At the country level, most times sales and marketing are aligned, but also very 'siloed' and removed from industry and even company-wide best practices and standard processes such as SLAs (service-level agreements)
Wilton, CT (PRWEB) December 21, 2009
In the world of real estate, the three key words are: location, location, location. However, from Florida to Finland, SiriusDecisions has learned that when the "location" involves a service expansion, two other words become critical: conversion rates. To some, the mere mention of conversion rates might attract the same "puzzled looks" as references to nuclear physics or quantum mechanics; however, replacing "conversion rates" with the three-word phrase - know your market - makes the meaning clear to even novice expansion planners.
Following a recent study of regional differences in its "demand waterfall" - SiriusDecisions' visual depiction of the steps to conversion-rate success by identifying the five stages of lead management -- the global b-to-b sales and marketing research and guidance leader can now present a composite view of regional demand creation conversation rates.
"At the country level, most times sales and marketing are aligned, but also very 'siloed' and removed from industry and even company-wide best practices and standard processes such as SLAs (service-level agreements)," notes Alden Cushman, SiriusDecisions' research director and benchmarking analyst. "Should the discovery of regional and country-specific differences in any study be expected? Of course. Spain does it the way Spain does it, the same goes for Finland, etc. However, the main thrust of our research findings is that there should also be standard processes and models in place to track and improve conversion rates and overall results."
Differences discovered when examining results from non US-based regions or countries can conjure up memories of a classic "lost in translation" faux pas. Chevrolet wondered why its Nova model wasn't selling in Mexico - until it was pointed out that the name meant "no go." When organizations expand overseas, SiriusDecisions also notes that despite the steep learning curve, its benchmarking indicates that roughly only half of its client base tracks conversion by geography.
SiriusDecisions' benchmarking reveals the following addressable factors at each waterfall phase that drive regional differences:
- Inquiries to marketing qualified lead (MQL). The firm's research indicates that regional differences in demand creation programs, lead scoring capabilities and marketing lead management skills are the key root causes why the average b-to-b organization in the Americas experiences a lower conversion rate between inquiries and MQLs than the two other international regions benchmarked (EMEA and APAC). While Americas field marketing uses a wider variety of demand creation programs, more EMEA and APAC operations remain strictly focused on trade shows and live events to generate early-stage leads.
- MQL to sales accepted lead (SAL). SiriusDecisions' research indicates that in most cases, sales organizations in EMEA and APAC accept fewer MQLs than the Americas due to the lack of a well-defined, formalized handoff process between marketing and sales.
- SAL to sales qualified lead (SQL). The Americas region held a significant edge in this category. This is where the lower lead qualification at the top of the waterfall, combined with minimal marketing initiatives, is most significantly felt.
- SQL to close. Conversion rates for this final waterfall phase are comparable. Explains Mr. Cushman: "Here, the reality of sales' comfort level to accept and work these leads is fully reflected. Higher in the waterfall, marketing activities are much more 'must haves' in terms of sourcing and qualifying leads. The bottom of the waterfall is all about the capability and efficiency of the sales organization; marketing initiatives are viewed more as 'nice to haves.' So most sales organizations are pretty good at accepting deals into their pipeline they feel they have a fairly good shot at closing; that's pretty much the same the world over. Marketing has a bigger impact at the top and middle of the waterfall. Does it have an impact at the bottom, too? Yes, that's what sales enablement is all about and marketing certainly can have an important impact on that, but it's more pivotal at the top and middle to find leads for sales and help to accelerate deals through the pipeline."
Concludes Mr. Cushman: "When viewed over a 12-month period, we learned that 1,000 inquiries produce about six closed deals in the Americas, roughly 3.5 closed deals in EMEA and 2.5 deals in APAC. Organizations beginning to collect and analyze their regional demand creation conversion ratios should understand that there will be differences. Rather than benchmarking each region and comparing them against each other, we recommend using these benchmarks as a baseline from which improvements are measured within the region."
For a more details regarding this regional research and the lessons learned, contact Alden Cushman at acushman(at)siriusdecisions(dot)com.
SiriusDecisions is the world's leading source for business-to-business sales and marketing best-practice research and data. SiriusDecisions Executive Advisory Services, Consulting Services, Benchmark Assessment Services, Learning and Events provide senior-level executives with the sales and marketing operational intelligence required to maximize top line growth and performance. The unique combination of thought leadership, benchmark data, analytic tools, best practices and access to a peer and analyst network allow SiriusDecisions clients to quickly receive the critical insight they need to make decisions effectively. For more information about SiriusDecisions, headquartered in Wilton, CT, visit: http://www.siriusdecisions.com.