Industry (neutral)report on the revenue potential of using Revenue Performance Management.

1. April 2011
Gleansight Deep Dive
.
Revenue Performance Management: The Sales
and Marketing Playbook Finally Has a Name
About the Pie Chart Whether a byproduct of the fast-paced world of technology innovation or simply
The data presented in the pie chart a result of language that lends itself so wonderfully to abbreviations, the use of
is derived from the December 2010
Gleansight benchmark report on Lead business acronyms has reached dizzying proportions. Last year, a new term
Nurturing. The data serves as the emerged from the lead management technology sector: Revenue Performance
basis for this Gleansight Deep Dive,
which provides analyst commentary Management (RPM). In fact, some of the tier-one vendors are referring to their
related to a particular aspect of the solutions as RPM platforms.
topic. The objective is to provide
additional perspective and illuminate Is RPM just a flashy new marketing gimmick for describing something old
certain key considerations regarding
the implementation of the related or does it represent a fundamentally new approach to sales-and-marketing
technology-enabled business initiative. alignment? Following weeks of Zen meditation (and no small amount of market
research), Gleanster has come to conclude that while RPM may not be an
To learn more about Gleanster’s entirely new animal, the concept does sit on a higher rung on the evolutionary
research methodology, please click ladder and that widespread adoption would benefit most organizations. This
here or email research@gleanster.com.
Deep Dive explores what, exactly, is meant by RPM, how the concept differs
from what came before it and why it’s likely to have staying power.
87%
Percentage of B2B marketers that say that their existing marketing techniques
are failing to meet the performance targets set by the organization
The business-to-business sales process has indicated that traditional marketing techniques
changed dramatically in the last 10 years. (primarily referring to email, tele-prospecting,
Companies don’t make purchase decisions; direct mail, and events) were not meeting
rather, people make purchase decisions. performance targets set by the organiza-
Rate & Review Gleanster research suggests that the average tion. Over 625 B2B sales and marketing
company struggles with revenue growth respondents to surveys between November
Related Research because they fail to engage their prospects 2010 and March 2011 cited revenue growth
with highly relevant and timely interactions. as the number one priority for 2010 and
Tell a Friend
The one size fits all approach to demand 2011 (an overwhelming majority). Combine
Note: This document is intended for individual generation simply doesn’t cut it anymore. these two statistics, and it becomes obvious
use. Electronic distribution via email or by post- that traditional B2B marketing and sales
ing on a personal website is in violation of the In fact, 87% of B2B marketers who participated
terms of use. techniques have become less and less
in the Q4 2010 survey on Lead Nurturing
effective at driving revenue growth.
Entire content © 2011 Gleanster, LLC. All rights reserved. Unauthorized use or reproduction is prohibited.

2. Revenue Perfomance Mgmt: The Sales and Marketing Playbook Finally Has a Name 2
The solution to this problem lies in unfamil- profound disconnect in quantitative decision-
Making Funnelnomics Scalable iar territory for most organizations because making abilities between marketing and sales
Funnelnomics is a term frequently used sales and marketing have traditionally been even among Top Performers. Respondents
to describe the data driven decisions managed as separate functions within the indicated a lack of visibility and measure-
that help optimize the buying and sales organization. At the end of the day, the goal ment at the top of the funnel as well as at
cycles. Even Top Performing companies for both sales and marketing is to maximize the end of the funnel. Sales generaly does
struggle to gain a holistic view of the revenue (and manage bottom line costs to a good job of making data driven decisions,
sales pipeline and justify decisions maximize profit). Sales and marketing leaders but marketing still struggles to close the loop
based on tangible performance data. share accountability for revenue growth. and link campaign execution with revenue
RPM can only become a reality when Yet, in practice (at least for the average outcomes. The antiquated B2B marketing and
data driven decisions can be made organization), marketing is accountable for sales processes have constrained organiza-
across the entire funnel. Most lead demand generation and sales is account- tions from optimizing the process over time.
management technologies still lack out able for pipeline performance and revenue.
Two other critical trends make the concept
of the box measurement and analytics The concept of RPM breaks down these of RPM compelling in today’s B2B marketing
dashboards to transform execution into divisions of labor to align the organization organizations: digital channels and data
actionable metrics. RPM will be much around a common goal: revenue perfor- access. According to Gleanster research, the
easier to implement when standard- mance. In reality, marketers are charged top three marketing channels for B2B and
ized metrics provide a dashboard with identifying or creating demand for a B2C marketers alike are email, the website,
of the entire RPM lifecycle for rapid product, demand that should ultimately and search engines (SEO and SEM) – all
analysis and data driven decisions. translate into sales and profitability. digital channels. The reality of the situation
is that buying and sales cycles are not linear
This is easier said than done for many organi-
processes. In a B2B environment, budgets
zations because marketing is one of the last
get cut, initiatives get moved, and inten-
remaining functions in the organization to be
tions can change rapidly. Digital channels
run “by the numbers”. In a Q1 2011 Gleanster
allow companies to track implicit and explicit
survey, 232 B2B marketing and sales respon-
behavior which can then translate into more
dents were asked to rank their ability to make
meaningful interactions across marketing
data driven decisions on critical marketing
and sales engagement. In many cases,
and sales activities. The findings revealed
that means potential opportunities must
that the average organization still struggles
be kept warm for months or even years.
to integrate quantitative measurement and
accountability into its marketing processes. This demands a holistic approach that
aligns marketing and sales. The confluence
Perhaps the most revealing insight from
of software-as-a-service capabilities and
this research relates to the existence of a
unlimited (and highly affordable) data storage
Rate & Review
Related Research
Tell a Friend
Note: This document is intended for individual
use. Electronic distribution via email or by post-
ing on a personal website is in violation of the
terms of use.
Entire content © 2011 Gleanster, LLC. All rights reserved. Unauthorized use or reproduction is prohibited.

3. Revenue Perfomance Mgmt: The Sales and Marketing Playbook Finally Has a Name 3
capacity are serving to empower organiza- ers know that Everyone Else does not?
tions with robust, lower-cost-of-ownership
Let’s start by dissecting the fundamental
technology solutions and the infrastructure
attributes of RPM. How does an organization
that’s needed to make the data actionable.
adopt an RPM approach? Figure 2 shows the
What is RPM? four pillars of RPM, some of which have never
been included in traditional B2B marketing lead
Revenue Performances Management (RPM)
management tactics. But like most initiatives,
isn’t really a fundamentally new concept. It’s
the foundation of RPM speaks to investments
more or less an evolution in the way organiza-
in people, process and technologies – all
tions should structure marketing and sales
of which make the four pillars achievable.
functions. Gleanster defines RPM as the
process by which organizations maximize People
revenue generation through data-driven
Over the past few years, we have seen
decisions that align sales and marketing,
an increase in the number of job postings
create highly relevant interactions with potential
pertaining to sales and marketing alignment,
buyers, and establish repeatable metrics for
marketing operations, and demand genera-
ongoing optimization of the lead lifecycle,
tion, with titles like Vice President of Demand
across marketing, sales and service.
Generation becoming increasingly prevalent.
What’s different about RPM? Why? Simple. Companies are waking up
the realization that someone needs to take
RPM aligns sales and marketing with a
ownership of RPM within the organization.
common metric and goal: revenue. That may
These job descriptions and requirements
seem obvious in hindsight, but the discon-
typically sound suspiciously like a Vice
nect that frequently divides marketing and
President of Sales role. That’s understand-
sales stems from a lack of alignment in
able, given that resources are accountable
the way success is measured for each of
for, and incentivized by, revenue perfor-
the two functions. Few companies would
mance. The primary focus, then, is to inject
argue the fact that marketing “should” be
measurement and continuous optimiza-
measured on revenue. Yet revenue attribu-
tion into ongoing business operations.
tion on marketing campaigns was a challenge
for 45% of Top Performers and 78% of Process
Everyone Else in the Q1 2011 survey on
As previously noted, the buying and sales
Lead Scoring. So, what do Top Perform-
cycle is typically not a linear process. In order
Rate & Review
Related Research
Tell a Friend
Note: This document is intended for individual
use. Electronic distribution via email or by post-
ing on a personal website is in violation of the
terms of use.
Entire content © 2011 Gleanster, LLC. All rights reserved. Unauthorized use or reproduction is prohibited.

4. Revenue Perfomance Mgmt: The Sales and Marketing Playbook Finally Has a Name 4
to maximize revenue, marketing and sales “significant time” manually creating
resources need to be flexible enough to touch measurement dashboards and analytics
prospects and customers with relevant and for executive management (78% of
timely interactions, no matter their stage in these Top Performing organizations
the buying process. RPM demands a holistic utilize a lead management technol-
approach to prospect engagement. The lead ogy). That needs to be automated to
lifecycle is not a handoff between marketing allow RPM to be a scalable tactic.
and sales.
Technology plays
Rather, it’s
an ongoing
“Fundamentally absent from a critical role in
most sales and marketing
automating person-
engage-
alized and complex
ment with
a potential operations is a continuous engagement with
prospects. But
source of
revenue. improvement process across these tools are also
a primary source
It may be
appropriate the entire lead lifecycle.” of data for ongoing
optimization and
for marketing
management.
or sales to manage primary engagement
responsibility at any given time in the process. Lead Lifecycle Management
As such, processes must be formalized
According to Gleanster research, Top
and structured to ensure leads/prospects/
Performers are twice as likely as Everyone
revenue is closely monitored no matter
Else to utilize nurture marketing techniques.
where in the process that lead may reside.
Nurture marketing allows companies to build
Technology relationships with prospects and pre-qualify
these individuals before they are passed to
Today, there is an eclectic mix of nomencla-
sales. Top Performers also develop nurture
ture to describe the technologies that support
marketing campaigns to capture sales-
RPM: demand generation technology, lead
qualified leads that, for whatever reason,
management technology, marketing automa-
fail to close, to hopefully come back at a
tion technology, and, more recently, RPM
later time and sell to these already qualified
platforms. Most of the features and functions
opportunities. These techniques and tactics
within these tools have become somewhat
demand that organizations take a holistic
standardized. These include lead scoring,
view of the lead lifecycle from marketing to
lead nurturing, multi-channel execution and
sales to customer service. Since all of these
CRM integration. Despite the maturity of some
interactions represent potential sources
of these technologies, most solution providers
of revenue for an organization, it makes
fail to address two fundamental areas which
sense to include Lead Lifecycle Manage-
throw a wrench into the automation of RPM:
ment as a primary enabler of RPM.
1. Connectivity. Lead management
tools are very good at managing and
Sales and Marketing Alignment
measuring engagement in email and Top Performers are two times more likely
web analytics, but these are not the only than Everyone Else to share the defini-
two channels organizations engage in. tion of a qualified lead between sales and
RPM demands a structured approach marketing. Historically, coordinated efforts
to measuring the effectiveness of all between sales and marketing has been
marketing channels. That means lead known as “alignment”. But RPM differs from
management technologies must also traditional best practices in that it calls for
help integrate and analyze data from the marketing department to be treated in
webinars, events, SEM, direct mail, etc. the same way as the sales department. The
Rate & Review idea is: measure what matters, and hold both
2. Dashboards and Analytics. Despite
functions accountable for revenue.From an
all the progress we’ve seen in the area
Related Research RPM standpoint, Top Performers are starting
of data visualization, it’s still uncommon
to incentivize marketers based on pipeline
Tell a Friend to see a single dashboard that provides
metrics rather than campaign performance.
RPM metrics across the entire lead
Note: This document is intended for individual In fact, a small but growing number of Top
use. Electronic distribution via email or by post-
lifecycle – from marketing to sales to
Performing organizations are breaking down
ing on a personal website is in violation of the service. In fact, 65% of Top Perform-
terms of use. the division of labor between marketing and
ing companies indicate they still spend
sales and approaching both functions as a
Entire content © 2011 Gleanster, LLC. All rights reserved. Unauthorized use or reproduction is prohibited.

5. Revenue Perfomance Mgmt: The Sales and Marketing Playbook Finally Has a Name 5
single entity, even hiring dedicated executive lifecycle. This is largely what makes the
Deep Dive Talking Points level roles that straddle both functions to concept of RPM sticky and unique. The Six
make the vision for a unified entity a reality. Sigma and Lean Manufacturing approach
Walk away with these 5 key takeaways:
have been transforming the business of
• Revenue Performance Management Data Driven Decisions Operations for years. Sixty-five percent (65%)
is the process by which organiza- While Top Performers strive to make data- of Top Performers (compared to 32% of
tions maximize revenue through driven decisions across the entire demand Everyone Else) engage in “ongoing optimi-
data driven decisions that align chain, they still have a considerable way zation of sales and marketing processes
sales and marketing, create highly to go in some areas. The truth is, the top led by executive leaders in marketing and
relevant interactions with potential of the funnel is still difficult to measure sales.” A continuous improvement process
buyers, and establish repeatable for most organizations. How do you know whereby organizations define, measure,
metrics for ongoing optimiza- exactly which campaigns performed the analyze, improve, control, and re-measure
tion of the lead lifecycle, across best? How do you benchmark a poor campaign effectiveness, channel mix, and
marketing, sales, and service. performing marketing campaign? What sales operations will invariably lead to the
• Sixty five percent (65%) of Top channels deliver the highest profit? maximization of revenue for the organization.
Performing organizations (versus Top Performers demonstrate superior Maturity Framework for RPM
32% of Everyone Else) indicated performance from data driven decisions, so it
they engage in “ongoing optimi- Gleanster research isolates Top Perform-
makes sense to inject data-driven decisions
zation of sales and marketing ing organizations based on performance
into every stage of the RPM process. In most
processes led executive leaders in revenue growth, bid-to-win rates, close
cases, these organizations started measuring
in marketing and sales.” rates, and pipeline metrics. But research
to improve their forecasting capabilities. New
on the topic of RPM suggests that even
• Top Performers are twice as demands from marketing and increased
Top Performers can mature in some areas
likely as Everyone Else to utilize targets can be met with predictable knowledge
of RPM. For example, the average Top
nurture marketing techniques. of how much it will cost to achieve these
Performing organization still has very little
targets and the most efficient combination of
• 8 out of 10 organizations struggle visibility into the effectiveness of different
channels to utilize in outbound campaigns.
to measure the effectiveness of channels and tactics at the early stages of
marketing campaigns in the earlier Continuous Improvement the lead lifecycle. The following maturity
stages of the lead lifecycle framework defines different stages of
Fundamentally absent from most sales
Marketing and Sales maturity as organiza-
• Continuous improvement and and marketing operations is a continuous
tions move towards a holistic RPM approach.
data-driven decisions differenti- improvement process across the entire lead
ate RPM from other conceptual
frameworks for marketing and sales.
Rate & Review
Related Research
Tell a Friend
Note: This document is intended for individual
use. Electronic distribution via email or by post-
ing on a personal website is in violation of the
terms of use.
Entire content © 2011 Gleanster, LLC. All rights reserved. Unauthorized use or reproduction is prohibited.

6. Revenue Perfomance Mgmt: The Sales and Marketing Playbook Finally Has a Name 6
Related Research
Recently published Gleansight benchmark reports that may be of interest
to senior industry practitioners include:
Lead Nurturing
Headquarters
B2B Precision Marketing
Gleanster, LLC
825 Chicago Avenue - Suite C Marketing Asset Management
Evanston, Illinois 60202
Social Media Monitoring
For customer support, please Customer Feedback Management
contact support@gleanster.com
Mobile Marketing
or +1 877.762.9727
Online Customer Communities
For sales information, please Enterprise Collaboration
contact sales@gleanster.com
or +1 877.762.9726
The Gleanster website also features Deep Dive analyst perspectives on
these and other topics as well as Success Stories that bring the research
to life with real-world case studies. To download Gleanster content, or to
view the future research agenda, please visit www.gleanster.com.
Rate & Review
Related Research
About Gleanster
Tell a Friend
Gleanster benchmarks best practices in technology-enabled business
Note: This document is intended for individual
use. Electronic distribution via email or by post- initiatives, delivering actionable insights that allow companies to make
ing on a personal website is in violation of the
terms of use.
smart business decisions and match their needs with vendor solutions.
Entire content © 2011 Gleanster, LLC. All rights reserved. Unauthorized use or reproduction is prohibited.