Accepting a Revenue Goal: A CMO to CEO Conversation
- AUTHOR Bonnie Crater
- November 11, 2013
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Marketing departments are being asked today to be more accountable for driving revenue. It’s not uncommon for a CEO to say “we want marketing to drive 30% of our revenue.” And if you’re the marketing lead, VP, CMO or otherwise, there’s two clarifying questions you might ask. “Do you mean source 30% of our revenue or influence 30% of the revenue?” Here’s why it’s important to ask this question.
There are often many sources of leads that result in closed deals. Some sources are marketing programs while others include telesales programs and operations, sales operations, and channel operations. So in order to understand the percentage of leads that are sourced by marketing, you’ll need a complete account of all responses to all the sources of revenue so you can see how well marketing is achieving the objective. Here’s a report in salesforce.com using the Full Circle CRM system that accounts for marketing, sales, and telesales sourced deals. It shows the first touch or first contact in the company and which department was the source.
In this report, marketing accounts for 5M+ of the won opportunities or 35.5% so returning the 30% suggested target, you might eagerly accept the 30% goal or propose that 35% is a better target.
While sourced deals can be a good metric, the other way you might measure marketing impact on sales is through marketing influence. In B2B marketing we all know that there are multiple marketing responses while the complex sale is being advanced and eventually closed. So a prospect or customer may respond to many marketing campaigns and each response can influence the advancement of the sale. You can read more about Full Circle CRM’s weighted campaign influence.
Here’s a report that shows where marketing is influencing revenue. You can see in the report below that inbound calls and sales outbound campaigns influence 5M+ in revenue but customers who accounted for 10M+ in revenue responded to and were influenced by many marketing activities.
So when the CEO wants to hold marketing accountable for revenue, be sure to determine what the metric is ahead of time. Find out if the metric is deal sourcing or deal influencing.