A few weeks ago I was interviewed by The CMO Club, a website dedicated to bringing CMOs together to become better leaders, marketers, and deal makers. The interview was focused on how to build CMO power by driving revenue in B2B. Despite the fact that most CMOs know they’re driving revenue, they are unsure of the ROI of their marketing. In turn, this causes marketers to appear as a cost center rather than a revenue generator.
In the following interview I address this common misconception and discuss the following:
- How many CMOS hurt their credibility and power by focusing on the wrong metrics:
- Vanity metrics: Sound good and impress people, but don’t measure impact on revenue or profitability
- Activity metrics: Measure what you do instead of what results and impact you have
- Cost metrics: Frame marketing in terms of cost and spending instead of results and outcomes
- How CEOs make the mistake of hiring more salespeople to drive revenue faster when they should instead focus on changing their processes to make sales more efficient and effective.
- How CMOs need to value the investments they’re making and connect the dots between spending and generating revenue
- To take control and learn the right language, CMOs should:
- Get comfortable talking about the dynamics of their pipeline/revenue cycle model
- Get better at measuring ROI for specific programs, so they can translate the impact of what they did in terms of revenue
- Not just talk about what’s happening, but instead make forecasts about what marketing will do in terms of revenue
- How making these changes can ensure that CMOs will be seen as an equal partner in the revenue equation