Sunday, October 23, 2016

The Unfinished Business of Marketing-Sales Alignment

A little over six years ago, I published a blog post that discussed the need for a more collaborative relationship between marketing and sales. Since 2010, I've written about various aspects of marketing-sales alignment 22 times.

I certainly wasn't the first person to discuss the disconnect that frequently exists between marketing and sales or the need for better marketing-sales alignment. For example, the July-August 2006 issue of the Harvard Business Review contained an article by Philip Kotler, Neil Rackham, and Suj Krishnasvamy titled "Ending the War Between Sales and Marketing."

For at least the past decade, both B2B marketing and sales professionals have recognized the importance of forging a closer relationship between marketing and sales. Over the past ten years, many B2B companies have made marketing-sales alignment an important business priority, and some companies have made significant progress in improving the quality of this critical relationship.

Despite the gains, however, two research studies from earlier this year clearly show that marketing-sales alignment is still a work-in-progress for many companies.

The CallidusCloud Research

The 2016 Sales and Marketing Sentiment Study by CallidusCloud was based on a survey of B2B marketing and sales professionals that produced 227 responses. The responses were nearly evenly split between marketers and sales pros. Sixty-two percent of the respondents were based in North America, and 22.7% were based in Europe.

Over two-thirds of the respondents (67.1%) said their company's sales and marketing teams are fully or somewhat aligned. In the 2015 edition of this survey, 71.9% of respondents reported full or partial alignment.

This research also found that both marketers and sales pros are less satisfied with their counterpart's performance in 2016 than they were in 2015. CallidusCloud asked survey participants this question:  "How satisfied are you in the performance of marketing (if you're in sales) or of sales (if you're in marketing)?" In 2016, 26.7% of all respondents said very satisfied or satisfied, down from 38.7% of respondents in 2015.

The CallidusCloud research pointed to several factors that may be making alignment more difficult to achieve. For example:

  • Only 29.8% of respondents said that lead data is fully shared between sales and marketing.
  • 41.9% of respondents said their company uses separate technology solutions to manage marketing and sales. Only 28.3% said their company uses a single integrated technology solution.
The Marketing Advisory Network Research

The 2016 B2B Sales & Marketing Collaboration Study by The Marketing Advisory Network was based on a survey of business, marketing, and sales professionals that produced 123 responses. More than 95% of the respondents were with B2B or hybrid B2B/B2C companies. This study also found several areas of "misalignment" between marketing and sales. For example:
  • 50% of sales respondents (but less than 20% of marketing respondents) said that sales follows up with 95% or more of the leads supplied by marketing.
  • Over 50% of sales respondents (but less than 20% of marketing respondents) said that sales reps regularly use virtually all of the sales assets and tools that their company makes available.

One reason that many companies are still struggling with marketing-sales alignment is that the two functions are still managed separately. I've long argued that optimizing demand generation in today's business environment requires the integration of marketing and sales for operational management and planning purposes. For an in-depth discussion of why such integration is needed, take a look at my earlier post titled Why Marketing-Sales "Alignment" Is No Longer Enough.

Image courtesy of Steven Guzzardi via Flickr CC.

Sunday, October 16, 2016

Why Successful Marketing Is All About "Give to Get"

Earlier this year, The Economist Group and Hill+Knowlton Strategies published a report regarding the development, use, and effectiveness of thought leadership content. The report was based on a 2016 survey of 1,644 global marketers and business executives.

The survey found that most business executives consume thought leadership content at least weekly, and 63% of surveyed executives said they have increased their content consumption over the past 12 months. But the survey also found that, on average, executives only engage with about 25% of the thought leadership content they see every day.

The Economist Group attributed this low level of engagement to several factors.

  • The pressure on marketers to produce a "continuous stream" of content makes it more difficult to create the kind of content that executives really value - content that is innovative, credible, and transformative.
  • The proliferation of content has caused business executives to become more selective about the content they consume.
The report also argues that internal disconnects make it harder for marketers to develop effective thought leadership content. For example, most marketers (82% in the survey) recognize that to create compelling thought leadership, content needs to center on the interest and needs of the audience. Yet, when marketers were asked to identify their three more important objectives for creating thought leadership content, four of the five most popular objectives focused on benefits to the brand, rather than benefits to the audience, as the following table shows:

This dichotomy permeates most aspects of marketing, not just content marketing. Senior business leaders are demanding that marketers demonstrate the value of marketing to the business, and marketers are responding by linking their activities to important business outcomes - things like revenue and market share growth. But the reality is, these business outcomes are not directly caused by marketing activities and programs. Instead, they result from how customers and potential customers respond to our marketing efforts.

This means that our ability to achieve our marketing goals depends on whether we are successful at winning the right responses from our customers and prospects. So therefore, the key to marketing success is to make our marketing activities, programs, and content truly useful and valuable to our customers and prospects, and thereby earn the responses that drive our desired business outcomes.

Some thought leaders describe this approach as "putting your customers interests above your own," but I don't agree with this characterization. It's not about subordinating your company's interests to those of your customers and prospects. It's about recognizing that your business objectives are only achievable by making yourself useful and valuable to your customers and prospects.

This post may sound a bit like Marketing 101. I suspect that most readers will agree with what I've just written. But this principle is easy to accept conceptually, and hard to consistently apply in practice, especially when the pressure is on to produce results quickly.

There's nothing wrong with having business outcomes as strategic marketing objectives, but it's essential to remember that these goals are best pursued indirectly.

For another good discussion of this important topic, take a look at this recent article at

Sunday, October 9, 2016

Why Marketers Must Beware of Bad "Research-Based" Conclusions

If you're a B2B marketer, you probably read survey reports on a fairly regular basis. They have become popular marketing tools for companies that provide marketing-related services and/or technologies. Survey reports can be valuable sources of information about marketing trends, practices, and technologies, but they can also mislead. Perhaps more accurately, survey results and reports can make it easy for us to draw inaccurate, or at least unjustified, conclusions.

A survey report published this past spring provides a good vehicle for illustrating my point. For reasons that will become obvious, I'll refer to this research as the "PA survey" and the "PA report." I'm using this report, not because it is particularly flawed, but because it resembles many of the research reports I review.

The PA report was prepared by a well-known research firm, and the primary focus of the PA survey was to show the impact of predictive analytics on the B2B demand generation process. The PA survey was sponsored by one of the leading providers of predictive analytics technology.

The PA survey asked participants to rate the effectiveness of their demand generation process as Effective, Neutral, or Ineffective. The PA report then provides data that shows the correlation between the use of predictive analytics and demand generation performance. The following table shows that data:

The PA report contains very strong statements regarding the impact of predictive analytics on demand generation performance. For example:  "Overall, less than one-third of study participants report having a B2B demand generation process that meets objectives well. However, when predictive analytics are applied, process performance soars, effectively meeting the objectives set for it over half of the time." (Emphasis in original)

The PA report doesn't explicitly state that predictive analytics was the sole cause or the primary cause of the improved demand generation performance, but it comes very close. The issue is:  Do the results of the PA survey support such a conclusion?

One of the fundamental principles of data analysis is that correlation does not imply causation. In other words, data may show that two events or conditions are statistically correlated, but this alone doesn't prove that one of the events or conditions caused the other. Many survey reports devote a great deal of space to describing correlations, but most fail to remind us that  correlation doesn't necessarily mean causation.

The following chart illustrates why this principle matters. The chart shows that from 2000 through 2009, there was a strong correlation (r = 0.992558) between the divorce rate in Maine and the per capita consumption of margarine in the United States. (Note:  To see this and other examples of hilarious correlations, take a look at the Spurious Correlations website by Tyler Vigen.)

I doubt that any of us would argue that there's a causal relationship between the rate of divorces in Maine and the consumption of margarine, despite the high correlation. These two "variables" just don't have a common-sense relationship.

But when there is a plausible, common-sense relationship between two events or conditions that are also highly correlated statistically, we humans have a strong tendency to infer that one event or condition caused the other. Unfortunately, this human tendency can lead us to see a cause-and-effect relationship in cases where none actually exists.

Many marketing-related surveys are narrowly focused, and this can also entice us to draw erroneous conclusions. The results of the PA survey do show that there was a correlation between the use of predictive analytics and the effectiveness of the demand generation process among the survey participants. But what other factors may have contributed to the demand generation effectiveness experienced by this group of survey respondents, and how important were those other factors compared to the use of predictive analytics?

For example, the PA report doesn't indicate whether survey participants were asked about the size of their demand generation budget, or the number of demand generation programs they run in a typical year, or the use of personalization in their demand generation efforts. If this data were available, we might well find that all of these factors are also correlated with demand generation performance.

There are a couple of important lessons here. First, whenever a survey report states or implies that improved marketing performance of some kind is correlated with the use of a particular marketing practice or technology, you should remind yourself that correlation doesn't indicate causation. And second, it's critical to remember that the performance of any major aspect of marketing is very likely to be caused by several factors, not just those addressed in any one survey report.

One final comment. Despite what I have written in this post, I actually believe that predictive analytics can improve B2B demand generation performance. What we don't have yet, however, is reliable and compelling evidence regarding how much improvement predictive analytics will produce, and what other practices or technologies may be needed to produce that improvement.

Top image courtesy of Paul Mison via Flickr CC.

Sunday, October 2, 2016

B2B Marketers Embrace Interactive Content

Interactive content has become an integral part of the marketing efforts of many B2B companies, according to a 2016 survey conducted by the Content Marketing Institute and sponsored by ion interactive.

In this research, 53% of the survey respondents said their organization uses some interactive content in its marketing efforts. Not surprisingly, large enterprises - those with 1,000+ employees - are more likely to use interactive content than smaller firms, but the differences are not as large as many might think. Sixty-five percent of large enterprise respondents said they are using interactive content, but about half of the respondents from mid-size and small companies also reported the use of interactive content.

The CMI survey also indicates that the use of interactive content is growing. Seventy-five percent of respondents said they anticipate their use of interactive content will increase in 2016 compared to 2015. And about one-third (32%) of non-users said they are likely to begin using interactive content in the next 12 months.

For this survey, CMI defined interactive content as "content that engages participants in a two-way dialogue or exchange, often providing utility and usefulness . . ." Some of the more popular types of interactive content include assessments, calculators, contests, quizzes, and interactive infographics, e-books, and white papers.

Benefits of Interactive Content

The majority of interactive content users in the CMI survey said that it provides several significant benefits. The following table shows the percentage of user respondents who agreed or strongly agreed with six benefits statements:

The findings of the CMI research reinforce the results of earlier research by other firms. For example:

  • In the 2016 Content Preferences Survey by DemandGen Report, when participants were asked about several possible changes in their B2B content consumption habits, 84% of the respondents agreed or strongly agreed with this statement:  "I prefer more interactive/visual content accessible on demand."
  • A 2014 survey by Demand Metric found that interactive content outperforms static or passive content at three critical marketing functions - producing prospect conversions, educating the buyer, and creating differentiation from competitors.
Interactive Content Works . . . If It's Useful to Buyers

The evidence described above clearly shows that interactive content can be a powerful marketing tool. But B2B marketers should remember that interactive content will only produce above-average results if it is useful and valuable to potential buyers.

As more and more companies use interactive content, the "novelty factor" for buyers will begin to wane. So, the real key to success with interactive content is to use interactivity to make your content even more useful and valuable for your potential buyers.

Sunday, September 25, 2016

How to Win the War Against Marketing Silos

One of the biggest challenges facing B2B marketers is the growing complexity of the marketing landscape. The increased complexity has been driven primarily by the proliferation of communication channels, the need to develop and manage an increasing volume and variety of marketing content, and the expanding scope of marketing's responsibilities.

To deal with the increased complexity, marketing leaders have implemented a plethora of new technology tools and added new human skills to the marketing function. Unfortunately, this response has often led to the development of more silos in the marketing organization, which can make it harder to create and execute effective marketing programs in an increasingly omnichannel world.

In their haste to address the growing complexity, many marketing leaders haven't made needed changes in the structure of the marketing organization, or in the processes used to manage marketing operations. A recent report by Harvard Business Review Analytic Services described the fundamental problem in unequivocal terms:  "Enterprises are investing millions in new marketing tools to keep pace with customers in the digital age. But maximizing returns on these investments is often undermined by outdated marketing structures and approaches."

Managing a growing number of marketing specialists while avoiding the negatives of organizational silos is not an easy task, but marketing leaders can learn important lessons from Team of Teams:  New Rules of Engagement for a Complex World by General Stanley McChrystal (with co-authors Tantum Collins, David Silverman, and Chris Fussell).

General McChrystal commanded the US Joint Special Operations Task Force from September 2003 until August 2008. During this period, one of the main missions of the Task Force was to defeat Al Qaeda in Iraq ("AQI"). In the early part of General McChrystal's command, the Task Force wasn't winning that fight. Team of Teams describes how General McChrystal and his leadership team transformed the Task Force so that it could defeat a new type of adversary in a new and very different warfighting environment.

The core problem was that organizational silos and bureaucratic management processes were preventing the Task Force from acting quickly enough to deal effectively with AQI. The Task Force included many small, specialized units or teams, each of which was very good at what it did. But, the training and culture that fostered a high level of trust and cohesiveness within each small team also contributed to a lack of trust and cohesiveness among teams. So the Task Force as a whole wasn't as effective as it needed to be.

General McChrystal and his leadership team recognized that they needed to scale the effectiveness of their small teams across the entire Task Force, and they took several steps to achieve this objective.

"Share Until It Hurts, Then Share Some More"

Task Force leaders recognized that every team in the Task Force needed to understand the overall mission, and also needed to be constantly aware of the current status of virtually all Task Force activities and operations. To accomplish this, Task Force leaders replaced the "need to know" mentality normally found in military organizations with information sharing on steroids.

They reconfigured their working spaces to encourage information sharing. All operations were run out of a large central room that had enough space for representatives of all the functional specialties of the Task Force, and for representatives from "partner" organizations such as the CIA. A wall of screens at the front of the room provided real-time information regarding Task Force operations. To further encourage collaboration, this entire room was designated as a "top secret" security space, which meant that almost any document or topic relevant to Task Force operations could be discussed and debated by anyone, anywhere in the room.

Even more important, Task Force leaders conducted a daily briefing that was designed to integrate everything the Task Force was doing with everything it knew. They also developed secure video conferencing capabilities that allowed personnel and representatives of partner organizations who were not in Iraq to participate in the briefings. In military organizations, these types of briefings are typically restricted to senior leaders. At some points, the Task Force invited thousands of individuals to attend the briefings, which shows how far Task Force leaders were prepared to go to encourage widespread information sharing.

Many B2B companies may not be able to reconfigure their physical working spaces to create a room large enough to accommodate the entire marketing team, but all companies can conduct regular meetings that are designed to keep everyone up to date on current marketing activities and plans, as well as any other factors that might impact marketing activities.

The frequency of these meetings should be based on the cadence of a company's marketing operations. The Task Force needed to conduct briefings on a daily basis, but some companies may find that weekly meetings work best, and others may decide that a monthly meeting is sufficient.

Develop "Lateral Connections"

General McChrystal and his leadership team also realized that they needed to increase the level of trust among the specialized teams in the Task Force. Every team needed to have insight into how their peer teams functioned and how their work contributed to the success of the Task Force.

To accomplish this objective, Task Force leaders instituted an "embedding" program. Under this program, an individual from one team (say, for example, a SEAL squad) would be assigned to a different team (such as a team of intelligence analysts) for six months. The purpose of this program was to allow these individuals to see how the war looked from inside other teams and build personal relationships across teams.

Some B2B companies will probably find this type of embedding program challenging to implement, and in smaller companies, it may not be possible at all. When embedding isn't possible, the next-best alternative is to routinely create cross-functional teams to work on major marketing projects. This allows people from different marketing disciplines to form personal relationships, and it requires them to consider multiple perspectives when developing significant marketing programs.

The Point

There are some obvious parallels between the situation that confronted General McChrystal in Iraq and the challenges that today's B2B marketing leaders are facing. Marketing is becoming more specialized, while the need to deliver engaging and consistent customer experiences across multiple touch points on a near real-time basis has never been greater. The "team of teams" approach provides one effective way of accomplishing this objective.

Illustration courtesy of Doc Searls via Flickr CC.

Sunday, September 18, 2016

A Much-Needed Reality Check on Predictive Analytics

Predictive analytics has become one of the hottest topics in B2B marketing over the past several months. In a survey last fall by Everstring, 25% of respondents said they were currently using some predictive tools, and another 47% said they were aware of predictive marketing and were investigating how to use it.

Two recent studies by Forrester Consulting reported even higher usage rates of predictive analytics among B2B companies. In one of these studies, 49% of survey respondents said they were currently using predictive analytics, and another 40% said they were planning to implement predictive analytics in the next 12 months. In the second study, 61% of survey respondents said they were currently using predictive analytics, and another 26% said they were planning an implementation within 12 months.

A new study by Econsultancy (in association with RedEye) provides a much-needed dose of reality regarding the adoption of predictive analytics and the challenges of using it effectively. The Econsultancy study was based on an online survey of nearly 400 digital marketers and e-commerce professionals that was fielded in April and May 2016. About half (51%) of the survey respondents were based in the United Kingdom, 23% were based in North America, and 22% were based in Europe. Respondents represented a wide range of industries.

Fifty-nine percent of the respondents to the Econsultancy survey work for client-side enterprises ("companies"), while 41% work for agencies, vendors, or consultancies. The survey results described in this post are based on the answers given by company respondents only.

The Econsultancy study confirms the strong level of predictive analytics usage. Forty percent of respondents reported that their companies are either currently using, implementing, or have budgeted for predictive analytics over the next 12 months. In addition, 80% of respondents said that the use of predictive analytics is "critical" or "very important" to the future of their organizations. Given this view, it shouldn't be surprising that 65% of the respondents said their company's budget for predictive analytics will increase in the coming year.

The Econsultancy research also revealed that predictive analytics is not a "magic wand that automatically guarantees sales." For example, 53% of the survey respondents from companies currently using predictive analytics said that their sales had significantly increased over the past year. However, 50% of respondents with companies that had "evaluated implementing predictive analytics and decided it's impractical" also reported a significant increase in sales over the past year. So, it's questionable whether the use of predictive analytics was the primary cause of the increased sales in those companies that are using predictive tools.

It's also clear from the Econsultancy study that you can't expect predictive analytics to be an overnight success. Only 23% of survey respondents rated their company as "competent" or "highly competent" at the use of predictive analytics, and 35% of the respondents strongly agreed that they "are yet to realize the benefits of predictive analytics."

Predictive analytics is becoming an important marketing tool for many large and mid-size B2B companies. But like most tools, it will take work and practice to maximize the value of predictive analytics in marketing.

Illustration courtesy of Skye D. via Flickr CC.

Sunday, September 11, 2016

The Dark Side of Marketing Performance Measurement

"Yes, a Jedi's strength flows from the Force. But beware of the dark side."

For the past several years, marketers have faced growing pressure to prove the value of their activities and programs. As a result, they are placing greater emphasis on measuring the performance of marketing tactics, channels, and programs, and some marketing leaders are allocating budgets and basing marketing mix decisions on performance measures.

Overall, this has been a positive development. It's hard to argue that marketers shouldn't track and measure the performance of their activities, and use performance metrics to guide marketing investments. Common sense says that this approach should lead to better marketing decisions.

But there's a potential dark side to the current fixation on marketing performance measurement. The problem arises when the ability to measure a marketing activity becomes the primary criterion for determining its value.

When taken to the extreme, this way of thinking can lead marketers to choose marketing tactics based largely on ease of measurement. As a recent blog post put it, "While marketers once accepted as fact that they didn't know which half of their budget was wasted, today they've done a 180 and believe that if it can't be measured, it's not worth doing."

I can understand why marketers are tempted to think this way. After all, in an environment where proving the value of your work can mean the difference between keeping or losing your job, marketing methods that are easily measured can appear to be the safe choice.

But making measurability the prime criterion for determining value is short-sighted and ultimately dangerous. It's a classic example of the McNamara Fallacy at work. The McNamara Fallacy was named for Robert McNamara, the US Secretary of Defense during the Vietnam War, and it relates to his approach to managing the war effort. The term was coined by the noted social scientist Daniel Yankelovich, who described it this way:

"The first step is to measure whatever can easily be measured. This is OK as far as it goes. The second step is to disregard that which can't be easily measured or to give it an arbitrary quantitative value. This is artificial and misleading. The third step is to presume that what can't be easily measured really isn't important. This is blindness. The fourth step is to say that what can't be easily measured really doesn't exist. This is suicide."

 Ironically, some of our efforts to improve marketing performance measurement have also exacerbated its dark side. For example, most marketers are now focused on measuring the impact of marketing activities on revenues. So, we're now constructing complex attribution models in an attempt to assign revenue dollars to specific marketing activities.

Measuring the performance of marketing activities that produce quick results is relatively easy. It's much harder to measure the performance of marketing activities that may not bear fruit for months or even years. For example, the content that you're creating and publishing this year can produce a positive impression in the mind of a potential buyer, and that impression can influence a buying process that won't even begin for two years. Likewise, some of the sales you're closing this year are due, at least in part, to the marketing activities and programs that you ran in 2014 and 2015.

In a recent interview, David Cote, the CEO of Honeywell, described the importance of long-term effects in these terms:  "You do well this year, not because of what you're doing this year, but because of what you did in the previous 5 years."

Marketing activities with long gestation periods, and those whose impacts are several steps removed from the final buying decision can be very difficult to measure. But many of these activities are vitally important for marketing success. Unfortunately, when we fixate on measurability, we can end up under-investing in these critical marketing activities.

As Albert Einstein purportedly wrote on his blackboard:  "Not everything that counts can be counted, and not everything that can be counted counts."

Illustration courtesy of Kory Westerhold via Flickr CC.