7 Steps to Effective Pipeline Management - Part 2

Sales Pipeline

This week I’ll continue my look, started with last week's Blog, on Marketing’s contribution to sales pipeline and how the customer’s buying cycle must drive how Marketing interacts with them and helps Sales to identify and develop sales opportunities.

The simple buying cycle I set out last week is as follows:

1. Understand Buyer behaviour
2. Be found
3. Convert interest to action
4. Create a community of interest
5. Nurture leads to create sales opportunities
6. Support the sales process
7. Retain and develop customers

I talked about the first three stages last week. These are about understanding and segmenting potential buyers; creating communications that enable your company to be found; and capturing interest so that it can be nurtured and developed into a sales opportunity.

Communities of Interest

I think of business communities as a self-selecting community with a set of business challenges and/or responsibility for operational or strategic assets which leads them to seek further information with which to educate and influence their purchasing decisions. They may be involved in a purchasing cycle, but typically community behaviour is more likely prior to formal acquisition processes and particularly post-sale.

Today generalised social communities such as Facebook and LinkedIn exist, within which communities of interest (‘Groups’) can be created. In B2B high-tech circles, media groups, such as TechTarget, continue to promote subject-specific communities. But the challenge facing Marketing is to use this community paradigm to nurture its own database of opted-in contacts. With the right content and a good understanding - based both on behavioural tracking and the information volunteered by respondents - of information needs, we can push out relevant information, or make it available on a personalised landing page URL and track response.

Nurture Leads

What is a lead?

This may seem like a strange question, but I can guarantee that what Marketing calls a lead and what Sales expect from a lead are two different things. This handover point from Marketing to Sales is always a bone of contention, often exacerbated by Marketing having to hit lead targets that bear no relationship to sales outcomes. If Marketing is the owner of prospect ‘touches’ until such time as the prospect (or more accurately to this point, the ‘suspect’) is ready to consider alternatives and shortlist, then how to identify this point is a priority and can only be achieved when Marketing and Sales sit down together.

In a complex sale, the nurturing process can be measured in months, so it requires a comprehensive nurturing strategy from Marketing using multiple communications channels and highly focused content. Twitter, Blogs, news stories, white papers, newsletters, video and interactive media are likely to be key content/ channels along with email, events and seminars. Contact-level database tracking and lead scoring will be essential to manage the nurturing process.

Support the Sales Process

Sales will pick up and continue the dialogue with prospects that Marketing has started. Particularly at the initial sales engagement, whether by telephone and email or in person, the messages must be consistent and deliver on the brand promise carefully developed over weeks and months. All sales support material must facilitate this process and be developed in close cooperation with Sales.

Later in the sales engagement, Marketing should be working closely with Sales to understand how it can support pipeline velocity: opportunities can get qualified out, slowed down or lost. Marketing has an armoury of weapons to help with opportunities that get stuck at various points in the sales process, such as ‘short listed’ or ‘proof of concept’. By automating the end-to-end pipeline process, Marketing should have a real-time dashboard that provides data on what is going on and provide input to Sales and Marketing discussions about what is being done. This is not just a Sales management responsibility. Rejected leads, opportunities qualified out and lost deals should be recycled and inform the marketing strategy.

Retain and Develop Customers

Realising customer value, building customer loyalty, and thereby expanding deployment of products and services in B2B environments is a key strategy for high-tech suppliers. In fact, in such a highly innovative industry, with the resulting short product lifecycles, this ‘land and expand’ strategy is critical to reduce the on-going costs of customer acquisition. Often profits are lower on the initial sale with an expectation of growing this business.

Marketing needs to understand how this strategy will be deployed and how interaction with customers is different from that used with prospects. It requires a more joined-up approach since the customer’s day-to-day experiences will now be handled by Operations (or Support and Services). How do today’s customer interactions help identify opportunities for expansion and how does Marketing leverage these?

Internal seminars, Intranets, executive events, case studies, networking and internal success stories can all be used in post-sales situations, but the focus once more has to be on engaging with Sales and Support to incorporate Marketing communications into the overall customer engagement strategy.

In Conclusion

Marketing can often get hung up on short term tactics and short term targets which are not aligned to actual pipeline performance. By understanding the customer journey throughout his buying cycle, tactics can be better targeted at particular stages in the journey to meet specific quantifiable ends.

7 Steps to Effective Pipeline Management - Part 1

The primary driver of B2B Marketing in high-tech markets is to feed the sales pipeline and generate a quantifiable contribution to revenue targets.

Marketing is primarily thought of in the context of demand generation - particularly driving sales leads - but this is just part of the equation. In my experience there are 7 key steps to align marketing activity with the sales pipeline. Each of these must be supported by KPIs that ultimately generate an acceptable ROI.

1. Understand Buyer behaviour
2. Be found
3. Convert interest to action
4. Create a community of interest
5. Nurture leads to create sales opportunities
6. Support the sales process
7. Retain and develop customers

Understanding Buyer Behaviour

One of the best books I've read on the B2B buyers' journey and the need to understand how buyer behaviour should drive sales and marketing strategy is 'The Leaky Funnel' by Hugh Macfarlane. In this book, Hugh reminds us that Sales and Marketing have a shared role to play in supporting a buyer through his (or her) journey from 'blissfully unaware' they have a problem to searching for a solution, selecting from alternatives and so on. Only by understanding this journey for your products and services in your market can you hope to determine buying signals and to shape your sales and marketing tactics accordingly.

In many high-tech environments - led by technophiles or Sales - one could be forgiven for thinking that all Marketing needs to do is tell people the product is available (and is of course the best on the market) for them to beat a path to your door (the 'better mousetrap syndrome). Why should they care? It's Marketing's job to communicate this.

Getting Found

Buyers will be searching for information for many reasons, depending on where they are in their buying cycle: they may be trying to confirm that they have a problem - perhaps they have reached a point of pain recognition, which is forcing them to dig into what the problem might be that is causing it. They need to be educated - and companies that can show 'thought leadership': relating to their business pain, identifying its causes and talking about potential alternative solutions are well positioned to begin a dialogue which may lead to an opportunity.

However, this is a different reason for seeking information - and requires a different response - to those who know they are looking for a particular type of solution and are researching suppliers. Marketers must use appropriate media channels and content to address these different needs. SEO/ PPC, Blogging, social networking, web communities and traditional through-the-line media channels and events must be deployed to provide buyers with multiple means of finding you. Content is King!

Converting Interest

Your website or landing page is key to converting interest into action and creating top-of-funnel enquiries. To engage with a potential buyer, you need to know who he is and this requires him to 'raise his hand' by registering his details on your site. I could fill many pages on the debate about whether a form should be required for downloading content, what fields it should contain and how long it should be, but there are many other sources for this. Suffice to say this requires a lot of testing, but typically the bar should be set low to encourage completion. In B2B environments, the buying cycle can be long, allowing for additional information capture throughout the process.

However, a dialogue can not begin until the buying party declares an interest; and the power lies with the buyer - often buyers want to remain anonymous until they have conducted their own research. This supports the need to promote thought leadership through multiple channels and the rise of social networking only serves to support word-of-mouth sources and delay the point at which a buyer will declare his hand. High pressure sales tactics are not well received amongst knowledgeable buyers. I have seen a marked decline in the value of trade shows during the early stages of B2B buying, for example, as there are many more effective channels for buyers to research vendors.

In my next Blog, I will look at the remaining stages: how to sustain a dialogue, develop the sales opportunity and build on-going customer relationships.

Focus on Marketing Metrics: should we be doing more?

I was inspired by a great Blog from Mashable to look at some of the current thinking on Marketing measurement. Prashant Suryakumar, who wrote this article makes the point that:

'There are no “best practices” for measuring a successful social media campaign. Crowd behavior is dynamic and context-specific, and it is difficult, if not impossible, to build a “one size fits all” solution.'

He goes on to make the point that there is a lot of data points that can be captured in social media, but not all of them are relevant and that metrics need to be divided into those that identify influencers in your community, those that help businesses understand engagement and the conversations that are being had (reputation) and finally those that show how social media is impacting the business holistically. As he says: 'Measuring the impact of increased chatter for your brand might not always translate to more revenue for the business. Measuring cause and effect between buzz, branding and sales might show different dynamics for different product groups.' For me, this is the crux of the issue - how does social media activity impact the bottom line? Understanding this better will be the challenge for 2011. For an indication that certain social networking tools, specifically Blogs, can drive identifiable inbound leads, check out this Blog from Tiecas, which quotes Hubspot data - and which chimes with my own experience.

Funnel Management and ROI

However, while social networking measurement may be the subject de jour we should not forget that measuring any returns from Marketing is still a minority sport. According to a report quoted on DemandGen that I tweeted a couple of weeks ago (@j_ceri), the Sales Lead Management Association (SLMA) 'found that 64.9% of BtoB marketers cannot track ROI, while 58% do not qualify inquiries prior to lead distribution.

When respondents were asked if they track marketing ROI, only 14.6% said they do it within the SFA/CRM system.'

Marketing still has a long way to go to transition to a more accountable function that can demonstrate its impact on the business in financial terms. The focus on marketing metrics, process, data and analytics has to increase in 2011 - if only to enable a successful introduction of marketing automation (for more details on the current state of play check out this report).

There is now no end of content from vendors on why marketing measurement makes sense, how to do it, how to automate it and so on. Technology marketers should check out the content from Bulldog, Hubspot and Eloqua in particular.

Let's get in the driving seat of identifying the revenue we drive in 2011 before the CFO forces change on us. You may be surprised at the good news contained in the data and how it can be used to defend against Sales' claims of 'not enough leads'!

What Did MySpace do Wrong.... if Anything?

Time Magazine reported yesterday that MySpace is expecting to be sold off imminently by News Corp, but in the meantime was expecting to reduce its workforce by 50% by the end of the month! That is a significant turnaround for the business, which had conceded that Facebook was Top Dog in social networking last November.

Dominating the Category

On the back of my last Blog which looked at the strides both Facebook and Twitter made this year, this news made me think once again about the short window of opportunity new technology start-ups have to establish market dominance of a major market segment. As a company that launched in 2003 and was sold in July 2005 for US$580 million, MySpace represents a spectacular rise and fall over the two years of 2009 and 2010 as Facebook became the go to site for networking and maybe the seeds of this change were captured in the changing user demographics of each site as Facebook opened its doors beyond its college community roots.

The 'Internet factor' obviously played a huge part in this dramatic rise and fall due to the speed with which technology has developed in our connected world - Twitter has come from nowhere to be worth a reported $3.7bn - but can it make money, or is it destined for a MySpace swan dive? And what role does Marketing play in building brand and repeatable revenue streams in these businesses?

Tracking Buyer Behaviour in a Connected World

Of course, B2B businesses are less likely to rise and fall in quite the same dramatic fashion, as enterprises are relatively slow to adopt new technology due to the need to manage the risk of change and clearly demonstrate ROI. But the development of business communities - on Linked-In and Facebook, or more loosely connected on Twitter - present a challenge to all marketers to understand all the influences, formal and informal, or buyer behaviour.

Knowing how to embrace tools to help influence the influencers - and turn it into cold hard cash - could be just about the most important weapon in a marketer's armoury in the coming years.