The Costly Conflict Between Sales & Marketing — How to Resolve it to Achieve Efficient Growth

There is no B2B business on planet earth where Sales does not complain about Marketing, and Marketing does not complain about Sales. Not a single one. This is a costly conflict for any business, and CEOs must resolve it to drive efficient growth.

In the current economic environment, especially for growing B2B SaaS businesses, investors are giving a premium to growing companies over profitable ones, as I wrote in my other post. However, not every growth is equal. A growth with healthy unit economics is valued up to 33% more than those growing at any cost. If you have a conflict between your marketing and sales leaders, most likely, your business needs more efficient growth.

According to SpencerStuart’s 2022 report, the median tenure of a CMO is 28 months. One of the main reasons for such a short time is a result of the conflict between marketing and sales. In most cases, CMO is out before the head of sales/revenue or the CEO. Replacing a C-level executive isn’t just expensive and time-consuming; it also significantly impacts the teams’ productivity and the operation’s overall velocity.

Build Trust and Partnership

To solve a conflict, you need to build trust between parties. If one does not trust the other, they will remain in constant battle, and everyone will lose. How do you build trust between your marketing and sales teams? It starts from the top, the C-level, or the VP level. It will then cascade down to the teams. The business will not succeed without it.

There are many ways to build trust and partnerships between people. Here is how I did it:

Have the same scorecard and set of metrics

As a CEO of a SaaS B2B business, I experienced numerous times where I asked the CMO for an update and got excellent performance results, but then I asked Sales how that helped them drive revenue, and I got the opposite answer — it didn’t. Mmmm … can it be that one of my executives isn’t telling me the truth? It can’t be. I trust them. It appeared that one was reporting on MQLs, and the other was reporting on qualified opportunities. There was a big gap between them that caused the misalignment.

At first, management should use one pane of glass when looking at the performance and operation numbers of the business. It sounds trivial and easy, but the business reality repeatedly shows that each executive holds different numbers, usually ones that make their business shine. That’s the nature of people. This is the root cause of so many conflicts.

As a business CEO, I invested in having a real-time dashboard that will tell the management, and all employees, how the company operates and performs. The data started from the very top of the marketing funnel (the raw inbound leads and their sources) to the marketing qualification funnel, all the way to the sales-qualified leads (SQLs) and each of the steps in the pipeline. I also added those outbound leads created by the sales team and the win/lose rate. We had raw data tables and time-based charts that visualized the true story of our business operation. You could filter the data by any dimension you need — traffic source, acquisition program, conversions, SDRs, AEs … name it. The data was live and accessible to everyone across the company. We also had a dashboard about existing customers and their use of our product and data points about renewals and retention. This is how I started to build trust — one source of truth, one set of numbers everyone can access at any time.

On my management calls, I used to have the RevOps leader present the operation’s data we had on the dashboard. One voice, one data source, one conversation — no friction, no arguments on whose data is more correct. It worked really well and helped to focus our discussions.

Align on goals and targets.

Once everyone uses a single source of truth about the metrics, it becomes much easier to align on goals. Setting a revenue target is easy; however, calculating how each step in the marketing and sales funnel should be to achieve the revenue target is more complex.

Having historical data throughout the funnel stages and setting goals for each step is a more straightforward exercise in algebra than a guessing game.

Once these goals are set and tracked in real-time, the conversation around the misalignment of numbers is gone forever. The focus is on execution, and how to get to these numbers. If your business is missing that alignment, don’t be surprised to have endless conflicts.

Alignment is no longer a once-a-year meeting between executives during a kickoff or budget planning; it is an ongoing process that requires at least a bi-weekly review. Markets are changing, competition is evolving, and deals are closing or lost …. many things are constantly changing. You must always adjust and improve when running an operation from the trenches. Your Q1 operational plans to achieve your annual targets will probably change as you start Q3.

The time of annual planning is over. In the current economic environment, businesses should use a more frequent and dynamic approach to planning. Very similar to how product and engineering groups transitioned from waterflow into agile planning, business planning should follow the needed agility.

Create a Partnership

Trust is built when there is a true partnership between the parties. A partnership isn’t when executives present during company all-hands or a sales kickoff event. A partnership is created when the parties meet daily, frequently speak, join meetings, commit together, report on the exact numbers, or even sit at the same office when possible. The parties need to invest in their relationship to create a genuine partnership. Their teams must always see a true partnership between leaders; it should not appear just in company events. When there is a true partnership, trust can be built and cascade down to the rest of the teams, driving them toward the goals and targets. When there is no partnership, or a faked one, everyone sees and feels it.

You got trust & partnership; now what?

Once you have the foundations of trust and partnership between marketing and sales, now is a time to go deeper into some practicalities to achieve success.

The Narrative

Typically, you use a high-level narrative at your company all-hands or during a sales kickoff. However, when the teams are in the trenches fighting to engage with prospects and win deals, they need variations of your high-level narrative. Something more aligned with value selling and the needs of the persona they are after. Your content marketers and product marketing teams should speak with customers and partner with sales SDRs and AEs to learn what narrative works and what content should be used.

Forrester estimates that only 35 percent of the content created by a B2B organization is actively used. The reason that the other 65 percent goes unused generally boils down to two things: unfindable (hard to find, unknown to users) and unusable (irrelevant, low quality).

Pricing and Packaging

As I wrote in my other post about pricing and packaging, I managed to increase the ACV of my products by 48% after changing the pricing and packaging of your products. With no change to the product or the sales capacity you already have, you can grow your revenue by doing just that.

A Winning Culture

Winning together is an important business culture between marketing and sales teams. A healthy and active culture means celebrating wins, learning from losses, and using deal forensics to understand why you won or lost. It is not about the drinks or parties but a constant learning process driving the culture.

Learning from the winners is important to helping others achieve their goals quickly. I used to record the top SDRs and AEs to share how they engaged with a prospect or won a deal, with all challenges on the way. I also recorded our product marketing teams sharing how to sell value to prospects rather than features.

There are many elements to the winning culture, but having one is important.

Seller & Buyer Surveys — the feedback loop

Sometimes your win, and sometimes you lose deals. However, it would help if you always learned why. Why did you win that deal, and what alternatives did the customer evaluate? Why did you lose a deal? There is much to learn to help both marketing and sales teams. It would help if you collected feedback from both your sellers and customers. Interviewing only your sellers isn’t enough. However, sometimes customers are not willing to share information. It is more common when you lose a deal, and they feel uncomfortable telling you the real story behind their decision. To add these colors from the lost customer, I used a 3rd party service. I found that most customers feel more comfortable sharing information indirectly than telling the story directly to my business.

I used to have a monthly win-loss analysis based on these surveys. The marketing and sales teams learned from their mistakes and improved their results. We made so much in these surveys accessible to everyone in the company to learn from.

Over time, marketing and sales learned how to collaborate at all levels of the organization, not just at the C-level. That helped drive velocity, quality, and quantity across all our targets. As the CEO of the business, ending the conflict was a high-priority task on my list.

Wittern by: Yuval ben-itzhak