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The impact of the Marketing/Sales relationship and effect on Business

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The impact of the Marketing/Sales relationship and effect on Business performance

Christopher R. Steger

Saint Leo University

MBA 525

Dr. Diane Monahan

June 16, 2019

Graduate Studies in Business Academic Honesty Statement

My signature entered below constitutes my pledge that all of the writing is my own work, with the exception of those portions which are properly
documented. I understand and accept the following definition of plagiarism:

1. Plagiarism includes the literal repetition without acknowledgment of the writings of another author. All significant phrases, clauses, or
passages in this paper which have been taken directly from source material have been enclosed in quotation marks and acknowledged in the text
itself as well as in the Reference Page. 2. Plagiarism includes borrowing another’s ideas and representing them as my own. 3. To paraphrase the
thoughts of another writer without acknowledgment is to plagiarize. 4. Plagiarism also includes inadequate paraphrasing. Paraphrased passages
(those put into my own words) have been properly acknowledged in the text and in the references. 5. Plagiarism includes using another person or
organization to prepare this paper and then submitting it as my own work. 6. Plagiarism includes resubmitting previous work, in whole or in part,
for a current assignment without written consent of the current instructor.

Saint Leo University’s Core Value of Integrity requires that students pledge to be honest, just, and consistent in word and deed. I fully understand
what plagiarism is, and I further understand that if plagiarism is detected in my paper, my professor will follow the procedures on academic
dishonesty set forth by Saint Leo University, the Donald R. Tapia School of Business and the G

X
Christopher R. Steger
Student

Signed Electronically: Christopher R. Steger on 6/16/2019

 II

Abstract:

The purpose of this paper is to examine the relationship between the sales and marketing

function while attempting to measure the impact of this relationship on overall sales

performance. The overall goal of the following paper is to examine the functions of both the

marketing and sales position and understand whether collaboration between the two departments

has led to increased business performance and specifically, sales results. In addition, this paper

reviews both selling and sales management articles that have been published throughout the

period of 1998-2019 covering marketing and business articles that have been peer reviewed.

The following review of literature will start with an overview of the topic at hand

including the relationship between marketing and sales professionals and whether or not the

collaboration between the two departments has led to increased sales performance. We will then

take a look at the different sources of work including those that define the marketing and sales

roles, and then compare and contrast the different methods for curing any disconnect that might

exist between sales and marketing. Finally, we will compare and contrast the main points of

these scholarly peer reviewed works to help draw conclusions as to which pieces of literature had

the most convincing argument and overall the most significant contribution to the comprehension

and development of their respective areas of research.

The reason for completing the review of literature on the topic at hand is because I

believe that being a ten-year veteran in the sales world has opened my eyes to a disconnect

between marketing and sales departments in many organizations. I believe that without team

cohesiveness, sales performance will diminish and create tension among the teams. The purpose

of this paper is to truly take a closer look at the question at hand regarding the relationship
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between marketing and sales and the impact that relationship has on overall sales performance

and provide an analysis of the findings from the reviewed articles.

Introduction

“Sales and marketing are meant to be part of the same function, but there has been a

growing realization that this relationship is not always operating as efficiently as it should.”

(Meunier, K. L., & Piercy, N. F. 2010) It is apparent in the context of the business environment

that the two primary revenue driven functions within a specific company are the sales and

marketing teams. Based on this relationship, “sales and marketing should be working together to

create and execute successful marketing strategies.” (Malshe & Sohi, 2009) This idea has been

affirmed by several scholars who encourage sales teams to be in marketing strategy

development, and that both departments coordinate strategic activities to foster, deliver, and

communicate an overall greater customer experience. (Slater & Olsen 2001)

While much of the scholarly reviews recommends the theoretical framework above,

evidence from the literature suggests that in most cases the sales function is not a part of the

strategy making process. (Martin, 2019) As such, in many organizations, the strategy creation is

left up to the marketing function without input from the sales team; we learn that the sales team

become formally presented with these new strategies developed by marketing only when the

marketing team decides to do so. (Kotler, 2006) When the sales team is finally in receipt of these

implementation plans for the selected strategy by marketing, the sales team does not agree and

support the strategy “because they feel these strategies are inappropriate, ineffective, irrelevant,

or disconnected from reality.” (Aberdeen Group, 2002).

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After carefully studying the literature there are limited studies in regard to the roles that

marketing, and sales functions play in order to make sales strategies ultimately successful, thus

leading to increased sales performance. In addition, the literature definitely stresses the

importance of a joint relationship between sales and marketing in regard to strategy creation and

implementation but no academic study has taken a deep dive to understand how this joint venture

would actually work. There is a scarce amount of resources which contain a guiding theoretical

framework for this type of study which outline specifically how strategy making between sales

and marketing occurs, and then answers the question of what makes this process more effective.

Since sales and marketing are the primary revenue generators for a specific organization, the

following study will examine this question at hand and determine whether developing the

relationship successfully will lead to better sales performance for the organization as a whole.

The following literature review will be outlined in the following manner. The first obstacle

is to identify any major issues in the sales and marketing relationship. Next, we will examine and

identify any drivers of sales and marketing integration. Finally, we will conclude by

understanding the suggestive framework for improving the relationship between sales and

marketing and how that relationship will impact sales performance.

Improving the relationship between sales and marketing

To understand whether an actual problem exists between sales and marketing we must

first understand and define the two roles. Salespeople are individuals who sell goods or services

to other entities (B2B) or to consumers (B2C). On the other hand, marketing refers to activities

undertaken by individuals to promote the buying or selling of a product or service. As you can

see the two are aligned closely. “Scholars have highlighted major differences between sales and
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marketing by citing cultural differences, inter-functional conflict, and the differences in thought

worlds and perspectives about the marketplace.” (Malshe, A., & Sohi, R. S., 2009). Furthermore,

we learn that “while the extant sales-marketing interface research highlights the need for these

two functions to work closely with one another to facilitate the strategy creation and its

execution, it also acknowledges that many times, these two functions do not share a great

rapport.” (Malshe, A., & Sohi, R. S., 2009) Researchers have looked into market orientation and

marketing R&D has shown that “effective internal collaboration brings organizational benefits in

terms of improve business performance and customer satisfaction. (Kohli & Jaworski, 1999)

Personally, I know that once there is a disconnect between marketing and sales business

performance will suffer and that is why much of the literature suggests that an improved

relationship between marketing and sales will lead to a better employee culture and ultimately

better sales performance.

Sales and Marketing Conflict- The Major Causes

According to Dr. Mahdani, “sales is interpersonal, push driven, more tactical, and has a

short-term focus while marketing is analytical, pull driven, more strategic and has a long-term

focus.” (Madhani, P. M. 2016) As such, he was able to identify four main components that lead

to conflict between sales and marketing.

A) Separate Identity

While sales and marketing can be considered to undertake the same job functions,

in the actual business environment they are trained and managed much differently.

(Olson 2001). Sales and Marketing have historically been structured as separate and

distinct departments with independent goals and separate management. Furthermore,

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Workman tells us, “Although their may be advantages in locating sales and marketing

in close proximity, in many organizations sales and marketing are separated,

sometimes geographically.” (Workman 1999) To sum it up, sales and marketing

integration is considered one of the biggest corporate problems for companies to

handle. Salespeople complain that marketing is trying to steal their thunder and cause

problems in closing their deals while on the other side, marketing complains about

sales people portraying the wrong brand message to customers and also gripe about

the lack of feedback that they receive from the sales team. As you can see, “many

organizations do not have a clear idea how sales and marketing should interact and

relate.” (Krol, 2003) Finally, Rouzies tells us that “problems arise with the sales and

marketing interface when large, separate departments become independent silos that

do not operate well together.” (Rouzies, 2005) In conclusion, both sales and

marketing have such a combative relationship due to a major disconnect that is

exacerbated by lack of trust and respect between the two teams.

B.) Time-Frame Conflicts

In reviewing the research literature, one of the recurring themes as to why conflict

arises between sales and marketing comes down to differences as to when goals are

set, resources are allocated, and performance evaluations are completed. Based on

this principle it is clear to see why such differences

“translate into conflicting priorities and inconsistent activities because sales

primarily focus on relationships, tactical and short term objectives such as revenue
targets while marketing are highly analytical, data oriented, long-term focused and
believe in building a competitive advantage for the future and hence mainly adopts a
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strategic, long term perspective such as brand building.” (Montgomery & Webster,
1999)

Finally, several of the research articles have made the point to highlight the

obstacles created by the short-term mindset of sales goals conflicting with the long

term mind set of marketing.

C.) Flow of Communication

For cross functional cohesiveness to be effective between marketing and sales

business units of the organization they must be able to communicate and interact. This is

required so that work can be shared and exchanged along with resources and other

assistance. According to Moorman, sales people will often complain about information

being available in a timely manner from marketing while the marketing team state that

the information they have spent valuable time in compiling is not being utilized by sales.

(Moorman, 2007) As such, to increase the directional flow of information and

communication among the different business units, specifically, marketing and sales, the

research recommends having more focused meetings and documented information

exchanges between the two departments.

Specific problems that occur amongst the relationship between sales and

marketing results from a perception that sales representatives are not following up on

leads given by the marketing team, including lack of lead integrity and efficiency. Dr.

Madhani makes a different opinion on how to combat this issue but his approach is

conflicting to those stated by other researchers. He states, “both sales and marketing

benefit from closed loop communication flow and feedback mechanism. Marketing will
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be able to update its database and statuses and will be able to assess the effectiveness of

its marketing programs, clearing identifying those that work and that that don’t.”

(Madhani, 2016) While this is a great idea in principle, I think that its unrealistic to

expect that sales will improve efficiency through closed loop communication to pick out

those sales people who are not using their leads etc. I believe this will only bring about

more conflict.

D.) Goal Differences

Dr. Madhani continues his assessment of the issue by highlighting the significance of

goal differences in relation to sales effectiveness and the overall marketing relationship.

He states that these goal differences cause a huge lack of trust, conflict, and it creates

hostility and conflict between sales and marketing. As an account executive responsible

for sales quotas, I know that we tend to think always in terms of sales numbers rather

than profits as Dr. Madhani points out in his article. Being in sales all my career, I know

that we always aim to boost our sales and carry our quota commitments in order to

develop commissions and bonus income. Much of the research alludes to the fact that the

salesperson will always push the product with the best incentives for him or her

personally. While I understand this can be true in many circumstances, it will ultimately

cause the salesperson problems in the end because a good sales person advocates for his

client and provides the best solution for the current situation and not because it will pay a

higher commission. On the opposite side of the spectrum, marketing teams plan sales

volume around profits. As you can see differences in these four main areas of focus for

the specific business units plays a huge role in the conflict between the sales and
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marketing relationship.The research also provides that the importance of goal differences,

which come from the direction of senior management has been studied by several

authorities on the subject.

Sales and Marketing Interface

One academic study followed the marketing strategy making process in real time.

“Specifically, it suggested that Marketing Strategy Making within the sales-marketing

interface consists of three stages: (a) Groundwork, (b) Transfer, and (c) Follow-up”.

(Malshe, A., & Sohi, R. S., 2009) In this study members from both business units felt that

for effective strategy making to be successful, it had to happen during the conception of

the strategy, where both the sales and marketing teams could attend either formal or

informal meetings regarding the current marketplace conditions and upcoming strategies

including doing most of the footwork. However, diverging from the Kotler article that

discusses the handoff strategy between the two teams, the Malshe study found “that the

transfer stage, during which sales and marketing functions formally come together and

marketing hands the strategy over to sales, constitutes just one stage in this process.”

(Malshe, A., & Sohi, R. S., 2009) Finally, the Malshe study states that the data obtained

indicates that follow-up which is the final stage in the suggested process, “consists of

both marketing and sales functions following-up on the activities they agreed upon during

the transfer stage and making necessary changes to the strategy.”(Malshe, A., & Sohi, R.

S., 2009)

Achieving Sales and Marketing Integration:

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The literature suggests several mechanisms to end the ongoing war between sales and

marketing through the following functions, (1) create shared responsibilities, (2) create a liaison

position that bridges the gap between sales and marketing, (3) change the organizational strategy

from being aligned to being integrated, and (4) set clear definitions of the roles and

responsibilities in the marketing and sales funnel. (Dawes, 2006)

1.) Create Shared Responsibilities

As the sales and marketing functions become better aligned, Kotler reminds us

that it is important to develop opportunities for the marketing and sales teams to work

together. This can be done through shared projects, goal creation, customer account

strategies etc. Ultimately, this will create cohesiveness and familiarity with the

other’s way of thinking and approaches to handling certain tasks. Specific to the

marketing channel, brand managers should occasionally attend sales pitch meetings

with the salesperson inside the customer setting. The literature suggests this can be

particularly helpful because the marketing function can get involved in helping to

develop other solutions that the salesperson might not have thought about to help

meet the customers needs. Furthermore, it is advised that this be done early in the

sales process to be most effective. Marketing needs to get involved early in the game

with helping to develop alternate solutions for the client and it is imperative for them

to sit in on the important account development planning meetings.

On the opposite side of the spectrum, the sales function needs to be involved in

helping to develop marketing plans and should be present for product planning

sessions with marketing. Kotler further recommends that “they should preview ad and

sales-promotion campaigns and they should share their deep knowledge about
 XI

customers’ purchasing habits.” (Kotler, 2007) Mutually, marketers and salespeople

should sit down together and create an agenda for increasing business with the most

lucrative accounts in each business vertical. Finally, Kotler recommends that

Marketing and Sales attend conferences together to help build the team comradery.

2.) Creation of a Liaison Position between Sales and Marketing

For this to be successful, the literature recommends that the liaison must be

someone that both groups trust. The primary responsibility of this person would be to

resolve conflicts and create a tactical flow of information between the two groups.

However, the literature carefully reminds us that micromanagement should not be any

part of the liaison’s responsibilities. In Dr. Madhi’s study, a marketing respondent

explained the liaison role as “a person who lives with the sales force. He goes to the

staff meetings, he goes to the client meetings, and he goes to the client strategy

meetings. He doesn’t develop product; he comes back and says, ‘Here’s what this

market needs. Here’s what’s emerging,’ and then he works hand in hand with the

salesperson and the key customer to develop products.” (Madhi, 2016)

3.) Change the organizational strategy from being aligned to being integrated
The research shows that organizations will function with great fluidity when sales

and marketing functions are aligned. When the specific organization has a quick sales

cycle, this is especially imperative that the two are aligned because this type of

environment does not foster a strong culture of shared responsibility. The literature

further recommends “integrating such straightforward activities as planning, target

setting, customer assessment, and value-proposition development”. (Kotler, 2007)

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Integration is essential because when the sales and marketing functions have

different ideas about the same customer, the overall integration strategy creation is

weakened. As such, all “key information should be synchronized between sales and

marketing by making information systems fully automated so that it will be accessible

by both teams.” (Madhi, 2016) Finally, the literature found that where companies

already had placed the importance om shared responsibility and organizational

planning; that were tied to specific goal-oriented metrics it directly correlated to

better results and increased cross functional relationships. Therefore, an organization

should move from having an aligned type of relationship to one that is integrated.

4.) Set clear definitions of the roles and responsibilities in the marketing and sales
funnel.
In most organizations, sales and marketing handle responsibilities that eventually lead

customers toward making a purchase. After the purchase, retention efforts must be made

as well. This is referred to as managing the “funnel.” (Hosford, 2006) The marketing

responsibilities for managing the funnel or pipeline is usually confined to the first few

steps including, building increased brand awareness, performance, marketing plan

creation, and lead generation. Next, the sales team must execute on the marketing plan set

forth by the marketing function and follow up on the leads generated. This is a simple

division of the labor divide and it keeps marketing from putting their nose in the

individual salespersons opportunities by providing marketing with a more strategic

function. However, the literature cautions that this sequence may bring about serious

consequences if not done correctly. If the deal ends up going south, sales can make the

excuse that the marketing plan was not strong enough and then marketing will come back

and state that the salesperson did not work the lead hard enough or with a tactical
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strategy. This is where senior management needs to step in and set clear metrics, goals

and expectations. (Iglesias, 2011)

Sales and Marketing Relationship regarding increased performance:

According to Homburg and Jensen (2007), they found that “differences between sales

and marketing perceptions of performance may be a cause of dissatisfaction in the interface.”

(Homburg and Jensen, 2007). The literature further points out that the efficacy of the relationship

between managers of these departments depends on team performance and results, and in the end

will dictate how the working relationship between the two managers will be. Recent studies have

made a point to show that a lack of cooperation between sales and marketing. Specifically,

Homburg and Jensen observed that “goal differences may be a source of interdepartmental

friction” (Kenneth Le Meunier‐Fitz-Hugh, Nigel F. Piercy, 2010), and that previous research has

attributed this issue to the responsibility of senior management.

Research context and literature review

Upon reviewing some of the earlier qualitative work into the relationship between sales

and marketing it is noted that that evidence pointed towards a poor working relationship and that

more research was to be conducted. In 2000, a conceptual work “which identified that the sales

and marketing interface is characterized by negative outcomes and conflict.” (Dewsnap, B. and

Jobber, D. 2000). According to DeConinck, when specifically identifying the role of salespeople,

stated, “due to their boundary spanning roles, salespeople are more likely to be out of sight and

away from direct supervision.” (DeConinck, J. B. 2011). This is one possible explanation for the

evidence that concluded a poor working relationship between the two teams. However, on the

other hand the research has shown the opposite to be true, “teamwork is important in selling
 XIV

organizations for the reason that salespeople depend on their colleagues, service support staff,

and other to accomplish selling-related tasks and increase productivity.” (Itani 2019)

Findings and Management Considerations:

After studying the literature, I have been able to pinpoint several ways to improve the

relationship between sales and marketing that will ultimately lead to better performance. First, all

the literature suggests that a focus on improving collaboration between the two business units is

a must to improve relations and it is critical to business performance. Several themes presented

themselves among the different pieces of literature and they pointed to a lack of discipline by the

senior managers of these departments.

There are three main principles that the literature advises be applied to managerial practice.

First, the results of the various studies show that “identical thought worlds in marketing and sales

are not desirable”. (Homburg, C. and Jensen, O.,2007) These findings go against the normal

approach that managers take where they try to bring the two departments together for formal

meetings to discuss differences and get on the same page. Second, the literature advises that

management should not try and force the harmony between the marketing and sales departments.

The issue becomes “what is good for the quality of cooperation between marketing and sales is

not necessarily good for the market performance of the business unit.” (Homburg, C. and Jensen,

O.,2007) The results of several studies inspire that organizations to create an internal role that

plays devil’s advocate between the two business units. This will in turn ensure that the most

relevant information and that most arguments are a result of market related decisions. (Homburg,

C. and Jensen, O.,2007) The third point from the analysis of the Homburg study demonstrates

what we mentioned prior, “that different goal orientations and different time orientations of
 XV

marketing and sales are bad for the cooperation quality between marketing and sales but are

good for the market performance of the business unit. Homburg continues to advise that either

the sales team or the marketing team should be the experts of the product issues within the

organization, and the sales team should be the expert with regards to the customer relationship of

the organization. Similarly, either marketing or sales should own the responsibilities of the long-

term dimension of the firm, and the other business unit should own the responsibilities of the

short-term dimension of the organization. The authors of the Homburg study state, “in this sense,

our study confirms “not to eliminate differences” and to distinguish the functional roles of

marketing and sales”. (Itati, 2019). Fourth, the Homburg study, “suggests that differences

between marketing and sales in regard to interpersonal skills and product knowledge are

detrimental to both cooperation quality and market performance”. Therefore, when it comes to

interpersonal skills, Donath’s (1999) bold statement on the problem and solution to get

marketing and sales “on the same wavelength” is supported by the findings of the Homburg

study.

Conclusion

As a career salesperson I have witnessed the struggle between the two departments to

capitalize on sales opportunity as a direct result of cohesiveness between marketing and sales.

“Research into market orientation, and marketing and research and development (R&D), has

shown that effective internal collaboration brings organization benefits in terms of improved

business performance and customer satisfaction.” (Kohli & Jaworski, 1998) While the literature

touches on the strategic ways that an organization can create the cohesiveness between sales and

marketing that ultimately leads to better sales performance, it does not specifically quantify sales
 XVI

performance after strategy implementation. However, the importance learned is that marketing

and sales play one of the most important roles within an organization. As previously mentioned,

they are directly responsible for revenue generation. As such, organizations should utilize the

strategies set forth in the following paper to tackle and existing marketing/sales issues that are

negatively effecting performance.

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