If there’s
one misconception about business development I would absolutely love to erase
forever, it would have to be this idea that a company can treat sales and marketing
as separate from one another. Let me make this clear; sales and marketing are
one and the same. You can’t have sales if you don’t have a solid marketing strategy,
and you can’t have a solid marketing strategy if you don’t have the sales to
pay for it. Marketing generates leads –
Sales closes leads and if you’re still not convinced, then you need to read
this now.
I’ve come across this issue several times as a consultant. Many times I’ve heard a business owner say, “We need to focus on sales. We’ll take care of marketing later.” For whatever reason, many companies don’t see the connection. Better yet, many business owners don’t understand the connection. So, why does this happen and how can it be put to rest?
Marketing doesn’t merely involve you deciding to redesign your website. It’s not just a question of coming up with a new brochure, revamping your catalogue or launching a new email campaign. More importantly, it isn’t something you spend your “spare time” doing. Instead, it’s a continuous process, one where your market knowledge and business know-how is used to drive customers to your business.
A Simple Explanation of Lead Generation
I used the following example to show a customer of mine what the relationship was between marketing and sales. I had, for a time, tried to convince them of the relationship, but it wasn’t working. So I decided to track how many leads were generate by each individual salesperson. In this case, the company relied only on cold-calling. All of their marketing was done once a year and none of it was related to their best selling product. Other than that, it was all up to their salespeople and their ability to make exploratory calls. This was all they had to generate interest with customers.
Each salesperson averaged about 10 qualified leads a month. We simplified this analysis to include only those customers who agreed to receive a quotation. The average closing rate for each salesperson was approximately 20% of the quotes. Now, it’s important to note that these were technical sales. As such, the sales cycles were long and the orders were hard to close.
This is what I showed the owner in order to get him to understand that the only way he could increase sales was to increase the number of leads. He needed a marketing platform to increase lead generation and he couldn't simply rely upon random calls.
Looking at the table above, it’s important to note that the only thing that changes is the number of leads. The closing rate stays the same at 20%. However, every time the company increases the number of leads it generates, it increases its sales. This is the simplest way to explain the relationship between marketing and sales.
The company's problem wasn't sales. The company's problem was marketing. The company's problem was the lack of opportunities to make sales. All this time, the owner was convinced that he didn't have the right people. He was convinced that he needed better salespeople. In fact, he was sure that it had been the company's main problem for years.
However, it's not just about having a marketing strategy. In the end, you have to be able to measure results. You have to track the quality of the leads you generate through marketing.
Here are some additional sources on this subject matter.
Calculate Customer Acquisition Costs From Three Marketing Campaigns
Lower Customer Acquisition Costs With Analytical Marketing Practices
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