Measurement is a key discipline for any modern marketer. Metrics that measure inbound, outbound, brand and other performance are all critical for understanding marketing effectiveness and its impact on sales. Yet, a Fournaise Marketing Group survey reported that 73% of CEOs think marketers lack business credibility, since they can’t prove they generate business growth. So, how can CMOs leverage new tools, such as predictive analytics, to measure marketing’s impact on revenue and improve sales and marketing alignment?
A New Generation of Marketing Analytics Tools
Thanks to a new generation of marketing analytics tools, today’s CMO has the ability to measure the impact of marketing programs, demonstrate a clear and compelling marketing ROI, and ultimately build respect in the executive suite.
While most marketing metrics tend to be backward looking, predictive models can be used to identify patterns in historical data and use it to anticipate what customers and prospects are likely to do next. Predictive analytics can be used to answer such questions as:
- Which prospects are most/least likely to buy? How can we prioritize our sales efforts based on those prospects most likely to buy?
- Which product is each of our customers most likely to buy next?
- Which customers are most likely to leave?
- How can we reduce customer acquisition costs, increase purchase size and reduce fraud?
Which measurements can be used to gain executive confidence in marketing’s contribution to sales?
Common goals, strategies, and success metrics for lead generation, qualification and prioritization are key to improving sales and marketing alignment. According to HubSpot’s recently published 2013 State of Inbound Marketing Report, 72% of C-level marketers said lead scoring was important to achieving marketing goals. This should be no surprise, since lead quality is often one of the top sources of contention between sales and marketing teams.
What is surprising, according to the HubSpot report, is that only 22% of marketers say converting leads into customers is their top marketing priority for 2013. While the reason for this lack of urgency isn’t clear, a solution is readily available—implementing lead scoring can be a high-impact step towards improving sales and marketing alignment.
Predictive Analytics Produces Superior Lead Scoring
Lead scoring is certainly not a new concept and it has been successfully implemented in most high-performing organizations. However, unlike traditional rules-based scoring approaches, predictive analytics can be used not only to prioritize sales leads, but also to use available information to predict the highest likelihood of success with that lead. For example, predictive analytics output can be used to direct the lead to a particular sales team or product specialist based on a prediction of which product the prospect is likely to buy.
Keep in mind that changing to a predictive model may produce leads with different characteristics than those your sales reps are already familiar with. So, make sure you remember to thoroughly educate and train your sales and marketing staffs in the new approach to reduce the chance that sales reps will reject or disqualify a high proportion of the new leads.
Lead Scoring Can Improve Sales and Marketing Alignment
Lead scoring can help eliminate the frequent finger pointing that exists between sales and marketing. By providing an unbiased measure that enables the impact of people and processes to be objectively evaluated, lead scoring can help CMOs show marketing’s impact on revenue, improve sales and marketing alignment, and begin to enhance their own credibility in the C suite.
What’s your best tip for improving sales & marketing alignment? Please let me know in the comments! I’ll be reading them all.
Here’s a version of this post in slide form:
Note: A version of this post originally appeared on the Quant5 Blog at http://quant5.com/blog/enterprise-analytics/how-predictive-marketing-can-give-cmos-true-credibility-in-the-executive-suite/