The Benefits and Limitations of Look-Alike Modeling

Demand Gen Report recently published a white paper describing the benefits of using look-alike modeling powered by artificial intelligence (AI) to improve lead generation performance. The white paper argues that B2B marketers can use "AI-fueled" look-alike modeling to get more qualified leads that convert at higher rates.

The principles underlying look-alike modeling aren't new. For years, astute B2B marketers have been identifying important attributes of their best existing customers and using those attributes to create a profile of their "ideal prospect." Then, they would use this ideal prospect profile to identify target audiences for outbound lead generation programs and otherwise guide lead generation efforts.

The current incarnation of look-alike modeling does essentially the same thing, but in a more sophisticated way using AI-powered data analytics.

Several technology providers now offer solutions that include or support look-alike modeling, and most of these solutions take similar approaches to the look-alike modeling process.

• They extract data regarding a company's existing customers from the company's internal technology systems including, but not necessarily limited to, the CRM and marketing automation solutions.
• Most solution providers have developed or obtained access to extensive databases regarding business organizations. The modeling solution will combine the company's internal customer data with any additional data regarding these customers in the provider's database. This enables the solution to create a more detailed picture of the attributes of the company's existing customers.
• The modeling solution then uses an algorithm to analyze the combination of internal and external customer data to identify the attributes that the company's existing customers have in common. The result of this analysis is usually called a customer data model.
• The solution then runs the company's customer data model against the provider's database of businesses to identify companies that resemble the model.

The major advantage of AI-powered look-alike modeling is that it incorporates far more data points than humans can realistically use when the process is done manually. Therefore, AI-powered modeling enables marketers to build a richer and deeper customer data model, and it does a better job of identifying companies that are likely to be good prospects.

Look-alike modeling can be an effective tool for improving B2B demand generation performance, but like any business tool or methodology, it has some limitations.

First, for look-alike modeling to be effective, a company needs to have enough existing customers to build a customer data model that's reliably predictive. One provider of look-alike modeling has indicated that a company needs at least 500 existing customers to build a reliable model. While 500 may not the the absolute minimum, effective look-alike modeling does require a company to have a substantial number of existing customers, and a start-up or young business may not be able to meet this requirement.

Second, look-alike modeling can be less effective when a company is marketing new products or services. If a new product or service appeals to a different type of customer than the company's other products or services, a customer data model based on the company's existing customers may not identify the right prospects for the new product or service.

The important point here is that look-alike modeling is a powerful tool for improving demand generation performance, particularly when it's enhanced with artificial intelligence. But B2B marketers should also remember that like any business methodology, look-alike modeling has a few important limitations.

Image Source:  Flickr.com

What Makes a Prospect Attractive for Account-Based Marketing

The basic premise of account-based marketing (ABM) is that a company should focus its marketing and sales efforts on prospects that have a strong likelihood of becoming good customers. So it shouldn't be surprising that account selection is widely regarded as the most critical step in building a successful ABM program.

Most ABM practitioners choose their target accounts by identifying businesses that "look like" their best existing customers. This technique - known as look-alike modeling - is an effective way for most companies to select target accounts in most circumstances. However, like any business tool, look-alike modeling must be used correctly, and in some cases, choosing target accounts based solely on look-alike modeling may not produce optimal results. Therefore, it's important for marketers to understand the underlying factors that make companies good targets for ABM.

The following diagram depicts the factors that make a prospect organization attractive for account-based marketing. At the highest level, attractiveness is a function of value and buying potential. In this context, value simply means that a prospect has the potential to be a large and profitable customer for your company. The best measure of this factor is the estimated lifetime value that the prospect would produce for your company.

Buying potential refers to the likelihood that a prospect will purchase your company's products or services, and as the diagram shows, buying potential is a function of two factors - fit and interest.

Fit is one of those business terms that's hard to define in a precise and formal way. The underlying idea is suitability, and one dimension of fit is whether your company's products or services can effectively address a need, problem, or challenge that the prospect is likely to have. In the diagram, I call this solution fit.

The second dimension of fit is more subtle, but equally important. I call this dimension company fit, and it refers to whether your company can effectively market to, sell to, and serve a particular prospect. Company fit is often a function of geography for small and mid-size companies. For example, if your company is based in Atlanta and primarily serves customers located in the southeastern United States, you may not be able to effectively market or sell to, or serve, a prospect located on the west coast, no matter how well your products or services fit the prospect's needs.

The second component of buying potential is interest, which refers to whether a prospect has shown an inclination to evaluate or purchase the kinds of products or services that your company offers. Interest also has two components - engagement and buying signals. Engagement refers to whether a prospect has had direct interactions with your company. Has anyone affiliated with the prospect visited your website, consumed your marketing content, or met with one of your sales reps? Has the prospect bought from your company in the past?

The other dimension of interest is buying signals, and this refers to prospect behaviors (other than direct interactions with your company) that indicate the prospect may be interested in the kinds of products or services your company provides. Today, most accessible buying signals consist of online behaviors such as website visits and content consumption behaviors. These behaviors are represented as intent data, which is collected and sold by B2B publishers. Some providers of predictive analytics acquire access to this data and incorporate it into their PA solutions. Therefore, as a practical matter, you will only have access to this type of intent data if you are using a predictive analytics solution to support your marketing efforts.

Earlier, I noted that look-alike modeling is an effective way for most companies to select target accounts for their ABM program in most circumstances. However, in some cases, choosing target accounts based solely on look-alike modeling won't produce optimal results. In those circumstances, you'll need to step back and use the factors described in this post. In a future post, I'll describe some of the circumstances that require more than pure look-alike modeling.

How to Pick the Right Accounts for Your ABM Program

Account-based marketing (ABM) is fast becoming the preferred approach to marketing for many B2B companies. Last summer, in a survey of B2B business and marketing leaders by Demand Metric, 45% of respondents said they were testing or already using ABM, and another 26% said they were interested in adopting it.

The defining characteristic of account-based marketing is that it focuses marketing efforts on a specified group of target accounts. Therefore, choosing which accounts to target is an essential step in implementing ABM, and most ABM thought leaders and practitioners agree that account selection is the most critical component of any ABM program. Choosing the right target accounts is not the only thing you need for success, but it will be impossible to build a successful ABM program if you target the wrong accounts.

ABM can be used for acquiring new customers and for marketing to existing customers. In this post, I'm focusing on account selection for new customer acquisition.

Most companies choose target accounts based on how closely those organizations resemble their existing customers. This approach is often called look-alike modeling, and the process is fairly straight forward:

• Companies identify the attributes and behaviors that their best existing customers have in common. For example, firmographic attributes might include company size, industry vertical, number of employees, and location.
• Then, they use these shared attributes and behaviors to create a profile of their "ideal customer."
• Lastly, they will choose their target accounts based on how closely they match the ideal customer profile.

Most companies select target accounts manually, but mature ABM practitioners are increasingly using predictive analytics to support the account selection process. Virtually all predictive analytics solutions use a sophisticated version of look-alike modeling to identify target accounts. They extract data regarding existing customers from your CRM and marketing automation solution and combine that information with external data about those customers to construct a customer data model. The solution provider then runs your customer data model against its database of businesses and/or applies the model to prospects already in your marketing database to identify the accounts that resemble your existing customers.

The advantage of predictive analytics is that it can incorporate and process far more data points than humans can realistically use. Therefore, predictive analytics solutions can enable companies to build and use more comprehensive customer data models and thus do a better job of identifying accounts that most closely resemble their existing customers.

In many ways, look-alike modeling is the essential foundation for effective account-based marketing. But like any business tool or methodology - no matter how powerful it may be - look-alike modeling is not without limitations. Therefore, it's important for marketers to understand what look-alike modeling is really trying to achieve, what assumptions or inferences underlie it, what the limitations of look-alike modeling are, and how to tweak the look-alike modeling process to reduce or eliminate some of those limitations. I'll discuss these issues in my next post.

Illustration courtesy of Emillo Kuffer via Flickr CC.

Two Key Promises of Predictive Marketing

As a B2B marketer, imagine how much more effective your marketing efforts would be if you had the following insights:

• What if you could identify businesses that are likely to have a strong interest in your company's products or services before you market to those businesses?
• What if you could reliably identify which of your current prospects have a strong propensity to buy your company's products or services and thus are ready to have a meaningful conversation with one of your sales reps?

These are two of the most significant promises of predictive marketing solutions. During 2015, predictive marketing was one of the hot technologies in B2B marketing, and it appears that the demand for predictive marketing solutions is poised to grow rapidly. 

Last fall, Everstring published the results of a survey of marketers regarding the use of various marketing technologies. Twenty-five percent of the survey respondents said they were currently using some predictive tools, and another 47% said they were aware of predictive marketing and were investigating how to use it. Two studies by Forrester Consulting - available here and here - reported even higher usage rates of predictive marketing analytics among B2B companies.

Predictive marketing solutions have the potential to dramatically improve the productivity of B2B demand generation by enabling companies to target their marketing and sales activities more precisely. Predictive analytics can be used to address a wide range of business issues, but the two uses that are receiving most of the attention in the B2B marketing world are new prospect acquisition and prospect/lead scoring.

Most predictive marketing solutions employ the same basic approach for both of these use cases. They take data regarding your company's existing customers from your CRM and marketing automation systems and combine that information with external data about those customers - from around the web, social media, and other third-party data sources - to construct a customer data model that describes the attributes and behaviors of organizations that are likely to have a strong interest in your company's products or services.

When predictive marketing is used to identify new prospects, the solution provider will run your customer data model against its (the solution provider's) database of businesses. The result is a list of prospects that resemble - to a greater or lesser extent - your existing customers. The inference is that prospects that closely resemble your existing customers  are likely to be interested in your company's products or services. With this insight, you can target your marketing programs more precisely and use your marketing resources where they are more likely to be effective.

When predictive marketing is used for prospect/lead scoring, the solution provider applies your customer data model to the prospects already in your marketing database and generates a score for each prospect based on how closely the prospect resembles your existing customers. This enables you to qualify prospects or leads using much more data than is typically available in traditional lead scoring systems. In theory, therefore, a predictive marketing solution qualifies prospects and leads more accurately, and it can potentially identify buying signals that are almost impossible to find using traditional lead scoring techniques.

The early indications are that predictive marketing solutions will drive significant business benefits. For example, in a 2015 study by Forrester Consulting, 72% of respondents whose companies were using predictive marketing grew revenues by 10% or more during 2014. Only 33% of non-users achieved the same rate of revenue growth.

While its clear that predictive marketing solutions can provide significant benefits in the right circumstances, there are a few caveats that marketers should keep in mind. For example:

• These solutions rely heavily on data from a company's CRM and marketing automation systems to construct the customer data model. So, if your company is a fairly mature user of CRM and marketing automation, and if your systems contain a significant amount of usable data, predictive marketing could be a sound investment. On the other hand, if you don't have enough reliable CRM/marketing automation data to work with, the value of predictive marketing will be more problematic.
• It's also important to recognize that you need a reasonable number of existing customers to create a customer data model that is reliable and predictive. Put simply, your customer data model will be richer and more reliable if it is based on 500 customers rather than on 50 customers.
• Predictive marketing solutions are not outrageously expensive, but they can require a significant investment. The cost of predictive marketing solutions varies greatly depending on the features of the solution and a variety of other factors. Pricing can always change, of course, but at present, it appears that the starting price for most predictive marketing solutions ranges from around $15,000 per year to over $100,000 per year.

Illustration courtesy of Louise McLaren via Flickr CC.

Marketing Planning for 2016 - How to Get Started

In my last post, I made the point that marketing planning for a B2B company has become a complex undertaking. I also argued that, while it's impossible to eliminate the complexity associated with marketing planning, you can make the job more manageable - and the outcome more successful - by using a sound planning process and framework. The diagram below presents a high-level, simplified view of the planning process and framework that I use when working with a B2B company on a marketing planning project.

The first step in your planning process for 2016 should be to review your company's overall business strategy for next year and identify the strategic business objectives that marketing will be expected to influence. For example, your company's business strategy will almost certainly include an overall revenue growth objective, but it may also include distinct revenue objectives for specific products or product line, geographic markets, or customer segments. Having a clear understanding of these strategic business objectives will enable you to align your marketing efforts with those objectives.

The next step in the planning process is to focus on three core components of any sound marketing strategy - the definition of the target market, the value propositions that you will communicate to organizations in your target market, and the buying group, the individuals within prospect organizations who will make or influence the decision to purchase your products or services.

Defining your target market, developing compelling value propositions, and identifying the buying group are critical for effective planning because these factors largely dictate the content of your marketing communications plan.

Think of it this way. If you've ever watched someone install a tile or hardwood floor on a home improvement TV show, you may remember that the installer spends a great deal of time making sure that the first row of tiles or boards is straight and square with the walls of the room. After the first row is in place, the rest of the installation usually goes fairly quickly. That's because as long as the rest of the tiles or boards "fit" with the first row, the whole floor is almost guaranteed to turn out right.

The definition of your target market, your value propositions, and your buying group are like that first row of floor tiles or boards. They provide the "landmarks" and reference points for the development of your marketing communications plan.

Target Market and Value Propositions

Defining your target market and developing value propositions is almost always a "back and forth" process. That's because it's likely that your products or services can create value for users in several ways, but it's also likely that they will create more value for certain kinds of companies. Therefore, the most effective way to deal with these two factors is to start by understanding and describing how your products or services will create value for users. From my experience, the best way to capture this insight is to answer a series of questions and record your answers in what I call a customer value map. Here are the questions:

1. What are all of the significant reasons that companies have for purchasing a product or services like ours? What problems or needs motivate the buying decision?
2. What kinds of organizations are likely to have the problems or needs that underlie these reasons to buy?
3. What specific outcomes are organizations seeking when they decide to buy a product or service like ours?
4. What specific features and capabilities of our solution will produce these desired outcomes?
5. What will the economic benefits be if these desired outcomes are achieved?

The Buying Group

Once you have defined the target market and identified how your products or services will create value for companies in your target market, it becomes somewhat easier to identify the buying group. When you develop your customer value map, you will identify the problems or needs that motivate organizations to purchase products or services like yours. A good way to identify the buying group is to add a question to your customer value map (after question 2 in the above list):  "Who within these organizations is most affected by each problem or need (who has the most to gain if the problem is solved and the most to lose if it isn't)?"

For most marketers, the primary output of the annual planning process should be a marketing communications plan that describes how you will tell your story to potential buyers. In a future post, I'll explain how to build and effective marketing communications plan.

Note:  If you'd like to learn more about developing value propositions and see an example of a customer value map, take a look at my white paper titled,"How to Create Irresistible Value Propositions."

What's Old and New in Account-Based Marketing

If you're involved in B2B marketing, you're probably aware of the hype surrounding account-based marketing (ABM). Some industry thought leaders are touting ABM as the "next big thing" in B2B marketing, and research confirms that the enthusiasm for account-based marketing is growing. For example, in the 2015 State of Account-Based Marketing Survey by SiriusDecisions:

• 92% of respondents said that account-based marketing is "extremely" or "very" important to their overall marketing efforts.
• 61% of respondents whose companies had implemented ABM said they plan to invest in technology to support their ABM efforts over the next twelve months.

Most of the hype about account-based marketing tends to portray ABM as a "new" type of marketing. In reality, account-based marketing is an amalgamation of old and new marketing principles and methods, and a set of relatively new, technology-enabled marketing techniques.

What's "Old" in Account-Based Marketing

The defining characteristic of account-based marketing is that it focuses on a group of identified or named accounts. ABM programs or campaigns are directed at relevant individuals (decision makers or influencers) who are affiliated with those named customers or prospects. This aspect of account-based marketing is by no means new.

Any business or marketing strategy worth its salt will include a definition of the company's target market, and this has been true for decades. In addition, for years, many B2B companies have been using direct marketing methods that focus on specific individuals who are affiliated with the business organizations that are in the company's defined target market.

So, in short, some of the fundamental principles and methods of ABM aren't new, but in fact, they embody techniques that many B2B companies have been using for years. However, this doesn't mean that the current incarnation of account-based marketing is simply a rehash of "old" marketing methods and practices.

What's "New" in Account-Based Marketing

Two characteristics distinguish the current practice of ABM from the "account-based" marketing campaigns and programs of the past. First, we now have technology tools that are enabling several new ABM techniques. For example, we now have the ability to target online advertisements and customize website content for individual named accounts or for specified types of accounts.

The second defining attribute of current ABM efforts is the level of coordination among marketing, sales, and business development activities. Today's most effective ABM programs typically combine content-based interactions and human-to-human interactions to create an integrated communications plan for each target account. In companies with the most successful ABM programs, marketers, sales reps, and business development reps work jointly to develop and then execute the integrated communications effort. This characteristic has caused some ABM thought leaders to argue that account-based marketing should really be called something like strategic account development because it encompasses much more than marketing.

ABM can be a powerful approach to demand generation for many B2B companies, and new technology tools can certainly enhance the effectiveness of ABM efforts. But ABM isn't entirely new, and successful ABM programs will incorporate many long-standing marketing principles and techniques.

Image courtesy of Cliff via Flickr CC.

There's No Such Thing as "No Decision"

B2B companies that track the performance of their demand generation efforts often categorize the outcomes of potential deals as wins, losses, or no decisions. In many cases, no decision is a catch-all category that is used for all potential deals that aren't successfully closed or lost to a competitor.

Research has shown that no decisions occur frequently. For example, the 2015 Sales Performance Optimization survey by CSO Insights found that between 20% and 28% of forecast deals result in no decisions. In this research, the term forecast deals referred to sales opportunities that were sufficiently "ripe" to be included in revenue projections for a specific fiscal period. Sales Benchmark Index takes a broader view of the issue and has estimated that 58% of the typical sales pipeline will stall or result in no decision.

There are two fundamental problems with the won-lost-no decision framework, one of which is that the no decision label is inaccurate 100% of the time. When a prospective customer does not buy (either from you or from a competitor), the prospect is making a choice to either remain with the status quo, or use internal resources to "fix" the status quo in some way. Whichever the case, the prospect has made a decision, and we need to evaluate the outcome accordingly. Calling this outcome a no decision can easily lead us to view the cause of the outcome as simple inaction.

The second problem with the no decision label is that it is too generic to inform marketing and sales leaders what really caused a prospect to opt for the status quo. This is important information because it enables us to identify the causes that we can affect and to separate those from the causes that are beyond our control.

For example, a prospective customer may choose to stick with the status quo because your offering and those of your competitors don't provide enough value to justify making a change. If you're experiencing a significant number of these outcomes, it's likely that you're targeting the wrong prospects or that your lead qualification process isn't revealing the "lack of fit" as quickly as it should.

Or, you may have prospects that decide to remain with the status quo because they don't recognize the real value that your solution would deliver. In this case, your marketing content and/or your selling process may not be adequately communicating value to your prospective customers.

In both of these scenarios, you can reduce the number of what are typically called no decisions, either by using a better definition of your target market or a more rigorous lead qualification process, or by improving your ability to communicate the value that your solution will provide.

In other cases, prospective customers may decide to stick with the status quo because of events or circumstances that are beyond your control. Some examples would include:

• A change in company leadership that results in a shift of strategic priorities
• A downturn in the financial performance of the prospective customer that results in tighter controls on spending

To improve demand generation performance, you need to know why you win or lose, whether the loss is to a competing company or to the status quo. To gain this understanding, we need to recognize that there's really no such thing as no decision.

Illustration courtesy of Flickr CC and Dan Moyle

Is Predictive Lead Scoring the Next Big B2B Marketing Technology?

The pace of innovation in marketing technology over the past decade has been nothing short of breathtaking. In the B2B marketing space, one of the hot new technologies is predictive lead scoring. There's no doubt that predictive lead scoring is still in its infancy, but it's beginning to gain some traction in the market. Last fall, SiriusDecisions published a report that provides valuable perspectives on the current state of the predictive lead scoring market. According to SiriusDecisions:

• Fewer than 500 B2B companies are currently using predictive lead scoring. But. . .
• The market is growing rapidly. In 2014, there were nearly 14 times more B2B companies using predictive lead scoring than there were in early 2011.
• 78% of the companies using predictive lead scoring are in the high tech industry.
• Over half (56%) of current users have annual revenues of $50 million or less.
• Nine out of ten current users say that predictive lead scoring provides more value than traditional lead scoring.

How Does It Work?

A predictive lead scoring platform is an analytics application that takes data regarding existing customers from a company's CRM and marketing automation systems, and combines that information with external data (from the web, social media, and other third-party data sources) to create a profile of organizations that have the greatest propensity to purchase the company's products or services. Then the application aggregates similar data regarding the prospects in the company's marketing database and compares those prospects to the profile of the company's existing customers, resulting in a "propensity to buy" score for each prospect.

Benefits of Predictive Lead Scoring

Predictive lead scoring enables companies to qualify leads and prospects using much more data than is typically used in traditional lead scoring systems. Therefore, predictive lead scoring qualifies leads and prospects more accurately, and it can identify buying signals that are almost impossible to find using traditional lead scoring techniques and technologies.

Advocates also argue that predictive lead scoring enables both marketers and salespeople to focus their efforts and resources on the leads and prospects with the greatest potential to buy, and that it can improve the relationship between marketing and sales by providing a more objective, data-driven, and therefore more reliable, way to qualify leads.

Is It Right For You?

Predictive lead scoring technologies are evolving rapidly, and any assessments made today have to be considered tentative at best. Predictive lead scoring solutions appear to offer significant benefits, but marketers should keep a few things in mind.

First, these solutions rely heavily on data from a company's CRM and marketing automation systems to construct the scoring model. So, if your company is a fairly mature user of CRM and marketing automation, and if your systems contain a significant amount of good data, predictive lead scoring could be a sound investment. On the other hand, if you don't have enough good CRM/marketing automation data to work with, the value of predictive lead scoring will be more problematic.

Predictive lead scoring solutions are not outrageously expensive, but they may be out of reach for many small B2B companies. Pricing is always changing, of course, but it appears that the starting price for most predictive lead scoring solutions ranges from around $2,000 to about $6,000 per month.

Seven Questions Your Content Marketing Strategy Must Answer

It's now abundantly clear that content marketing has become an integral part of the marketing efforts of most B2B companies. Recent research by several organizations has shown that an overwhelming majority of B2B companies are using content marketing in some form. But despite this widespread use, many B2B marketers aren't particularly happy with their content marketing program. In the latest B2B content marketing survey by the Content Marketing Institute and MarketingProfs, only 38% of respondents rated their content marketing efforts as effective.

Research has also shown that having (and following) a content marketing strategy is critical to success. In the 2015 CMI/MarketingProfs survey:

• Only 35% of respondents said they have a documented (written) content marketing strategy, while another 48% said they have a strategy, but it's not in writing.
• 60% of respondents with a documented strategy said their company is effective at content marketing, but only 7% of respondents without a documented strategy said their content marketing efforts are effective.

A comprehensive content marketing strategy will address numerous issues. The Content Marketing Institute has published an excellent white paper on content marketing strategy which includes thirty-six questions that marketers should consider when they're developing their strategy.

While all of the questions in CMI's white paper are important, I usually recommend that clients begin by focusing on a set of seven core questions. The answers to these questions won't constitute a complete content marketing plan, but they will provide a solid foundation for your content marketing strategy.

1. Who is the target audience for our content? What are the characteristics of the organizations that constitute our best prospects, and what are the attributes of the people in those organizations who will influence the decision to purchase our products or services?
2. What are the primary marketing objectives (brand awareness, lead generation, etc.) of our content marketing program?
3. What issues or topics will be relevant and compelling to the people in our target market?
4. What content formats will be most effective with the people in our target market?
5. Given the communications behaviors and preferences of the people in our target market, what communications channels will we use to publish, distribute, and promote our content?
6. Who will be responsible for creating our content resources, and who will manage our content marketing program?
7. What financial resources will be needed to fund our content marketing program, and where/how will we obtain those resources?

From these questions, it should be clear that your content marketing strategy must be based on clearly defined marketing objectives and a deep understanding of your potential buyers. This reinforces the point that content marketing is ultimately a means to an end. It is a method of marketing that enables companies to create and sustain meaningful engagement with potential buyers for the purpose of achieving strategic marketing objectives.

What Makes a Lead Really Sales Ready?

One of the most important requirements for an effective B2B demand generation system is a clear understanding of who constitutes a sales-ready lead. Describing what makes a lead sales-ready is the essential starting point for defining the roles and responsibilities of marketing and sales. In an optimized demand generation system, marketing is primarily responsible for acquiring new leads and for nurturing leads until they are sales ready. Once a lead is sales ready, sales assumes the primary responsible for managing that relationship.

The term sales-ready lead is used frequently by marketing thought leaders and practitioners, but it's difficult to find a useful or widely-accepted definition of the concept. Some marketing pundits avoid the need to define sales-ready lead by saying that the term means whatever marketing and sales agree that it means.

In practice, companies vary greatly in terms of when they pass leads from marketing to sales. In a recent blog post, Bob Apollo described research by SiriusDecisions regarding when companies treat leads as being sales ready. According to this research, 28% of companies treat all contacts or inquiries as sales-ready leads and pass them to sales without any qualification. At the other extreme, 10% of companies only pass leads to sales after they are fully BANT-qualified. In between, 25% of companies will pass a lead to sales when the lead has an "appropriate" job title and is affiliated with an "appropriate" type of company.

We need to do better. If we want to optimize the performance of our demand generation system, we need a rational, reasonable, and substantive definition of who constitutes a sales-ready lead. I'll offer one momentarily, but first it's important to understand who is not a sales-ready lead.

To start with, a raw inquiry does not constitute a sales-ready lead. A raw inquiry is someone who has identified himself or herself, but otherwise has shown only a minimal level of interest in what you offer. He or she may have filled out a registration form and downloaded one of your content resources, but that's it.

Sales ready is also not equivalent to ready to buy. As noted earlier, some companies only pass leads to sales when the leads are fully qualified using the traditional BANT criteria. As I pointed out in an earlier post, the problem with BANT is that some of the criteria won't be met until near the end of the buying process, and in addition, it's increasingly unlikely that any one person can ever satisfy all of the BANT requirements.

A sales-ready lead, therefore, falls somewhere between a raw inquiry and a BANT-qualified lead. Here's my proposed definition:

A sales-ready lead is an individual who (a) is affiliated with a qualified prospect, (b) can make or influence the decision to purchase your product or service, and (c) is sufficiently interested in exploring solutions to engage in a meaningful dialog with a salesperson. In this definition, the term qualified prospect means an organization that has a need your company can address and falls within your defined target market.

This definition provides a good starting point, but I also think it's important to have specific criteria for identifying sales-ready leads. The table below includes eleven criteria that I suggest are appropriate for most companies. The first four criteria apply to the prospect organization, and the remaining criteria apply to the individual lead.

That's what I say makes a lead really sales-ready. How about you?

Why Your Content Marketing Should Alienate (Some) Prospects

Recently, I attended a webinar presented by Doug Kessler titled Insane Honesty in Content Marketing. If you're not familiar with Doug Kessler, he's one of the co-founders of Velocity Partners, a content marketing agency based in the UK. Velocity consistently publishes great resources regarding content marketing, and this webinar is a must-see for B2B marketers.

According to Kessler, insane honesty in content marketing consists of:

• Actively seeking out your weaknesses and sharing them openly; and
• Strategically putting your worst foot forward.

Obviously, this approach runs counter to a whole laundry list of widely-accepted marketing principles and practices, and the idea is probably difficult for many marketers to swallow. In the webinar, Kessler shared several examples of insane honesty at work, which is another good reason you should view the presentation.

Six Reasons to Practice Insane Honesty

Kessler identified six reasons to practice insane honesty in your content marketing:

1. It surprises and charms - Because this type of content is rare, it is more likely to capture the attention of potential buyers.
2. It signals confidence - Kessler contends that confidence is the most powerful attribute of all effective content marketing.
3. It builds trust - If you're insanely honest about the weaknesses of your solution, potential buyers will be more likely to trust what you say about the strengths and benefits of your solution.
4. It alienates less likely buyers.
5. It attracts your ideal prospects.
6. It focuses your sales and marketing team on the battles you can win.

All of these reasons are important, but I want to focus on reason #4 in this post. Marketing content that is insanely honest will alienate some of your prospects, and that is a good thing because of the economics of B2B demand generation.

Insane Honesty Supports Economic Demand Generation

The diagram below illustrates the point that your investment in a prospect increases as the prospect moves through the marketing/sales funnel. On average, you will have much more invested in a Sales Opportunity than you will in an Inquiry. Therefore, it's important to determine whether your solution is a good "fit" for a prospect as early as possible in the prospect relationship.

Marketing content that is insanely honest serves two critical marketing objectives. It functions as a magnet that simultaneously attracts prospects who are a good fit for your business and repels those who aren't. The result is a more effective and efficient demand generation process and a lower likelihood of winding up with frustrated and unhappy customers.

Building a Simple and Effective Lead Qualification Framework

The essential starting point for building a tighter alignment and a more productive relationship between marketing and sales is developing a joint framework for qualifying sales leads. Without a common understanding of who constitutes a qualified lead, it's simply impossible to get marketing and sales on the same page.

Marketers and salespeople frequently have differing perspectives about who is a qualified lead. When I'm working with a client on a demand generation project, I interview marketers and salespeople separately, and I ask a simple question:  How would you define who constitutes a legitimate sales lead?

The marketers typically say that a qualified lead is someone who works for a company that is in their target market, has an appropriate job title, and has expressed interest (in some way) in what their company offers. The salespeople, on the other hand, will usually say that a legitimate lead is someone who meets the marketers' criteria and whose propensity (and ability) to buy has been established using criteria such as BANT.

When this kind of disparity exists, is it any wonder that marketing and sales are often at odds?

The solution to this problem, of course, is to involve both marketers and salespeople in the development of a lead qualification framework that both groups will use.

There's certainly no need to start from scratch when you're developing a lead qualification framework. With a few minutes research using Google or another search engine, you can find many examples to use as a guide.

Many B2B companies use the Demand Waterfall(TM) developed by SiriusDecisions as the basis for their lead qualification framework, and SiriusDecisions has also developed a "Lead Spectrum" that defines seven lead qualification levels. I am an admirer of the work that SiriusDecisions produces, and I have referred to their models on several occasions in this blog.

When it comes to lead qualification frameworks, however, I usually recommend that companies start with a simpler model. Then, you can add lead stages or lead qualification levels if you identify specific needs for the additional detail. The objective is to develop a lead qualification framework that contains as much detail (but only as much detail) as you really need.

The "starter" lead framework that I typically use with clients has four lead qualification levels - Inquiry, Profiled Lead, Sales-Ready Lead, and Sales Opportunity.

The conceptual approach underlying this framework is simple. The first significant event in the lead qualification process occurs when someone identifies himself or herself and indicates some initial interest in your company (or, more likely, in a content resource your company has published). This makes the individual an Inquiry.

Your first task is to determine which of your Inquiries fit within your target market. Depending on what information you collected when the individual identified himself or herself, you may be able to perform this task without needing more information from the lead. For example, if you have a company name, a few minutes of research will enable you to determine whether the company fits your target market definition (in terms of size, industry, etc.). On the individual level, you may have collected a job title during the initial identification, but if not, a little research should enable you to obtain that information. If a lead fits within your target market, you then have a Profiled Lead.

For marketing/sales alignment purposes, the most critical lead stage to define is what I call a Sales-Ready Lead. In an optimized demand generation system, marketing is primarily responsible for acquiring new leads and for nurturing leads until they are sales ready. Once a lead becomes sales ready, sales assumes primary responsibility for managing that relationship. What transforms a Profiled Lead into a Sales-Ready Lead is the level of interest the lead expresses (either explicitly or via behavior) in what your company offers. For a discussion of how I define Sales-Ready Lead, see my earlier post titled What is a "Sales-Ready Lead?"

The final lead stage used in my starter framework is Sales Opportunity. The critical defining characteristic of a Sales Opportunity is that the prospect's buying process has advanced far enough that you can reasonably project when a buy/no-buy decision will be made. In other words,  with a Sales Opportunity, you can forecast (within reasonable parameters) when a prospective deal will close.

A simple lead qualification framework is not that difficult to develop, and it can drive a significant improvement in marketing/sales alignment.

Stop Making Lame Excuses for Marketing/Sales Misalignment

In a recent blog post, Dan McDade with PointClear wrote that in "chaotic" organizations, 70%-94% of leads generated by marketing are ignored by sales reps. Dan's statistic pertains to what he considers to be poorly-performing companies, not average firms. Nevertheless, this statistic seemed to be shockingly high, so I decided to look for other recent research regarding sales follow-up on marketing leads.

• An article at Business2Community by Sherry Lamoreaux contained a reference to a survey by CEB in which 49% of surveyed sales reps said they ignored more than half of all marketing-generated leads.
• The 2013 Lead Management Optimization survey by CSO Insights paints a slightly more positive picture. In this study, 46% of respondents said that sales reps actively pursue at least 75% of marketing-generated leads. Unfortunately, 42.6% of respondents indicated that sales reps actively pursue less than 75% of marketing generated leads.

Even if the CSO Insights study provides the most accurate view, it's clear that there's still a significant disconnect between marketing and sales in many companies.

Let me be blunt here. In 2014, successful B2B demand generation requires a coordinated effort by both marketing and sales, and a lack of alignment between marketing and sales is now both intolerable and inexcusable.

Marketing/Sales Misalignment is Intolerable

The lack of marketing/sales alignment is intolerable because it results in waste and significant lost revenue opportunities. As proof, consider the following research findings.

• Companies' inability to align their marketing and sales teams around the right processes and technologies has cost them upwards of 10% or more of their total annual revenues each year. (IDC)
• Companies with highly aligned marketing and sales functions achieved an average of 32% annual revenue growth, while less well-aligned companies saw a 7% decrease in revenues. (Aberdeen Group)
• B2B companies with highly aligned marketing and sales operations achieved 24% faster three-year revenue growth, and 27% faster three-year profit growth. (SiriusDecisions)

Marketing/Sales Misalignment is Inexcusable

The lack of alignment between marketing and sales is inexcusable because the process for creating alignment is well known. The marketing/sales alignment puzzle has four major pieces.

Value Creation - This refers to how you create value for customers. Marketing and sales must be aligned on this issue because it's the foundation of your entire demand generation system. To create alignment, marketing and sales should agree on your core go-to-market value propositions.

Target Market Definition - This includes both the kinds of organizations that will make your best prospects and the identity of the individuals within those organizations who make or influence the decision to purchase your product or service. If marketing and sales use a common target market definition, there will be fewer disagreements about the quality of leads produced by marketing.

Messaging - This refers to the content you use to tell your story to potential buyers. There is often a huge disconnect between marketing and sales when it comes to messaging. Various studies have shown that between 50% and 90% of the content resources produced by marketing are not used by sales and that sales reps spend hours every month creating their own sales materials. These problems can be avoided if marketing and sales agree on the major components of your company's messaging.

Lead Management - In this area, alignment means that marketing and sales have agreed on:

• What constitutes a "sales-ready lead"
• How the hand-off of leads by marketing to sales will be handled
• How sales will follow up with leads supplied by marketing
• When leads will be passed by sales back to marketing for additional nurturing

None of these steps is particularly complex or difficult to implement. The only thing preventing better marketing/sales alignment is the unwillingness of marketing and sales leaders to put aside cultural baggage and take the necessary steps. The time for lame excuses is over.

Is Account-Based Marketing Right for Your Business?

One of the hot topics in B2B marketing circles today is account-based marketing (ABM). ITSMA (the Information Technology Services Marketing Association) led the development of account-based marketing about a decade ago. Although it started in the technology sector, ABM is now used by many kinds of B2B companies.

ITSMA defines account-based marketing as:  "A structured approach to developing and implementing highly customized marketing campaigns to markets of one, i.e. accounts, partners, or prospects." (emphasis added) By this definition, the distinguishing characteristic of account-based marketing is that it entails the development of a unique marketing strategy and communications program for each target account.

Recently, some marketing consultants and software companies have been arguing for a broader view of account-based marketing. For example, SiriusDecisions has identified four varieties of ABM - large-account marketing, named-account marketing, industry-account marketing, and customer marketing. For a description of these four varieties of ABM, read this post at the SiriusDecisions blog.

Firms that advocate the broader view use the term account-based marketing to describe marketing programs that focus on a specific group of named accounts, but do not necessarily involve the implementation of a unique marketing program for each target account. While these programs are often based on solid marketing principles and can be very effective, they are not true account-based marketing, at least in the original sense of the concept. In this post, I'm using the term account-based marketing as it was defined by ITSMA.

It's now clear that account-based marketing can be highly effective in the right circumstances, but is ABM right for your business?

Your answer to this question largely depends on the attributes of your universe of existing and potential customers. True account-based marketing is typically used only for very high-value customers and prospects because it's expensive to execute. For example:

• ABM requires both marketing and sales personnel to be deeply involved in the development and execution of each account plan.
• Many of the activities involved in ABM cannot be automated because they require the exercise of human judgment.
• Account-based marketing will usually require the development of unique marketing and sales content resources for each target account.

Because of the costs associated with account-based marketing, most companies that use ABM do so selectively. The diagram below illustrates how account value and the diversity of account needs influence which approach to marketing is most appropriate.

The lower left corner of the diagram represents accounts (existing customers and prospects) with relatively low value and relatively homogeneous needs. A mass marketing approach (i.e. "one size fits all") is probably most appropriate for this group of accounts. Note, however, that this group represents a small part of the total universe of accounts.

The top portion of the diagram represents very high-value accounts. These are the types of accounts that are suitable for account based marketing, even when their needs are fairly homogeneous. In most companies, these accounts also represent a fairly small portion of the total account universe.

As the diagram illustrates, targeted marketing (which may, in fact, focus on a specific group or set of named accounts) is the most appropriate marketing approach to use for most accounts. As I'm using the term, targeted marketing refers to the use of customized marketing messages for market segments and buyer personas, but not for individual accounts. When targeted marketing is done correctly, it enables a company to obtain many of the benefits of account-based marketing at a significantly lower cost.

So what's the bottom line? If you're a B2B company with a few existing customers who are "too big to lose," and/or if you can identify a small number of potential customers who would provide exceptionally high value to your company, then consider implementing account-based marketing for those selected accounts, and use targeted marketing programs for the rest.

How to Build a Better Profile of Your Ideal Customer

Most readers of this blog are probably familiar with ideal customer profiles. An ideal customer profile is a description of the kinds of companies that would make the best customers for your business. The goal of creating and using an ICP is to focus your marketing and sales efforts on those prospects with the greatest likelihood of becoming good customers and to avoid wasting valuable resources on prospects that aren't a good fit.

Most companies base their ideal customer profile(s) on the characteristics of their existing customers. They first identify their "best" customers (which usually means their largest and/or most profitable customers), and then they identify what those "best" customers have in common. Most ideal customer profiles use "firmographic" attributes such as:

• Annual revenues
• Number of employees
• Industry vertical
• Location

Some companies will also include other attributes when possible, such as:

• The "footprint" of the organization (local, regional, national, global)
• The most relevant organizational unit or department
• The business situation (for example, is the company in growth or decline)

While this process for creating an ideal customer profile is used by many companies, it doesn't go quite far enough. When I work with clients to develop ICP's, I ask them to consider three additional questions as we go through the process just described. Answering these questions will add depth and context to your ICP and ultimately make your ICP more insightful and useful.

Here are the three questions I add to the conventional process:

• What kinds of companies have derived significant (i.e. above-average) value from using our product or service, and why have these companies obtained greater value?
• What kinds of companies will be receptive to our marketing and sales efforts and thus be more likely to buy from us?
• What kinds of companies can we acquire as customers at an acceptable cost?

Of these three questions, the first is the most important. Companies that have derived exceptional value from using your product or service are likely to be among your largest and most profitable customers. Common sense says that similar types of companies will make your best prospects.

Understanding what is driving the exceptional value may enable you to expand the definition of your ideal customer. For example, you may find that the companies deriving exceptional value are primarily found in one industry. However, when you identify why those companies are obtaining greater value, you may find that the same issue or challenge also exists in other types of organizations that you do not currently serve. So, by answering the why question, you may well uncover an entirely new group of "ideal" prospects.

Four Key Ingredients in the Marketing/Sales Integration Recipe

In November of last year, I published a post here titled It's Time to Integrate Marketing and Sales. It's now the second most popular post at this blog, and it also created quite a stir at LinkedIn. In the Sales and Marketing Alignment group alone, the post had prompted 99 comments as of yesterday.

I was pleasantly surprised by the number of comments that supported the basic idea of integrating marketing and sales. The comments also revealed, however, that there are widely different views about what the "integration" of marketing and sales really means. To maximize the potential of integrating marketing and sales, company leaders must have a clear and detailed picture of what the end result should look like.

In my view, there are four key ingredients in the recipe for marketing and sales integration.

A Unified Go-to-Market Strategy and Plan

An integrated marketing/sales function must be based on a comprehensive go-to-market strategy and plan that has been jointly developed by marketing and sales. For integration purposes, the most important components of the go-to-market strategy/plan are:

• The value propositions that describe how your products and/or services create value for customers
• A definition (description) of the kinds of organizations that constitute your company's target market (an ideal customer profile)
• Profiles (personas) of the types of individuals who make or influence the decision to purchase the kinds of products or services that your company offers
• A description of the messages and content resources that will be used to communicate your value propositions to potential buyers
• A description of the lead stages that your company will use to categorize prospects and the criteria you company will use to qualify prospects. This will include a definition of what constitutes a "sales-ready" lead.

Integrated Demand Generation Processes

An integrated marketing/sales function is also based on a set of demand generation processes that collectively span the entire revenue generation cycle. Some of these processes will be performed exclusively by marketing, and others exclusively by sales. However, several critical demand generation processes, such as lead nurturing and lead qualification, will require the involvement of both marketing and sales. What's important here is the recognition that marketing processes and sales processes are components of a single revenue generation system and that they are often connected and interdependent.

Integrated Technology Systems

To maximize the results from marketing/sales integration, marketers and sales professionals must be working from the same data relating to prospects and customers. Therefore, it's important to integrate the information systems and technology tools used by marketing and sales. The most significant integration will typically involve the company's marketing automation/lead management software and its customer relationship management software.

Unified Leadership and Management

A fully integrated marketing/sales function will be led by a single C-level executive. The title of this executive may be Chief Customer Officer, Chief Revenue Officer, Vice President of Sales and Marketing, or something similar. Whatever title is used, the important point is that one senior executive is responsible for leading all of the company's revenue-generating activities.

Those are my key ingredients for a full integration of marketing and sales. What would you add to or remove from this list?

I'd also like to hear your views about whether fully integrating marketing and sales is always the best course of action. What circumstances make integration critical to success, and what circumstances make another approach the best solution? Please comment to share your views.

What is a "Sales-Ready Lead?"

One of the most important requirements for an effective B2B demand generation system is a clear understanding of who constitutes a sales-ready lead. Decribing who is a sales-ready lead is the essential starting point for defining the roles and aligning the work of marketing and sales. In an optimized demand generation system, marketing is primarily responsible for acquiring new leads and for nurturing leads until they are sales ready. Once a lead becomes sales ready, sales assumes the primary responsibility for managing that relationship.

The term sales-ready lead can be found in many books, articles, and blog posts, but it's surprisingly difficult to find a definition that's really useful. I'll offer one momentarily, but first it's important to understand what a sales-ready lead is not. A raw inquiry does not constitute a sales-ready lead. A raw inquiry is someone who has shown only a minimal level of interest in what you offer. He or she may have responded to an outbound lead generation campaign or visited your website and filled out a registration form, but that's it. The problems caused when marketing passes raw inquiries to sales have been widely discussed in the demand generation literature, so I won't repeat them here.

Sales ready is also not equivalent to ready to buy. Some people suggest that sales-ready leads are only those leads who are fully qualified using tradtional BANT criteria. In an earlier post, I discussed why BANT is no longer an effective framework for qualifying leads. The basic problem with BANT is that some of the criteria will not be met until near the end of the buying process, and in addition, it can be impossible for any individual lead to satisfy all of the BANT requirements.

A sales-ready lead, therefore, falls somewhere between a raw inquiry and a BANT-qualified lead. Here's my proposed definition:

A sales-ready lead is an individual who (a) is affiliated with a qualified prospect, (b) can make or influence the decision to purchase your product or service, and (c) is sufficiently interested in exploring solutions to engage in a meaningful sales dialog with a sales rep. In this definition, the term qualified prospect means an organization that has a need your company can address and falls within your defined target market.

This definition provides a good starting point, but I also think it's important to use some specific criteria for identifying sales-ready leads. The table below shows eleven criteria that I suggest are appropriate for most companies. The first four criteria apply to the prospect organization, and the remaining criteria apply to the individual lead.

OK, that's how I define sales-ready lead. How about you? How would you change my definition? Would you use an entirely different approach?

Content Marketing Basics for 2013 - Buyer Personas

Relevant content is a fundamental requirement for any effective content marketing effort. Today's business buyers are incredibly busy, and they view their time as their most precious commodity. Just as important, buyers now have easy access to a wealth of information, and they've come to believe that they can find whatever information they need whenever they need it. Under these circumstances, relevant marketing content is essential for creating and maintaining engagement with potential buyers.

To create relevant marketing content, you obviously need to know who your potential buyers are, and you must understand what makes them tick. You need to have a clear picture of the problems and issues they are facing on the job and how they are trying to deal with those problems and challenges.

The best tool for collecting and organizing information about your potential buyers is a buyer persona. A buyer persona is a detailed description of an actual type of buyer who is involved in  decisions to purchase the kinds of products and services you provide. A buyer persona is, therefore, a composite description of a type of buyer, rather than a description of an individual human being. It contains demographic data about the buyer and, more importantly, it describes the buyer's business situation and motivations. Developing a persona for each of your significant buyer types will provide the information you need to create content that will resonate with those buyers.

Before beginning work on your buyer personas, you will need to develop your ideal customer profile. An ICP is a description of the types of organizations that constitute your best prospects. An ideal customer profile includes firmographic information such as industry vertical, company size, and geographic location. Much of this information will be included in the buyer personas, but I've found that it's better to develop the ICP first.

In my last post, I discussed the process for formulating your core customer value propositions. One step in that process is to identify the individuals in the prospect organization who are most affected by the issues or problems that your product or service can address. If you've gone through this process, you'll have a pretty good idea of what individuals (described by job title or job function) are part of the "buying group" for your solution. Identifying the buying group is important because it tells you what buyer personas you need to develop.

A complete B2B buyer persona will contain the following eight components:

• Type of business - The type of business the buyer works for. This will be drawn from your ideal customer profile.
• Job title/function - The buyer's position in the prospect organization.
• Buying role - The role the buyer plays in the purchasing decision process. Common roles include the user buyer and the economic buyer.
• Objectives/responsibilities - The major business objectives and job responsibilities of the buyer.
• Performance measures - The measures used to evaluate the buyer's job performance.
• Strategies - What the buyer does to achieve his/her objectives and fulfill his/her job responsibilities.
• Major issues/concerns - This is the heart of the buyer persona. If you can identify what issues and problems are keeping your potential buyers awake a night, you can create compelling marketing content.
• Personal attributes - These attributes include the age, gender, education level, and compensation level of your buyer. Obviously, ranges will be used for most of these attributes.

Buyer personas simplify the content development process because they define the target audiences and identify the major issues that your content resources need to address.

In my next post, I'll explain how to use a content audit to determine what specific content resources you need to develop.

Read Part 1 of the content marketing series here.

Read Part 2 of the content marketing series here.

Read Part 4 of the content marketing series here.

Marketing and Sales Alignment: Putting the Whole Puzzle Together

There's no longer any doubt that a high-performing B2B demand generation system requires a coordinated effort by both marketing and sales. Changes in the attitudes and behaviors of buyers have made it essential for marketing and sales efforts to be tightly integrated.

Most of the discussions about marketing and sales alignment have focused on the lead managment process. In this area, alignment primarily means that marketing and sales have agreed on:

• What constitutes a "sales-ready lead"
• How the "hand-off" of leads by marketing to sales will be handled
• How sales will follow up with the leads supplied by marketing
• When leads will be passed by sales back to marketing for additional nurturing
• How new leads acquired by salespeople (through prospecting) will be handled

Having marketing and sales aligned on a well-designed lead management process is important, but that's not the only place where marketing and sales need to be on the same page. In other words, lead management is only one piece of the marketing-sales alignment puzzle.

There are three other critical pieces of the puzzle - value creation, target market definition, and messaging.

Value Creation

Value creation refers to how you create value for customers. It's critical to have marketing and sales aligned on this issue because it's the foundation for your entire demand generation process. To create alignment, marketing and sales should agree on the core value propositions that you will offer to potential buyers. (For a list of questions that can help you define core value propositions, see this earlier post.)

Target Market Definition

Your target market definition includes both the kinds of organizations that will make your best prospects and the identity of the individuals within those organizations who make or influence the decision to purchase your product or service. Marketing uses this definition to design lead generation campaigns and programs. If marketing and sales use a common target market definition, there will be fewer disagreements concerning the quality of leads produced by marketing.

Messaging

Messaging refers to the content you use to "tell your story" to potential buyers. Messaging is embodied in all kinds of communications vehicles, including traditional marketing collateral documents, white papers, e-books, webinars, and sales presentations. There is often a huge disconnect between marketing and sales when it comes to messaging. Various studies have shown that between 50% and 90% of the collateral materials produced by marketing are not used by sales, and the American Marketing Association has reported that salespeople spend 30 hours per month searching for or creating their own sales materials. These problems can be avoided if marketing and sales agree on the major components of your company's messaging.

The Whole Puzzle Matters

Aligning marketing and sales across all four of these issues is not easy given the culture that exists in many companies. But consider how much better your demand generation would perform if you marketers and salespeople had a common view of:

• How you create value for customers
• What kinds of organizations make your best prospects and who the key players are within those organizations
• How to effectively communicate your value to potential buyers
• How to manage leads effectively throughout the buying process

How MSP's Can Take Advantage of B2B Marketing Automation - Part 1

The use of marketing automation technologies by B2B companies is growing rapidly, and the growth is likely to continue for the foreseeable future.  Marketing service providers who serve B2B companies need to be aware of this trend because it changes the way B2B companies approach marketing and the kinds of marketing services they will require - and be willing to pay for.  To fully realize the benefits of marketing automation, B2B companies will need to define marketing and sales processes more precisely, and they will need to implement new marketing techniques. Marketing service providers who can help B2B companies make these changes stand to win new clients and boost revenues.


The best way to identify the kinds of marketing services that are likely to see increased demand is to identify the tasks that B2B companies must perform in order to take full advantage of marketing automation systems. There are eight major tasks that are essential to implementing and successfully using marketing automation technologies. Most of these tasks provide the foundation for new marketing techniques that many B2B companies have not previously used. Therefore, many B2B firms – especially small and mid-size companies – will need assistance to perform some or all of these tasks, and that’s what creates the opportunity for savvy marketing service providers. I’ll describe two of these major tasks in this post, and I’ll cover the others in my next few posts.

Creating an Ideal Customer Profile – This task is right out of Marketing 101, and it should be a core component of every company’s marketing process, whether or not marketing automation is involved. An ideal customer profile is simply a description of the kinds of companies that make the best customers and, by extension, the most attractive prospects. The ideal customer is usually described in terms of “firmographics” such as industry classification, company size, and geographic location. The ideal customer profile is used to shape lead generation programs, and it is one major component of the lead scoring system that will be set up as part of the marketing automation implementation.

Obviously, a marketing service provider cannot decide what a client’s ideal customer profile should be. The role of the MSP is to lead the client through a process that is designed to ensure that all the right questions are asked and that all the appropriate factors are considered.

Developing Buyer Personas – Most B2B buying decisions are made (or significantly influenced) by a group of people rather than by one individual. This is true even in relatively small companies. Research firm MarketingSherpa says that in companies having between 100 and 500 employees, the average number of people involved in buying decisions is 6.8. This buying group is usually composed of individuals who have different points of view regarding a proposed purchase. For example, a “user buyer” will usually have different priorities than a “technical buyer” or an “economic buyer.” To market to these buyers effectively, a company must develop marketing content that addresses the specific needs of each type of buyer in the buying group. The basis for developing such content is buyer personas.

A buyer persona is a biographical sketch of a typical buyer. It is more than a job title. Buyer personas are written in narrative form, and they are written as if the archetypical buyer is a real human being. A company needs to create a persona for each type of buyer who significantly influences the purchase decision. Marketing automation systems enable companies to create and execute marketing programs that are customized for each type of buyer, but the starting point for leveraging this functionality is the creation of buyer personas.

To develop a complete buyer persona, marketers must answer several questions about each type of buyer. Here are some examples:

•What are the buyer’s major business objectives and job responsibilities?
•What strategies and tactics does the buyer use to achieve his objectives and fulfill his responsibilities?
•What measures are used to evaluate the buyer’s job performance?
•What issues and problems keep the buyer awake a night?
•How old is the typical buyer? [Age range is OK]
•Is the buyer typically male or female?
•What is the typical buyer’s educational background?
•What sources does the buyer turn to for information?
•How would the buyer describe the issues he or she is facing?

As with the ideal customer profile, an MSP cannot build buyer personas “for” a client, but the MSP can lead the client through the process of developing buyer personas that will drive relevant and effective marketing.

In my next post, I’ll cover two more tasks relating to marketing automation that MSP’s can help B2B marketers perform.