It's no secret that the marketing landscape is changing. With the continued growth of digital marketing and the ever-changing algorithms of social networks and search engines, businesses have to adapt their strategies and marketing tactics in order to stay ahead.
One of these adaptations is moving away from traditional marketing toward a revenue marketing model.
In this article, we will discuss what revenue marketing is, and outline the advantages it has over traditional marketing. We'll then outline how your company can get started on its revenue marketing journey.
What is revenue marketing?
So, what is revenue marketing? In short, it's a model that focuses on generating revenue rather than simply acquiring customers. This means that businesses are not only looking to acquire new customers but also to increase the lifetime value of their existing customers. In order to do this, businesses need to focus on creating valuable content that will help their customers achieve their goals.
With the revenue marketing model, a company works to closely align its sales and marketing departments toward the common goal of generating revenue. This approach is all about measuring the results of campaigns and making incremental improvements over time using a continuous feedback loop of data between the two teams.
With revenue marketing, businesses can:
- Generate more sales-qualified leads.
- Better attribute success to specific campaigns.
- Increase customer focus.
- Align sales and marketing more effectively.
Revenue marketing vs traditional marketing
There are a few key advantages to revenue marketing over a more traditional model. First, it allows businesses to track their progress in a more holistic way. In traditional marketing, businesses tend to focus on acquisition metrics like website traffic or the number of leads generated. While these metrics are still important, they don't paint the whole picture when it comes to your marketing efforts.
Revenue marketing allows you to track your progress in terms of actual revenue generated, and attribute it to specific marketing campaigns, which gives you a more accurate picture of your marketing ROI.
Another advantage of revenue marketing is that it puts the customer first. In traditional marketing, businesses tend to focus on their own products and services rather than on the needs of their customers. Revenue marketing, on the other hand, is all about understanding your customer's needs and pain points and then creating content that addresses those needs.
This customer-centric approach is more likely to result in long-term customers and repeat business.
In the traditional marketing model, marketing and sales work in silos whereby marketing works to generate leads and hands them off to sales. This is often where marketing’s involvement with those prospects ends. With the revenue marketing model, both sales and marketing work together on their prospects from initial contact all the way through to the final sale. And this alignment can help generate up to 209% more revenue.
When marketing and sales work in silos, there can be a lot of tension and miscommunication. Marketing success is often measured by the quantity of leads over the quality of those leads, whereas sales are only interested in those ready to enter the sales pipeline. A marketing team might track how well a piece of content performs, but they’ll never know if that generated traffic actually led to any sales.
By eliminating silos, you can optimize your sales and marketing teams’ effectiveness. You’ll be able to measure the impact on revenue that each marketing campaign generates, giving your marketing budget a higher ROI as you move towards campaigns that generate the most revenue. And the leads generated will be more qualified so sales can close them more quickly.
Moving to a revenue marketing strategy
So, if you want to move away from traditional marketing and embrace all the benefits that revenue marketing can bring, how do you go about it? It’ll be a lot of work to start, but it has the potential to completely transform your business operations.
Strong company-wide commitment
You may think that it’ll be easy to get support from those in charge for a revenue marketing strategy. After all, what CEO wouldn’t want to see the marketing and sales team working together more efficiently towards revenue growth?
But there will be some roadblocks.
Change can be a daunting concept, especially if you’re trying to change the company’s entire way of working. There may also be a fear of a temporary drop if profits while the changes are underway.
KPIs for everyone are also likely to change within each role. Responsibilities will change as more collaboration is needed, and there may even be shifts in management.
Despite all these changes, everyone at the company needs to be fully on board, starting at the top with the CEO. When everyone knows what’s expected and has a clear vision for where the company is headed, it’ll make the transition just that much smoother.
Keep customers informed
Such a drastic change in processes will likely affect your customers too, as you’ll be making changes right across the funnel.
But as long as you keep them in the loop and are transparent about any changes, they shouldn’t have any issues. Keep communication open and let them know ahead of time how things are going to change and what they can expect.
Probably the most difficult step in implementing a revenue marketing strategy is getting your marketing and sales department in alignment. Building out these processes can be a challenge, especially with the two departments that are typically so at odds with each other.
But you need to break down those silos and get everyone in the same room to agree on KPIs and how they can move towards the revenue marketing model together.
Key things to establish include:
- Defining a sales-ready lead.
- How to qualify a lead.
- The ideal customer persona.
- The accounts that sales are interested in.
- The marketing materials that sales need to close deals.
Everyone in the company should be aligned but starting with marketing and sales is key for getting to grips with revenue marketing. Next will come customer support and customer success, which need a clear understanding of how they can collaborate to reach those revenue goals.
Fill organizational gaps
As you transition, you may notice you don’t have the right people at your company to implement revenue marketing, or the right people are in the wrong role.
It might be that sales and marketing report to different leaders, which can help exacerbate the silo problem. Or a lack of a dedicated data analyst in the marketing department might mean data isn’t being analyzed as thoroughly as it should. Search for those organizational gaps and try to fill them with new hires or by shifting employees in their current roles to suit this new way of working.
You likely already have a sizeable MarTech stack, so it’s time to review if it’s all fit for purpose.
Technology plays a huge role in revenue marketing. You’ll need a tool that can centralize as much as possible or a set of the best class of tools in each category that can be integrated.
Here’s a breakdown of what tools and systems you’ll need:
- Customer relationship management (CRM)
- Marketing automation
- Data connector
- Data enrichment
It’s crucial that your data all syncs so everyone who needs it has access to a unified view of everything all in one place. Having these tools and collecting the right kind of data is essential for the revenue marketing model. You’ll be able to see exactly what marketing activities have helped move more prospects through the tunnel, and which aren’t impacting your pipeline and should be discontinued.
Attributing your marketing efforts to revenue is one of the cornerstones of revenue marketing, but can also be a huge pain point for the transition.
There are many touchpoints that someone can go through before they become a customer and different ways to measure this. It could be as simple as someone clicking through a paid ad and making a purchase. But often it can be more complex, like a user subscribing to a newsletter and becoming a lead after a month when they sign up for a free trial.
Marketers will need to test multiple attribution models to discover which is the most accurate for their accounts. Only then can they focus their marketing efforts on the ones that bring in the most success, increasing revenue over time.
So if you're looking to move away from traditional marketing and towards a more modern, effective approach, revenue marketing is the way to go. It's time to start thinking about how you can align your marketing efforts with your company's revenue goals. Then will you be able to truly measure your marketing ROI and see the results of your hard work.
Want to discover more about how far revenue marketing can take you? Join the Revenue Marketing Alliance!