Time: An Overlooked Difference between Marketing and Sales

Most of us in marketing have experienced this scenario – your company misses the just completed quarter’s sales targets – marketing and sales leaders are hauled into the CEO/COO’s office for a grilling to explore why this happened.  Inevitably, Marketing is thrown under the bus for not producing enough leads.  But there’s a disconnect that is frequently overlooked or disregarded – what marketing are working on today is not what sales are working on today.

Although the above statement may be intuitively obvious to anyone who stops to think about it, this time difference isn’t sufficiently considered for marketing and sales performance measurement.

Consider a manufacturing supply chain as an analogy.  There are planning, scheduling, procurement and delivery activities that happen in the inbound supply chain long before manufacturing can produce a product, and then there’s the outbound supply chain to ship and distribute the product for purchase by the eventual customer.  This total lead time from end-to-end is typically 3 to 12 months depending on the industry.  Manufacturers use Demand Planning to deal with synchronizing the supply chain lead time with anticipated future demand relative to when the finished goods will be purchased.

Marketing has a life-cycle of processes over an extended time period like a supply chain.  Consider this hypothetical example of a typical B2B marketing campaign process over a quarterly time increments:

  • Q1 – marketing does research, analysis and testing to formulate the campaign value proposition, target market(s), offer, etc.
  • Q2 – marketing develops the campaign content, materials, enablement resources, etc.
  • Q3 – marketing begins executing the campaign.  First leads start coming in.
  • Q4 – campaign in full swing – leads are coming in.  Sales get qualified leads for action.
Now add the typical B2B sales and/or buying cycle of 3 to 9 months or longer on top of that and we’re in Q6 or Q7 or later when deals are planned to close for leads generated by this campaign.  So if Q7 sales didn’t make quota, marketing wasn’t working on the same leads or deals for Q7 as sales was.  That doesn’t exonerate marketing from some responsibility for the problem.  However, what these quarterly sales review meetings seem to miss, is not to look at what marketing did in the quarter in question (Q7 in this example), but what marketing did in Q1 through Q4 that led to the Q7 outcome.

Some questions executives could ask considering the time differences for a more relevant discussion and productive outcome from the review process:
  • What was the original analysis for the campaign(s) that produced leads that should have generated sales in the quarter under review?
  • What was the anticipated customer demand in the plan and how was it determined?
  • What changed in the meantime?  Economic factors, buying cycles, customer budgets, competition, market shifts, etc.
  • Did the campaign execute as planned and produce the expected results?
  • Were adjustments made to the campaign as unanticipated external or internal changes occurred?
  • Are sales selling according the campaign value proposition and reasons customers expressed interest?
That meeting is also a good opportunity to look forward for the next couple of quarters with the same questions to anticipate potential problems and proactively make adjustments. Also review what plans marketing have in the early phases of the campaign process that will drive sales activity 3 to 5 quarters from now.

Is this lead time difference an issue for you?  If so, how do you handle it?  Your comments are always welcome.
Copyright © 2009 The Marketing Mélange and Ingistics LLC. http://marketing.infocat.com

1 comments:

Melissa Paulik said...

Mike,

Really valuable insights. This is one of the reasons why sales gets frustrated with their marketing counterparts. When the pipeline dries up and sales are down they come to marketing looking for ways to fill it back up – quickly. Unfortunately, by then it’s too late and most of the activities that marketing executes are generating opportunities for the following quarters or longer – depending on your sales cycle.

There are some “quick fix” type campaigns that marketing can assist with. e.g. calls into the database or add-on sale campaigns to existing customers. However, you have to be careful with an “all hands on deck” approach to fixing a sales slump in the short term. If you take marketing management’s eye off the future, you’ll risk distracting them from focusing on those critical campaigns that will ensure a full pipeline down the road.

Melissa