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Bridging the Gap: Customer-Centric Alignment
May 22, 2008
Using the Customer Buying Process to Improve Marketing and Sales Alignment
By Laura Patterson
As we all know, your marketing and sales teams are both are responsible for generating company revenue, via the equation: (Opportunities in pipeline X the average deal size X the win rate) ÷ by the sales cycle time. This sum multiplied by all the sellers in your organization determines your revenue, meaning that even a small increase in each factor can make a huge difference. The better marketing and sales are aligned, the more likely each of these components can be improved.
But unfortunately, statistics show that this symbiotic relationship is far from Ideal In many organizations. According to the Miller Heiman Sales Best Practices Study, only 31 percent of respondents agreed that their marketing and sales organizations are well-aligned. And while many of these marketing and sales teams recognize that they need better alignment to be more effective at opportunity development and customer acquisition, they seem permanently stuck in opposition.
What's in a Name?
The key to improving alignment requires taking a customer centric approach. When marketing and sales are aligned around prospective customers needs, wants and purchasing processes, the company is better poised to improve the win rate and reduce the sales cycle. Improving alignment can seem like a daunting task, but there is already a commonly used tool that can help facilitate the process. This common tool, the sales funnel, helps us understand the flow of business opportunities. And if we rename it a "customer buying pipeline," it has the opportunity to be so much more.
Why rename it?
A "sales funnel" suggests two things. First, the term suggests that this process is something owned by sales and not necessarily a shared responsibility across the organization. Yet, marketing plays a critical role in bringing potential buyers to the table. Marketing has the responsibility to identify, find and secure profitable customers. Marketing also provides segmentation, customer targeting, positioning, product offers and messaging to differentiate the company. Both the marketing and sales functions are essential to building the buying process. Second, it suggests a sales-centric rather than a customer-centric approach to the buying decision.
When properly engineered, the customer buying pipeline serves as an important tool for improving marketing and sales alignment to improve both teams' performance. Opportunity management provides insight into which sales and marketing processes are effective and increasing deal flow, and insight into how efficiently opportunities are moving through the stages of opportunity development.
Constructing Customer-Centricity
But how do you go about engineering a customer buying pipeline?
1. Understanding your customers' needs and their buying process. Before developing your pipeline, defining your stages and investing in a sales force automation tool or CRM system, map your ideal customer's buying process. We call this engineering the "buying pipeline." It will ensure you understand how and why your customer makes a buying decision. It is possible you will have to create more than one buying process map. Different segments may buy differently and different products/services may have different purchasing processes.
Effective pipeline management is a reflection on your company's ability to identify the right opportunities and the needs of your prospects as well as truly understand how they will go about making the purchase. Once you understand your customer's decision making and buying processes you can develop a strategy for managing the opportunity at each stage in the pipeline.
2. Define each of the stages using incremental behavioral commitments. What is an incremental behavioral commitment? Let's use an everyday example to illustrate the concept. When two people are both interested in finding a long-term relationship they begin the courting process. Certain demonstrated behaviors along the way indicate whether the relationship is progressing toward the ultimate behavior of saying "I do."
For example, showing up for the first date, the first kiss, introducing each other to friends and family, and so on are incremental behavioral commitments. This behavior demonstrates to both people that the relationship is going from initial contact to ultimate deal. The question we have for you is whether you have a clear understanding of the specific incremental behaviors your customer's actually demonstrate that show they are moving their relationship commitment forward.
3. Group behaviors into stages. These stages will become the foundation for how you classify the status of each opportunity. Marketing can now develop tools appropriate for each stage that facilitates engaging the prospective customers.
Pipeline management allows you to calibrate your marketing and synchronize marketing and sales efforts. It also allows you to take a more scientific approach to opportunity and customer development, enabling you to understand what is happening in the buying process and where to make adjustments.
Pipeline management is really about managing opportunities. Opportunities represent customers, which provides with an excellent point of view around which to align marketing and sales.
S&MM online columnist Laura Patterson is the author of "Measure What Matters: Reconnecting Marketing to Business Goals," and "Gone Fishin: A Guide to Finding, Keeping, and Growing Profitable Customers." She is president and co-founder of VisionEdge Marketing, Inc, a leading metrics-based strategic and product marketing firm located in Austin, Texas. For more information, go to
www.visionedgemarketing.com.
Sales & Marketing Management Magazine
This article is brought to you by Sales & Marketing Management, the leading authority for executives in the sales and marketing field.
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