Time for Software Marketing to Grow Up
To improve ROI, software vendors must switch to sales-based - rather than product-based - marketing.
By Tom Hogan, Catapult Direct
Apr. 29, 2006
Despite being in its thirties, high-tech marketing is still an industry in its adolescence. And like any adolescent, it's unsure of where it wants to go but knows better than anyone else how to get there.
Part of the problem is the crowd that Marketing runs with. Marketing hangs out almost exclusively with "Product Guys" - not salespeople. Product Guys are like those guys who go on first dates and talk endlessly about themselves. Finally, as the evening wanes and the date is utterly bored, they smile engagingly and say, "But enough about me. Let's talk about things I like to do..."
For these Product Guys, it's all about "The Product" and its capabilities. On sales calls, when talking about The Product, they just can't stop. "But enough about the features, let's talk specs..."
The campaigns Marketing creates based on interactions with Product Guys and these bad, first date-style conversations are some of the most unoriginal and uninspiring in history. But this problem persists because the people picking up the marketing tabs are, by and large, technologists in love with their own technology. They and their Marketing departments share the belief that their products are so unique and meaningful that they don't need to be marketed, just explained.
Wrong. If customers were ever inspired or motivated by the tech-speak IT marketers have force-fed them all these years, they aren't anymore. Jaundiced by years of blue screens and having to kluge together their own "solutions," buyers have discovered the hard way that the best technology doesn't always carry the day, that pioneers don't always make the best providers, and that "second to market" is often a strategic advantage rather than a badge of disgrace.
The Advent of Sales-Based Marketing
Connecting to this market requires a new approach to marketing, one that starts not with the "Product" but with the "Customer." This approach recognizes that the most important transaction is the one that takes place not within the product development team but between the customer and sales rep. This new approach is called Sales-Based Marketing (SBM). And it works.
SBM is a bottom-line approach to technology marketing based on four principles:
1. The sales cycle is as complex and important as the product cycle, and needs the same level of design, monitoring and funding.
2. Marketing programs are only as effective as the infrastructure they're built on. That means before spending a dollar on promotions, marketers need to optimize the data-side of the house, including customer relationship management (CRM) and salesforce automation (SFA) systems, lists and databases.
3. You must be able to identify your target, know the problem they're facing, and reach them with a compelling offer or solution, or you haven't got a chance.
4. Everything is based on a fluid ROI hierarchy that responds to your company's growth and market changes.
Here are the steps involved in deploying Sales-Based Marketing.
Break Down the Sales Process
Job no. 1 in SBM is to break down the sales cycle into as many distinct components as possible. The Marketing VP should sit down with his/her Sales counterpart for this first exercise. An estimate of how long each step in the process generally takes should also be included. After this first pass, the details need to be verified and refined in meetings and conference calls with a cross-section of the Sales team, including Support for repeat sales. (Incidentally, this is a process that should be repeated regularly throughout the life of the company, not just as an initial exercise.)
Armed with this knowledge, Marketing then designs a budget, calendar and series of campaigns against those areas in the sales cycle that need the greatest help and where there is the greatest potential return on investment (ROI.) For some companies, the priority is lead generation, both in terms of number and quality. For other companies, it's shortening the time from contact to initial deployment. For others, it's turning the beta deployment into a six-figure deal. For still others, it's turning initial sales into repeat customers.
Once this initial process is complete, Marketing should then broker quarterly or semi-annual meetings between Sales and Product Marketing/Management. These meetings will be tactical at first, with Sales finding out the best workarounds for product flaws and discovering what it can pre-sell from the next version to help the sale of the current version. But ultimately, these meetings will serve to align product development with customer need, resulting in stronger, market-driven products with shorter sales cycles.
Part of the problem is the crowd that Marketing runs with. Marketing hangs out almost exclusively with "Product Guys" - not salespeople. Product Guys are like those guys who go on first dates and talk endlessly about themselves. Finally, as the evening wanes and the date is utterly bored, they smile engagingly and say, "But enough about me. Let's talk about things I like to do..."
For these Product Guys, it's all about "The Product" and its capabilities. On sales calls, when talking about The Product, they just can't stop. "But enough about the features, let's talk specs..."
The campaigns Marketing creates based on interactions with Product Guys and these bad, first date-style conversations are some of the most unoriginal and uninspiring in history. But this problem persists because the people picking up the marketing tabs are, by and large, technologists in love with their own technology. They and their Marketing departments share the belief that their products are so unique and meaningful that they don't need to be marketed, just explained.
Wrong. If customers were ever inspired or motivated by the tech-speak IT marketers have force-fed them all these years, they aren't anymore. Jaundiced by years of blue screens and having to kluge together their own "solutions," buyers have discovered the hard way that the best technology doesn't always carry the day, that pioneers don't always make the best providers, and that "second to market" is often a strategic advantage rather than a badge of disgrace.
The Advent of Sales-Based Marketing
Connecting to this market requires a new approach to marketing, one that starts not with the "Product" but with the "Customer." This approach recognizes that the most important transaction is the one that takes place not within the product development team but between the customer and sales rep. This new approach is called Sales-Based Marketing (SBM). And it works.
SBM is a bottom-line approach to technology marketing based on four principles:
1. The sales cycle is as complex and important as the product cycle, and needs the same level of design, monitoring and funding.
2. Marketing programs are only as effective as the infrastructure they're built on. That means before spending a dollar on promotions, marketers need to optimize the data-side of the house, including customer relationship management (CRM) and salesforce automation (SFA) systems, lists and databases.
3. You must be able to identify your target, know the problem they're facing, and reach them with a compelling offer or solution, or you haven't got a chance.
4. Everything is based on a fluid ROI hierarchy that responds to your company's growth and market changes.
Here are the steps involved in deploying Sales-Based Marketing.
Break Down the Sales Process
Job no. 1 in SBM is to break down the sales cycle into as many distinct components as possible. The Marketing VP should sit down with his/her Sales counterpart for this first exercise. An estimate of how long each step in the process generally takes should also be included. After this first pass, the details need to be verified and refined in meetings and conference calls with a cross-section of the Sales team, including Support for repeat sales. (Incidentally, this is a process that should be repeated regularly throughout the life of the company, not just as an initial exercise.)
Armed with this knowledge, Marketing then designs a budget, calendar and series of campaigns against those areas in the sales cycle that need the greatest help and where there is the greatest potential return on investment (ROI.) For some companies, the priority is lead generation, both in terms of number and quality. For other companies, it's shortening the time from contact to initial deployment. For others, it's turning the beta deployment into a six-figure deal. For still others, it's turning initial sales into repeat customers.
Once this initial process is complete, Marketing should then broker quarterly or semi-annual meetings between Sales and Product Marketing/Management. These meetings will be tactical at first, with Sales finding out the best workarounds for product flaws and discovering what it can pre-sell from the next version to help the sale of the current version. But ultimately, these meetings will serve to align product development with customer need, resulting in stronger, market-driven products with shorter sales cycles.
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