The rules of B2B marketing are constantly changing. What worked yesterday won't necessarily work today or tomorrow. This blog presents information, opinion, and speculation about where BtoB marketing is headed.
Some pundits contend that account-based marketing will create better alignment between marketing and sales. In reality, ABM can be a catalyst for improving sales-marketing alignment, but it won't cause such improved alignment to magically materialize. The adoption of ABM will quickly uncover weaknesses in the relationship between your marketing and sales teams, and that's a good thing. Here's why. One of the key requirements for successful account-based marketing is coordinated efforts by business functions that have historically operated more or less independently. The need for teamwork routinely involves marketing, business development, and sales, and when ABM is used to expand relationships with existing customers, it will also extend to the customer success/customer service functions.
To reap the maximum benefits from ABM, marketing, business development, and sales must jointly develop an engagement plan for each target account. This account plan will usually span several weeks to several months, and will likely include activities by all three functions that must be closely coordinated. In addition, these business functions must be ready to make on-the-fly adjustments to the account plan based on actual buyer responses and changing business conditions at each account.
Therefore, successful ABM requires multiple business functions to work collaboratively on an ongoing basis. This level of coordination is challenging for many companies because it represents a major change in how they have traditionally engaged and managed sales leads.
In many B2B companies, the demand generation process involves a series of "hand-offs" from one business function to another. In essence, the process assumes that marketing, business development, and sales will engage potential buyers sequentially. The metaphor often used is a relay race in which each member of the relay team runs for a specified distance, and then passes the baton to the next runner.
The relay race approach has never been the best way to manage demand generation, and it is particularly problematic when used with ABM. The adoption of ABM has an effect that is similar to reducing the work-in-process inventories in a manufacturing process.
ABM "Lowers the Water Level" In the discipline of lean manufacturing, inventory is one of the seven primary sources of waste, and most lean practitioners are always looking for ways to reduce inventory levels. To explain one role that inventories play, lean experts use a "rocks in the river" analogy.
In this analogy, inventory is like the water level in a river. As long as the water level is high enough, boats on the river will easily float over any rocks in the stream bed. The high water level makes the rocks invisible and also eliminates the danger they would otherwise pose for boats navigating the river. But if the water level is lowered, the rocks become visible, and the danger they pose becomes clear.
Lean experts say that inventory in a manufacturing system often conceals problems in the manufacturing process. High inventory levels also alleviate the immediate pain caused by the problems, but at a high cost. When inventory levels are lowered, the real problems become visible, and the ramifications of those problems become apparent. So in lean manufacturing, reducing inventories ("lowering the water level") not only eliminates waste, it also points company managers to the real problems that need to be solved.
The adoption of account-based marketing works in a similar way. Because successful ABM demands an unprecedented level of collaboration and coordination across multiple business functions, any lack of collaboration or coordination will quickly become visible. And this will enable company leaders to address the specific problems that are holding back the success of their ABM program.
The bottom line is, ABM can be a catalyst for improving the relationship between marketing, sales, and other business functions because it will make weaknesses in those relationships visible and addressable.
Eighty-seven percent of the survey respondents said that measuring marketing performance is a growing priority for their company, but more than half (54%) also said their ability to measure and analyze marketing performance needs improvement or is poor/inadequate.
The widespread interest in measuring marketing performance indicates that the demand for performance measurement software is poised to grow substantially. In a September 2018 report, Forrester Research said that marketers spent about $1.09 billion on marketing measurement solutions in 2017, and the firm estimates that spending on such solutions will reach $2.1 billion by 2023.
The Demand Gen research also revealed what is motivating marketers to improve their measurement capabilities. When survey participants were asked what is increasing their need for deeper metrics, the top two drivers identified were:
The desire to show marketing's impact on pipeline and revenue (70% of respondents)
The push to show ROI from all marketing investments (60%)
As these results show, the key motivations for improving marketing measurement capabilities are to demonstrate the economic value that marketing creates for the business and to optimize the mix of marketing programs based on economic performance.
Both of these objectives require the use of financial metrics, and this makes marketing measurement more challenging. The heart of the challenge is attribution, which is the process of assigning revenue and costs to marketing programs.
There are three robust methods for attributing revenue to, and measuring the financial impact of, advertising and marketing programs. Two of these methods - marketing mix modeling (MMM) and multi-touch attribution (MTA) - have been in use for several years. The newest and most sophisticated method is unified marketing measurement (UMM).
Marketing Mix Modeling
Marketing mix modeling involves the use of advanced statistical techniques to estimate the impact of advertising and marketing activities on incremental sales and/or other desired outcomes. Marketing mix models are usually based on many months of historical information about sales and marketing/advertising spending across both digital and offline channels. MMM also incorporates factors such as weather, competitive activity, seasonality, and overall economic conditions.
MMM is a top-down approach that estimates the impact of distinct marketing programs and channels on incremental revenue. These models do not evaluate the actions of individual prospects or customers. Because MMM is backward-looking and doesn't consider the actions and responses of individual people, it doesn't provide the timeliness or level of detailed information that are required to support tactical marketing decisions.
Unlike MMM, multi-touch attribution is a bottom-up approach that analyzes information about the actions and behaviors of individual prospects and customers. Ideally, this data will include every exposure that an individual has had to a marketer's messages and his or her responses (or lack thereof) to those messages.
Most MTA solutions focus exclusively or primarily on estimating the financial impact of digital marketing activities, and their ability to capture the impact of offline marketing activities is limited. Therefore, MTA solutions can overstate the amount of revenue attributable to digital marketing programs. MTA solutions can also be inaccurate because they don't usually account for a baseline of revenue that would exist without any marketing efforts.
Most robust MTA solutions use advanced statistical techniques and computer algorithms to assign revenue to marketing activities, rather than relying on simplistic pre-set "rules" (such as first-touch, last-touch, etc.) that often produce wildly inaccurate results.
Unified Marketing Measurement
Given the inherent limitations of MMM and MTA, a growing number of companies have begun using a method known as unified marketing measurement that leverages the strengths and eliminates the weaknesses of MMM and MTA. UMM solutions are capable of measuring the impact of both digital and offline marketing activities, and they combine a top-down and bottom-up approach. In its report, Forrester estimated that UMM solutions now account for 28% of the measurement solution market.
What About Cost?
These advanced marketing measurement solutions aren't exactly cheap. In a report published last year, Gartner estimated that companies pay from $100,000 to $250,000 on average for a one year MMM or MTA solution. And the cost can be much higher.
Notwithstanding the cost, advanced marketing measurement solutions can be a smart investment for many companies. In its report, Forrester noted that these solutions often enable a 15% improvement in marketing ROI, and that overall spending on marketing measurement represents only 0.2% of total marketing spending.
Illustration courtesy of Kari Bluff via Flickr CC.
Salesforce recently published the fifth edition of its State of Marketing report. The new report is based on a survey that was fielded between August 13th and September 23rd of last year, and produced 4,101 responses from marketing leaders (manager or higher). Survey respondents were from North America, Latin America, Asia-Pacific, and Europe.
The authors of the report observed that today's marketers are facing far different challenges from their predecessors. These new challenges are driven by high customer expectations for overall experiences that match their expectations for product quality. This observation isn't particularly surprising, given that the importance of customer experience has been widely discussed for several years.
The Salesforce survey identified four major trends in marketing.
Marketing Becomes the Orchestrator of Customer Experiences Providing exceptional end-to-end customer experiences is inherently cross-functional, but marketing is well positioned to function as the hub of customer experience efforts. Nearly half (45%) of the survey respondents said that marketing is leading customer experience initiatives across the business at their company.
This finding is nearly identical with the August 2018 edition of The CMO Survey, in which 45.7% of respondents reported that marketing leads customer experience efforts.The Salesforce survey also found that marketers are forging connections with sales, commerce, and service teams in order to deliver better end-to-end customer experiences.
New Realities Elevate the Importance of Data Unification It's not news that the effective use of data is critical for marketing success. The Salesforce research found that marketers are using more sources of data to gain a deeper understanding of customer needs, preferences, and behaviors.
According to the survey, the median number of data sources used by marketing organizations will increase from 12 in 2018 to 15 this year. However, more work is needed to unify those data sources. Only 47% of survey respondents said they have a completely unified view of customer data sources.
Marketers Remain Committed to Personalization The Salesforce survey revealed that marketers' belief in the power of personalization remains strong. More than eight out of ten of the survey respondents said that personalization produces major or moderate improvements in brand building, lead generation, customer retention, customer acquisition, and customer advocacy.
The survey also found that the use of artificial intelligence to power personalization is growing. Twenty-nine percent of respondents in the latest survey reported using AI, up from 20% in 2017. Marketers also appear to be focused on trust and privacy issues. Fifty-one percent of respondents said they are more mindful about balancing personalization and privacy than they were two years ago.
Marketers Strive for Real Time Engagement Lastly, the Salesforce research found that engaging customers in real time has become marketers' top priority and their biggest challenge. Fifty-two percent of survey respondents said they now engage customers in real time across one or more marketing channels. It also appears that marketers are making their engagements more responsive and dynamic. Fifty-two percent of the survey respondents said they adapt marketing strategy and tactics based on customer interactions.
The annual State of Marketing survey by Salesforce provides an important snapshot of the attitudes and practices of global marketers. I suspect that the new Digital Trends Survey by Econsultancy will address some of the same issues, and it will be interesting to compare the findings of these two studies. Image source: Salesforce
In my previous two posts, I've discussed the expanding role of marketing in driving business growth. Recent research shows that many marketing leaders now believe they are primarily responsible for leading growth efforts in their organization, and that CEOs and other senior executives share this belief.
The recent research also shows, however that leading growth is more of an aspirational goal than a current reality for most marketers. Overall, the studies suggest that most marketing leaders are still relying primarily on conventional marketing communication tactics and tools to drive growth.
Against this backdrop, a book published last fall by the American Marketing Association describes an interesting and arguably novel approach to identifying and exploiting growth opportunities. The Organic Growth Playbook by Bernard J. Jaworski and Robert S. Lurie is the first in a series of seven books to be published by the AMA that will address complex, challenging, and difficult-to-solve marketing problems.
The basic premise of The Organic Growth Playbook is that the conventional approach to marketing - which is based largely on attempting to differentiate a product or service in the minds of potential buyers - isn't a reliable way to drive consistent organic revenue growth for most companies. The authors contend that in addition to product positioning and differentiation, marketers should focus on identifying the specific behaviors of potential buyers that have a disproportionate impact on the ultimate purchase decision, and then work to persuade prospects to engage in those behaviors.
The first step in the process described in The Organic Growth Playbook is to map the buying process waterfall. This step provides the essential foundation for the rest of the process, and in addition, the insights produced by mapping the buying process waterfall constitute one of the main components of the market expertise that I discussed in my last post.
Mapping the buying process waterfall is a two-step process. The first step is to identify all of the activities that are performed by any of the potential buyers in a given market from the time they become aware of a need they may need to address until a solution is purchased (or not purchased). These activities are arranged sequentially, with the earliest activities at the top of the map, and later activities - including the ultimate purchase decision - at the bottom. Activities that potential buyers use for a similar purpose, and that happen at about the same time - are grouped by their position or stage in the buying process.
The second step is to identify the frequency with which each activity in the buying process occurs. This step is critical because it enables the marketing team to measure the flow of potential buyers through the buying process and identify what paths different types of buyers tend to take.
The book's authors argue that in most buying processes across most industries, there are one or two critical buyer behaviors that have a decisive impact on the final purchase decision. The authors call these activities "high-yield behaviors," and they become the focal point of marketing and sales efforts.
The following diagram presents a greatly oversimplified version of a buying process waterfall map:
In this diagram a high-yield behavior (Target Behavior X) is shown at the top, and the ultimate purchase decisions are shown at the bottom. The diagram also shows the percentages of buyers who made each purchase decision segmented by whether or not they engaged in Target Behavior X. As the diagram shows:
Potential buyers who engage in Target Behavior X are twice as likely to purchase the company's product (60% vs. 30%); and
Potential buyers who engage in Target Behavior X are only half as likely to exit the buying process without making a purchase (20% vs. 40%).
In this example, Target Behavior X has a significant impact on the company's ability to earn more sales and generate revenue growth. Therefore, a focal point of the company's marketing and sales efforts should be to persuade more potential buyers to engage in the desired behavior. And because this type of analysis considers all of the potential buyers in a given market, it can enable marketing and sales leaders to uncover growth opportunities they had not previously considered.
Marketing has always been associated with revenue generation and growth, but a rising number of marketing leaders now contend that business growth is the raison d'etre of the marketing function. Recent research shows that many marketing leaders believe they have become primarily responsible for driving growth in their organization, and that this belief is shared by CEOs and other senior executives.
Despite this view, however, the recent research also suggests that most marketers have not moved beyond conventional marketing tactics in their efforts to drive growth. For example, in a recent survey of CMOs and other senior marketing leaders by the CMO Council and Deloitte, more than 40% of the respondents said they were working on brand shaping and campaign execution activities, but only 6% said they were actively involved in growing revenue across all business activities.
If both senior marketing leaders and other C-suite executives see the need for marketing to play broader role in growth, why have so few CMOs taken up the challenge? Many CMOs want to be growth leaders, but haven't been given the formal authority to play that role. In these circumstances, they key is to build credibility with the CEO and other members of the senior leadership team and thereby earn the right to exert influence over company-wide growth initiatives.
Some industry commentators have argued that the most effective way to expand the impact of marketing on growth is to focus on customer insights. A recent article in the Deloitte Review urged CMOs to "relentlessly pursue customer expertise" and use that expertise to gain influence with other business functions. The authors contend that marketing leaders should develop expertise about the entire customer journey (including those parts owned by other business functions) and then leverage that expertise to build partnerships with other company leaders to improve customer experiences.
Both Customer and Market Expertise are Necessary Developing expertise about the customer journey is obviously a critical part of marketing's job, but it's not the whole job. In order to identify and effectively exploit all growth opportunities, marketing leaders need to develop market expertise as well as customer expertise.
Market expertise includes customer insights, but it's broader in several ways. As the term implies, the primary objective of market expertise is to understand the economic and competitive characteristics of the market in which the company operates. Developing market expertise requires marketing leaders to perform an analysis of several factors, some of which are:
What is the size of the market?
How fast is the overall market growing? Are some segments of the market growing significantly faster than others?
Who are the major competitors in the market? Is the market fragmented, or is it dominated by a few large competitors?
How profitable is the overall market? Are some market or customer segments significantly more profitable than others?
Is the market composed of a large number of small customers or a relatively small number of larger customers?
How easy or difficult is it for new competitors to enter the market?
Is the market vulnerable to substitute products and/or services?
This list is far from complete, but it provides an indication of the kinds of issues that marketing leaders should be analyzing on a regular basis.
Focus on Critical Buyer Behaviors
Market expertise also requires a clear understanding of the behaviors of potential buyers. The recent emphasis on delivering outstanding customer experiences has elevated the importance of understanding how and where customers and prospects interact with the business and what they are trying to accomplish during those interactions. Customer insights like these can be used to improve customer experiences, which will contribute to growth.
These insights are important, but growth-oriented marketers also need to understand the behaviors of potential buyers who do not become customers. More specifically, marketers need to identify whether potential buyers who become customers engage in different behaviors (or certain behaviors more frequently) than potential buyers who do not become customers. In many cases, these behavioral differences will reveal where marketers can have a major impact on business growth.
In my next post, I'll discuss how identifying and quantifying the behaviors of potential buyers can help marketers identify untapped growth opportunities.
Illustration courtesy of OTA Photos (tradingacademy.com) via Flickr CC.
The role of marketing was a major topic of conversation last year, and there is a widespread belief that marketing's scope of responsibility has expanded. In the August 2018 edition of The CMO Survey, eight out of ten (79.6%) of the survey respondents said that the role of marketing in their organization had broadened over the past five years.
Marketing's responsibility for orchestrating customer experiences has been widely discussed for several years. More recently, industry commentators and practicing marketers have become focused on the role of marketing in driving business growth.
In a recent survey of over 200 CMOs and senior VPs of marketing by the CMO Council and Deloitte, 27% of respondents said that the CMO is primarily responsible for the growth strategies and revenue generation for their organization. The CEO came in second at 22%.
Marketing leaders also believe that other senior business leaders expect them to play a leading role in growth. When participants in the CMO Council/Deloitte survey were asked what level of expectation there is among senior executives and board members for marketing to be a growth driver, 35% of respondents put the expectation level at high, and 33% said senior company leaders think growth is the primary mandate of marketing.
Some will argue, of course, that this is nothing new. After all, it's fair to say that growth has always been the "prime directive" of marketing. What's new is that marketing and other business leaders now believe that marketing needs to expand the tools it uses to drive revenue growth.
So as we begin a new year, it's appropriate to ask two basic questions about the expanded role of marketing. First, to what extent have marketing leaders embraced the growth challenge and adjusted their activities to play a larger role in growth? And second, what should be the role of marketing in driving growth, and what do marketing leaders need to do to fulfill that role?
Where Do We Stand Today? The recent research indicates that leading business growth is more of an aspirational goal than a current reality for most marketers. Overall, the studies show that most marketing leaders are still relying on conventional marketing communications tools to drive growth, and they remain much less involved in other business activities that have a significant impact on growth.
For example, in the latest edition of The CMO Survey, senior marketing leaders from B2B and B2C companies were asked to identify the activities or functions that marketing is primarily responsible for in their company. The top four activities identified by survey respondents were:
Brand (91.4% of respondents)
Digital marketing (82.7%)
Social media (82.7%)
Other activities identified by more than 50% of survey respondents included promotion (71.6%), positioning (71.6%), public relations (69.1%), and marketing analytics (68.5%)
In contrast, only 40.1% of respondents indicated that marketing is primarily responsible for revenue growth, and even fewer respondents indicated that marketing has primary responsibility for market entry strategy (38.9%), new products (34.0%), and market selection (26.8%).
The CMO Council/Deloitte survey referenced earlier paints a similar picture. That research found that many marketing leaders have identified some steps they need to take in order to drive growth, which include developing strategies and plans to improve revenue and gain market share. The research also found, however, that most marketers are falling back into their "brand comfort zone." The survey report states:
When asked what the role of marketing is specific to growth, only 6 percent of respondents say they are driving routes to revenue across all facets of the business globally, only 4 percent are providing sales intelligence and key account insight support, and only 13 percent are working to retain and grow customer relationships through improved customer experiences. Instead, many marketers are defining and shaping the brand (44 percent) and executing campaigns to attract customers and predispose prospects (42 percent). . . Overall, despite the clear intention to drive revenue, brand and campaign win out in action. . ."
These survey findings suggest that most marketing leaders have not moved significantly beyond "conventional" marketing tools and tactics in their efforts to drive business growth. So what is the "right" role of marketing in business growth, and what steps should marketing leaders take first to fulfill that role? I'll address this question in my next post.
Top image courtesy of ccpixs.com (Creative Commons License).
This will be my last post of 2018, and I want to thank everyone who has spent some of his or her valuable time reading this blog. My goal for this blog has always been to provide content that readers will find to be informative, thought-provoking, and useful, and I've been immensely gratified by the attention and engagement this blog has received.
For the past few years, I've used my last post of the year to share which posts have been most widely read. Like last year, I'm only considering posts that were published in 2018. I've ranked the posts based on cumulative total reads, and therefore posts published early in the year have an advantage.
So, in case you missed any of them, here are our five most popular posts for 2018:
Astute business leaders have long recognized that trust is a vital element of competitive success. But traditionally, trust has been viewed as a "soft" issue - one of those things we know is important, but find difficult to measure. New research by Accenture Strategy quantifies the impact of trust on both revenue and earnings.
So far this year, I've published seven posts here that have addressed some aspect of trust. I've devoted this must attention to trust because it has a significant impact on virtually all aspects of marketing. Trust lies at the heart of all business relationships, and back in January, I argued that widespread buyer skepticism of vendor-provided information was one of those elephant-in-the-room issues for B2B marketers.
Lack of trust produces a major drag on marketing performance. If buyers don't trust what you say, they won't give you credit for understanding their needs, or for providing relevant, personalized, and engaging content and experiences. It's no coincidence that most companies aspire to be seen as a "trusted advisor" by their customers and prospects.
Most business leaders instinctively understand that earning and maintaining the trust of existing and potential customers is essential for success. But because trust is intangible, its economic and financial impacts are difficult to measure and quantify. A recent analysis by Accenture Strategy has now established a clear and measurable link between trust and both revenue and earnings.
The Accenture Strategy "Competitive Agility Index" is a measure of a company's competitiveness that is based on three equally-weighted components:
Growth - Year-over-year enterprise value growth and revenue growth
Profitability - Multi-year views of return on invested capital, net debt, and EBITDA margin
Sustainability and Trust - A quantitative view of environmental, social, and governance factors, including the United Nations Global Compact principles, and a proprietary measure of trust based on publicly available data
In this research, Accenture Strategy used more than four million data points to calculate index scores for over 7,000 companies operating in 127 discrete industries. The index is designed to measure overall competitive agility, not specifically the impact of trust. But Accenture found that trust factors had a disproportionate effect on the overall index score - and on both revenue and earnings (EBITDA).
The Accenture analysis also makes the importance of trust abundantly clear. The authors of the study report wrote: "Our 2018 analysis revealed that more than half (54 percent) of the companies we examined experienced a material drop in trust at some point during the past two and a half years. . . Across the 54 percent of companies in our sample that experienced a drop in trust, revenues at stake conservatively equate to at least US$180 billion, based on available data."
Based on this analysis, Accenture Strategy argues that companies must make trust a strategic priority. The study report states: "Your leadership team must embrace trust as a core element of business strategy. All teams - at every level - must walk the talk. The choices they make every day need to support trust as a key element of their corporate business strategy."
The analysis by Accenture provides compelling evidence that trust has a significant impact on corporate financial performance. Therefore, it's important for marketers to make enhancing trustworthiness a key objective for all of their programs.
Since launching this blog in 2010, I've written about various aspects of sales-marketing alignment 26 times. And I certainly wasn't the first person to address this topic. For more than a decade, most B2B marketing and sales professionals have recognized the need to forge a more productive relationship between marketing and sales, and many B2B companies have been working on sales-marketing alignment for several years.
Yet, sales-marketing alignment remains a hot topic and an ongoing challenge for marketing and sales leaders. Yesterday, I performed a Google search using the term "sales and marketing alignment." My search produced 320,000 results. When I limited the search to the previous year, Google still returned 22 pages of results.
So, as we near the end of 2018, it seems appropriate to ask how much progress has been made toward achieving effective sales-marketing alignment.
Given the continuing interest, it shouldn't be surprising that several research studies performed in 2018 address the topic of sales-marketing alignment. The research indicates that some companies have made meaningful progress in improving the quality of the marketing-sales relationship.
Earlier this year, for example, InsideView published The State of Sales & Marketing Alignment in 2018, which was based on a survey of more than 500 sales and marketing professionals. In this survey, 75% of marketing respondents, and 68% of sales respondents reported having a good or excellent relationship with their counterparts.
Overall, however, the 2018 research shows that many companies still have work to do to turn their marketing and sales organizations into a cohesive, high-performing demand generation team.
In the InsideView survey discussed above, respondents rated their sales-marketing relationship as weak or very weak on several important demand generation activities, including:
Defining and executing field programs;
Sharing knowledge about customer buying processes; and
Reporting results of joint activity.
In the 2018 State of Pipeline Marketing study by Bizible (and other firms), only 31.2% of survey respondents characterized the sales-marketing relationship in their company as aligned. Another 56.1% of respondents described their sales and marketing teams as being somewhat aligned.
In the 2019 Data-Driven Marketing & Advertising Outlook study conducted by Adweek Branded on behalf of Dun & Bradstreet, only 25% of surveyed B2B marketers said they and their sales counterparts share a full definition of who constitutes a qualified lead. Another 56% of the survey respondents said they and sales have agreed on a limited definition of a qualified lead, but they have no formal documentation of that definition in place.
The growing use of account-based marketing has elevated the importance of - and focused more attention on - building and sustaining a collaborative relationship between sales and marketing. But in the 2018 ABM Benchmark Survey by Demand Gen Report, respondents identified sales and marketing alignment as their second biggest ABM-related challenge (39% of respondents), trailing only proving ROI/attribution (40% of respondents).
Where Do We Stand?
So, where do we really stand with sales-marketing alignment as 2018 draws to a close? Many of the current "best practices" for improving sales-marketing alignment focus on two primary objectives:
Creating a shared understanding among marketing and sales team members regarding the key elements of the company's go-to-market strategy, including the definition of the target market, core value propositions, and customer buying processes; and
Establishing an agreed-upon lead management process (lead stage definitions, lead scoring criteria, etc.).
These objectives are important, but they aren't sufficient to create the level of alignment - or, more accurately, operational integration - that's required for high-performing demand generation in today's business environment.
Over three years ago, Scott Brinker described the situation eloquently when he wrote that the conventional methods for improving sales-marketing alignment weren't "so much a breakthrough in alignment as much as a negotiated peace settlement between two separate countries who share a common border. Trade policy and border control were established, facilitating commerce between them, but they were not one nation under a common flag."
What's Needed in 2019?
To take sales-marketing alignment to the next level in 2019, marketing and sales leaders need to focus on two additional objectives:
Recognized Interdependence - Effective sales-marketing alignment requires a widespread recognition by members of the marketing and sales teams that they need each other, and that an integrated approach to demand generation is essential for success. Therefore, marketing and sales leaders must constantly communicate and reinforce the importance of having marketing and sales work together seamlessly and function as a cohesive team.
Ongoing Collaboration - Effective alignment also requires marketing and sales to work collaboratively on an ongoing basis, and collaboration needs to occur naturally and spontaneously, whenever and wherever it's needed. Therefore, marketing and sales leaders must constantly communicate that informal, self-directed collaboration among marketing and sales team members is not only acceptable, but expected.
The authors contend that customer expectations have risen to exceptionally high levels, and that meeting those expectations requires companies to achieve an unprecedented level of coordination across the business. Many CEOs have responded to this need by creating new C-level roles with responsibilities that span traditional business functions.
These new roles come in several "flavors" with titles such as chief revenue officer, chief growth officer, chief customer officer, or chief digital officer. The growing use of these new senior leadership positions obviously raises questions about the future role of the CMO.
Not surprisingly, the article's authors describe four possible "pathways" for today's chief marketing officers:
Up - The CMO is promoted into a new role and given broader responsibilities for leading growth and customer experience functions.
Over - The CMO keeps the same title, but his or her role is expanded to encompass new growth and customer experience responsibilities.
Down - The CMO's role and responsibilities are downgraded, and the "head of marketing" may no longer be a member of the senior executive team.
Out - The CMO leaves the company, either voluntarily or involuntarily.
If CMOs (or other top marketing executives regardless of title) want to move up or over instead of down or out, they need to demonstrate a new set of skills and capabilities. And there's no shortage of advice regarding what those skills and capabilities should be. Dozens of recent articles have weighed in on the skills and capabilities that the "modern chief marketing officer" should possess.
The Deloitte/CMO Council research revealed that the three most important drivers of CMO success are:
Knowing how to use customer data and analytics
Having an enterprise-wide business mind-set
Being the voice of the customer at the leadership table
In the Deloitte article, the authors recommend that CMOs should begin redefining their role by focusing on three key behaviors.
Relentlessly pursue customer expertise - Marketing is uniquely positioned to be the voice of the customer, and CMOs should constantly strive to improve their understanding of customers and demonstrate their customer expertise to other senior leaders. CMOs need to leverage data-driven insights to understand the whole customer journey, including those parts that don't directly involve the marketing function. They also need to build partnerships with other organizational leaders to deliver better end-to-end customer experiences and support the achievement of other strategic business objectives.
Make marketing make sense - CMOs should "speak the language" of other senior leaders and be ready to translate marketing concepts into terms that align with the objectives of those leaders. In other words, the CMO's goal should be to explain how marketing activities and programs will help other senior leaders achieve their objectives. Obviously, this will often require the CMO to quantitatively connect marketing initiatives with financial outcomes.
Establish a "center-brain" mentality - CMOs must balance the "right-brain" creative aspects of marketing with the "left-brain" analytical/data-driven aspects of marketing. Going forward, successful marketing will demand both strong analytics and inspired creativity.
Although these larger teams provide some benefits, they also come with downsides. For one thing, many CEOs increasingly find themselves refereeing conflicts between senior executives. And even when outright conflicts do not erupt, there is a danger that each C-level executive will bring an overly narrow perspective about how to achieve enterprise-wide business objectives.
What CEOs really need are senior leaders who combine a broad and deep understanding of the business, functional expertise, and perhaps most importantly, sound business judgement. So the most desirable skill for "tomorrow's CMO" to demonstrate is the ability to understand how the business works economically and competitively, and how the marketing function can effectively support and advance the company's strategic agenda.