The new CMO mindset: Revenue-Driven Marketing.

Posted by Larry Garfield
Apr
18
2018

Revenue-Driven Marketing, the act of truly aligning marketing with sales, and understanding the quantitative impact that marketing investments have on revenue, has always been “the holy grail” of marketing executives. It goes without saying that if you could see the impact of your spend on revenue, you’d be able to maximize marketing ROI, both in aggregate and across various campaigns and channels, as well as produce a predictive model that forecasts how to “spend X to generate Y.”

Today, CMOs have many tools at their disposal to bring that holy grail of revenue-driven marketing within reach, and with management expectations around marketing measurement, it’s more imperative than ever before for CMOs to understand and lead these important initiatives.  In this post, we’ll explore the demands modern CMOs face to prove their worth as well as best practices and technologies that can help you take revenue-driven marketing from theory to practice.

Today’s Marketing Reality

While the goal of marketing is the same as it’s always been, the way in which we execute that mission looks a lot different today than it did 10 years ago. The technologies are vast, the channels are increasingly digital, the data is immense. The buyer’s journey has put more pressure on marketing to serve up the right content at the right time to nudge prospects in their direction once they’re ready to buy. CMOs themselves look more like Harry Crane than Don Draper. According to Gartner, over 75% of marketing leaders say they now own or share responsibility for their P&L -- signaling the definitive end of “brand for brand’s sake” marketing as we know it. Salesforce recently published their Fourth Annual “State of Marketing: Insights and trends from 3,500 global marketing leaders” and noted that high-performing marketers share common goals and metrics with sales and work to gain an understanding of how marketing’s efforts impact individual accounts and customers.

Sharing the same goals and metrics as sales is the essence of revenue-driven marketing, whereby marketers determine and evaluate their efforts based on the impact to revenue in an objective, data-based way. This kind of thinking eliminates a LOT of conflict that often mires the sales & marketing relationship by keeping everyone focused on the same goals and on incremental improvement. Marketing is able to optimize campaign mix to generate more, higher quality leads for sales, and sales provides feedback into what’s working and driving real revenue to shape future marketing efforts.

Ultimately, a Revenue-Driven Marketing framework should give you clear visibility into your funnel performance so you can set lead and opportunity targets based on revenue goals, create campaign plans that achieve those targets, and evaluate campaign performance in real-time. With this model in place, CMOs can move forward confidently with their marketing plans to drive strong, predictable growth.

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