The journey from lead to cash is a long one, with many twists and turns on the path along the way. Analytical sales and marketing managers should be highly interested in what exactly goes on throughout this journey. They need to know just how effective their demand generation activities across sales and marketing is.
The SiriusDecisions Demand Waterfall helps address this inquiry by providing “a framework for measuring and benchmarking demand generation from initial inquiry to close and across sales and marketing,” aka telling the entire lead-to-cash story. With various stages and levels of marketing qualification at pit stops throughout the waterfall, this visualization helps clarify the different roles that marketing and teleprospecting play in terms of lead generation. It clarifies the story of what goes on before we enter the sales funnel.
But how do sales and marketing managers take the SiriusDecisions Demand Waterfall from theory to practice? How can they effectively benchmark their own lead generation efforts with their own data? How can they overcome the limitations of Salesforce.com reporting in creating the SiriusDecisions Demand Waterfall?
The Marketing Funnel from InsightSquared is a good start.
What questions does the Marketing Funnel answer?
The Marketing Funnel provides answers to several important questions:
Where are our deals coming from?
Based on historical conversion rates, how many leads do we need to reach our quota?
Specially, the Marketing Funnel seeks to clarify exactly how leads are converting into deals. How is each stage converting leads from the previous stage and onto the next stage? With these answers, sales and marketing managers can get a better sense of whether their sales process is working and if there is alignment and agreement between sales and marketing.
The Marketing Funnel adopts some of the acronyms popularized by the SiriusDecisions Demand Waterfall – MQL (marketing-qualified lead), TAL (teleprospecting accepted leads) and TQL (teleprospecting qualified leads). The top of the marketing funnel, where these acronyms reside, reflects the handoff process for leads between marketing and sales.
Look at this example above. Over the past year, this company created nearly 9,000 leads. After subtracting deduplications or other ‘false’ leads, they ended up with approximately 8,000. About 5,600 of these leads ended up raising their hand – indicating a level of interest in your product or services – and become categorized as MQLs.
From there, sales accepted about 60% of them. Essentially, this means that sales agrees with marketing that 60% of these are quality leads worth following up with and converting into opportunities. From there, we can then dive into the sales funnel to see how effectively opportunities are converting between each stage all the way through to a closed-won deal.
Why are these answers important?
For optimal sales and marketing alignment, both departments need to agree on the definitions for what makes a high-quality lead. In the example above, marketing happily handed over 5,600 leads. However, according to the sales reps who have to follow up with these leads and attempt to convert them, only 3,300 of them were deemed to be quality leads.
The Sales and Marketing VPs need to huddle up together and look over this report. Why are so many leads not being accepted by sales? Should marketing pursue new campaigns in search of higher-quality leads? Is sales dropping the ball and not effectively working leads, thereby letting many potentially great ones slip through the cracks?
Unfortunately, these answers cannot be obtained in Salesforce.com. The limitations of Salesforce.com reporting list leads and opportunities separately. There is no easy intuitive way to combine the two fields and analyze them together in Salesforce. To do so, sales and marketing managers have to export that data to Excel and merge them manually, creating a difficult and time-consuming process.
Fortunately, the Marketing Funnel from InsightSquared can solve all of these issues. Marketing VPs need to work together with their Sales counterparts over this report to really tell the entire lead-to-cash story and determine how they can create a happier ending.