therefore, without marketing, sales would have a lot less people to sell to.
Historically, the Sales and Marketing teams within companies don’t tend to get along. Each division tends to focus solely on their own specialisation without much regard for co-operation, and when results aren’t as hoped, each department looks to the other for blame. This builds friction in-house.
The bottom line is that Sales and Marketing need each other. No matter what your business is, it is essential that you ensure integration across your Sales and Marketing teams to keep the gears turning. Don’t think of them as opposing forces, but instead as one and the same team; TEAM REVENUE!
Companies with strong sales and marketing alignment get 20% annual revenue growth. [Aberdeen Group, 2010]
It can be argued that the miscommunication issue with Sales and Marketing is due to the pre-conception that they have different targets, that Marketing does their job, hands over to Sales and calls it a day.
Marketing teams can get caught up in the notion that their end goal is to produce a high quantity of leads for the Sales team. The Sales team’s job is to generate revenue for the company by converting the maximum proportion of those leads to customers as possible. In this scenario there isn’t any overlap in the team’s jobs. Sounds about right, yes?
Wrong! This is where the gears would fail. This analogy falls apart if you consider that in this model the Marketing gear is in motion then stops just as the Sales gear starts turning. The entire point is that they function together, as one gear turns, so to does the other.
B2B marketers who emphasise lead volume over lead quality reduce sales efficiency, increase campaign costs, and fuel the gap between sales and marketing [Laura Ramos, “Improving B2B Lead Management,” 2006]
So how do we get Sales and Marketing rotating together?
To ensure harmonious integration of your Sales and Marketing teams it is pivotal that both teams support one another. Both teams should work together to achieve the same end goal.
Ensure that your Marketing team knows that their goal is not simply lead generation; they share the same goal as the Sales team. Sales budgets focus on a revenue figure. They know that in order to reach this number they need to generate “x” number of customers from the leads they receive from Marketing.
If Sales needs to make “x” number of sales and they generally are able to convert 5% of the prospects supplied to them into customers, Marketing will need to generate 20 times the number of “x” to reach revenue goals
Find below a simple step-by-step method of how you can generate targets for your Marketing team using Revenue as the shared goal. Apply this to your own business by substituting your figures into the formula.
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The above system works most optimally when Sales and Marketing COMMUNICATE! Get your teams talking! Hold regular “smarketing” meetings where everyone is encouraged to share what has and hasn’t been working. Facilitate continuous visibility into one another’s objective and daily responsibilities so that there is a shared understanding of realistic expectations.
With opened communication comes the ability to align around goals and personas in an effective manner.
Persona classification (Lead Scoring):
So what is persona classification? In Sales and Marketing this refers to how customers and prospects are viewed and catalogued in terms of what stage of the buying process they are at. It has to do with the perceived quality of prospects, i.e. how likely they are to become valued clients if contacted by Sales today.
So, how can you go about classifying your leads? What information do you need? This is where Lead Scoring comes into play.
Lead Scoring is the system used to rank prospects dependent on their “sales-readiness”. The higher a lead score the more likely that they will buy your service/product. Prospects with a higher score represent leads that are ready to be approached by the sales team. The problem associated with not having a scoring system which is accessible by both the sales and marketing teams is that this could mean that a salesperson attempts contact with a lead who is not yet ready to be contacted, i.e. they don’t want the product/service yet. This poses the risk of potentially losing that lead which may have converted to a customer if nurtured for longer before being approached.
Some of the key benefits associated with an effective lead-scoring model include:
Increase in Sales efficiency and effectiveness:
Lead scoring focuses Sales’ attention on leads that the organisation deems most valuable. This ensures that unqualified leads or leads with a low perceived value are not sent to sales for engagement thus avoiding the “Marketing leads are terrible quality!” argument and minimising the chances of losing prospects due to engaging too early.
Increase in Marketing effectiveness:
A lead scoring model quantifies for Marketers what types of leads or lead characteristics matter most when it comes to end sales. This qualification helps Marketers more effectively target their inbound and outbound programs and deliver more high-quality leads to sales. Never underestimate the value of having a company-wide understanding of what quantifies a “Sales-ready lead”!
Alignment between teams:
Lead scoring helps strengthen the relationship between Sales and Marketing by establishing a common language with which the teams can communicate. If Sales and Marketing can easily discuss the quality and quantity of leads generated, an end can be put to the Sales and Marketing bickering about low quality leads or bad sales follow-ups once and for all!
How to Lead Score:
For lead scoring to be an accurate and effective method of categorising prospects for salespeople, you must ensure you utilise a holistic approach to scoring. That’s to say that your scoring model should include both explicit and implicit information regarding the quality of the lead.
Explicit scores are based on demographical information your company has collected from prospects.
B2B companies may want to collect explicit information such as: company size, industry segment, geographic location, job title etc, whereas B2C companies are looking to collect explicit information such as age, gender, geographic location, occupation, education, income etc.
Implicit scores are gathered by monitoring your prospects behavior since they have come in to contact with your company. For instance; how regularly does the prospect visit your website? What is their open and click-through rate for emails? Have they downloaded eBooks or reports from your company? Their level of voluntary interaction with your company is a great indicator as to whether they are ready to be contacted by the sales team.
Process of setting up a lead scoring system:
1. Determine Scoring Criteria:
Have your Sales and Marketing teams communicate to define the most common qualities in the leads that successfully convert. You may also wish to utilise a staff survey approach with this stage and distribute it to your Sales and Marketing team to collect their feedback on what are the most important criteria.
2. Assign Points to Each Characteristic
Based off of the relative importance of each criterion, i.e. what has the highest impact on end conversion, allocate numerical values that weight these characteristics accordingly.
When observing explicit information your teams may find that companies of a specific size are most likely to convert. Therefore, together you may determine that prospects that fit this size will be awarded 10 points towards their score. The further away from that figure a company is, the lower the value added to their score.
When observing implicit information your teams my find a high correlation between converted leads and prospects who downloaded an eBook from your website. Therefore, together you may determine that if a lead downloads an eBook from your site they gain 10 points towards their score, however if they visit your blog they may only gain 1 point towards their score.
3. Dynamically Score Each Lead
Now that you have assigned values to each step of the lead interaction process this is where you patiently wait and collect information about your customer’s behavior. Based on both explicit and implicit information gathered you can start to generate scores at this stage.
4. Distribute and Prioritise Leads According To Scores
In the above examples, the higher a prospect’s score the more “ready” they become for engagement from Sales. Once scores can be generated, ensure you have a specific score at which the Sales team is alerted that the prospect is “ready” for contact.
5. Analyse Performance Data
It is important to realise that Lead Scoring is not something you can set-up once and leave. Customers have ever-changing wants and needs so it is vital that your Sales and Marketing teams continuously review the scoring process based on performance and apply changes to the scoring process as required.
For those of you who need some guidance to get started, find below some template examples to get you started with a lead scoring structure:
The Value of Lead Scoring
When Sales and Marketing are clear on the definition of a ‘qualified lead’, only the most sales-ready leads are passed on to sales to close. Defining a threshold Lead Score speeds up this process by keeping sales from wasting time on leads who aren’t likely to convert. Furthermore, it gives them a better chance to follow up on prospects that may not convert on the first call.
50% of leads are qualified but not ready to buy [Gleanster Research]
A 10% improvement in lead quality can result in a 40% improvement in sales productivity. [Stu Schmidt, Cisco Webex Sales Conference 2.0, 2007]
In the event that the potential customer has been engaged in your sales process and doesn’t purchase, they will still expect to hear from you. When Sales and Marketing work together and communicate, there is less chance of a lead being lost in the system or ignored by Sales.
- Prospects are not always put off by sales calls when they are not ready to buy, however in the traditional Sales and Marketing set up they are likely to be deemed ‘low quality’ leads by sales who do not follow them up again.
- Leads who are not yet ready to purchase should be reintegrated into the Sales and Marketing Funnel where the process will begin again. Marketing will nurture the prospect further until they qualify as ‘sales ready’, when they will then be passed on to sales.
- Scoring leads in this way can give both Sales and Marketing a more in-depth understanding of buyer personas and lead scoring criteria which can be used to improve sales and marketing processes. Strategy can then be built around problem areas in the funnel, by identifying how to move customers past bottlenecks to ensure maximum speed through the sales pipeline. Lead Scoring information is valuable data that can also be used to inform other campaigns.
Setting up these processes may seem daunting now if your business is just starting out, but by dedicating the time and effort to effectively integrating your Sales and Marketing teams now you can reap countless rewards for your business in the future.
Happy aligning! 🙂