Despite putting more effort, marketers cannot clearly establish how their investments translate to revenues. Daniel Raskin, CMO and co-founder, Mperative, believes this is due to a lack of common language between revenue-facing teams. Here, he explains the problem and how revenue marketing can solve it.
Misalignment between marketing, sales, and customer success teams has created a mounting barrier to how marketers and executives can distinguish the return on their marketing investments. The global market for marketing technology is $345 billion, according to StatistaOpens a new window . Despite this and endless hours of manpower invested into making marketing more data-driven, marketers are still faced with outdated tools and data silos that prevent them from clearly articulating how their efforts impact business performance. In fact, the struggle to quantify marketing initiatives is so prevalent that, according to our studyOpens a new window , 85% of executives still cannot clearly link marketing activities to revenue. Why?Â
There is a lack of a common language across the organization. This is why marketing teams struggle to quantify their contributions — the revenue-centric language that the rest of the organization is centered around is foreign to them.
Unfortunately, without a common language between revenue-facing teams, marketing metrics and models become disconnected from the rest of the business, causing the value of marketing to remain unclear to revenue stakeholders when determining which factors are driving or hindering revenue. This language barrier that persists across departments has resulted in the marketing credibility gap. Here is a more detailed explanation of what the credibility gap is and how to go about closing it.
See More:Â Why Your Demo Should Be Part of Your Sales Tech Stack
What Is the Marketing Credibility Gap and Why Does It Exist?
Marketing has historically focused on lead-based and account-based metrics, while the rest of the business has operated around revenue-centric metrics and language. For example, marketers have long placed a heavy emphasis on obtaining marketing-qualified leads (MQLs). Metrics like the number of MQLs generated and MQL conversion rates are confusing to the rest of the business because they do not clearly demonstrate how marketing contributes to the bottom line, especially in contrast to sales teams that can talk in exact terms about what revenue growth they have produced. Because of their focus on lead-based or account-based metrics, marketers cannot credibly communicate direct cause-and-effect relationships between marketing activities and revenue outcomes in a language that resonates with their peers.
Because their models are isolated from the rest of the business, marketers often have to customize their own analytics, forcing them to rely on whatever one-dimensional reports and dashboards they can get instead of modern analytics tools. According to our studyOpens a new window , 74% of B2B marketing executives still primarily rely on outdated spreadsheets in an attempt to create alignment with revenue stakeholders on their initiatives. But bringing together data in spreadsheets from wide-ranging marketing tools is a nightmare, so marketers often burn hours on manual data preparation, all for an incomplete picture of their efforts.Â
The “snapshot†nature of marketing systems and spreadsheets also makes it difficult to extract insights about trends over time. Without a unified, multidimensional perspective of the entire customer journey, marketers cannot get a high-level view. The solution is clear: as marketing and sales teams become increasingly data-driven, they must establish common success metrics to build systems that can give them the whole picture. This is the path to establishing a unified RevOps strategy.
How To Build a Bridge (And Get Over It) With Revenue Marketing
Revenue marketing is a new method designed to eliminate the marketing credibility gap by centering key marketing metrics around revenue and connecting marketing strategy to revenue operations. This approach remedies the disconnect between marketing models and other departmental systems across the organization. It is especially important given that to achieve a truly unified view of the customer journey, marketing and sales teams must be aligned on revenue metrics to work together to identify better and generate quality opportunities for sales teams. By adopting a revenue marketing approach, marketers can build alignment and transparency across all revenue-facing teams. Doing so can help marketers not only eliminate data silos and establish cause-and-effect relationships between their initiatives and revenue outcomes but also uncover relevant data trends to make meaningful, predictive forecasts from their marketing and sales information and identify the impact of marketing initiatives across the customer journey.
Revenue Marketing is an Essential First Step to True RevOps
Revenue marketing is the solution to the current disconnected approach to revenue operations. It helps eliminate much of the time and money previously burned on customizing marketing systems to determine how marketing influenced revenue and allows those resources to be repurposed towards driving growth.Â
Revenue marketing serves as the foundation businesses must build on to attain a unified view of the whole funnel from initial engagement to past close. This ultimately eases operational processes like identifying where CRM data accurately represents reality. When implemented, revenue marketing makes more advanced data science possible for marketing analytics by giving models data that link the cause and effect of marketing initiatives to revenue outcomes. This equips marketers to apply predictive analytics to project business outcomes and helps the entire business to establish a unified understanding of the most effective pathways to growth.Â
How to Close the Gap for Good
With revenue marketing, marketers can shift their focus from lead-centrism to opportunity-centrism and connect their actions to revenue by establishing a common revenue language and success metrics that every revenue-facing team can align with. It is time for marketers to convey how their efforts contribute to business value confidently.Â
See More:Â See More:Â Are You Ready for Sales Intelligence Tools?
Here are three key best practices organizations can follow to close the marketing credibility gap for good:
- Make the shift from lead-centric to opportunity-centric revenue initiatives. While leads are still important, marketers must shift their focus from the individual to the collection of leads and individuals as a buying group to better understand what is going on across the organization. Continuing to rely on lead-centric metrics will prevent marketers and the rest of the business alike from seeing a complete and accurate picture of how marketing does/does not contribute to how revenue is generated.
- Establish a clear and common revenue language. Leverage opportunity-centric metrics to establish a common revenue language amongst every department across the organization. Collaborating with sales, finance, and customer success teams to establish common success metrics will create a more effective and coordinated organization. It will also further enable marketers to highlight where their marketing activity generates revenue for the business, thereby justifying future marketing investments.
- Break down your silos. Many organizations claim they are practicing revenue operations but are not taking steps to break down their operational silos. Failing to take the entire demand engine into account shifts the organization’s focus to only one part of the problem (typically making sales processes more effective) and will result in a one-sided solution. Organizations must choose an approach that will break silos down to achieve a unified view of the whole customer journey.
By taking these steps and reducing the marketing language gaps, marketers can justify how their efforts and investments are translating into revenues.
How are you reducing the lack of common language between revenue-facing teams? Let us know on FacebookOpens a new window , TwitterOpens a new window , and LinkedInOpens a new window .
Image Source: Shutterstock