How would you describe your current marketing and sales motion?
Do you have a finely tuned, highly repeatable, highly predictable model for generating demand and closing business? Could you easily turn the dial for demand up or down? If you had another dollar to invest in sales and marketing, do you know what impact it would have?
Or, like nearly three-quarters of businesses, do you succeed because you have a strong product or service? Your customers find what you offer compelling, but you feel like you are constantly experimenting with your sales and marketing formula. In fact, you succeed ‘in spite of’ your sales and marketing investments, not ‘because of’ them.
If you have the latter motion, you are stuck in a state of random acts of sales and marketing — which is a typical side effect of such an inside-out, product/service-led go-to-market strategy.
There are tell-tale signs that sales and marketing programs are stuck in a perpetual random acts of marketing state. Start by considering these questions:
Moreover, does your approach to building demand equate to some combination of the following:
So, what is the problem with random acts of marketing? They are not sustainable or repeatable and they fail to deliver ROI. More specifically, they fail to drive real lift to sales and revenue. In many cases, these random acts of marketing barely cover your existing customer churn and leave you with a flat business, thus eroding your growth.
Look at end-to-end conversion metrics. How efficient is your aggregate lead-to-revenue motion?
According to SiriusDecisions, the typical lead-to-revenue conversion rate ranges from 0.375%-0.6%, depending on the type of market.
ANNUITAS research has found that nearly three-quarters of marketing organizations are stuck in the random acts of marketing state — or as we refer to it at ANNUITAS — a tactical demand generation state.
Meanwhile, companies that make the critical shift from a tactical to a Strategic Demand posture — which we discuss in a recent whitepaper, Making the Critical Shift from Tactical Demand Generation to Strategic Demand Marketing — see a significant improvement in their performance.
The average ANNUITAS client transforming to Strategic Demand starts at a lead-to-revenue conversion rate of 0.44% — growing to 0.99% in the first twelve months of their transformation program. Over the longer term, the average ANNUITAS client sees lead-to-revenue conversion rates reach 1.68%.
Quite simply, random acts of marketing require more investment and deliver less return; whereas, Strategic Demand delivers sustainable, repeatable ROI — serving as an engine of growth.
So, how do you move away from tactical, random acts of marketing to a Strategic Demand state?
The core of this shift is moving from an inside-out, product/solution-led approach to a buyer-centric customer strategy — a critical move for an increasing number of companies.
“More businesses will shift to a customer-led growth mindset in 2020. By placing customers at the core of their marketing strategies…” notes a recent piece on The Drum.
While being buyer-centric would seem to be intuitive, the challenge lies in operationalizing — through Conversation Tracks, Demand Process and Perpetual Demand Generation — and for most companies this requires a transformation effort.
What are your next steps? What does it take to drive a transformation to buyer-centric, Strategic Demand?