B2B Marketing’s Black Box

For some companies in the B2B sphere, Marketing is a mysterious black box at which you throw money at one end and pray that something will eventually come out a few months down the road.

In the age of lead-to-revenue technology, you wouldn’t expect the black box analogy to be used to describe the B2B Marketing process. Yet this is the dim view held by many, helped by the long sales cycle of complex products and a lack of analytics which would assist in tracking conversion rates. Locked in this myopia, these companies would seek to influence the outputs by changing the inputs. Do you need more opportunities and closed deals? Just throw more money into lead generation….

Don’t get me wrong. Lead Generation, the inputs to the process, is an essential part of the equation. Yet it is not the most important, by far. Rather, it is the process which converts these leads to closed deals, our black box, where most of the marketing and sales resources should be focused. It is all about taking a holistic view, a Lead-to-Revenue approach which optimises conversions, reduces inefficiencies and significantly affects the bottom line.

Let me give a practical example.

You have spent a significant amount of money on a Google Adwords campaign which has directly resulted in 1,000 visits to a specified landing page. Visits which are anonymous and yet (you hope) will affect the number of opportunities and closed deals which will come out at the other end. Lead-to-Revenue technology (I am avoiding to use the term Marketing Automation; more on this in a later post) assists in tracking these anonymous visitors through their subsequent visits to your website, the type of content they consume, the emails they open (once they become known when downloading gated content), up to the point when they are deemed to be warm enough to be passed on to a member of your sales team. Even then, these opportunities are tracked to the point when they are closed and beyond. Any resulting revenue from closed deals which arises can be attributed directly to the campaign, with the resulting returns known.

Now consider this.

Our Adwords campaign resulted in 100 visitors who filled in their details to be able to download content from the website. Out of these qualified leads, 20 were nurtured to the point of being ready to be forwarded to a salesperson to deal with in person. This eventually results in 2 closed deals. (Note: conversion rates differ widely from industry to industry, so the percentages presented should not be taken as a benchmark.)

Let us say that you want to increase the number of closed deals to 4. Using a Black Box approach, you would double your budget for the Adwords campaign and hope to achieve twice the closed deals. Using a Lead-to-Revenue approach, however, you have other options. You may use A/B testing or other approaches to optimise lead generation. Or you could improve the user experience on your website, or generate more gated content which is relevant enough for your target audience to download. Or why not give the sales team more effective tools to convert leads into opportunities and closed deals? You could also help them by placing targeted content on LinkedIn for companies at an advanced stage in the funnel. Just consider that improving the conversion rate for each of the stages in the buyer journey by, say, 20% could still result in doubling the number of closed deals, at a much lower cost, especially when one accounts for the budget spent for these improvements across a number of campaigns.

Besides being an effective methodology to structure the marketing and sales functions, the approach aligns marketing and sales as it provides a common language and objectives, and also provides a framework for KPIs to be tracked and reported.