- Construct a technology road map based on business drivers to guide investment
- Consolidate applications into a platform with data and process level integration to improve efficiency and effectiveness
- Work to integrate marketing technology with the enterprise infrastructure to reveal deeper insights into customers, partners, and market opportunities
- Establish inter-disciplinary teams and processes to combat the silos point solutions can create
- Learn to leverage corporate IT to improve vendor management, due diligence, and governance practices
We are now publishing the results of our major annual Tech Marketing Benchmarks survey. Our tenth year of doing so!
My thoughts today:
1) Most importantly: The Marketing Transformation effort is accelerating. Many vendors have been at this for a few years but as we now do some accounting for results, we see as many false-starts as we do successes. And so there are renewed and bigger efforts underway to Transform. The best evidence of this is in recent, aggressive marketing budget overhauls and larger, more sweeping re-organizations of the marketing function.
The good news is that top marketing execs and C-Level execs DO understand that “future” Marketing can and should be the game-changer function, and so they are going to keep at the Transformation efforts until they see results.
Here are three major outcomes to watch for and benchmark, on your own Transformation journey: Shorter purchase cycles; reduced overall cost of (combined) Marketing + Sales; and vastly improved customer analytics as a result of integrated marketing plus sales automation efforts.
2) Budgets remain under pressure: we see the average large Tech Vendor getting a 1.7% budget increase this year. That is 1/2 the increase of last year…and we were even “closer” to the 2008-2009 recession at that point. The main culprit is the economy: management teams not willing to spend until better signs of demand pick up. The second factor is media shift: going-to-market with digital ve traditional media.
3) Tech vendors still spend 3-5 times as much on selling as they do on marketing. Heavy salesmanship has deep deep roots in IT vending. My belief is that the future holds a more even application of monies and activities between selling and marketing.
Building the Intelligent Sales & Marketing Organization.
IDC’s best and brightest analyst teams were assembled in Boston and San Jose during the past two weeks to present their latest insight and guidance for creating the global intelligent economy; focusing specifically on the impact of social, mobile and virtual technologies on this vision. Morning speakers discussed how to position for the third wave of IT industry growth driven by mobility, clouds, big data and intelligent industries. In the afternoon, one of the many tracks included presentations by IDC’s Sales and Marketing Advisory team about the vision of the intelligent sales and marketing organization and they key success factors required to achieve this vision. A few key take-aways from each of the presentations in this track are provided below.
Executing for Marketing Excellence in 2011 by Rich Vancil:
Start – or accelerate – your social business transformation
With communication cycle-times dropping and the purchase decision influence continue to shift to buyers, a shift to “social business” is imperative for your success;
41% of businesses have already implemented an enterprise social software solution
Focus on building “peer-to-peer” connections, not “vendor-to-customer”
Make a deeper investment in intelligence and operations
Drive marketing operations and market intelligence initiatives and investment down through the organization, across the business units and into the regions
Better establish and govern the processes for sales enablement and data quality to improve sales intelligence and their ability to leverage insight and resources.
Build a better budget (IDC CMO and Sales Advisory clients should refer to IDC’s combined marketing and sales investment benchmarks data)
As marketing budgets recover, allocate new investments with the needs of a new reality – digital marketing is here to stay, and is only increasing in its ability to drive awareness building and demand generation; and greater alignment with sales will require continued investment in campaign management, sales enablement and lead management extending into what has traditionally been considered sales’ domain.
Building the Intelligence Sales Organization by Michael Gerard:
Listen to your buyers:
Technology buyers indicated a desire to reduce their buying cycle time by 40%.
Two-thirds of the delay between desire vs. actual buying cycle time is the result of buyers’ internal funding and decision-making processes; however, vendors’ sales teams can impact this part of the delay!
Drive sales to be more strategic by investing in a next generation sales operations team which focuses on – sales strategy, productivity and automation. Team with marketing, your learning and development organization and IT to gaps in sales intelligence – customer intelligence for sales and sales enablement.
Push the limits on sales performance measurement
Establish a sales analyst function to better measure sales productivity
Improve data quality with the aid of other parts of the organization
Analyze the sales pipeline, rep performance and the impact of sales productivity improvement initiatives to help impact strategic and tactical decision-making
The Sales & Marketing Automation Imperative by Gerry Murray:
o Investment in sales and marketing automation continues to increase as companies recognize the value of technology in adapting to new market realities
o However, sales and marketing need to better align across their own teams as well with other parts of the organization to create a more holistic experience for customers (e.g., marketing, sales, finance, services, support)
o Your company should establish a customer data czar, with team members in sales and marketing, to execute and govern data quality processes.
o Evolve to a more comprehensive sales enablement platform (i.e., beyond a content portal) centered on integrated customer experience management
Clients of IDC’s Sales Advisory Service [http://www.idc.com/eagroup/sales.jsp] and CMO Advisory Service [http://www.idc.com/eagroup/cmo.jsp] should contact us for a full overview of any of these areas as well as access to our latest research schedule and listing of published research.
Please do provide any comments on this topic below or reach out to us to participate in upcoming sales and marketing research.
The IDC Sales and Marketing Automation Framework
Sales and marketing organizations are seeing a rapid evolution of solutions for automating their core business processes. While we are years away from anything like an integrated ERP-class solution that can manage the full range of sales and marketing activities, the building blocks are available today. CRM vendors have established that a single system of record is within reach for the sales team, and an emerging group of companies are is starting to prove that this goal is attainable for the marketing side of the house as well.
However, automating these two organizations will be a major undertaking for large companies. There will be significant process, cultural, and technical challenges. But the benefits are self-evident: lower cost, higher efficiency and productivity, greater accountability, better performance, improved customer experience, and potentially shorter sales cycles.
The Need for Alignment
The 80/20 Rule and the 50/50 Rule: IDC research shows that up to 80% of the content marketing generates is not used by Sales, even though a lot of it is specifically created for Sales and Channel enablement. Additionally, customers say that Sales reps are insufficiently prepared for their initial meeting 50% of the time. Clearly a massive disconnect is at work.
IDC’s Framework for Sales and Marketing automation is, therefore, focused on the tight alignment of key Sales and Marketing processes. This framework represents only those processes that must be coordinated (potentially integrated) between the two organizations. It is not meant to be a comprehensive map of all the processes in which each organization must engage to be successful – there are many activities on each side of the dynamic that do not have a corollary on the other.
Each high level process in Sales that has a counterpart in Marketing must share:
- A common set of definitions for inputs and outputs
- Proportional allocation of budget and resources based on overall business objectives
- Phase-appropriate performance metrics
- An integrated IT ecosystem
IDC recommends that sales and marketing automation efforts be tightly coordinated across both organizations so that the customer experience and lead management processes are handled seamlessly by all parts of the infrastructure. Even if a marketing implementation will have no sales users and vice versa, the data definitions and flow will be critical for both organizations. IDC recommends that:
- Senior marketing and sales leaders meet regularly to plan, review, and asses automation projects
- Marketing operations and sales enablement teams are especially critical, they should have representatives from both organizations with senior level sponsorship.
- Marketing needs to be very cognizant of how leads and lead details will flow into the SFA/CRM environment.
- Sales needs to be diligent in making sure marketing is capturing the high priority prospects and the high priority details so that lead acceptance criteria is routinely fulfilled.
One of the key issues for automating sales and marketing is establishing a shared automation road map. Upcoming research from IDC will help you: prioritize your plans based on business impact and implement best practices to be most successful.
Twenty percent of tech vendors $1b or greater in revenue are now reporting that they have experienced some form of organizational “mash-up” between marketing and sales over the last 12 months. This is the C-level effort to adddress the long-standing mis-alignments and costly points-of-friction between sales and marketing.
Lots of thoughts on this…but the most important is a “heads-up” to expect more organizational pressure and change in 2010. IDC forecasts marketing expenses (investment) to rise by 3.5% this year. We expect sales expenses (investment) to rise by 4.7%. Finally, we expect average revenue to to rise by 3.2 %. So, the math is not hard: operating margins will be under continued pressure. My sense is that the C-Level will respond with more brute force re-drawing of organization charts.