Marketing and Sales - Where is the Balance?

Many companies seem to find the balance between marketing and sales hard to judge.

On the one hand if you had one sales person and invested all the other cost of employing sales staff into marketing communications you could cherry pick the best prospects and deals. On the other hand you could argue you do not need much marketing, what you need is lots of sale staff, on the phone and visiting prospects, bringing orders in. You do not care how much it cost to employ sales staff because their income is mainly commission anyway.

Somewhere between the two is the truth of it. The answer varies from company to company, product to product, market to market and people to people. Another complication can be in the role of marketing managers. Many small Var’s and ISV’s spend as much on marketing staff as they do on marketing communications!

  • It helps to recognise a number of characteristics in our type of market.
  • The indirect and direct cost of Sales staff is high
  • Sales staff are usually good face to face
  • Not many sales staff are good at marketing

Apart from the clever bit of marketing strategy and marketing communications planning, the majority of marketing is an administration function.

Sales staff are not necessarily the best people to generate new leads. Even if they are good at generating leads, sales staff are an expensive way of generating them.

The best way of generating leads is to plan the required marketing communications activities for the year, well in advance, and get administration staff to carry out the routine work. What you need is a company procedure for marketing. Of course, the company procedure should include the ability to measure the success of the marketing communications and see what is going on. Such information is vital and allows modifications to the plan if the expected results are not realised. Perhaps you find one particular form of communications is producing better then expected results. You might find certain market sectors are hotter than others. You will want information so you can constantly fine tune the plan to produce the best leads at the lowest cost.

Unless you spend £100k + on marketing communications, or work in a particular market, the role of Marketing Manager is part time. Even if you include strategy, once the strategy is in place you would be struggling to make a full time job of it. Most marketing staff in Var’s and ISV’s have a sales or some other role to play.

A simple guide, but not a rule, is to only employ sales staff if you have more enquiries than you can handle and that if you do not employ a sales person you will not be able to win all the business you might otherwise be able to win. And, that having won that extra business, a profit can be derived from it, after paying out the extra costs of employing that sales person. An exception to this might be where a sales person brings their prospect list with them. However, if you are an ISV and if a sales person can bring leads to your company, it does beg the question ‘How good is your marketing?’ for, clearly, if your marketing was good, you would know all the prospects in the market for your kind of system.

It is difficult to give answers to a question with such a broad perspective but I hope the points raised stimulate thought and help you identify where you can improve your marketing and sales function.

Points for consideration:-

  • How much does it cost to generate leads?
  • How much does it cost to generate sufficient leads that one sale is made?
  • What is the ratio of marketing direct and indirect costs?
  • Who produces the most leads; sales or marketing?
  • Which leads are the best quality and lowest cost?
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