We’re continuing our series of deep dives based on data from the 2015 State of PIpeline Marketing report. In this post we explore the findings that are most relevant to B2B CMOs.
The three areas we focus on are sales and marketing alignment, success metrics, and marketing attribution. By exploring these areas, CMOs and marketing leaders can understand how their peers are doing pipeline marketing and driving business value for their organization.
You can check out our previous pipeline marketing industry analysis here.
How CMOs Are Budgeting and Watching Their Marketing Channels
How are companies planning their marketing budgets for 2016? Depending on company size, as measured by employee count, marketing budgets may increase or decrease in the coming year.
The larger the company the more likely budgets will remain the same or decrease. The smaller the company the more likely budgets will increase. Why is this?
Once marketers grow demand, hitting critical mass or establishing brand leadership, the product should sell itself. Decreasing or holding marketing budgets steady as the company establishes dominance in its category allows companies to spend less on marketing the product and more on maintaining brand position or developing new product lines.
How much exactly will CMOs spend in 2016? For companies 26 to 200 employees strong, the majority of CMOs say they will spend between $200K to $1M. For companies with 1K or more employees the majority of CMOs in these firms say they will spend between $1.1M and $20M on marketing.
With millions being spent on delivering the right message along the right channels, it is vital to understand how CMOs measure success.
Metrics CMOs Use To Measure Success
Let’s look at the primary metric for success used by B2B CMOs.
The plurality of B2B CMOs use total opportunities as their primary metric for success. This is followed closely by total revenue.
Half of all B2B CMOs are using total opportunities or total revenue as their number one metric for success.
When asked which channel has the biggest impact on revenue the second most popular response was “I don’t know.” CMOs use revenue as a primary metric for success but many of them don’t know which channels the revenue comes from.
For the senior level marketers who do know, they say email marketing, content marketing, and conferences and tradeshows have the biggest impact on revenue.
While not the sexiest topic, sales and marketing alignment enables organizations to generate revenue and thrive in a competitive landscape. It allows organizations to go about driving revenue.
Do We Really Need To Talk About Sales & Marketing Alignment?
In highly competitive industries the products are functionally indistinguishable, marketing channels are saturated with advertisements and exceptional messaging is difficult to come by. This is exactly where sales and marketing alignment can become a competitive advantage.
Sales and marketing alignment is a critical piece of the puzzle for marketers to pay attention to. That’s why we took a deeper look at some important alignment issues facing today’s sales and marketing teams.
We find a disconnect between CMOs and mid-level marketers when it comes to perceptions of sales and marketing alignment. CMOs are more likely to say their sales and marketing teams are tightly aligned, while middle management is more likely to say the two teams are seldom aligned.
Why the discrepancy? The simple answer may be that these marketers come from different companies where sales and marketing alignment varies. But it could be that job roles for today’s middle management level marketers entails planning, collaborating and sharing data with sales -- all of which may can lead to feelings of misalignment when executed poorly.
Whichever the case, B2B CMOs need to pay attention to their marketing teams and how well they execute on the most important campaigns and strategies that involve the sales team.
For a CMO, it’s important to look to other organizations to see what makes them successful. What are organizations that have a tightly aligned sales and marketing team doing differently?
We find that the primary metrics used by organizations with high levels of alignment are revenue and total opportunities.
It’s no surprise that firms using down-funnel metrics like revenue and opportunity -- metrics that both marketing and sales can get behind -- are more aligned. When sales and marketing use one metric they can optimize and strategize for a single goal: driving revenue and measurable business value.
Making It All Possible Using Marketing Attribution
In the 2015 State of Pipeline Marketing report, we found that over half of CMOs either don’t or don’t know if they have the right attribution model in place. Without a solution for measuring and managing marketing resources, CMOs have a difficult time executing on the functional areas described in this post.
For example, estimating marketing spend, budgeting, driving revenue and improving alignment is nearly impossible without understanding revenue impact, i.e. the impact that teams and marketing activities have on revenue.
Inaccuracy in attribution is inaccuracy in managing the the most important marketing resources: spend and talent. This is why a quarter of CMOs plan on changing their attribution model in the next six months.
Today’s CMOs know how important it is that teams get the credit they deserve and those teams have the attribution data they need to execute.