I recently sat down with Forrester VP and Principal Analyst, Laura Ramos, following our webinar in which she was a guest speaker, to find out more about the state of go-to-marketing efforts she is seeing across B2B marketing and selling.
The topic of sales and marketing alignment has been a problem for as long as I’ve been a marketer. I’ve grown especially passionate about the topic over the last few years — so much so that we’ve produced two market surveys on alignment, the first of which served as the basis for my book, Aligned to Achieve. In our second alignment market survey, one fact that stands out is more than half, 54% of respondents reported themselves as low on the go to market maturity spectrum. They are still using manual and ad hoc tactics to support dated sales and marketing approaches. I invited Laura to talk about the changes she’s seeing in the market related to alignment, and how these trends are transforming companies go-to-market strategies.
Eiler: Why does deciding where to focus go-to-market strategy and effort continue to challenge B2B companies?
Ramos: An embarrassment of technology riches has caused marketers specifically, and many parts of the business in general, to focus more on mechanics and less on understanding our prospects and customers. Anyone who’s seen the Chiefmartec Marketing Technology Landscape Supergraphic knows that the availability of technologies is vast and overwhelming. Couple this with a new generation of technically-savvy marketers – who grew up using technology to attract interest and harvest leads – and you end up in a situation where customer knowledge takes a backseat to the operational aspects of marketing and selling.
Many marketers today have at least a few years of experience using marketing technology under their belts. They are finding that the promises of better demand generation, with more credit going to marketing, haven’t materialized as planned. Why? Because many lost sight of fundamentals that drive good business strategy: segmentation, targeting, and positioning.
I often ask clients “Who do you sell to?” and I hear answers like “well, we sell to technology decision makers and to business decision makers.” That’s not a segmentation strategy that helps to pursue the best customers for your businesses. Inbound marketing techniques release marketers from determining whether there is enough market to support their business. Or if the opportunities within a market are big enough or mature enough to grow it.
Eiler: Do you think the CMO should set the direction for segmentation and targeting?
Ramos: I think the CMO should set market direction, but I’m concerned that many CMOs don’t have the data, tools, and processes in place to create a discipline around analyzing customers and segmenting properly. Too few aren’t adept at using insight to develop ideal customer profile(s), sizing the total available market for their portfolio based on that ICP, and orchestrating a go-to-market strategy across marketing and sales to pursue the best accounts in that market.
When it comes to segmenting the market and prioritizing opportunities, if it’s not the CMO setting the strategy, then who? Besides marketing, who has the imaginativeness, storytelling skills, customer insight, and communication expertise to help the business see the customer come in every strategy and execution decision? Segmentation is not about telling every customer story; it’s about getting the business to focus on the right kinds of customers at the right time.
Eiler: What’s been happening more recently, say in the past few years, to help companies address these issues?
Ramos: Years ago, marketers didn’t have easy access to the analytic tools and data to track prospective buyers’ online behavior, build rich profiles of their ideal customers, and forecast which are likely to be in-the-market for their products or services. They didn’t have the insight to create more relevant and personalized messages, nor the tools to help them do that at scale.
Now, both prospective and current customer data enrichment and management are now as core to the marketing tech stack as marketing automation. Consequently, intensive go-to-market approaches like account-based marketing or strategic account management — ones that were manual, time-consuming, and difficult to do — can now be accomplished faster, more efficiently, and on a larger scale.
Eiler: How has the growing interest in ABM – or account-based everything as some people like to describe it – changed how marketing strategy and sales align around going-to-market?
Ramos: ABM has converted sales and marketing alignment from lip service talk to essential execution walk. You can’t accomplish effective marketing at the account or micro-segment level without closely coordinating account selection, intelligence gathering, outbound account pursuit, and assessment of results. Marketing helps sales reach all the decision makers and influencers in an account while sales helps marketing understand what those accounts care about and where buyers are in the purchase journey. As a result, we are seeing sales and marketing share more goals and an increase in marketers saying, “I’m rewarded on pipeline” when we ask about metrics.
Better access to and integration of customer data fuels ABM’s ability to be more effective – to target the right people at accounts with interest-raising information so that it’s much easier for sales to start a business relevant conversation. Unfortunately, in our International B2B Marketing Online survey last year, we found 84% of marketers said that the accuracy of their customer data was one of their top 5 concerns, and only 12% of them reported high confidence in the accuracy of the data they manage. Data and tools are in the market today to change this trend and cure the underlying problems this data reveals.
Eiler: Do you think companies understand why it’s critical to identify their ICP and TAM together and how this benefits their ability to target and execute?
Ramos: No, I think most marketers focus too much on their existing customers when setting market strategy. This limits their view to the true potential of their market. They also focus too much on the personas and buyers’ journeys of people they know about, not who might also be a good fit. Personas are great tools for understanding key decision makers and how to message to them. But an ICP provides a very different analysis: it helps you understand not only customers but also the goodness-of-fit between your strategy and your market opportunity.
Many marketers think they know the size of their firm’s market opportunity (usually seen as much larger than reality). Ask them, “How often are you looking at your TAM? Do you know how it changes? How accurate is your understanding of it?” and you are likely to get some blank looks today.
Eiler: What are some of the things that really get in the way of improving go-to-market maturity? And in keeping up with the changing demands of the B2B buyer?
Ramos: Outdated practices are a primary one. Most companies go to market based on past experience, gut feel decisions, or just plain educated guessing. Product teams highlight features and functions, while regions worry about local competition, regulations and the like. This leaves marketing and sales in the position of having to execute several, sometimes conflicting, strategies at once.
Not to be too repetitive, but it’s also a lack of customer understanding and a disconnect between how companies want to conduct business and the changing expectations among business buyers that this experience should be more like buying as a consumer. Buyers want to buy from firms that make the whole process easy, frictionless, and digital. They will talk to a human when it’s necessary, but only when it’s necessary.
Eiler: What do you think companies should do in the next 12 months to improve their GTM maturity?
Ramos: Marketers need to step up to really understanding their current customer experience and to working across their companies to make those experiences better for the buyers. This isn’t easy and won’t make marketing popular when you start uncovering practices that aren’t great for your customers, but internal teams see it as “well, that’s just the way we do it.” It’s time to break down those old habits and question whether what you do is really best for buyers.
For example, I would start with your customer onboarding process. Audit how you welcome and train customers; how you get them up and running. How can you make this seamless and a delightful experience? How do you show new customers that the brand promises you made early in their purchase process get delivered in a superior customer experience? I’m not arguing that everyone should report to marketing to make this happen, but marketing must set direction, communicate the changes, say how results will get measured, and then talk about what we are doing along the way. I mention this because getting customers off to a good start is the fastest way to turn them into loyal buyers and, ultimately, vocal advocates for your brand.
As you mature, you will need to make additional investments in customer data management, marketing and sales alignment, customer experience, and process change. Customer data management is probably the most crucial part to this as it underpins your success in everything from segmentation, to account strategy, messaging, marketing mix, and campaign execution. Any modernization initiative needs a leader to drive it and I believe a CMO armed with accurate data about your ICP and TAM is in the best position to lead this effort.