This list is based on a talk I did at Inbound15. The talk was around how the marketing consultants are leading us astray with sales and marketing alignment. This is a distilled list of the action items.
1. Throw out written service level agreements
Nothing says we are not on the same team than a service level agreement. If sales isn’t following up on your leads it is because they think their time is best spent elsewhere. If you were a rep, you wouldn’t spend a minute on things you didn’t think would help with your quota. No SLA is going to change that.
2. Get rid of MQL and SAL definitions
Besides service level agreements, MQL and SAL are the most conflict ridden terms in marketing vocabulary. “We think its qualified”, “Why didn’t you accept it?”. MQL/SAL just means you aren’t on the same page with what sales wants to see. Get rid of these terms.
3. Get rid of marketing incentive plans based on lead gen number
Incentive plans based on lead gen numbers drives the wrong behavior for marketers and sets them up for conflict with the sales team. Marketers can make lead gen numbers – we all the know the dark arts that can’t be mentioned at Inbound. Teams have common goals. Get on the same goal as sales – revenue. Put your compensation at risk if you don’t achieve the number as a company.
4. Use capacity measurements to determine your marketing contribution to revenue
Let’s assume an inside sales rep can handle and properly follow-up on 50 new leads a week, and the rest of the time they are following up on the prior weeks leads, moving opportunities forward or closing deals. Figure out the number for your team. Inside sales time and resources are limited. If the number is 50, and you are providing 50 leads – then whatever revenue closes, marketing contribution to that revenue is around 100%. You are filling the inside sales reps time with leads. If you are only supplying 50% of the weekly quota, then you are probably only contributing around 50% of the revenue. The exact number isn’t important. By doing this you eliminate the discussion of which deals marketing helped with and get the focus back on what matters – are you helping the sales not have to cold call.
5. Ask the sales VP what his opportunity creation % is from leads without any marketing help
In other words, if the VP of Sales had to self-prospect with no marketing, how effective would his team be on an opportunity creation basis? Buying a list and cold calling, how effective would that be? Most teams it is 1% at most. That 1% number is your competition. If marketing can’t supply leads at least 2% or better, you are better off not having marketing.
6. Establish an opportunity creation target for marketing supplied leads
Now ask you VP of Sales what percentage of leads that you provide him does he think should result in opportunities. The number will probably be 5% to 30%. This is your target opportunity creation rate. Even if you think the rate is too high, go with it. VP of Sales are smart people. If they ask for 10% opportunity creation rate leads, and you deliver them, but the sales team still doesn’t have enough leads, the VP of Sales can either have his team cold call (1 – 2% at best), mine the customer base for more opportunities, or lower the hurdle for marketing to send sales leads. Let him decide that.
7. Establish with the VP of Sales what Behavior a Prospect Would Exhibit to mostly like result in opportunity creation at the agreed upon rate
If the VP of Sales wants leads that generate opportunities 20% of the time, she is asking for leads that are somewhat down the buying cycle. What does that behavior look like? Together, define that behavior. Is it someone who has attended a webinar? Looked at your pricing page? Read some ebooks? It is likely not one of these, but a collection of events that makes someone look like a good prospect.
8. Implement lead scoring and establish a lead threshold
Assign scores to each activity from #7. Create a score threshold that represents the behavior sales would like to see for someone to convert to an opportunity at the agreed upon opportunity creation rate. So, if sales thinks someone who attends a webinar and looks at the pricing page is worthy to follow-up, assign 10 points to each of these activities, and any lead that hits 20 points or more goes to sales. If the looking at 20 web pages means sales wants to talk to someone, then assign one point for each key page someone visits. If visiting the careers page means the person is likely a job seeker, subtract 20 points for their score. Now pass all leads to sales that meets the requirement.
Now start experimenting. Remember those people who download the e-book “Justifying this purchase to my boss” whom you think are great prospects but sales doesn’t? Talk with the VP, do an experiment, get her buy in. See what happens when you try sending over 500 of those leads. Do you hit the agreed up on opportunity creation rate? Everyone is on the same team, everyone on the same goal, everyone will want to try new things to make money.
10. Treat your budget as one pie of sales and marketing money
Sales and marketing budgets come from the same pot of money. Spending on marketing helps at the top of the funnel, spending on sales the bottom. Have frank discussions with the sales VP on where the revenue generation problem is and be prepared to move money between the budgets.
11. Align the marketing organization to serve the customer
Marketing is there to drive revenue. Sales has two key people they rely on each week – the demand generation manager for leads, and the product marketing manager for thought leadership, content, competitive analysis. The rest of the marketing team needs to line up and support these two people. Everyone. If you aren’t supporting these two key people, you aren’t supporting sales and you aren’t aligned.