I plead guilty to enjoying a cold beer or two, and I’ve watched with amazement as the decade-long bull market in the craft beer industry shows no signs of abating.
The question for 2013 is not so much what is the state of marketing automation, but rather, what difference does marketing automation make to a company’s growth? We call this Revenue Marketing, which means marketing is making a measurable contribution to revenue. This is the ultimate promise of marketing automation, from which sales and marketing teams benefit most.
Does marketing automation make a business difference? This is the key question answered in a recent study by Lenskold Group and sponsored by The Pedowitz Group, a leading provider of marketing automation strategies. Since Sales & Marketing Management’s readership is comprised of both sales and marketing professionals, let’s review this report according to three factors:
Today’s CMO cares about increased outcomes (revenue), having strategic support for Revenue Marketing initiatives and being able to take a holistic approach to these new marketing capabilities. Today’s CSO cares about revenue, growth, better leads and bigger deals.
What matters to the CSO?
CSO Point #1: Want to outgrow your competition? Of course! Companies outgrowing their competitors are more likely to use integrated marketing automation (66% versus 50% of slower/same growth companies). The definition of integrated marketing automation is the use of full-featured marketing automation (like Marketo or Eloqua) integrated with CRM. This is an area of technology and process that enables marketing to impact revenue in a significant way. It’s a fast-growth area of technology experiencing and it’s here to stay. Is your marketing group using integrated marketing automation?
CSO Point #2: What is the role of marketing in companies outgrowing their competition? Companies outgrowing their competitors are more likely to have experienced an increase in total marketing revenue contribution from marketing automation (55% versus 31% of slower/same growth companies). This data highlights the role of Revenue Marketing in competitive advantage. It also points out that faster-growth companies have marketing departments that can actually measure the impact marketing is making on revenue. How’s your marketing group performing?
CSO Point #3: Want to increase average deal size? Well, it’s your lucky day! 28% of marketing teams that use marketing automation reported an increase in the average deal size from a marketing qualified lead that was passed to sales. Why? Because they are nurturing and educating that lead, scoring the lead based on demographics (Is it qualified?), behavior and online behavior (Is there intent to buy?), until it’s ready for a conversation with your sales team. This allows the sales team to have a deeper, richer sales conversation that leads to a higher average deal size. Sound good? How is your marketing group tracking this key metric?
What matters to the CMO?
CMO Point #1: How is marketing measured and what difference does that make to top line revenue growth? Of the companies using marketing automation and ROI metrics, 69% reported an increase in total marketing revenue contribution. Contrast this with the 19% increase in total marketing revenue contribution reported by users of only traditional marketing metrics. These data points indicate that marketing automation is not enough; a focus on ROI metrics by marketing is equally important. I’d also like to point out here that you can’t calculate ROI without being able to measure revenue. Is your marketing group measuring and reporting its direct influence on revenue?
CMO Point #2: Show me the numbers! Numbers, metrics, revenue, pipeline – are the mantra of today’s successful CMO. If marketing is going to play in this game, it needs to run marketing like sales – by the numbers.Wouldn’t you like your marketing organization to make this kind of impact on your business?
CMO Point #3: Take a holistic approach to the numbers. Successful marketers understand there are many elements that impact how and how much they can impact revenue performance of their company. Companies that use integrated marketing automation take a holistic approach (tools, processes, organizational structure, skills, alignment with sales and content) to revenue marketing to help drive success.
The Bottom line
For marketing automation to deliver on its promise, the CMO and CSO must ensure that their people understand they are all accountable for revenue. They are on the same team. A clear understanding of their respective roles in the process of Revenue Marketing is essential. The CMO must hire people with the right skill sets to execute the best practices identified in this research. While marketing automation software is not the great panacea, it continues to prove itself as one of the wisest investments a company can make to impact the topline.
Debbie Qaqish is Principal Partner and Chief Strategy Officer for The Pedowitz Group, which helps businesses acquire, nurture and deliver sales-ready prospects through demand generation strategies. She will present a free webinar, “Let Marketing Shift Revenue Into Overdrive” at noon Eastern Time on Friday, Feb. 22. You can register here.