Lead Generation has been the darling of B2B marketing for years. But 79% of marketing leads never convert into sales.
The problem is that lead generation alone puts the focus on the wrong metric.
Luckily, there is a fix. Enter: Revenue Marketing.
For companies to generate positive Marketing ROI, marketing teams need to build comprehensive Revenue Marketing Strategies (and align their KPIs to them).
Here are six levers your marketing team can pull today to start generating revenue.
1) (Qualified) Lead Generation
Lead generation is one of the best ways to generate revenue, as long as you don’t do it in a silo. If leads and Cost Per Lead (CPL) are your only KPIs, it’s a good indicator that you are on the wrong track.
The role of demand gen in a revenue marketing strategy isn't just to generate more leads but to generate the leads that are the likeliest to close, buy your most profitable products and stay with you for years.
By creating very targeted campaigns based on your Ideal Customer Profile, you might generate fewer leads than for broader campaigns, but if they are better leads, you might be winning.
If you generate 10% fewer leads but close 50% more of them, at a 20% higher ARR, are you not doing better?
And here is the culprit of it all: If you want to produce revenue, you should really optimize your campaigns based on Cost per SQL, Cost per Opp, and ROI. Not CLP. CPL is a great indicator, especially if you have a long sales cycle, but it is not a success metric.
You might be thinking, all of this is all great, but where do I start?
- Open your CRM
- Pull all of your deal data from over the past year (or past 2 years)
- Look at the top 50% of your clients
- Now you can start understanding trends: Who discovered you? Who made the final decision? What did they buy first? Why did they buy it?
- From there you can create your ICP and start bringing in the right leads and holding your demand gen team (or agency) accountable for generating qualified leads.
2) Top to Bottom of the Funnel Lead Nurturing
Sometimes, demand gen teams focus more on bringing in leads and end up passing them to sales too early and never touching them again. You guess what happens next. These leads don’t close.
In 2012, Marketing Sherpa reported that 73% of leads were not sales ready when they made it to sales. But nurturing leads from the top to the bottom of the funnel can be a game-changer:
- Companies that excel at nurturing generate 50% more sales-ready leads at 33% lower cost per lead (Forrester)
- Nurtured leads spend 47% more when they close (Marketing Sherpa)
- Reduce the percent of marketing-generated leads ignored by sales (from as high as 80% to as low as 25%) (Marketo)
- Raise closings on marketing-generated leads (7% points higher) and reduce "no decisions" (6% points lower).
- Have more sales representatives make quota (9% higher) and decrease (by 10%) the ramp-up time for new reps.
Nurturing can be achieved in a variety of ways, including retargeting ads, direct calls, or drip emails customized to each prospect’s stage of the buyer’s journey, behavior, interests, or other factors.
While the process might be longer than bringing in the leads and passing the buck to sales, the rewards are more qualified leads, fewer failed conversions, and a better-looking bottom line.
KPMG research has found that existing customers contribute the most to revenue growth: existing customers are 50% more likely to buy new products and spend 33% more than new customers.
Best-in-class marketing teams leverage this opportunity by creating regular upselling campaigns. Working with the customer success team, marketers can understand when customers are most likely to be receptive to an upgrade.
They can then create targeted automated campaigns that combine emails, organic channels, advertising, or even direct mail to upsell the most loyal of customers.
Another opportunity to upsell existing customers is to leverage new feature launches. Carefully packaging your software so that some new in-demand features are only available in higher tiers can push lower-tier customers to upgrade their product to the next tier.
B2C marketers are usually cross-selling pros, leveraging the 83% of consumers who are willing to share their data to create a more personalized experience. Discounts, deals, and cross-selling product recommendations contribute to that personalized experience.
The key to cross-selling is keeping it relevant to the customer, which means it's best to keep it relevant to their recent purchase.
In B2B, some sales teams and customer success teams already make recommendations based on the knowledge they've learned since working with the customer in past purchases or taking the time to hear about the customer's specific needs.
By leveraging this same data to create cross-selling campaigns, marketing teams can significantly increase the rate of customers that adopt more than one product, and in doing so, increase both the company ARR and average customer LTV.
5) Pricing and Positioning
Pricing and positioning offer your brand the opportunity to stand out from the competition with a firm position (and appropriate pricing) on where you stand in the market.
For instance, if your brand is value-based and your ideal customers expect more bang for their buck, you'll want to make sure your pricing isn't too high. On the other hand, if you're targeting a higher class, you'll want to make sure your price isn't too low, or it may come off as 'less than' despite being of great quality.
By leveraging your Marketing Team’s unique understanding of both the market, the competition, and experimentation, you can tweak your pricing until you perfectly optimize volume and margins to create maximum impact on revenue.
6) Lead-to-Close Velocity & Objection Stacking
As B2B leads take anywhere from a few weeks to a full year to become a customer, the sales cycle length can dramatically impact revenue generation.
While traditional marketing activities are not usually seen as revenue drivers, companies should consider how these activities impact lead-to-close velocity and close rates. Things like proper messaging, awareness, and credibility (i.e., case studies) all affect both and therefore have a major impact on the bottom line. While it’s sometimes difficult to measure, it’s always worth it to understand its relationship to revenue generation.
Understanding common objectives that come up throughout the buying process is another way marketing can influence revenue generation. By gaining insights into why leads may not be converting, marketing can be proactive and start addressing common concerns and questions in marketing content before leads even make it to sales. Doing so prevents these objections from being raised in the sales process, making it a smoother, faster cycle. Sales-informed marketing promotes further alignment between the two teams, opening the door to better close rates and higher revenue.
C-Suite and Collaboration Are The Keys to Success
For these strategies to work, there needs to be a core alignment between sales and marketing and the entire C-Suite, as most of these initiatives require impeccable collaboration between all departments. The 7th step might be enlisting the services of a revenue marketing agency to help you with that alignment! Start taking charge of your brand and business's future with revenue marketing by downloading our Revenue Marketing Workbook Template bundle.