How does marketing lead the company in creating revenue?
This question keeps popping up—in our interactions with clients, in industry publications, in our conversations with peers. We firmly believe in the power of marketing to unify and transform diverse teams across an organization. And most of the marketers we talk to believe in that potential too.
Yet many still feel that their organizations executives and sales teams don’t see that kind of value. Marketers are often frustrated by limited or shrinking budgets and sometimes are stymied by roadblocks from the very teams they are aiming to support.
We had a chance to consider this issue again as we participated in the dynamic and engaging workshop Designing Buyer-Centric Campaigns: Demand Generation and Account-Based Marketing, hosted by BMA Colorado. Through the workshop, the presenter, Carlos Hidalgo, founder and CEO of the Customer Experience Strategy firm VisumCx, challenged the participants to think differently about the way they deliver value.
Can You Answer This Critical CEO Question?
Carlos presented this scenario: A group of marketers had just returned from a large trade show and were planning their next campaigns. The CEO walked in, and the marketers asked if he’d like to see what they were planning. His response:
Here’s what you can tell me: We just spent a quarter million dollars on a trade show. How much did we make from that investment?
How would you answer that CEO’s question? If you admit that you don’t know how, you’re not alone. Turns out, many marketing departments are consumed by creating campaigns and testing drip programs and promoting content assets—all geared at providing leads to sales. But after those leads are turned over, they don’t really know what happens to them. And they don’t know how much revenue their efforts directly generate.
There is a major link missing here.
Marketing ROI: It’s About the Money
It’s
Carlos reminds marketers that CEOs and CFOs don’t think in marketing terms; they think in business terms. If marketers are having a hard time getting budget or are facing cuts, they need to stop showing CEOs and CFOs their campaigns—and instead show them how much money they make when they invest in marketing.
Marketers know that marketing is a driver of revenue. They know that if you don’t market, your revenue drops. But few are able to draw direct lines from their strategy, through the tactics of each program, to the dollars that result from their effort.
For many organizations, that is one of the major attractions of account-based marketing (ABM). Creating highly personalized messages for highly desirable target accounts has been shown to shorten sales cycles, enable higher-dollar sales, and increase overall revenue. But to deliver that ROI, you must first overcome some upfront cost barriers of ABM, not the least of which is actually creating the content to support the program.
Does that put you back at square one? Not necessarily. But you do have to think differently—intentionally—about how you create your marketing and how you connect the dots from your program to the revenue you bring in.
Planning Your Intentional ABM Program:
3 Takeaways to Start With
In our workshop, Carlos walked participants through a process of discovery to supply that missing link. Here are three foundational principles to keep in mind as you plan your ABM approach.
1. Understand that sales is not your customer; the customer is your customer.
But the buying journey does not start with sales.
In fact, sales interactions are a tiny fraction of the buying process—and buyers own the process. Your challenge is to understand all the different ways that process can happen, how to support multiple stakeholders at every milestone, and guide each buying committee member to the next step in the buying journey.
2. Understand your buyers and create content that matters to them.
How can you know what’s meaningful? You have to talk to them!
Yes, this will be time-consuming. In fact, the time it takes to do this and build the foundation of your strategy is probably your biggest upfront investment—and potentially your hardest sell. But it also can be what transforms your marketing program into a direct driver of revenue.
3. Understand why you’re creating every piece of content—and measure its effectiveness.
Anticipate that when visitors finish any piece of content, they’ll have another question.
Be ready to show them right away where they can get the answer to that question and take the next step in their journey. And build in automated triggers that send people to the next relevant content piece or action based on their behavior.
This is a highly focused strategy, and it requires ongoing measurement and upkeep. It allows you to build in tracking of customer behavior and trace them through the buying process so you can see what content pieces and actions lead them to a sale; how much that sale is; how long they stay customers; and their lifetime revenue with you—all directly tied to what marketing spent.
Now, the Conversation Changes
Carlos capped the workshop by emphasizing that when you can have the ability to demonstrate the path customers take to their purchase, your budget conversations become much more streamlined. They cease to be about which marketing tactics you’re planning and they become instead about simple business math and meeting business objectives.
Think about how different your budget conversation will be when you can say:
“Last year, marketing returned $8 for every $1 we spent. So, to reach XXX revenue goal, we should spend X dollars on marketing. Conversely, if you want to cut X from marketing this year, you’ll see XXX reduction in revenue.”
Simple math.
Time to dig deeper into leadership opportunities?
Like most really good learning sessions, this workshop opened up a flood of questions for the marketers in the room. For most participants, the prospect of taking the lead and transforming the revenue model for their organizations is thrilling. But it ’s a complex issue to take on.
To respond, we will be delivering a series of blogs about the opportunities and challenges of marketing leadership. And we’ll offer practical insights into how marketers can take the lead in attaining business objectives. Tune in back here for more insights.