The Evolution of B2B Marketing Operations
Highlights from this Episode
Highlights from this episode
David McKie is the Vice President of Marketing Operations at Medidata Solutions and former Marketing Operations VP at SAP. In today’s episode David shares how marketing can help the sales department with the other 75% of the pipeline that marketing hasn’t influenced. In that context, he makes some intriguing observations about the potential future evolution of marketing operations and sales and marketing alignment. In that context, he touches on a number of critical success factors for modern marketing operations.
Key Points from This Episode:
- The danger of getting too involved in sales processes
- Spreadsheet hell
- Revenue attribution
- Tradeshow engagement that drives revenue
- The importance of deep analysis of results in the handoff of sales
“I think that it’s very difficult to finely target specific marketing campaigns to fill up the demand.” — @damckie [0:03:27.1]
“My fundamental philosophy is that once you hand over to sales, there should be that handshake, that checkpoint that looks at the quality, and nothing should get to sales if it’s not properly qualified.” — @damckie [0:15:07.1]
Links Mentioned in Today’s Episode:
David McKie — https://www.linkedin.com/in/davidmckie/
David on Twitter — https://twitter.com/damckie
Medidata Solutions — https://www.mdsol.com/
Scope Summit — https://www.scopesummit.com/
[0:00:07.2] ANNOUNCER: Welcome to the B2B Marketing Jukebox by LeadCrunch. Help us start a movement to make B2B marketers the maestros of shareholder value.
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[0:00:33.7] DG: I’m here with David McKie. David is the Vice President of Marketing Operations at Medidata. Before that, he had worked for quite a while in SAP where he was also involved in marketing operations. Really, probably one of the early people in that area.
David, thank you so much for joining us today.
[0:00:53.0] DM: My Pleasure.
[0:00:53.9] DG: If you would, tell the audience a little bit about what your company does, the problem it solves, the markets it serves, just to put everything into context that we’re going to talk about today.
[0:01:02.7] DM: So Medidata Solutions is a company that focuses on the life sciences industry and we have software and services, expertise and data that helps pharmaceutical, medical device and contract research organizations with conducting the clinical research necessary to bring new drugs to market. So that ranges from everything around trial feasibility and design, all the way to patient enrollment, data collection and gathering, file management and even to some of the more sophisticated capabilities around ingesting and analyzing genomic data as part of clinical research.
So it really runs the whole gamut of clinical research, and every time – It seems like every time a new quarter rolls around and we’ve just expanded our product line and we actually just recently did that with the acquisition of a company called Shift Analytics. So now we’re also getting into the commercial side of the life sciences business. So if you think about the whole process of drug research and conducting clinical trials, what happens once the FDA approves it?
Well now, it needs to go into market and it needs to become adopted by various positions and there’s a whole process around optimizing the market penetration. So Shift Analytics as they would describe it, they help pharmaceutical companies get to peak revenue faster by optimizing sales force, increasing awareness. There’re a lot of different pieces of the whole life sciences and treatment lifecycle that we now play in. So hopefully that’s an easy enough overview.
[0:02:46.5] DG: My perception is that there’s been—marketing went from looking at things like brand recall in B2B and doing a bunch of brochures and a website to getting highly focused on driving revenue and doing just what you said, because I think anybody that gets up the food chain a little bit realizes that’s how you get more money and more budget and all of that.
I’m sensing from you that maybe that’s not necessarily the right or best answer for marketing. Is that how you’re starting to see it?
[0:03:20.1] DM: Well, I can’t say that that would be true for every marketing organization at every company, but certainly at the companies I’ve been at. I think that it’s very difficult to finely target specific marketing campaigns to fill up the demand, and even when you can target it, you’re still only talking about 20 to 30 percent% of what sales is delivering on their own. So you’re always a junior partner. The short answer is, “Yes, that’s what I’m saying.”
The other challenge that I have, frankly, is that there’s a role that marketing can play in helping sales with the other stuff that they’re working on. So if you took a number, like a nice round number, like 25% contribution, if marketing — if all marketing could say is, “Here’s what I did to help the 25%,” you’re really missing out on a big story that you can tell around the impact you could have on the whole pipeline.
I don’t think it’s an easy story to tell, but there’s a lot of value that marketing can provide to that other 75% that is not coming in through a marketing channel, and we’ve gone through this here at Medidata. There’s a story and a value proposition. How do we communicate the value of our products and how they fit into a bigger overarching story for the industry? A lot of times the sales teams can have trouble with that. That’s not their day job, to come up with those stories. Frankly, if you let the sales teams do that, you’d have wild variations across different sales numbers depending on their sophistication.
So giving them the talk track and the materials that’ll really help them communicate the value to their potential customers, that could be hugely rewarding. But if we’re looking only at marketing contribution, that’s not valued. Let me give you one example. At SAP one year, we had a metric, one of the top five metrics for marketing overall, worldwide, was the conversion rate of marketing sourced opportunities to revenue. For me, every time I heard that metric, I couldn’t help but think, “Why?” The only reason I could come up with was because we want marketers to follow that pipeline and all the way through to revenue and make sure that it converts. But what about that other 75% that isn’t sourced for marketing? Isn’t there a value in us helping sales with that?
Theoretically, if you hand over an opportunity to sales and it’s properly qualified, that opportunity should be just the same as anything sales sourced on their own. In practice, I know it doesn’t always work that way. But, theoretically, then it’s all just part of the big hole, and once it’s in the sales pipeline, we should be looking at all of it the same, and how can we help sales close all of it? I was always worried that this idea of conversion rate for marketing sourced opportunities, what that would do is create a dynamic and incentive for marketers to get up into the sales person’s pipeline and start inspecting specific aspects of the pipeline, and create a domino effect where now, as a marketer, now I’m not only trying to tie everything to revenue, but I’m spending a good chunk of my time looking at sales and what are they doing in their pipeline, and how are they are managing their opportunities, and are they managing my opportunities effectively?
We all agree that needs to be done. The question is; is that what marketing should be doing, or should we leave that to the sales team to focus on? But I feel like I’m flogging this whole idea of tying marketing to revenue. I see where it can go and frankly, I worry that it just completely distracts marketers from coming up with creative marketing campaigns and telling creative stories and explaining the value to our customers.
[0:07:26.4] DG: Yeah, I love measurement. I love the funnel. I love all that conversion stuff. I think it’s very interesting. But I do think at the end of the day, the best marketers are people that know how to tell stories and know how to frame the conversation and position companies. To your point, I think that’s extremely valuable, deep into the pipeline when somebody’s trying to close stuff. So I don’t think it’s just helpful at the top of the funnel or just with those things that are marketing-sourced. So I couldn’t agree with you more.
Given that, do you think it’s still worth the time and the energy and the effort, which is considerable, to do all the funnel management and to try to measure what you’re doing?
[0:08:12.2] DM: Yes, absolutely. The distinction I would make is that I think that we should measure the work that we do to the outcome we’re trying to achieve, but not try to get 10 steps ahead of where we are today.
So let me give you an example that I always give as it relates to paid search. If I tell somebody who’s managing paid search that now you have to manage to the revenue you’re driving from paid search— In an enterprise sales cycle, I just don’t know how to do that. I don’t know how to tie all of the click-throughs and people coming into the website, and some of those people will come to the website, some of them might go to some sort of gated asset or content that then requires them to fill out a form. Some of them we might have cookies, so we can track that they came into the website through paid search and that they visited X number of pages.
But then when you think about the process from paid search all the way through to revenue, there are—Gosh! I couldn’t even count the number of steps and different ways that somebody can come in and out of the funnel or pipeline after paid search. To meaningfully try to tweak things in the paid search side, what I’m doing as somebody managing paid search, the content, the copy that I’m them putting up, how I’m allocating my dollars across the different ads.
It’s so far removed from all the different conversations that happen, all the different demos, the organizational shakeups, the budget changes, organizational shakeups at our company as well as the customers, the new product launches, the company acquisitions that we do. There’s so many things that happen in between. I can’t connect the dots to how I impact revenue. But I am managing paid search, and so I should be measuring and managing how effective I am at displaying ads that resonate with people so that they actually click through. That I’m covering the different keywords that are important to the industry. That from a competitive ranking, I don’t have competitors buying up all the keywords that relate to our products so that we get pushed down in the rankings.
We should be managing to specific outcomes, but I just think that sometimes managing to revenue outcome is a couple of steps too far. So there’s definitely a need to continue to manage steps towards outcomes, but you have to trust that, especially in the enterprise sales cycle, that if I do the job properly and if I’d properly managed the spend and optimize the spend from the different keywords, that it will have a positive impact on the business, I can show the number of click- throughs, I can show the number of returning visitors, I can show how we’re ranking competitively, and that should be enough for paid search. That’s one thing.
I’ll give you another example that we found at Medidata. Trade shows; trade shows and events, and whether it’s a dinner, or a breakfast, or a trade show, what we historically found was that the marketing team would put on an event and then they would ask the sales team, “Make sure you put it into Salesforce when you get an opportunity.” Guess what? It never happened. Nothing ever got put into Salesforce. So we said, “Look. You guys need to show us what value this is driving from generating in business.” So we started following up with them and asking them and badgering them and pestering them. We did the work of putting it in Salesforce once we found out that they created an opportunity.
We just kept hammering home that message that, “Look, every time you start a conversation, record it. Every time that we create an opportunity, let’s record it so that we can actually see what’s actually helping to drive pipeline creation.” Ultimately, you might want to see that it’s turning into revenue. But, again, the focus is on “show me that you’re actually doing something with this trade show, that you are talking to people and setting follow-up discussion”.
Frankly, there was zero visibility on that and the lack of confidence from the leadership team that it was happening properly. I can tell you that with some of the work that we’re doing, it started to create a culture of managing towards these things. I love this examples but our market development team, which is like a business development team, we emphasized the need for creating opportunities coming out of these events so much that they decided to proactively start scheduling on-site meetings at these events.
We have an industry trade show called Scope, which happens down in Orlando every year. They went to that event, they scheduled meetings ahead of time, they took the opportunity to say, “Hey, we’re going to be here, we’ll have a booth, we can show you some demos, we’ll have some product experts there that can talk you through some of what we do, and guess what? You’re already going to be at the trade show, so it’s really no skin off your back. Just give us 15 minutes of your time.”
Very easy to do, and people weren’t doing that before. I mean, they would man the booth, and if somebody happened to stop by, great. But the level of reaching out and proactively scheduling these meeting, it starts to become— It feeds on itself, because you’re managing to the specific outcome for that activity. Ultimately, it will or should turn into revenue. But if I go too quickly to revenue, people start getting hung up on how do I manage to revenue? I don’t know how. I get overwhelmed, and I’d rather have people focused on, “I’m asking you to do this, because this particular activity will drive this kind of outcome, and I’m going to manage you to that outcome.”
Now we all have to trust that everyone along the way is going to do their part of the process, and so that if what you produce doesn’t turn into revenue, then we’re going to have to pick that up at some later stage in the process and figure out what’s going on. But I’m not going to ask you to manage to that, basically to manage what somebody else is doing in the next two, three stages in the process.
Does that make sense?
[0:14:25.4] DG: Yeah, it sure does. Let me ask one counterpoint. I want to go back to your paid search example. I’ve definitely seen times when you can get a higher conversion at one point, and let’s say because you’ve exaggerated what you’re doing or it’s the wrong target audience or any number of things, and there isn’t the follow on conversion. Forget closed one, just turning into sales meetings. How do you guard against that if you don’t take this longer view, making sure that what you’re doing actually is headed in the right direction and you haven’t lost the larger context?
[0:15:06.1] DM: Well, you can still take a look at it. I mean, my fundamental philosophy is that once you hand over to sales, there should be that handshake, that checkpoint that looks at the quality, and nothing should get to sales if it’s not properly qualified. So, to me, an opportunity is an opportunity, is an opportunity. So if we agree on that, then we can definitely say, “I don’t need to get into the sales business if we have that handshake properly set up and sorted out.”
Now, what you’re suggesting is that, “Okay. I’m bringing a lot of people into the funnel and maybe I’m doing a lot of follow-up calls, and I’m finding out that “Yeah, I’m getting a lot of interest,” but they’re the wrong accounts. They’re the wrong type of people. They actually think that we’re selling X when we’re selling Y.
I still think you look at conversion rates within the process, right? Because, to me, anything that’s automated, any part of the process that’s automated, I don’t trust a hundred percent. Maybe it’s just more of an enterprise, B2B type selling motion, but I think you have to get somebody on the phone.
So I would look at the conversions all the way through to getting it into a tally team and then qualifying it into an opportunity. So if I’m pumping in a lot of junk into that team and they’re wasting their time on it, then I’d like to know that and I’d like to measure that. To make sure that we’re doing some level of— We’re getting better at what we’re feeding them before they actually get on the phone.
So there is that part of a conversion rate you want to look at. Frankly, the other thing is, when people are on the phone, they’ll tell you. So you’ll hear from that business development team or lead team, lead follow-up team that, “Hey, you’re getting a lot of junk here.” You’ll hear it and then you’ll go take a look at it, and then you’ll try to figure out what’s going on and then you’ll solve for it.
So measurement and conversion rates are all goodness from my perspective. I think that when you look at it from coming in through a marketing activity through a lead qualification process, that’s a pretty straightforward part of the process, right? That you can easily manage through that lead qualification process.
Where I really struggle is when you do that handover to sales. What happens within the sales side? Well, that could be something completely – probably 80, 90, 95 percent of the time, whether something falls out on the sales side has nothing to do with what I gave them. It has more to do with either the product itself, the competitive market, the specific budget situation of the customer. It could be sales methodology approach.
So then the question becomes, “Why am I getting involved in all the sales pipe issues? I did my job. This is what I was asked to do. Now, if you want me to drive revenue, then I have to start becoming accountable for everything that’s happening on the sales side.” Again, you just start getting— you blur the lines between sales doing their job and me trying to get involved and getting sales to do their job better.
[0:18:18.1] DG: Yeah, I totally agree with you. I’ve done a lot of work with SDR teams, and now and then you’ll get people that want the SDR team to be compensated on close one business, and to your point, they get very demotivated, because they can only take it so far. If you start weighting their compensation heavily on something that they can’t control, they tend to start looking for jobs somewhere else.
So I think it’s the same thing with marketing, right? Your job is to get it to a certain point. Get feedback to see if you got it to that point, and then after that, I think it’s best to kind of walk away from it and let somebody else to take over that that’s their job to get it converted. So I couldn’t agree more.
David McKie, thank you very much.
[0:19:01.7] DM: It’s been my pleasure, Dave. Thanks for having me.
[0:19:04.1] DG: You bet.[END OF INTERVIEW]
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