Most marketing and sales leaders in business-to-business companies agree that when their respective operations are aligned, they perform better and grow faster. In fact, according to a Sirius Decisions study, “Aligned teams achieve 24 percent faster three-year growth and 27 percent faster growth over the same period.”
Marketing legend and Harvard professor Philip Kotler notes, “There is no question that, when sales and marketing work well together, companies see substantial improvement on essential performance metrics: Sales cycles are shorter, market-entry costs go down, and the cost of sales is lower.
He also says without alignment, customer performance suffers. “Time and again, during research and consulting assignments, we’ve seen both groups stumble (and the organization suffer) because they were out of sync.”
Organizations with tightly aligned sales and marketing functions enjoyed 36 percent higher customer retention rates and achieved 38 percent higher sales win rates.
In yet another study by MarketingProfs and MathMarketing, “Organizations with tightly aligned sales and marketing functions enjoyed 36 percent higher customer retention rates and achieved 38 percent higher sales win rates.”
With such irrefutable evidence linking better business performance to aligned sales and marketing operations, why do some companies still struggle to execute something so clear-cut?
The answers to this question vary widely depending on industry and other factors, but chief among them is company culture and long-standing rivalries between sales and marketing teams.
Indeed, says Prof. Kotler, “When sales are disappointing, marketing blames the sales force for its poor execution of an otherwise brilliant rollout plan. The sales team, in turn, claims that marketing sets prices too high and uses too much of the budget, which instead should go toward hiring more salespeople or paying the sales reps higher commissions.”
Prof. Kotler lumps the tension between sales and marketing into two categories: “economic and cultural.”
What Can You Do to Better Align Sales and Marketing?
As expected, there is no shortage of advice for what marketing and sales leaders can do to bridge the gap between their operations.
The American Marketing Association (AMA) suggests strong communication from your C-suite—in particular, the CEO— to set common goals. “The first step in aligning the sales and marketing teams is to make sure the goal comes from on high within the company.”
AMA also suggests tying ROI to marketing. “With an aligned marketing and sales alliance, marketing gets a huge boost in one area that’s long been a challenge: reporting ROI.”
Part of the problem with demonstrating a clear ROI is that marketing executives are focused on how many leads the marketing department is generating, and not on their contribution to revenue.
The Path to Alignment
Prof. Kotler says there are four types of relationships between sales and marketing:
Not surprisingly, the most effective relationships are aligned and integrated. “When Sales and Marketing are aligned, clear boundaries between the two exist, but they’re flexible. The groups engage in joint planning and training.”
Once more, when the two groups are aligned, marketers work with the sales team directly on your company’s top accounts.
On the other hand, he says, “When Sales and Marketing are fully integrated, boundaries become blurred. Both groups redesign the relationship to share structures, systems, and rewards. Marketing—and to a lesser degree Sales—begins to focus on strategic, forward-thinking types of tasks (market sensing, for instance) and sometimes splits into upstream and downstream groups.”Jeremy Boudinet, director of marketing for sales software company Ambition, agrees with the benefits of an integrated sales and marketing function. “The more that sales and marketing are on the same page, the easier it is for you to close your sales cycles.”
Communication is the Key
It’s clear there are no magic potions for achieving perfect alignment, but one simple act can have a profound effect on your company’s Marketing and Sales success: communication.
Frequent, open, and regular communication between the two groups can help facilitate collaboration and stave off future problems.