Historically, there has been a divide between sales and marketing. Very few companies have their sales and marketing teams working together seamlessly. The current economy, however, is forcing the issue. With more demanding buyers, more niche-oriented competitors and longer and longer sales cycles, salespeople are being forced to think like marketers and marketing people are being forced to think like salespeople.
Both sales and marketing have their own funnels. Marketing must now directly tie the end of their funnel to the beginning of the sales funnel. Moreover, the output of the sales funnel must tie back into the marketing funnel. Every dollar spent on marketing must be measurable and show clear return on investment. Every lead generated for the sales force, must be accounted for.
Traditional marketing focuses on creating awareness in the general marketplace. The problem with this type of marketing is it is extremely expensive and almost impossible to measure. Companies with huge budgets tend to win this game. They succeed in creating mind share for the sales team but they do so by spending unnecessarily large amounts of money. Moreover, they never know which specific initiatives led to their success. Today, CEOs and CFOs expect more from marketing and they are questioning every dollar spent. Marketing executives must get ahead of this scrutiny.
They will do so by carefully planning their campaigns and setting up clear measurement criteria to determine which campaigns are successful and how to increase their effectiveness over time. These metrics include, but are not limited to: total reach, number of inquiries, number of first meetings, # of proposals, # of sales, meetings-to-reach ratio, closing ratio, conversion rate, acquisition cost, cost per contact, cost per meeting, profit results, and ROI. Marketers must clearly track all activity through the marketing funnel to the sales funnel. The marketing funnel should comprise three key stages:
1. Reach - the number of people in the suspect base that will be touched by a specific campaign.
2. Enquiry - the number of people who respond positively to a campaign by initiating a conversation.
3. First Meeting - the number of people who are sufficiently interested that they are willing to meet with a salesperson to learn how the firm might address their specific challenges (i.e., qualified leads)
All marketing today must be oriented toward generating qualified leads for the sales team. Every campaign must be measured in terms of the number of first meetings it generates for the sales team. And every sales professional must be scrutinized in terms of his or her ability to convert first meetings into sales.
The end of the marketing funnel is the beginning of the sales funnel. First meetings should represent the top of the sales funnel. All activities prior to first meeting represent part of the marketing funnel even if salespeople are engaged in them. (Yes, sales and marketing must learn to work together.) All opportunities must be tied to a specific campaign in order to connect all sales activity to the marketing activity. Once a first meeting is successfully concluded, the sales funnel should comprise three key stages:
1. Diagnose - the buyer is willing to work with the sales professional to help him or her understand the situation and develop a solution.
2. Propose - the buyer is clear about the challenge they are facing, what your firm can do about it, and is open to receiving clear documentation on the specific way you can work with them to resolve their challenges.
3. Close - the buyer, ready to take action to resolve their challenges, is now negotiating with you and completing necessary paper work to initiate a project.
Phases vs. Steps
Many organizations we consult with tell me they have more than a three step sales process. I don’t disagree. Your sales process, however, is not the same as your sales funnel. Managing the sales funnel is about managing the phases that opportunities go through as they mature. The steps you go through to make a sale are not the same as the phases an opportunity will go through. By way of analogy, what you do to harvest fruit is separate from the phases that fruit goes through as it matures. Fruit is initially unripe, then it’s ripe then it spoils if it’s not eaten. The steps to harvest fruit might involve planting, tilling, spraying, inspecting, picking, etc. The steps you go through might be very different to the steps I go through but the phases the fruit will go through are universal. The same with funnel management.
Wash, Rinse, Repeat
The end of the sales funnel is the beginning of the marketing funnel. In other words, existing customers must not be neglected. Marketing must now engage in a separate set of campaigns that reach the entire client base, generate enquiries from existing clients and lead to first meetings with the sales team to discuss new challenges/opportunities.
To make the most of your sales and marketing investment, accurate metrics must be gathered for each phase of the marketing and sales funnel. Getting a handle on these metrics and putting them into a management dashboard is the key to ensuring ever dollar invested in sales and in marketing will provide increasing returns to the business. These metrics can be captured seamlessly if your CRM and accounting systems are set up properly and if your sales and marketing teams learn to work together. Once these metrics are tracked and managed, sales and marketing will have tied the knot and you will have a consistent cash flow machine regardless of economic conditions.
About the Author:
Adrian Davis is a business strategist and trusted advisor for chief executives and business owners. He is a thought-provoking speaker and is frequently called upon to address senior management teams and sales groups on the subjects of corporate strategy, competitive advantage and sales excellence.