Are Revenue Teams Displacing Sales and Marketing Teams?
Kharisma Moraski is the head of global sales at ServiceRocket and strategic GTM Leader. She has 20 years of experience in sales and operations leadership across various industries including technology, retail, and advertising. She is also an aspiring fiction writer, human, and animal rights enthusiast.
Kharisma has explained explicitly the activities of sales and marketing of an organization a few years back and how both teams have been transformed and aligned to be on the same page and to have the same goal. She expressed her opinion stating that revenue teams are no longer different from sales and marketing teams; in fact, they are a part of the revenue team.
Evolution of sales
If you look back 18 or 20 years back, there’s always been this fundamental disconnect between marketing and sales and other parts of the organizations. Everything was much siloed. Everything was gold, very differently. Marketing was gold on brand, PR notices and pipeline generation. When you look at sales and sales is gold on closed business, not necessarily conversion of leads but not in the way the marketing team was.
The dichotomy in the organization
This dichotomy has been continuing for decades and no questions were asked on this. This is because of the long journey of the customers or the life cycle of the customers. For example, a customer would buy software for a lifetime. Once they made the software purchase, they own those licenses, then every three, five, seven years, they would purchase maintenance renewals. They never had to repurchase the software unless it got an end of life or something of that nature. So by default, what you had was this lifetime customer value of five-plus years. So marketing was only focused on new logos.
Now no one focused on this long term service because they were going to be around for five-plus years. So, it was way more expensive to try to switch any time after that first initial purchase than it ever was. Just to wait for the maintenance renewals to come and just renew the maintenance. So you think five, five-year lifetime customer value, at a minimum, you have this very sustainable business and very low term.
Alignment in the organization
These days, customers have lots of options. They are now paying monthly or annually. So switching the vendor is pretty easy. If customers are not satisfied with the service, the move to another vendor. That is when you see marketing and sales have to react to this. They no longer are fractured as last time. So these teams suddenly had to work much more closely together.
But the reality is we now need customers to adopt the solution. We had to take really good care of them. And not only did we now need to be focused on new logo acquisition, but we needed to also understand how we could maximize the existing revenue and every single account that we encountered.
So with this, both the teams have some of the same goals. Providing excellent customer value and customer experience has become a focal ambition of theses team. Hence, marketing now cannot concentrate only on the pipeline, PR need to understand how they can help customer success, drive adoption, how do they have customer, how do they help sales continue to have those upsell and cross-sell conversations. So now all of these organizations have to be completely intertwined and interconnected to make sure of providing excellent customer experience and the good lifetime of the customers.
Figuring out each step and taking action toward successful customer journey and excellent customer experience fall under the accountability revenue team and all responsible teams rolling up under one individual. This is the fundamental shift we have from 2000 till the date.
AMA with Kharisma Moraski
The following is excerpts from the AMA session with Kharisma.
How should existing sales and marketing teams evolve for this new role?
I think one of the things that used to happen a lot was everyone had siloed goals. I think any organization now and anyone within the organization should challenge their organization to make sure that all of their goals are very distinctly aligned to one single outcome.
Is CRO the new CMO?
I don’t know that I would say the CRO is the new CMO, but what I would say is there needs to be a single leader responsible for awareness to the closure of the customer life cycle. And at the end of the day, the way that you determine that is through revenue.
As technology and analytics are bringing much-needed accountability, is it time to merge the MQL and SQL?
I’ve started moving more and more away from MQL and SQL versus just having what we would consider Just as SQL. And so I, in my opinion, it would be, yes. If you’re hyper-focused on revenue generation through customer readiness and expectations and experience, then you will look at SQLs only.
How do you differentiate sales teams from revenue teams?
Really there is no difference. To me, it’s a little bit less about how do you differentiate, I still think marketing is going to exist, sales are going to exist and customer success is going to exist. The difference is this siloed thing that we have and the nature of calling things, handoffs and who owns it and at what point does someone own it.
Since we lacked sales and marketing alignment for ages, has this led to the creation of a new team like revenue, revenue optimization, etc.?
It’s not even necessarily about the lack of marketing alignment. The fundamental shift allowed breaking down the silos across all the cross-functional teams and making sure they work seamlessly with each other to the benefit of the customers.
How do you make a new client be a client forever and how much sales and revenue do you should plan for this kind of a situation?
I’m going to say very honestly, I don’t have the answer to make a client forever. Because this is a changing environment and disruption product. There are a million different things that can affect it. Now. What you can do to maximize your lifetime customer value and keep them as long as possible is again, those seamless interactions where you are very authentically interacting with your customer.
Are CRO teams the new fad?
I think one of the things I’ll have to say with business is the only thing consistent and businesses change. I wouldn’t call it a fad, but what I will say is it’s a response to the change in the environment that we’re in.
What is the ideal funnel in 2020 according to you? Is there a major overlap in all stages of funding?
I’m going to ask a qualifying question. I think when they’re saying funnel, I think they’re talking about pipeline and sales stages. I’m going to go back to it depends on what the biggest thing companies miss on. The sales team in an organization truly needs to understand your ideal customer profile. You need to understand what that buyer’s journey for that ideal customer profile looks like. And then you map what you need to do to match their needs to get through that buyer’s journey.