Unmet revenue expectations — the silent killer of B2B marketing careers

 Are you meeting your B2B revenue expectations?

More than ever it seems, the CEO/CFO and CMO are fundamentally at odds when it comes to the purpose of marketing. Perhaps this has always been so. However, we now appear to be hitting a new peak. And it could cost marketing leaders their jobs.

Of course this isn’t entirely surprising, considering the viewpoints classically held by both offices. 

The CEO/CFO leadership is focused primarily on hard-nosed business performance: cash flow, cost reduction, quarterly results – and the bottom line. 

At the other end of the executive inner sanctum, the focus of a CMO is often on ‘softer’ metrics – MQLs, awareness, shares, time on site, sign-ups etc. In other words, more up-stream measures of success.

Of course, more recently, many marketing leaders have been busy implementing the latest marketing technology. With the latest of Scott Brinker’s martech landscape infographics now showing 6,829 marketing solutions spanning 6,242 vendors and 48 categories, the worry is that marketers are spending more time on -tech than on mar-.

Thing is, when marketers are too disconnected from the financial measures of their work, this leads to distrust from CFOs and CEOs. 

According to research from The Fournaise Group

‘80% of CEOs believe Marketers are too disconnected from the short-, medium- and long-term financial realities of companies.’ 

They go on to explain the reason: 

‘78% of these CEOs think Marketers too often lose sight of what their real job is: to generate more demand for their products/services in a business-quantifiable and business-measurable way.’

Ultimately, this leads to an average CMO lifespan of just three years (compared to eight years for CEOs and five years for CFOs). 

If you consider that many marketing leaders spend the first six months sorting out the problems they inherit and the last six months planning their exit, that leaves just 24 months to make any kind of significant impact on the business. And, in B2B, where sales cycles are often nine months to a year, it’s easy to see that the pressure is on.

Measuring what really matters

Even if CMOs are able to show positive results for marketing against the department’s own measures, these are not the ones that ultimately matter to their boss.

At worst, according to 68% of respondents to a study published by The Economist and Marketo – discussing ‘marketing stats’ such as lead quality and site traffic gives marketing the appearance of running a (very expensive) cost centre. At best, it’s seen as an unavoidable investment.

It would be convenient to dismiss this as a philosophical disagreement or a turf war. But according to an Active International report, 45% of both CMOs and CFOs report that this misalignment has a negative impact on the company’s success and growth.

And that’s not good news for anyone inside or outside the boardroom.

You say tomato, I say bounce rate

Of course, it’s not all marketing’s fault. A big part of the problem is that, all too often, company management fail to clearly communicate the overarching business objectives and corporate strategy. 

In fact, in our recent Revenue Rift research, this was the #1 barrier to success reported by B2B marketers when it came to hitting revenue and pipeline targets. After all, it’s difficult to hit targets that are either unclear or in constant motion.

What’s surprising is that this is viewed as a more difficult obstacle than lack of budget, time or staff – the usual suspects when it comes to explaining shortfalls (and also the easiest ones to point to on the CFO’s balance sheet).

So what does that mean? 

Some say that marketing simply has a problem marketing marketing – that if only they could make CEOs ‘get it’, all their problems would vanish. The problem with this thinking is that, at a business level, CEOs ‘get it’ more than anyone else. They know what matters to the business and everything else is, frankly, garnish. 

The reality is that the CEO:CMO misalignment is marketing’s issue to solve.

Do you speak CEO?

It is critical that marketing leaders are not simply passive victims. Nevertheless, Harvard Business Review reports that this indeed is often the case: 

74% of CMOs it surveyed say their jobs don’t allow them to maximize their impact on the business.

And they’re not wrong, according to HBR:

‘When responsibilities, expectations, and performance measures are not aligned and realistic, it sets a CMO up to fail.’

The solution? Marketing leaders need to initiate the process, structure better conversations with the rest of the C-suite, and set the right expectations. And this means speaking the lingua franca of business instead of PowerPoint charts teeming with MQLs, page-rank and CRO.

Setting the right expectations

The good news is that we’re already seeing initial momentum in this direction. Marketers are increasingly abandoning vanity metrics and focusing on those directly related to improving business.

The Revenue Rift research shows more mid-market and enterprise marketers using revenue and closed:won rates as their primary performance measures over those focusing on social engagement and email clicks (though these other measures are still widely used).

Of course, the problem of management’s lack of clarity remains. While this can be seen as a C-suite problem (surely they can do a better job?) the brunt of the issue will find its way to marketing’s door. So it becomes marketing’s job to interrogate their leadership about what really matters – what are the real business targets and what is expected from marketing to support the business in hitting them?

Even if this proves difficult and a clear strategic directive remains conspicuous by its absence, marketers can begin to ask themselves one anchoring question: 

'How are our marketing activities contributing to growth and driving the bottom line?'”

It’s not rocket science, far from it. But it will demand a focus on business outcomes rather than marketing tactics. And this will better prepare marketing leaders for the inevitable CEO/CFO question: What are you doing with all that budget we give you?


Download your copy of the Revenue Rift Report and get the full picture on what other marketers just like you are doing to meet the challenge of delivering for the bottom line. Got questions? Contact us at hello@consideredcontent.com, we’d love to help.


Revenue responsibility: are you owning it?

 The Revenue Rift Report by Considered

Chances are, when you started your role in B2B marketing, you weren’t tasked with revenue generation. After all, delivering the company’s income has traditionally been the responsibility of sales with marketing more often offering up-stream support.

Take a look at the sales team in your own organisation. They spend weeks on end developing business opportunities, making contact with leads, forecasting revenue pipeline, juggling buying committees, and closing deals. It takes persistence, time and not a little luck to hit their quotas.

So what happens when less and less of the sales process is actually under their control? 

What happens when senior management decides that marketing should be more directly responsible for revenue?

 

The new revenue reality for B2B marketers

In most B2B companies today, sales still carries significant quotas, but marketing is becoming responsible for an ever-increasing amount of revenue. In our latest research52% of mid-market and enterprise marketers said they are under ‘a lot of pressure’ to deliver pipeline and revenue. This increases to 56% when we look just at enterprise marketers. 

 52% of B2B marketers are under a lot of pressure to deliver revenue and pipeline

What’s more, it’s increasing. 

A massive 86% of respondents say the pressure has become worse in the last 12 to 18 months. Just under half (49%) say it’s increased a lot. 

Of course, advances in campaign analytics and marketing attribution have made rapid improvements. Today, more than ever, marketing can see the direct results of its activities all the way to bottom-line revenue. It’s imperfect certainly, often showing more correlation than causation, but it’s leagues ahead of where it was just a few years ago.

What’s more, the modern B2B buyer is showing an increasing tendency to avoid sales until they really have to. They’re doing more online research and content consumption, becoming more informed before making contact. In fact, LinkedIn found that the average decision maker reads 10 pieces of content before completing their purchase decision.

Simply, they’re spending more time as an ‘unknown’ – more time on marketing’s side of the fence.

 

Greater accountability = greater power

While the pressure is on, to be clear, this isn’t bad news. After all, it wasn’t too long ago that marketing was under constant pressure simply to prove the value of its existence

Having responsibility for the bottom line is a dramatic improvement in comparison. It demonstrates that companies recognise marketers as not merely the brand’s purveyors of creativity, but contributors to the business and its growth in a meaningful way.

But it does mean a greater emphasis on accountability – and that means delivering hard numbers. In fact, in our research, 31% of respondents say increasing marketing-driven revenue is a key marketing priority for the year ahead.

It also means implementing brand and demand strategies that can handle a greater part of the sales cycle, as the marketing department is also handing off opportunities at later stages than before. 

And it means having a far better relationship with sales.

Ultimately, it means marketers can no longer collect email addresses and pass them to sales as ‘leads’. They need to take a more rigorous approach, tracking prospects across the entire lead-to-revenue cycle, assessing and scoring them against meaningful metrics at every stage.

 

Getting performance metrics right

The move to more bottom-line responsibility means fluffy lead metrics are out (as are vanity measures of engagement such as likes and shares). So what replaces them?

The number one performance metric for the marketers in our survey is delivering marketing-generated pipeline/revenue – even ahead of closed:won rates. This is both a reflection to the increased pressure they face and a demonstration of a move to adopting a more commercially-focused mindset.

The reality is that, today, marketers have access to a wider range of data than ever before, and can respond it far more nimbly as well. As such they can gain greater intelligence and insight into buyers and trends than ever before (far more than is generally available to sales).

What’s more, marketing is a function that understands the wider market. The CMO is predominantly a market-facing role. It’s their job to be able to understand and respond to changes in customer expectations and demand.

 

The time to act is now

The results from our study are clear: it’s time for marketers to take responsibility for more of the pipeline, and ownership of the revenue targets.

Yet even as recently as January 2018, Deloitte reported that only 6% of CMOs are actively working on growing global revenue. And as a result their report points out:

Many CMOs struggle to establish the kind of interdepartmental collaborations that can allow them to expand their influence – and value – beyond the marketing organisation.

Not good.

So what does this mean in practice?

While nothing here is rocket science, becoming more focused on the bottom line can often mean flipping traditional approaches on their heads. Simply, it means starting with revenue and working back:

  • What’s the revenue goal? 
  • How many new customers will it take to meet it? 
  • What kind of customers?
  • What’s the typical ratio of sales qualified leads to get to that number of clients?
  • And how many marketing qualified leads need to convert? 

This will also mean balancing your short- and long-term objectives. The danger of developing a revenue obsession is that longer term brand building gets ignored. However, significant research shows that without investment in your core brand, long-term revenue growth will stall (see How Brands Grow by Byron Sharp and The Long and the Short of It from the IPA). 

It’s about balance. 

On one hand, it means focusing on lead generation and revenue acceleration over the near term (the next two or three quarters). This may mean building what’s starting to be called a Revenue Operations (RevenueOps) capability that’s custom tuned to moving prospects through the sales cycle and converting more of them at each stage. 

But it also means continuing to build a distinctive, relevant brand that will deliver a revenue multiplier over the longer term. 

It is still the case that buyers tend to select from a surprisingly small number of potential vendors. These will be drawn from those that they are somewhat familiar with (and will be the ones they tend to research as a trusted source of information). The reality is, you need to be on their radar before they begin the purchase process. And that means growing your brand.

 

Reaping the rewards of greater accountability

The new revenue reality comes with a higher level of pressure and responsibility for sure. But it offers rewards, as well. 

According to Gartner, marketing leaders that own or share P&L responsibilities command 20% larger budgets.

That could go a long way towards making the purchasing process better for sales and buyers – and getting marketing closer to its revenue target. And ultimately, it will allow marketing to fully take its place at the top table of business decision making.

 


Download your copy of the Revenue Rift Report and get the full picture on what other marketers just like you are doing to meet the challenge of delivering for the bottom line. Got questions? Contact us at hello@consideredcontent.com, we’d love to help.


It's time B2B content marketing got real

 The Get Real Guide to B2B Content Marketing

The gurus say one thing. Your results say another. It’s time to get real about what really works in B2B content marketing.

Unless you’ve been living under a rock, you’ll know that content matters in B2B marketing.

But for many, the words they hear at the conferences and on influential blogs don’t match up with what they’re seeing in their businesses.

Let’s take an example analysed by Mark Higginson in an article for Econsultancy. He focuses in on Amex’s Open Forum — a much-praised hub of insight and advice for small businesses. Their top post gets 17,346 shares — impressive. Until you realise that the average for their other 1,300+ articles is just 200 shares.

Of course, if that was an isolated incident, there’d be little to worry about.


A one off? Sadly not.

For example, let’s look at the fact that, according to research by Forrester, just 27% of senior marketers strongly agree that they’re seeing satisfactory business value from content marketing darling Twitter (Forrester’s Q1 2015 Global Social Relationship Platform Wave™ Online Survey).

Or take research from Vanson Bourne that shows that while 94% of IT marketers use social and 71% are planning to spend more on it, just 20% of IT decision makers use social to shortlist potential vendors.


Houston, we have a problem.

While the latest must-do activity changes, some things do not.

The overall objectives for B2B content have remained remarkably consistent in recent years. Technology Marketing’s B2B Content Marketing Report for 2016 shows the top priority as Lead Generation (55%) followed by Brand Awareness (38%) and Customer Acquisition (37%) — though, interestingly, Revenue is a poor 9th on 22%. Other research has reported much the same thing year on year.

So why is there such a mismatch between objectives and results?

Well it comes down to a few things — four to be precise.

  1. Strategy isn’t being approached in the right way, linking marketing to the wider business realities
  2. There is insufficient customer-focus (in a way that will lead to increased revenues and shorter sales cycles)
  3. Too many brands suffer from poor differentiation in the minds of their prospects
  4. And content marketing is prioritising content over marketing (and is too obsessed with the latest bright shiny tactics)

Marketing success = business success

While so much of the popular discussion around marketing today focuses on what marketers are doing (social, content, ABM etc), too little takes time to ground it on why they’re doing it. Or if it does, it tends to focus on the outcomes of individual activities (how many shares something got).

The reality, of course, is that marketing is a function of the overall business. Its role is to add tangible value. This can mean a number of things — growing brand, depositioning competitors, engaging investors, launching products — but ultimately they pretty much all come back to increasing or accelerating revenue.

This means that any content that doesn’t link to the wider marketing strategy and to delivering tangible business results will always be ineffective in the eyes of senior management.


Any successful content marketing approach will have customers at its core.

Let’s face it, creating empty, navel-gazing material is a guaranteed direct route to failure (even though a distressingly high number of brands who should know better still do it). So focusing on the customer will always make good business sense.

But it is one thing to reflect what customers find interesting but another to tie their interests and objectives with yours. So while many businesses churn out “interesting” top 5 listicles that may generate some clicks (sometimes lots of clicks), they’re failing to move the prospect towards a sale.


What will you teach your customers?

Research from CEB has clearly shown that being able to educate customers about their own businesses is a fundamental marker of success in B2B.

Those that manage this out-perform all others by a staggering margin. So when we talk about being customer-focused in B2B content marketing, we mean helping the customer achieve their key real-world objectives in a way that has a direct line to how your business makes money.

Importantly, this will often mean actively trying to persuade customers to stop doing what they’re currently doing and start doing something new. Or it will mean showing them fundamental issues in their businesses that they may be currently unaware of. Or it will mean helping them get unstuck from a situation holding their businesses back.


Attention spans are getting shor... ooh, look, a cat in a bow tie

Customers today, have frighteningly short attention spans. They’re busy. They have never-ending to-do lists and not enough time.

As a result, they probably don’t spend a lot of time thinking about the intricacies of a new ERP system or VoIP provider except when they’re in the final stages of a buying decision. This means that it has never been more important to develop a strong, differentiated brand. 

Creating meaningful differentiation means that, in that limited time a customer thinks about solving a particular problem, they’re more likely to think of you.


Buyers will assign more importance to things that are easy to recall.

It’s not only that customers are more likely to think of you if you have real differentiation, they’re more likely to think better of you too. This is a cognitive bias known as the availability heuristic. So, if they’re starting to research how to fix a problem in their business, they will gravitate to sources of information they can easily bring to mind.

This may be a media outlet: Didn’t The Register run and article on that recently? Or it could be a contact: Didn’t Sarah put in a marketing automation system last year? I wonder what she thinks. Or it could be a vendor: I’ve heard a lot of businesses like mine use Marketo, I’ll go check them out.

While ‘brand’ has become a somewhat unfashionable area of marketing, having a strong, distinctive brand has never been more fundamental to success. Whereas in the past, this would often be around elevating key attributes, today, it’s those brands that are associated with being the most knowledgeable, helpful and human that tend to stand out. That is, those brands creating the right kind of content.


Too many people get marketing strategy mixed up with executional tactics.

It’s why we see so many questions about the need for a SnapChat strategy, a chatbot strategy, a VR strategy. Let’s be clear: these are not strategies, they’re at most tactics and at least media.

Marketing strategy is the process of identifying meaningful business outcomes, making hard choices about what to focus on and outlining a broad course of action to achieve those outcomes.

Strategy is not about deciding how to best use social media, or whether to create videos instead of how-to guides, or how to structure a lead nurturing programme. These all come later (if at all) when the core strategic foundations are in place.

So when you read articles on B2B content marketing that start with the need for an editorial calendar, big red warning lights should begin flashing in your head. There are too many ‘comprehensive’ guides that pay little or no attention to content as part of a wider programme with tangible business objectives. They’re all about the activity rather than the outcome.


Getting real about B2B content marketing

The right content marketing done in the right way, works. It builds brands, creates demand and accelerates sales. What’s more, it can achieve all this without the need to play the long game that so many pundits claim — why run a marathon when you can sprint?

Thing is, once created and structured in the right way, this content can keep on performing week in, week out. What begins as a targeted outbound demand generation campaign can seamlessly become an inbound source of additional traffic and leads, or an on-demand triggered nurture programme.

And, by tracking results — qualified leads, pipeline, sales velocity rather than likes, shares, visitors — and running low-risk tests, you can continually tune your approach over time.


7 keys to real-word success

So what does it take to create the right kind of content marketing? Start with the following seven areas:

  1. Be clear about what success looks like in business terms and the role marketing and content can play in delivering it

  2. Focus on what really matters to customers within your sphere of influence (not what you wish matters to them) — don’t get side-tracked chasing clicks that will never turn into revenue

  3. Develop highly actionable personas — it doesn’t matter that the buyer is called Sue and likes Zumba, it does matter where she sits in the buying process, what she really needs to fix and what’s a deal-breaker for her

  4. Create cycles of content focused on the sales funnel — think campaigns first, triggers second and air cover third

  5. Focus each piece on the next behaviour you want to see from a viable prospect

  6. Invest in great writing that talks to customers in their language, not jargon-filled business-speak

  7. Measure and track everything, create low-cost experiments, adapt and refine for increased results

While this is by no means the whole picture, it does provide a foundation for B2B content marketing that delivers against the real-world demands of the business. It means that you can more closely tie your content marketing activities to actual results. Ultimately, it means you can create the kind of marketing that engages both customers and senior management.