Marketing Clique

Waiting too long to follow up on a lead can drastically affect a sales opportunity.

A recent blog post from marketing automation software company Marketo comments on how sales responds to leads. As it turns out, it's not a pretty picture. Marketo's blog post cites data from an independent lead response management study that says if sales waits even an hour to follow up on a lead from marketing it can ruin a sales opportunity.

While somewhat dated (2008) there's another study from Omniture that highlights some alarming findings about how sales follows up on leads from marketing. Here are the key points:

• Only 4.6 percent of the businesses use a strategy involving both phone and email
• Less than 5 percent called within 24 hours
• 19 hours 31 minutes was the average sales response time by email
• 36 hours 57 minutes was the average sales response time by phone
• 45.2% of companies sales teams never responded at all

The message is clear: speed does matter

The process of implementing marketing automation can be an excellent exercise in understanding how sales and marketing can work more effectively together. The result? More business. I've been through two of these processes and can attest that it is helpful in bringing both marketing and sales to the same table.

Ultimately, marketing and sales should be coming together to define a process that can be done time and again. Campaigns can differ, but having an established underlying processes, combined with the right people and the right IT is the magic recipe. The following excerpt from a recent Manticore Technology whitepaper describes this well:

Marketers tend to think about marketing automation in the context of "campaigns." In reality, it's a layer above campaigns. Properly implemented, it's used to build a repeatable process to ensure that only qualified leads are sent to Sales, while the remaining leads are engaged in an ongoing, targeted dialogue to nurture their interest. With a strong process, the other two components, people and technology, can fall in place. Naylor Gray, director of marketing at Frost & Sullivan, sums it up this way: "Effective and sustainable marketing that drives revenue must be built on the right processes, technology and people. Companies that adhere to best practices along these lines close a lot more business. For Marketing to play a key role in the growth of a company, we believe you need to start with process, which guides and validates the people and technology investments." "With a strong process, the other two components, people and technology, can fall in place." —Manticore Technology Whitepaper

What this means to marketing

Take a leadership role and ensure that both marketing and sales are focused on the forest, not just the trees, by providing a roadmap for implementing whatever marketing automation you choose. Ensure that process is overarching. Sometimes salespeople need to be reigned in because they are feverish about specific campaigns and closing business ASAP. And sometimes sales can help keep marketing focused on what drives market share: signing more business.

Marketing automation software continues to gain momentum. The reason marketing automation has become so appealing is because it allows businesses to do more with less—more marketing and sales with fewer marketers and salespeople. And one of the helpful side effects of the software implementation process is that it encourages a much-needed alignment of marketing and sales.

But the real value of anything a business implements is how it will help to attract and retain customers. A company's decision about which marketing automation software to purchase and how to implement it once they have committed to it are paramount. And the purchase decision can have a profound impact on marketing, sales, and IT.

Use marketing automation for lead nurturing

The most appealing aspect of marketing automation is the ability to automatically manage a lead—managing the buyer who has decided to begin evaluating your product but who is not quite ready to pull the trigger and sign on the dotted line. Traditionally, salespeople have managed this process. But salespeople get antsy, call the prospect too much, and if the prospect doesn't buy in a "reasonable" amount of time the salesperson moves on too soon. But what if that buyer is on one of those long and winding roads to purchase? What if there are little nuggets of value you can spoon feed the buyer during that long-and-drawn-out buying process? Lead management software helps salespeople spend more time with fewer prospects.

Use marketing automation to deliver the right value to the right prospect at the right time

The beauty of being able to automatically score a lead and begin the whole nurturing process is that you can begin to segment your marketing efforts. Naturally, there are some prospects for whom you want to roll out the red carpet. And while you certainly don't want to dismiss the other prospects, perhaps you know that they can be effectively developed without as much attention.

Demand generation is most effective when you're delivering something of value during the research phase before a buyer purchases.

Traditional pamphlets and brochures filled with marketing jargon just don’t cut it anymore. Buyers are looking for informative and interesting content that provides actual value and education. They expect vendors to provide them the content they need throughout the sales cycle. Increasingly, the first two-thirds of that cycle is spent researching the market and vendors, without regular contact with a sales rep. To remain top of mind with the buyer and claim the "thought leadership" position, marketers are deploying marketing automation to provide a steady stream of educational content for buyers.
—Lauren Carlson, Tailwinds for Marketing Automation Software

I think Lauren has a strong point. But what is that pearl of value that we should be giving away to our prospect? This is where the collaboration between marketing and sales can really pay off. Sales will reveal what the buyers are asking for, and marketing can help to develop the types of valuable devlierables that can be used during the lead nurturing process. These deliverables are apt to be different for different types of buyers.

Beware of the overuse of email

A recent Forrester Research report points out that marketers are overusing the email feature in marketing automation. Just because you've got a marketing automation tool that can deliver a customized email every week doesn't mean that will be the most effective deliverable for the prospect.

• If you can imagine that your qualified prospects are simply customers that haven't yet officially signed on, what would you be providing them? Is there anything you can provide that will be valuable for them and not incrementally cost you and your team substantially more time and money to deliver?

I think marketing automation is here to stay and it's an exciting new development in the whole world of customer relationship management (CRM). But like many other evolutions at the crossroads of IT and business there is due diligence that needs to happen before the purchase, and cogent analysis of the planning process once you're ready to go live.

I look forward to your feedback!

Today, Shirley S. Wang of the Wall Street Journal published an article in the Health Section entitled Why So Many People Can't Make Decisions. The article discussed how our approach to decision-making can affect our lives and relationships. Some people make decisions rquickly, while others take longer.

• Some people are what psychologists categorize as ambivalent. They tend to weigh both the pros and cons when making decisions. And they take longer to make decisions.
• Other personalities see decisions as being more black and white. These folks tend to have strong positive or negative views, and require less time to make decisions.

The article caused me to consider both of these camps when thinking about sales and marketing campaigns, especially when we're using marketing automation applications like Eloqua, Marketo, and Sliverpop. Likewise, our general email marketing outreach should be segmented based on the different types of decision-makers. At the very least, we should be testing different messaging that appeals to these different buyer behaviors. The black and white-minded decision makers are probably going to respond more positively to a direct response type of message, while an ambivalent decision-maker is more likely to respond favorably to more information and time.

The Take Away

Always be testing. Adapt your marketing message to speak to both types of decision-makers.

• Think act now direct response messaging for the black and white decision makers: special offers, incentives, discounts.
• Use more of a progressive approach with the ambivalent people: white papers, case studies, statistics.

As the alliance between marketing and sales becomes more prevalent and increasingly interdependent, there's mounting pressure for marketing to contribute to the bottom line. While all companies measure their success by revenue and profit, there are varying tolerances with revenue-producing timelines. Typically sales is on the front lines and held responsible for driving the lion's share of results. But what about marketing? And how does this fit in with the new world of marketing's direct role in driving B2B lead generation?

Public companies are laser focused on quarterly results with a lot of emphasis placed on monthly numbers. Sales managers are asked to update forecasts on a weekly basis, if not daily, all with the aim of submitting more accurate forecasts. Shareholders are anxiously waiting for their ROI and company management is eager to demonstrate its ability to hit its number. The pressure on sales and marketing is clear, but sales and marketing still struggle to find the best way to attribute revenue. Was it a sale that originated because of a lead generation campaign that was birthed in marketing? Or, was it the pure grit of sales that muscled it through and got it closed before month-end? Who should be held responsible if target number isn't reached?

Many private companies are bank rolled by investors who are looking to hit an annual target. And public companies answer to the shareholders and board members. Encouragement from investors is correlated with how far along the year has progressed. If it's the 4th quarter and the numbers look iffy, investors are calling for board meetings. Re-orgs are right around the corner and heads might roll! Small businesses are focused on monthly performance but even more excited about what can be done to increase revenues year-over-year. By the way, it's easy to forget that 99% of businesses in the United States are small businesses.

What this means for marketing and sales

The marketing timeline should absolutely be correlated with the sales timeline. Lead generation efforts and marketing activities should be carefully mapped to company requirements to show revenue. New product announcements, events, and client/prospect communications should always be arranged in consort with sales campaigns.

Also, marketing efforts need to be rewarded. And since marketing and sales are increasingly working together in true team fashion, that means management may want to re-examine how to incentivize marketing and sales.

The convergence of marketing and sales has left some managers scratching their heads. What's the best way to approach commission programs and create compelling incentives that motivate both marketing and sales, working together?

Traditionally, marketing and sales have operated in segregated silos with separate incentive programs. Salespeople = brawn. Marketing = brains. Now that marketing and sales are increasingly working side by side, especially in the B2B world, what kinds of incentives and goals make sense?

B2B marketing automation software (eg. Eloqua, Marketo, Silverpop) has caused an awkward task for some organizations: how to get marketing and sales to the same table and agree on how to integrate lead generation, marketing automation and sales force automation with a predictable and smooth hand off from marketing to sales. This leads to re-working the incentive plan.

Should both marketing and sales be on a progressive, juicy commission plan?

Most upper-management and sales force personnel, as well as workers in many other jobs, are paid based on performance, which is widely perceived as motivating effort and enhancing productivity relative to non-contingent pay schemes. However, psychological research suggests that excessive rewards can in some cases produce supra-optimal motivation, resulting in a decline in performance. To test whether very high monetary rewards can decrease performance, we conducted a set of experiments at MIT, the University of Chicago, and rural India. Subjects in our experiment worked on different tasks and received performance-contingent payments that varied in amount from small to large relative to their typical levels of pay. With some important exceptions, we observed that high reward levels can have detrimental effects on performance. – Federal Reserve Bank of Boston

I think we can look to the 2005 Federal Reserve Bank of Boston Study for some revealing insight. The study demonstrates the paradox of how people will surprisingly perform more poorly if they are working under a tiered reward schedule that offers a really big carrot on a stick at the top end - like most sales organizations. So what's the secret to success? Dan Pink says we need to be working in an environment that allows:

1. Autonomy
2. Mastery & Challenge
3. Transcendent Purpose

Let's think about this...

1. Autonomy: Contrary to the hype and thinking of sales as "team," salespeople are largely autonomous. Sales isn't a team sport, per se. Management, however, may see sales as a team effort because that's how they get compensated - for overall performance. But the salesperson isn't necessarily thinking of the team's success when s/he closes a deal.

Because the art of sales is normally not mechanical and involves more than rudimentary cognitive skill, salespeople react favorably to environments where they are given an opportunity to pursue mastery and be challenged...

2. Mastery & Challenge: While most mature sales and marketing organizations encourage the development of advanced skills the time has come for marketing and sales to work on these skills together. For example, some progressive organizations encourage all levels (not just management) to devote a day, or two, to be creative and try to think up new ways of doing things better, or differently. This highly focused, free time together has the potential to birth some exciting new ways of approaching marketing and sales.

3. Self Purpose: Organizations should consider becoming more cult-like. Why? Because people who are involved with a goal that is larger than themselves, or larger than their company, or even industry, will reach deeper and produce extraordinary results. If a person's raison d'être becomes interwoven with their company's mission, there's a powerful synergy. Sales and marketing professionals will stick around if you've got a retention plan that involves intrinsic rewards.

What this means to executive management

Marketing and sales goals can, and should, align with what is most important to executive management:

• Higher revenues
• Lower costs...
• Leading to higher profitability
• Increase in market share, with new customers
• Increase in both short and long-term value for the shareholders

Start Small - Think Big - Adapt to Change

"Open plan" offices look cool. As the name implies, they're open, airy, and have a free, creative, Web 2.0 feeling to them. You've seen them. Or, perhaps, you work in one - everyone is sitting in the same open room with everyone else, with no barriers between each other.

Some office environments need to encourage collaboration and instant interaction with colleagues. An air traffic control (ATC) center would be an example. But what is the implication of an open plan for the typical B2B office of 2010? Research from Queensland University of Technology in Brisbane, Australia found that the open plan is counterproductive for health service managers, but I think the study has farther-reaching implications:

In an era of changing workplace reforms, health service managers are embracing innovative work place designs, such as open plan work environments, where employees may have more flexibility. Managers are constantly seeking different ways of transforming their workplace so that their corporate culture and image can be improved. On the one hand, they must respond to corporate pressures to reduce the costs of building facilities and on the other hand they are indirectly introducing different types of issues that affect their employees. Method: A review of the literature was conducted by examining textbooks and journal articles in relation to the various issues that affect employees in an open plan work environment. Results: Research evidence shows that employees face a multitude of problems such as the loss of privacy, loss of identity, low work productivity, various health issues, overstimulation and low job satisfaction when working in an open plan work environment. Conclusion: Managers need to have a better understanding of open plan work environments before embracing such workplace designs. A multidisciplinary approach is recommended when decisions are being made in relation to which type of environment is better suited to the requirements of their employees as this has an impact on workforce productivity and job satisfaction.

>> download study - 867KB PDF

A few years ago I was exposed to my first open office environment. It was at an IT research and consulting firm. I remember that it felt awkward, at first, and then I became accustomed to the noise, lack of privacy, and constant interruptions. The office was equipped with meeting rooms along the outsides of the open plan office space. The idea was that anyone could duck into one of these rooms if they needed peace and quiet.

A colleague and I questioned the validity of the open office plan at that company. We knew that it was counterproductive to our focused effort at making a high volume of focused sales calls, managing conference calls with executives and analysts, and so forth. We'd frequently have to use the side rooms, but then we weren't at our own phone extension, had to carry our laptop with us, and make sure we weren't in a scheduled room. Intuitively we knew that the open plan wasn't the most productive, and both of us had seen research that validated our concern.

What this means for sales and marketing

Even though it's tempting to create a "bull pen" for sales and watch them jump like monkeys to try and make sales, it might not be working in your favor, especially if your product is B2B-focused, and more strategic. If you're hosting a PBS fund raising drive, perhaps that's a different story.

And the marketing folks need peace and quiet too. Although sales and marketing are converging, they don't need to be right on top of each other. If you are redoing your office workplace environment, consider consulting with an efficiency expert who is certified in workplace productivity design. Sometimes business ideas that seem chic and hip are not as practical as we would hope.

More Research

My blog post is based on my opinion, with some supporting research. To be fair, there is additional research that supports the open office plan, and varying degrees thereof. One great source for office workplace design research is Knoll's Whitepapers and Topic Briefs web page. Knoll is a workplace furnishings design company. Check out Open Plan and Enclosed Private Offices by Dr. Mike O'Neill. It's a superb source of information and cites additional research on the subject.

Today, as I write this, it's Friday. Friday is a special day for salespeople.

Friday is when buyers tend to commit to orders and sign on the dotted line. That's not malarkey. It's what many salespeople experience.

But what are those mysterious decision-makers doing the rest of the week? Here's my best guess, which is where the malarkey weaves its way in (all for fun):

• Monday: Decision-makers are swamped with hundreds of emails, internal meetings, and next to no deals close.
• Tuesday: Decision-makers are meeting with your competition.
• Wednesday: Decision-makers are trying to generate business of their own, so they can pay you.
• Thursday: Decision-makers are working on their budget and trying to decide how they're going to spend their budget.
• Friday: Decision-makers are signing contracts and committing to spending money with you!

I hope you have a great weekend. If you're a decision-maker, know that you're making some salesperson happy when you sign the order and send it over. If you're a salesperson, I hope you close some business this afternoon. Smile when the telephone rings!

Our customers and prospects are everywhere. The trouble is they're not all in the same place at the same time. That's why we need to meet them where they're at.

Forrester Research senior VP of Idea Development Josh Bernoff recently wrote an article for AdAge. In it he discusses research that makes a case for encouraging workers to use technology to connect with customers. Josh goes on to recommend:

If your company shuts off access to sites like Facebook, Twitter, and YouTube, that has to stop, because you're shutting off your staff from the very places that will give them ideas of how to innovate in connecting to customers. —Josh Bernoff, Marketers Are More Likely to Innovate -- and Here's Proof

Good salespeople have traditionally been adept at meeting their prospects and customers face to face. Today, with increased adoption of technology to increase the efficiency of marketing it's become common that neither salespeople nor marketers will see their prospects during the entire nurturing process. How about once the prospect signs on as a paying customer? Sure, probably. But during the six-month sales process? Maybe not.

While lead nurturing software, like Marketo and Eloqua, allows marketers to manage a much higher volume of prospects, there's still a strong reliance on email as the central vein of outbound communication. Logic paths are carefully planned so certain emails are sent to certain people at certain times, all based on certain prospect/client activities or inactivity.

My question is, will email continue to prevail as the preferred method of communication? Moreover has email already fallen by the wayside as the best way to nurture all prospects and clients?

Don't get me wrong. Email marketing is generally effective, especially when customers and prospects have opted in and indicated it's their preferred method of contact. But relying solely on email to nurture prospects and customers may be inadequate, especially with the growing acceptance of other communication forms: SMS/text, Facebook, Twitter. And don't forget about the old school methods that many people still hold onto: face-to-face meetings, phone calls, and even snail mail! By the way, if you must send snail mail, use FedEx. It's still better at getting someone's attention. People will almost always open a FedEx overnight envelope.

The take away

Try not to accept technology for technology's sake. If you can use technology to become more efficient in some areas of marketing and sales that's great. But one software solution isn't going to take care of everything.

I recently listened to a presentation by a marketing executive from a very visible, ostensibly easy-to-reach company. At the end of her PowerPoint presentation there was the quintessential how to contact me slide. Her presentation was fine, up until then. She looked up at her how to contact me slide on the presentation screen and began gloating that she's hard to reach; that she doesn't answer phone calls; travels a lot, and receives such an extreme volume of email that if she doesn't recognize the sender she's unlikely to respond.

The response from many in the audience was a nervous grin and a knowing nod, as if they too were so damn busy they didn't have time to communicate either. My reaction, however, was a gagging in my throat, and I think a few others felt the same.

Given the convergence of sales and marketing, I think it's incredibly important to meet customers where they're at. If a client or prospect "reaches out to you," it's a good thing to respond. In other words, they're not going to respect the idea that you're so busy that you don't have time.

The same goes internally. If you're a big, important executive who has an army of people who report to you, take the time to connect with your tribe. It's good for everyone. Employees are an important variable in the success quotient. Umm, they're human.

The convergence of sales and marketing means that marketing has to be more accessible

The lines are blurring. The roles are converging. Times are different in the B2B lead generation world. Be accessible. I'm not suggesting that you be available 24/7. But if you supposedly make yourself available via telephone, email, IM, then be prepared to use those tools when people are trying to contact you.

The CEO of a very well-known company I used to work for once explained to me:

"Greg, I always answer my phone and respond to emails. Why? Not because I know who everyone is. Quite the opposite—because I don't know who everyone is. It could be someone who helps me and my business. Quite often it is. I'm still in control. If I'm through with the telephone conversation I let the person know. Likewise, I'll tell the person via email what to expect as a next step, and sometimes it's 'don't bother following up with me any further.'"

I can tell you, first-hand, that he held true to his communication ideals. He responded to all direct communications. We were in a taxi together, after hours, and his cell phone (a number he provided on his business card!) rang. He didn't know who it was, didn't recognize the number. It turned out to be a reporter from the Wall Street Journal. She was on deadline, needed to crank out an article within the hour, and wanted a quote from my boss. He gave her a snappy quote. It appeared in the WSJ the following day, was read by many thousands of businesspeople and furthered my boss' position (and our company's) as an authority in the marketplace.