Just like Sales, Marketing is responsible for managing a predictable, reliable demand generation pipeline with a plan that ultimately produces higher value opportunities and maximizes revenue.
The traditional approach to the pipeline - Awareness, Interest, Demand, Action - or the more modified version of this pipeline Awareness, Interest, Consideration, Purchase - is outdated. The customer is no longer a passive recipient or a sidelined spectator.
In today's environment, customers are actively engaged in the buying process. Today we leverage a mix of vehicles from search engines to customer generated blogs and reviews, from online communities to social networks, and from broadcast to personalization designed to create engagement and enhance experience. Therefore, how we approach, define and leverage the pipeline must also change.
One of the best ways to change our thinking is to change the language we use to define and describe the customer buying pipeline. Here are six revised key measurable stages to take into account when developing, implementing and measuring Marketing's contribution to the opportunity pipeline that reflect today's environment:
These may seem like a new twist on an old idea, but language matters. These labels aren't about what we do TO a prospective customer, but rather what we do WITH them. These revised labels suggest collaboration between the buyer and your company. Another key difference from the traditional approach is that these labels are behavioral in nature. This makes it easier to define what behaviors for each measurable stage you want to be able to affect .and measure.
Together, these steps create the string or series of behavioral events most prospects exhibit on their way to becoming and remaining a customer. Let's briefly examine each of these.Contact
While awareness is "just fine and dandy," as we say in Texas, what really matters is establishing contact. Prospects may be aware of your company and its products and services but until they demonstrate some degree of interest, you may be wasting time and money. Making contact means you need more than a vague idea of the market or customer set, you must have actual contact information.
For some organizations, they are just beginning to build their contact data base. For others, they have an extensive existing contact data base they may be adding to and maintaining. Regardless it is possible to "count" the number of people who gave you their contact information and permission to contact them. For example you could "count" the "freshness" of each contact, the entire database, the cost to acquire, the cost to maintain the contact, the conversion number and the rate of contacts to connects.Connect
With contact made the next thing is to connect. What is the difference between a contact and a connection? Another Texas reference sums it up: we've said "howdy" but "we ain't shook." A contact is an observable signal of hello from a person; it doesn't mean they are eager to get to know you better. A connection suggests at least the virtual exchange of a handshake and the establishment of some type of rapport. You can approach measuring marketing's impact on creating connections in much the same way as we measured contacts: the number of connections made, the cost to acquire and maintain, and the rate of conversion from connection to conversation. We'll be able to use a version of these metrics for each step.
Unfortunately you can't tell how deep a well is by measuring the length of the pump handle. That is, just because the connection has been made, doesn't mean you have a customer or even someone who is inclined to engage in a conversation beyond the casual and polite visit to borrow a thing or two or yack about the weather. It's about becoming a follower - downloading material from your website, signing up for your newsletter, participating in your webinars etc. This is why the conversation stage is so important. This is the first stage that truly signals more than a passing interest.Conversation
Now we're talking! That's the best way to describe the conversation stage. There's a flow of information back and forth between prospects/customers and you. Both parties are engaged. This is where the rubber meets the road. You cannot acquire a customer that requires a considered purchase without a conversation or series of conversations. Once the conversation is in play, the next step is consideration.Consideration
"Just because you can put your boots in the oven doesn't make em biscuits." This is the perfect Texas saying for understanding the difference between a conversation and consideration. Just because we have a conversation in play with a customer doesn't mean you have a qualified opportunity that is seriously considering purchasing from you. Consideration involves customers/prospects applying careful thought to your offer and company and weighing their options.
Different marketing vehicles, such as customer references, case studies, and third party white papers, will be deployed at this stage to help the customer/prospect build preference and predisposition toward your offering. At this stage it is possible to determine whether you have a sales ready opportunity worthy of sharing with sales. Time is money so in addition to measuring the time it has taken to move a contact to this stage you can begin to quantify the value of the opportunity as well. We can measure Marketing's financial contribution to the pipeline.Consumption
Even though the opportunity has now moved to the domain of Sales, Marketing still plays a role in converting the opportunity from consideration to a contract to consume or an actual consumption of the product or service. And upon consumption, Marketing can now measure the overall conversion rate, and time, the cost from contact to customer, the cost to acquire, and Marketing's "win" rate (how many of the Marketing opportunities closed and how this rate compare to the win rate of non-Marketing generated deals).Community
It would be a shame to stop investing in a relationship that has just begun. A customer is your most important asset. Customers are also your most important advocates. In the world of customer generated content, blogs, social networks, and product reviews, marketing organizations need to focus on developing their customer community, the final C in the pipeline. There are numerous ways to build this community, such as using Facebook and LinkedIn or other social networks to create a means for your customers to engage with you and each other.
Hopefully these six key measurable stages for developing, implementing and measuring Marketing's contribution to the opportunity pipeline offer you a valuable approach for understanding how to measure the engagement of your customers. It also enables a more collaborative conversation with marketing and sales.
So "don't wait for the mule to go blind
darlin', load up the wagon," with a new year on the horizon, now is the time to revisit how you frame your pipeline.Laura Patterson is president and co-founder of VisionEdge Marketing, Inc., a recognized leader in enabling organizations to leverage data and analytics to facilitate marketing accountability. Laura's newest book, Marketing Metrics in Action: Creating a Performance-Driven Marketing Organization (Racom: www.racombooks.com ), is a useful primer for improving marketing measurement and performance.
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