C A T E G O R Y : M A R K E T I N G S T R A T E G Y, F I E L D M A R K E T I N G

Field Marketing 2.0: The Heart of Growing Conversion Rates
We often endeavor to write compelling copy Organizations tracking and reviewing their demand creation activities should always be trying to improve Introduced in 2007, the concept of Field Marketing 2.0 is a framework for this improvement Best practice organizations implementing Field Marketing 2.0 are already benefitting from dramatically improved demand conversion rates about the reasons for aligning sales and marketing, implementing better processes, and selecting the right technologies as a solid foundation. A humorous anecdote here, a quotation there, all designed to get you to pause during your busy day and take note. Today, we’re going to let the numbers tell the story. In the Core Strategy Report titled “Field Marketing 2.0: The Next Generation of Demand Creation,” we introduced a future state of demand creation built on a previously set 1.0 foundation of process, service-level agreements, metrics and a partner/vendor network. In this brief, we examine new data that starkly displays the quantifiable rewards that leading-edge organizations are experiencing as they embrace Field Marketing 2.0 principles and practices. REAPING THE REWARDS At the SiriusDecisions Summit 2008: Growth through Integration, we asked more than 300 sales and marketing executives how far their organizations had progressed in the implementation of Field Marketing 2.0. Only 6 percent indicated they completed the journey; another 54 percent indicated they were in development, 21 percent in evaluation mode and 19 percent hadn’t yet started. What awaits the 94 percent who have yet to fully implement a 2.0 model? A bounty of riches. In the brief “Demand Creation: Performance Anxiety,” we first reviewed conversion rate findings from a survey conducted around our five-stage demand waterfall. Since that time, we have isolated organizations that we consider to have instituted a series of strong 2.0 processes (good progression toward the ideal), as well as organizations that we consider to truly be the closest to a 2.0 scenario. We have now collected their conversion rates and compared them to averages (right); the results include:
Sales Accepted Leads Inquiries Marketing Qualified Leads (MQLs)

• Inquiries to marketing qualified leads. An average b-to-b organization experiences a 3.9 percent conversion rate between inquiries and marketing qualified leads (MQL). Organizations that have instituted strong processes were found to have a 5.8 percent conversion, while best practice organizations saw their number jump to nearly 10 percent. Key differences in 2.0 organizations include much tighter target marketing, well-developed lead scoring models enabled by a marketing automation platform (MAP) and multi-touch demand creation programs (also known as portfolio marketing). • Marketing qualified leads to sales accept-

ed leads. While an average b-to-b organization reports a 58 percent conversion rate between MQLs and sales accepted lead (SAL), the number jumps to 66 percent for organizations with strong processes and nearly 75 percent for those that are best in class. When marketing and sales work collaboratively to set proper expectations for what an MQL can/should be, and create basic service-level agreements and handoff processes, conversion rates at this stage will improve dramatically. Building efficient lead
Waterfall Conversion Rates
Average Strong Process Best-inClass

3.9%

5.8%

9.7%

58.3%

65.6%

74.5%

49.1%
Sales Qualified Leads (SQLs)

56.4%

60.5%

23.1%
Closed/Won Business

26.9%

30.7%

© Copyright SiriusDecisions. All Rights Protected and Reserved.

1

C A T E G O R Y : M A R K E T I N G S T R A T E G Y, F I E L D M A R K E T I N G

routing and distribution practices drive these rates to even greater heights. • Sales accepted leads to sales qualified leads. The average b-to-b organization sees roughly 49 percent of its SALs become sales qualified leads (SQLs), while those with strong processes or are best-inclass report 56 percent and nearly 61 percent, respectively. Organizations that do a poor job of identifying and flagging the reasons for rejected leads – and do not recycle them either into teleprospecting or field marketing for additional nurturing – not

only leave money on the table, they build a wider gulf between marketing and sales as a result of wasted time, effort and money on both sides. Field Marketing 2.0 principles including self-qualification and comprehensive, holistic lead nurturing programs improve the qualification of sales leads through better matching of the needs of prospects with specific marketing and sales collateral and knowledge. • Sales qualified leads to closed business. Finally, the average organization sees roughly 23 percent of its sales qualified leads become closed business, a number that rises to nearly 27 percent for strongprocess organizations and 31 percent for those that are best-inclass. Only when the numbers in the middle of the sales and marketing waterfall improve – indicating an increase in the quantity of quality leads entering those stages – will an organization begin to see a lift in close rates (linear system analysis reveals that improving one step in the process only moves the source of system inefficiencies to another step in the process; improved system efficiency requires a complete systems analysis of all steps in the process). In the absence of a steady stream of well-qualified leads, sales reps will work lower-quality leads longer than they should, decreasing productivity and limiting their ability to close regardless of skill level. LIKE MONEY IN THE BANK While examining individual stages is certainly interesting, the real impact of Field Marketing 2.0 can only be seen when we begin to roll the stages up and look at the waterfall holistically. Intra-stage, a 2.0 organization will create more than twice the number of MQLs as an average organization; more than 29 percent more SALs; more than 24 percent SQLs and nearly a 35 percent increase in closed deals. Now, let’s work the numbers from top to bottom for each of our categories, using the conversion rates at each stage of the waterfall, starting with 1,000 inquiries in each case. An average organization will close roughly 2.5 deals per 1,000 inquiries; those in the strong process category will close nearly 5.8 deals, and best-in-class organizations will close 13.5. Attribute an average sales price (ASP) of $50,000, and strong process organizations will realize $165,000 more in revenue per 1,000 inquiries than an average organization; use an ASP of $150,000, and the number jumps to $595,000. And those that are best-in-class, you ask? Using an ASP of $50,000, they realize $550,000 more per 1,000 inquiries than average organizations, and $1.65 million using an ASP of $150,000. THE SIRIUS DECISION Organizations living in a Field Marketing 1.0 world need to understand

THE FIELD MARKETING 2.0 WORLD
In the Core Strategy Report, “Field Marketing 2.0: The Next Generation of Demand Creation,” we introduced the five core pil lars of advanced demand creation, including:

• Ownership. Distinct, go-to places within sales and marketing for collaboration, planning, process building and feedback around advanced demand creation concepts. In a 1.0 world, distinct sales ownership is typically lacking, forcing marketing to largely go it alone, or try to ally with individual sales audiences.

• Process. Comprised of three sub-processes, including target, campaign and qualify. In a 2.0 world, 1.0 processes are used in an adaptable fashion (by scenario, geography and/or business unit).

• Technology. The “backbone” on which systematic, predictable, repeatable field marketing capabilities are based. 2.0 companies use a marketing automation platform (MAP) as the center of their demand universe, with best-in-class tools bolted onto it as required.

• Services. The outside partners – primarily in the areas of telemar keting and teleprospecting – that help to augment an organiza tion’s internal field marketing/demand creation activities. 2.0 organizations tightly integrate the activities undertaken by these partners into their MAP, rather than keeping them isolated.

• Metrics. The means by which the field marketing organization judges its performance, justifies its spending and proves its impact to sales, executive management and the board of directors. 2.0 companies use a shared waterfall (as described within this piece), focusing on improvements at the SQL level rather than simply the top of the waterfall when performance wanes.

© Copyright SiriusDecisions. All Rights Protected and Reserved.

2

C A T E G O R Y : M A R K E T I N G S T R A T E G Y, F I E L D M A R K E T I N G

that they’ve only taken the first step of a long and evolving journey. The good news is that each step along the way promises improved efficiencies and quantifiable results. Meanwhile, 2.0 organizations are taking the next step and reaping the rewards of noticeably improved demand

creation waterfall conversion rates. Whether it is advanced lead scoring, routing/distribution, self-qualification, nurturing and predictive marketing; all are giving 2.0 organizations a clear competitive advantage. Bottom line: You can watch the progress, or be part of it. It’s your call.

© Copyright SiriusDecisions. All Rights Protected and Reserved.

3