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How to improve sales-marketing alignment with 1 key metric

Have you ever been in a meeting where marketing claims that it is generating all these MQLs but sales isn't converting them, while sales claims the MQLs they're receiving are really not that good? On this episode, I talk about how MQLs are completely the wrong metric to use for alignment. Instead Sales Accepted Leads can do a far better job of bringing marketing and sales teams together to work as one unit. 

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1. Why sales and marketing alignment is important: Marketing and Sales share the same objective

Here is the most important truth of all: both sales and marketing share the exact same objective, which is to increase the amount of revenue that we bring into the business to help the business grow even further. It just so happens that we're playing different positions on the field.

Marketers want to drive more leads, help the business grow, and grow their careers, and sales people want to close more deals, make their quota, help the business grow, and grow their careers.

At the end of the day people are just people. They're trying to make an impact, they're trying to make a difference, and we have to figure out how we can work together since we have such a shared common objective.

This is where empathy can go a long way inside the team dynamic to help you understand the other person's reality. When you look at it from sales' perspective, if sales says, "Hey, the MQLs that you're sending me aren't good enough," there probably is some truth to that. This is a person, or a group of people, that need to make their quota. A large chunk of their compensation is tied to their ability to hit the quota.

Now, if we're cynical, yes it's possible that they're being lazy or making excuses, but far more likely is there's some truth in what they're saying. That's why when sales says, "Hey, the leads aren't good enough," it's really important for marketers to stop and start to listen to what they're saying.

2. How do you coordinate sales and marketing?: Establish an agreed-upon metric

While marketers love to talk about the number of visitors they have, or form submissions, or demo request form submissions, or webinar attendees, at the end of the day if the person that sales calls at the back end of that isn't ready to buy it's not a great lead. But if we keep counting MQLs and using that to measure our activities, especially spend and look at cost per activation as our main driver for marketing activities, we're not going to do a great job for the business in terms of helping it grow.

This is where sales accepted leads are far better for alignment across the board. Sales accepted leads complete the feedback cycle. So, we find out from sales, "Hey, out of these hundred leads that you sent us, only 50 of them are actually ready to buy something," or, "25 of them are actually duplicates from the same accounts that we're targeting."

Sales accepted leads remove a lot of the noise and focus on who is actually ready to buy and enter the next stage of the funnel. Not only that, but sales accepted leads removes channel bias. Whereas you will have some channels that lead to people who are more ready to buy than others, when you look at MQLs that noise is still there. However, when it comes to sales accepted leads, once a sales rep has called this person and verified that this is a good candidate to buy our software, we remove the channel bias entirely and can focus on the fact that, "Hey, out of all the sales accepted leads that we have how many actually ended up converting?"

And the most important part is that it removes excuses on both sides. Marketers are accountable to the sales accepted leads number instead of the MQL number, so we can no longer talk about, "Hey, we've brought in enough MQLs, why aren't they converting?" And then sales can no longer say, "The leads marketing sent us aren't good enough because sales accepted means you told me they're good enough, now tell me why they're not converting because clearly marketing was not the problem."

What this means is sales accepted leads are marketing's core metric, not MQLs, and this completely changes the dynamic across the board for the company and brings about a culture of alignment and teamwork.

3. Use data to increase teamwork

Given this reality, it's important to have the right reporting mechanisms in place to measure all stages of the funnel, to know how our work is performing. That means we need to know our cost-per-sales accepted lead on the marketing side. We need to know sales accepted leads by channel. We need to know sales accepted leads to close rates, and much more. That's the responsibility of the marketing leader, to be able to track the leads all the way through the funnel so that we know how much a sales accepted lead is actually worth to us, and how much we can spend in terms of marketing dollars at the top of the funnel.

As we build these reporting mechanisms out one thing becomes clear, which is that we are responsible and accountable to each other with data. We don't report to each other, we are accountable to each other. And that builds a culture of transparency and accountability, and these are good things if we want to build a high-growth business.

What about marketing's other contributions?

Now, when I walk people through this framework, one of the most common objections I get is, "Well, Shiv, we're doing all this work on the marketing side that has all of these other positive benefits. Aren't we missing all of those? What about things like brand lift, items that are currently not being tacked, longer conversion sales cycles that we won't get credit for down the line, or worse, sales doesn't even log the activities in sales force so we don't even know which opportunities were actually influenced by marketing, and other channels getting credit for the work marketing is doing?"

While all of this is true, and some of those points are definitely valid, here's what's important to know; as we build the right reporting mechanisms and data-tracking systems, and we begin to align with sales around one core metric, over time marketing will most definitely get more budget because we will be able to measure marketing's impact on revenue, and we will have agreement with sales on it, which is the biggest hurdle of all.

And this is something that I know a lot of marketers are concerned about, because in a lot of SaaS companies marketers often don't get the recognition they deserve because they're often stretched thin and working on a lot of projects that'll help the company across the sales funnel. But I promise you, as you do this work, people will take it more seriously, and the marketing function along with the business will grow.

The key to making all of this happen is to make sure marketing and sales work together as one team to grow the business.


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