What's Revenue Generation Marketing?
Revenue marketing is a holistic approach to marketing that focuses every strategy, tactic and initiative toward a singular goal: driving revenue.
Revenue marketing is not a specialty, like Demand Gen, Marketing Ops, Brand Marketing, Event Marketing, etc., but rather a philosophy that aligns all marketing specialties and tactics into a comprehensive plan that drives attributable impact to the bottom line.
Through that emphasis, marketing turns from a cost into an investment that predictably generates the revenue the business needs to sustain and grow.
That’s a question we like a lot at ProperExpression.
In traditional B2C structures, marketing is definitely responsible for revenue. “How much of the product is getting off the shelves?” “How much lift did this campaign generate?” These are questions that B2C marketers have had to answer for a very long time.
In B2B, things get murkier. But even if the industry has been slow to pick up on the trend, leaders like Paul D’Arcy, CMO of Miro, have been writing about revenue marketing since 2012, so we are far from new territory here.
What we are seeing, however, is an increasing number of companies focusing on marketing's impact on revenue and revenue attribution. And while marketing teams don’t close deals, they can certainly both contribute to the bottom line and prove it.
Before the birth of digital marketing, the impact of marketing on sales was really difficult to assess. With digital marketing though, we turned a corner. Everything became measurable. Or at least, that has become the expectation. Of course, the reality is much more nuanced. Measuring the impact of every marketing dollar on the bottom line is much more complex than it might appear.
That being said, the tools that we now have at our disposal, along with the traditional tactics of using correlations and measuring lift, enable marketers to provide more transparency into their contribution to the bottom line than ever before. With this ability comes faster growth for the company and a better seat at the table for marketers. That’s a win-win!
What’s a Marketing Funnel Strategy?
A Marketing Funnel Strategy often refers to the process of aligning your messages to the three stages of your buyer's journey:
- Awareness — In this stage, your marketing messages should appeal to consumers who are just getting comfortable with their problem and the brand/product options available to resolve it. They're just becoming "aware" of you and the competition. Marketers often use social media, blogs, paid social ads, and paid search ads to bring more awareness in this stage.
- Consideration — Now that the consumer is aware of your brand and product, they are considering their options (i.e., what do you offer over the competition? What makes you the better choice?). Many marketers establish expertise in their industry for this stage, using blog guides, webinars, targeted ads and FAQs to stand out.
- Conversion/Purchase — By the third stage, your consumer has converted into your customer. The marketer's job does not end here, though. It's important to nurture that relationship to encourage loyalty and repeat purchases. Many marketers look to referral programs and special bundles to strengthen the connection between brand and consumer.
Demand and lead generation programs are most often laser-focused on bringing new leads into the pipeline. The KPIs in these processes tend to revolve around creating MQLs or SQLs. However, focus on such metrics can incentivize the wrong sorts of behaviors:
- Passing leads to sales before they are ready.
- Paying very little attention to "old" leads that are already familiar with the brand.
- Under-leveraging existing databases and contacts
Concentrating on only MQL and SQL-related metrics can also put marketing at a disadvantage, as not all departments are as focused on these KPIs. Instead, shifting the mindset to track and improve metrics that are impactful company-wide can enable marketing to speak the same language as the other departments, furthering the efforts for alignment.
Revenue marketing focuses on exactly what it indicates: driving revenue.
While revenue marketing uses some of the same tactics as demand gen, it utilizes a more holistic approach and creates a more cohesive go-to-market strategy.
Revenue marketing considers one key factor that is often neglected in lead gen plans: time-to-close (or sales cycle time). Most revenue marketers will understand, for example, that if it takes 2 months to move a lead from awareness to consideration, and 6 months from opportunity to close, most of their revenue target depends on the leads that are already in their database. Comprehension of this data will empower marketers to better understand the company goals and which activities best support these goals. They can then put more effort toward nurturing existing leads while simultaneously filling the funnel with fresh leads for the sales team.
While revenue marketing uses some of the same tactics as demand gen, it utilizes a more holistic approach and creates a more cohesive go-to-market strategy.
Although many mistake revenue marketing and return-on-investment (ROI) as one and the same, the two marketing terms are certainly not. Instead, think of them as simply related. Revenue marketing refers to the plan of actions and marketing methods you intend to execute to increase your overall revenue. On the other hand, marketing ROI refers to the efficiency of the investment you pursue. This efficiency is calculated via this formula:
(Sales Growth — Marketing Cost) / Marketing Cost = Marketing ROI
Take, for instance, social media. You will want to track metrics like engagement, brand awareness and traffic driven as channel-specific metrics that will tell you if your social media tactics are working. However, you’ll only know if your social media strategy as a whole is successful when you look at how it influenced closed deals and revenue.
Both revenue marketing and ROI goals are essential to marketing success. Together, they make up the foundation of which marketing efforts do and do not work as revenue drivers for your brand. This, in turn, allows your business to pursue only profitable investments.
4 Stages of Revenue Marketing
- Create specific, measurable, and attainable company revenue goals
- Develop a sales strategy that seems most likely to meet those goals
- Align your marketing strategy with the sales strategy
- Optimize and refine your marketing to better drive revenue
Revenue marketing brings significant growth potential to a business and its bottom line, but it requires the whole company comes together to support the revenue-focused effort.
In fact, Review 42 reports that 81% of companies that beat their revenue goals are "somewhat" or "completely" aligned. The report also found that 56% of aligned companies meet their revenue goals, and an additional 19% manage to beat their targets.
Unfortunately, alignment can be elusive to achieve. To help you through your revenue marketing journey, we outlined how every member of the C-suite can provide marketing teams with the tools and support they need to drive revenue.
Regardless of whether they have a marketing background, CEOs play a key role in revenue marketing.
They set the overall company goals and strategy, align all of the teams and make it a priority for each team to support one another.
The first step is to set goals for marketing with revenue in mind: asking marketing to increase the share of voice and then measuring them on how revenue is working at cross purposes.
Here are 4 ways CEOs can directly influence marketing teams’ success:
- Leverage the GOST (Goal Objective Strategy Tactics) framework to set clear and measurable goals and objectives for the entire company and highlight the role of each department in attaining the goals.
- Institute a culture of transparency and accountability. Key metrics like Sales Cycle Time, Profitability per Product Line or Level, CAC, Close Rates, and more should be available to all C-level executives and strategic planners as appropriate.
- Regroup and re-adjust the strategy with their team regularly based on data and new findings.
- Establish a culture of active cross-departmental collaboration.
This role is the MVP of revenue marketing because they keep the C-suite on the same track. This includes keeping the communication between C-suites regular, consistent and accessible.
The role of the CMO is to identify and communicate areas that bring a competitive advantage to your brand and business. The CMO needs to understand how to turn a marketing team into a revenue marketing team. High on this list is how to turn revenue and sales goals into channel-specific metrics, allowing for more efficient channel optimization with fewer wasted cycles. This will give their company the competitive advantage it needs to ensure they're not only staying well within their budget but investing in areas that reach and resonate with the right target audience.
Achieve Revenue Generation Marketing Success with ProperExpression
With the right plan in place, any company can allow for marketing to go from a revenue black box to a clear revenue driver for the company. The key is to align your company. According to Inc., you need to break down the silo (departments working separately and individually towards a goal) to increase your revenue. Their report found that when you do, you benefit from "an average of 32% annual revenue growth while less aligned companies reported an average 7% decline in revenue."
Each team member has a role to play in making it happen:
- CEO: sets company goals and stays focused on them. Don't get distracted by unrelated metrics.
- CSO: Help marketing understand the sales process to generate better leads that are more likely to close.
- CRO: Build a tech stack that provides reporting you trust that can inform everyone on which activities are truly driving revenue.
- CMO: Build your strategy around the company goals to tie all your activities back to those goals. Focus your marketing on what matters for your company.
If you'd like more insight into how you can achieve revenue marketing success, talk to the experts at ProperExpression. In the meantime, download the Revenue Marketing Workbook Template Bundle to help your organization become a revenue marketing company.
