Unfortunately, many marketing automation customers have a culture of perceiving marketing and all of its parts as a cost rather than as a revenue driver. And organizations that see marketing as a cost of doing business, can manage it in one of only two ways: either arbitrarily or by continually working to lower the cost of marketing. When presented with the two options, the arbitrary method may seem better, but it’s really not. Who wants to work in a role where the value of that role isn’t tied to reality? Where budgets could swell or shrink on whims or perception?
A better way, is to create a culture (both inside and outside marketing) of viewing marketing spend as a key driver of revenue growth. But just as a person suddenly standing up one day and telling the people around him to view him differently is unlikely to change how he is viewed (at least not in the way he intended), marketers need to change not just what they say, but also how they act.
- Does your team have a marketing model that maps out monthly MQL, opp, bookings and cost per MQL/Opps?
- Does your entire team know what marketing goals have been set for this month?
- Does your team meet weekly to review monthly goal attainment?
- When it comes to marketing automation, have you set clear expectations on how many MQLs/opps/new customers you plan on getting out of nurturing and other database marketing programs?
- Do you separate brand promotion program spend from demand generation program spend so as not to muddy the effectiveness of your demand generation spend ROI measurement?
- When you make new marketing budget requests, do you include models showing how much new business it will generate for the company?
Many companies unfortunately still don’t do these things, but many of the successful ones do and they have a big impact on creating a culture of performance in marketing.
If your company is one of the ones still working to make this cultural shift, don’t feel too bad. Look at this quote from Raghu Raghavan, CEO of Act-On Software, a company which offers a very popular and successful marketing automation platform. When being interviewed back in April about his plans for a recently secured $44m round of funding, Mr. Raghavan said...
“...Act-On’s growth was only limited by ‘how much money I have to hire salespeople’...”
What a strange statement by a marketing automation executive. Does marketing spend not also drive growth at Act-on? If not, how is marketing viewed at Act-On? Even for a company that primarily differentiates on the lower cost of it’s solution, that would be a peculiar reality considering the idea that marketing and marketing automation can drive growth and create ROI is presumably a key slide in their sales pitches. Given Mr. Raghavan’s impressive credentials and modern marketing chops, hopefully this quote is out of context.
Either way, this quote must have had Act-On’s customers shaking their heads and the CRM sales rep that manages Act-On's account window shopping Ferraris. What would that CRM rep’s commission be on licenses for $44 million worth of sales people? Sadly, the way housing prices are right now here in San Francisco, probably still not enough to buy a house. :(
Author: Chris Russell