CEOs running today’s B2B organizations are laser-focused on profit, execution of strategy, and top-line revenue growth, and they expect every one of their departments to be aligned with these key goals. For many, the area that gives them the most heartburn–based on budget and non-goal alignment–is marketing.
For CMOs, this could mean big trouble. If your marketing organization isn’t making a measurable impact on revenue, then your job could be in jeopardy.
This article presents three key questions you should ask yourself as a CMO to determine whether you need to change your strategy. Here’s your first question:
How aligned is marketing to the organization’s overall revenue goals in a direct and measurable way, and not the “fuzzy math” kind of connection?
- If you can honestly answer that your marketing goals are directly aligned with those of the business, ask for a raise!
- For everyone else, get in step–and fast. Executive alignment is as basic as it gets.
Easy question, right? Now let’s move on to the next question to help you determine whether you are on the right track.
When you show up to the monthly board or executive committee meeting, what kind of metrics do you present? (I know the mention of this monthly presentation probably brings on another round of heartburn, but try to focus on the question.)
Are your metrics typically activity-based?
- number of impressions
- number of ads
- number of tradeshows
- number of e-mails sent
- percent of opens, click-throughs, and conversions
These are what most CEOs call “who- gives-a-flip metrics.” If you are presenting only these kinds of activity-based metrics, then you need to change your approach–now. This is old-school for a B2B organization given the new technologies available today that allow marketing to make a direct contribution to top-line revenue growth in a repeatable, predictable, and scalable fashion.
Or are your metrics revenue-focused?
- number of sales-ready leads (SRL) sent to sales
- percent conversion of SRL to opportunity
- percent conversion to close
- percent contribution to pipeline from marketing
- number of days to close
If you are already reporting revenue-focused metrics, then again–ask for a raise! Chances are you are currently being recruited because of your skill mix and experience. CMOs who are focused on revenue metrics are generally using the optimal mix of people, processes, and technologies to grow top-line revenue.
Hopefully, you are already doing these things and hitting it out of the park every month. But if you are still confused about your role, then consider this final scenario and question:
You are putting together your 2013 strategic plan. As CMO, which of the following are the top strategic initiatives you will present to the executive team?
- improve use of search
- improve conversions
- improve use of social media
- create new Web site/messaging/colors
- grow number of leads sent to sales
- improve number of impressions from ad spend
While these are all valid concerns for any marketing department, compare it to the next set of answers. The above initiatives should only be part of the plan–especially if your company has big revenue growth plans in 2013. If your answer stops here, then you won’t have job security for long. Consider these strategic initiatives instead:
- Execute a revenue marketing strategy in which marketing will grow its contribution to the sales pipeline by 200% through marketing sourced, highly qualified leads; improve opportunity velocity by 20%; and impact overall deal size by 11%.
- Create a marketing funnel and process with standard conversion rates from inquiry to close so marketing can begin forecasting revenue impact–not just reporting on past history.
- Conduct a skills gap analysis on my current team around this journey to revenue marketing. What skills do I need to add, replace, or train?
- Reorganize the marketing organization around the revenue marketing competency.
- Develop the key processes and tools across sales and marketing to help us drive a repeatable, predictable, and scalable revenue impact on top-line growth.
- Select and implement or improve the use of your revenue marketing solution. Note: There is an entire new generation of technologies out there called marketing automation, demand generation, revenue performance management, and revenue marketing (a term coined by The Pedowitz Group) to help marketing directly contribute to revenue growth. This is not simply CRM or fancy e-mail systems.
So how did you do? For the B2B enterprise organization, marketing’s role should now be to fully participate in the revenue discussion. Today’s B2B CMO should sound like a VP of sales–not the head of a creative agency. If you are not stepping up to this new reality, then your job could be at risk. Are you ready?