Making Commercial impact Results from European Sales and Marketing study

ComEx

Copenhagen, February 2014

2

Introduction

Motivated by clients’ statements

” We know our marketing and sales activities,

but we do not know their real impact on sales

and also do not know how we measure it and

improve.”

” We have to reduce our sales and marketing

costs, but we do not know where and what

activities are critical to success.”

” We do not have a company-wide, transparent

overview of all of our marketing and sales

activities and the related costs.”

” We need to generate more business from our

marketing and sales budget.”

Purpose

We have conducted an European survey among

more than 300 commercial managers with the

purpose of understanding ...

How they allocate and measure the return on

their commercial investments

What characterises the companies that perform

better than the average in their industry

This presentation gives you an executive overview of

the results

1

2

3

Content

1. Key conclusions

2. Detailing of best practice and relevant assessment questions

3. Detailing of survey results

4

We have identified four key characteristics of companies that excel at

making commercial activities accountable

Source: Implement Consulting Group Sales & Marketing survey 2013

Companies that perform better than average in their industry have certain

characteristics

Conclusion

Fact

They measure and

know optimal level of

sales and marketing

investments across

markets, segments,

channels and

customers

of high-performing

companies measure

some or all of their

sales and marketing

investments

69%

They allocate sales and

marketing resources

based on a systematic

and fact-based

approach

of high-performing

companies have a

structured and

controlled process for

resource allocation

52%

They coordinate the

allocation of resources

and budgets in an

integrated process with

sales and marketing

of high-performing

companies have a

common decision

process between sales

and marketing

62%

There is a clear link

between sales and

marketing performance

and the individual as

well as team incentive

structures

of individual and 50% of

team performance

assessments are linked

to return on sales and

marketing investments

54%

5

Content

1. Key conclusions

2. Detailing of best practice and relevant assessment questions

3. Detailing of survey results

6

A majority of the high-performing companies know the optimum level

of investments and the impact of these activities

Conclusion

• 69% of high performers know the impact of marketing and sales

activities on revenue. Furthermore, they know the optimum level of all

or some of their marketing and sales activities

• Impact is measured frequently and more often when an activity is

implemented for the first time

• In general, optimal level of investment and impact are known if it is for

a select and a few number of activities that drive value

Source: Implement Consulting Group Sales & Marketing survey 2013

Key questions to consider

• What is the return on investments for your largest cost drivers within

sales and marketing?

• Are there segments or markets where it would be more effective to

reduce sales resource and increase marketing investments – or vice

versa?

• Does sales and marketing make a common business case for

developing the most attractive markets, segments or customers?

Best practice elements

• The return on investment for the

largest resource pools, i.e.,

salespeople, sales support,

campaigns, advertising, etc., is

known and documented

• As a consequence, the optimum

marketing and sales resource

level across markets and

segments is defined

High-performing companies

know the optimal level of sales

and marketing investments

7

High-performing companies have a structured and fact-based

approach for allocating sales and marketing resources

Source: Implement Consulting Group Sales & Marketing survey 2013

Key questions to consider

• How are roles and responsibilities for allocating sales and marketing

resources?

• Are your sales and marketing budget and distribution across markets

and segments also relative stable – even though the markets and

customers are changing?

• How do you ensure that allocation of sales and marketing resources is

not a continuation of last years budget – but a structured process

driven by sales and marketing together?

Best practice elements

• Sales and marketing have a

common and structured

approach which ensures that

allocation of resources is based

on an objective qualification of

where the return on investment

is highest – and not how the

budget allocation was last year

• Impact is measured and used for

re-allocation if needed

Conclusion

• 52% of companies performing above market average have a systemic

and structured approach for allocating sales and marketing resources

• Only 29% of the market performing or below market performing

companies had a systematic and structured approach

High-performing companies

have a structured and controlled

process for resource allocation

8

High-performing companies are more likely to allocate resources in a

joint decision-making process between marketing and sales

Key questions to consider

• Is the budgeting process a joint process between sales and marketing?

• Is allocation of sales and marketing resources (number of salespeople,

advertising, campaigns, etc.) decided by sales and marketing

together?

• Does sales and marketing have a common impact case for the return

on their investments across segments?

Best practice elements

• Sales and marketing have a

common overview of the

potential sales and marketing

levers and the potential effect of

these

• Allocation of sales and

marketing resources across

segments is a joint decision

process

Conclusion

• High-performing companies have more collaboration between

marketing and sales when allocating financial and human resources

(62%) whereas companies with lower performance do it to a lesser

extent (41%)

• Also high-performing companies are more proactive using, e.g., impact

evaluation and contribution to strategic targets as factors for allocation

High-performing companies

have a common decision-

making process between sales

and marketing

Source: Implement Consulting Group Sales & Marketing survey 2013

9

High-performing companies link the performance assessment of the

organisation with the return on marketing and sales activities

Key questions to consider

• Is there a link between the performance within sales and marketing

and the team and individual incentives?

• Does the incentive structure support optimal allocation of resources

across sales and marketing?

• Is there a culture and incentive to cooperate between sales and

marketing in defining the optimal level of investments?

Best practice elements

• The incentive structure on team

as well as individual bases is

directly linked to the return on

investments within own function

– as well as the performance

across the value chain

Conclusion

• 54% of individual and 50% of team performance assessments are

linked to the actual return on marketing and sales activities, for

companies performing above market average

• The equivalent figure for average or below market performing

companies are only 29%

Individual and team

performance assessments are

directly linked to return on sales

and marketing investments in

high-performing companies

Source: Implement Consulting Group Sales & Marketing survey 2013

10

Content

1. Key conclusions

2. Detailing of best practice and relevant assessment questions

3. Detailing of survey results

11

Overview of key findings

What characterises the best? On par with or below

market average growth Above market

average growth +/-

They ...

Know what they do in terms of marketing and sales activities 29% 46% 17%

Know what they invest 49% 67% 18%

Measure the impact of the investment 54% 69% 15%

Know the optimum level of investment 36% 56% 20%

Measure the synergy between sales and marketing activities 28% 44% 16%

While the process is …

Based on joint decision process between marketing and sales management 41% 62% 21%

One of the top 5 most important processes in marketing 17% 32% 15%

A structured and controlled process 29% 52% 23%

Done in collaborating environment that involves all top managers 9% 27% 18%

And the ability to deliver return on marketing is part of the assessment of ...

The person responsible 29% 50% 21%

And his/her team 29% 47% 18%

Source: Implement Consulting Group Sales & Marketing survey 2013

12

Get in touch

Learn more about Implement Consulting Group on

www.implementconsultinggroup.com

Join The Commercial Excellence Forum

We invite you to participate in 4-5 events each year in

the form of after-work meetings, conferences etc. with

organic growth as the recurrent theme.