The seminal driver of Lead-to-Revenue Management (L2RM) was the need to calibrate marketing's spend to the result of revenue generation. Today, revenue performance has become a standard measure, but 10 years ago that seminal idea was radical. It required cultural change and some significant reengineering and automation of marketing and sales processes. Early adopters have seen significant gains by euthanizing under-performing pet programs and prioritizing investments on the basis of return on marketing investment (ROMI). But, after copping the quick wins, L2RM pioneers are finding it hard to continuously improve revenue performance. It's really time to broaden—or maybe just clarify—our vision for L2RM.
On the surface, managing the lead-to-revenue process is disarmingly simple. You get a lead from some marketing activity (outbound campaign, inbound from PPC, at a tradeshow, whatever). You track activities with the lead—what the prospect does; what you do. At some point, based upon agreed criteria, you transfer the lead to sales. If sales closes the deal, you have tracked the revenue impact of a marketing program. Over the course of many programs, activities and deals, patterns emerge: Which programs generate revenue; which customer behaviors demonstrate interest; what content offers accelerate deals. You learn; you adjust; you get better. An easy win. But below the surface, a few dynamics exacerbate organizational stress and disruption.
L2RM is a bit of a strategic mash-up
An L2RM initiative can potentially remediate a number of common challenges vexing B2B marketers: Marketing must pivot focus to customers and their outcomes, not products and their capabilities; marketing needs to develop new processes for early stage engagement with prospective customers; marketing needs to have more revenue impact; marketing needs align better with sales. A winning L2RM strategy must address all these challenges, but marketing execs need to realize that this is way more than stepping up responsibility for marketing's impact on revenue performance. Here's why:
- B2B Marketers are managing early-stage entropy. Marketing needs to rapidly evolve for success with an already evolved buyer. Marketing programs are being recalibrated to the buyer's journey. Marketing channels and tactics are proliferating like fruit flies. The content needed to engage with buyers is a mind-boggling, budget-busting challenge.
- L2RM is complicated and cross-organizational. L2RM is a multi-stage end-to-end process executed by individuals in different organizations. The process always includes several important integration points with sales. In larger organizations (where marketing has been organized by marketing focus or specialty), it requires coordination with other siloed marketing teams, often with their own budgets, and usually operating with different goals and objectives.
- Significant gains require marketing to develop lots of new processes. You don't learn if you don't develop a way to analyze the marketing performance data. You don't adjust unless you can clearly communicate the specific things that need to be done differently. And you don't get better without developing new competencies that are manifested through new processes or process improvements (and the skills to execute them).
Set the stage for a strategically phased approach to L2RM
L2RM is a strategic marketing initiative that will first disrupt, and then transform, your marketing organization. And, with the ever-present pressure to deliver more high-quality leads, it's easy to fall into the trap of moving too fast. L2RM transformation should be a "crawl, walk, run" endeavor. Envisage and evangelize the ultimate goal, but take a realistic assessment of your current marketing maturity and create an L2RM road map to communicate the incremental plan that drives to that vision. Bottom line— you can do this. Just make sure you recognize (and communicate) just how much change is happening.