Marketing and sales teams are both are responsible for generating company revenue, represented by the equation: Opportunities in pipeline X estimated deal revenue X closure rate DIVIDED BY the “sales cycle time.” The answer to this calculation can be multiplied by the number of salespeople in your organization to project your revenue for the period calculated.
Take a look at this equation again, and note that even a SMALL INCREASE in one or more of these factors can make a HUGE difference. And the better marketing and sales are aligned, the more likely each of these components can be improved.
I can “feel” each of you “clicking off” of this BLOG right now…”I don’t want to be measured THAT closely”…”Yeah, that’ll happen”…”You’re taking all the FUN out my job!” But give me a moment. My conclusions might trigger some ideas that will help your organization meet its goals more easily and effectively…even in tough times like we are experiencing now.
First, let’s address this chasm between marketing and sales. Unfortunately, statistics show that this symbiotic relationship is far from ideal in many organizations. According to a recent business survey, only 31 percent of respondents agreed that their marketing and sales organizations are well-aligned. And although most marketing and sales teams recognize that they need better alignment to be more effective, they seem permanently stuck in opposition.
What's in a Name?
The key to improving alignment requires taking a “customer centric” approach. This is nothing new to the foodservice channel. When marketing and sales are aligned around prospective customers needs, wants and purchasing processes, the company is better positioned to close deals as well as reduce the sales cycle. If we more closely examine a common tool often used to gauge the sales process --- the “sales funnel” --- both parties are able to better visualize the flow. However, the term “sales funnel” sounds so sterile…lets rename it the "customer buying pipeline." (CBP)
Why rename it?
A "sales funnel" suggests two things. First, the term suggests that the process is somehow “owned” by sales and is not a shared responsibility across the organization. In fact, the term “sales funnel” alone suggests a sales-centric, rather than a customer-centric, approach to the buying decision.
Marketing plays a critical role in bringing potential buyers to the table. They provide segmentation, channel targeting and priorities, positioning, product offers, and an organization’s message of “differentiation.”
When properly engineered, the “customer buying pipeline” can serve as an important tool to encourage these two groups to work together. Examining the CBP can provide insight into which sales and marketing processes are effectively impacting the sales process, and insight into how efficiently opportunities are moving through the overall sales cycle.
Engineering a customer buying pipeline
-
Understanding your customers' needs and their buying process. Before developing your own CBP, map your ideal customer's buying process. It will help the stakeholders understand how and why your customer makes a buying decision. And there is not a single process…it is entirely possible you will create a number of “buying process maps” for different customer types. Effective CBP management is a reflection on your company's ability to identify the right opportunities and the needs of your prospects as well as truly understand how they will go about making the purchase. Once you understand your customer's decision making and buying processes you can develop a strategy for managing the opportunity at each stage in the pipeline.
-
Define each of the stages using “incremental behavioral commitments.” OK… but what is that?? An illustrative example might be to describe the process of developing a personal relationship with someone. Certain demonstrated behaviors along the way indicate whether the relationship is progressing toward the ultimate behavior of saying "I do." For example, showing up for the first date, properly managing the first kiss, introducing each other to friends and family, and so on are “incremental behavioral commitments” --- formally demonstrating to both people that the relationship is moving toward the “ultimate deal.” The issue in a business relationship is to thoroughly understand the specific incremental behaviors your customers demonstrate to show they are moving toward “the ultimate deal.” Simple, eh?
-
Group behaviors into stages. By grouping CBP into stages, they become the foundation for how you classify the status of each opportunity. Once identified, marketing can develop the tools appropriate for each stage to assure prospective customers are engaged.
CBP management allows you to calibrate your marketing and synchronize marketing and sales efforts. It also allows you to take a more scientific approach to opportunity and customer development, enabling you to understand what is happening in the buying process and where to make adjustments.
CBP management is really about managing opportunities. Opportunities represent customers, which provides with an excellent point of view around which to align marketing and sales.