From a marketer's perspective, what are your recommendations and tips for approaching sales?

Copy of article as promised:

Marketing and Sales, they share the same big picture, but never seem to see the same view. Is this a good thing or bad? Is the tension healthy or should it be eliminated? New research may well provide the answer.

I’ll admit it right up front; I have several friends who are accountants. Look, they’re nice people each and every one. And there’s really only one noticeable difference between most of them and me. It’s how we think about quality and its cost. Take the way we dressed when we began our business careers – I went bespoke, they bought off the rack; I wasn’t happy with a tie that others might own, they didn’t give a toss. In a similar vein, I bought an impractical red European sports coupe; they bought a Toyota Corolla and didn’t even think about the colour. They inevitably had more money in the bank and (with some validity I admit) thought I was hopeless with money. I thought they were penny-pinching to the point they weren’t enjoying life quite to the extent they should. We clearly lived in different “thought worlds”.

And so it often is between the thought worlds of different company business units. There are for example several key interfaces between Marketing and other aspects of a business, including engineering, HR, quality assurance, IT and finance. Many of these relationships have the potential influence the commercial fortune of the host company. Somewhat surprisingly however, there’s been little research published in relation to the critical relationship between the thought worlds of Marketing and Sales.

It’s surprising I guess because many marketers would say the Sales guys just don’t get it. Volume and then more volume until month’s end; the commission cheque, the long lunch and start all over again. All short-term and very self-centred. A clash between the trained professional versus the self-taught street fighter. Right or wrong? Whatever the spin put on it, it’s certainly not a rare kind of complaint in my experience.

As a consequence, some Marketing Directors spend a significant amount of time and effort trying to re-educate and inculcate the Sales team in everything from brand strategy and positioning, through to pricing theory and style guide compliance. It just makes common sense to bring the Sales guys up to speed, to have them think long-term and get on board with the Big Picture… or does it?

Well, finally, someone did the hard yards and come up with the answer. A study by Christian Homberg and Ove Jensen’s published in the Journal of Marketing concluded market performance grows best in an environment that maintains a certain level of tension between Marketing as a long-term product voice and Sales as a short-term customer voice. But it’s not entirely a black and white issue. Let me explain.

The study certainly rejects the perspective that thought world differences are bad. Rather their empirical evidence supports a view that the differences are both good and bad! The authors concluded the different orientations of Marketing and Sales have a positive effect on overall market performance. They cited the example of pricing to illustrate their point – in a company faced with price pressure from customers Sales might be tempted to price cut (and incur consequent revenue and profit sacrifices) if Marketing did not act as the devil’s advocate and argue for a more long-term perspective and its financial implications.

However the study also demonstrates that different competencies and differences among interpersonal skills do have a negative effect, because they may prevent the exchange, understanding and synthesis of ideas (it may for example preclude the development of an optimal design during a product’s development phase).

So, what does all this mean from a management perspective? Well, firstly, the study puts to bed the notion that companies should eliminate all differences between Marketing and Sales. Secondly, the authors caution against trying to maximise harmony between Marketing and Sales – “because what’s good for the quality of cooperation between them both may not be good for the long-term market performance of the business unit”.

The out-take from these two key observations is that companies should develop an internal role structure that fosters devil’s advocacy by Sales (typically a more customer focused and short-term perspective) and by Marketing (typically a more product-focused and long-term perspective), as this will help ensure more relevant information and arguments will be brought to the table and evaluated as part of the decision making process.

Homberg and Jensen also suggest companies should try and remove the differences between Marketing and Sales in regard to interpersonal skills and product knowledge, as these two differences are detrimental to cooperation quality and market performance. They say, “Marketing and Sales should have similar competencies but different orientations–in other words, similar people with different missions”. Ideally the people in Sales and Marketing should be qualified to work in either role, and job rotation should give them the opportunity where possible.

In most companies the authors say their findings have a clear implication – “Marketing will [likely] be the long-term oriented advocate of product profitability, whereas… Sales [will likely play] the short-term-oriented advocate of customer relationship profitability”.

And so it seems the Sales guys are here to stay… in fact, perhaps it’s time to change offices, grab the odd long lunch and have a go yourself...?

…Still a marketer? Not yet convinced the grass is greener on the other side? Out of the frying pan and into the fire? Perhaps you’d feel more comfortable making the jump if you knew which structures worked best and in what industries.

Even more recent research published in March 2008 by Christian Homburg, Ove Jensen and Harley Krohmer (also in the Journal of Marketing) takes the first close look at the interface between marketing and sales units.

In their cross-industry study of 337 EU-based companies they were able to identify five typical structures for the Sales-Marketing relationships within the subject companies. In summary, these were:

1. The Ivory Tower cluster, where the sales unit has the lowest range of market knowledge and is the most product-focused of the five clusters identified. It has a short-term focus and so sales staff tend to have an operational rather than a strategic orientation. There is not much interaction between the sales and marketing units and both units seem to lack an understanding of product and market needs. It is typical of the financial services sector and the machinery industry.

The authors cite the German banking industry, which has gone through a severe crisis, as a good example. German banks have strived to improve the customer orientation of their sales force and to train frontline employees in more advanced capital market instruments. However, having completed their expert research interviews, the authors observed, “Companies sometimes hire marketing professionals from consumer goods companies to inspire marketing thought in the organization. These people are highly customer oriented but cannot really make themselves heard, because they know too little about the specificities of the market and the products.” This is one potential reason, the authors suggest, why marketing is detached from the market in these industries.

2. The Brand-focused Professionals, a structure that demonstrates the highest levels of formalisation, joint planning, teamwork and information sharing. Both marketing and sales also have the highest levels of market and product knowledge and the most long-term orientation of all the clusters. Marketing is product driven and powerful in this cluster, however the cooperation between marketing and sales is structured and professional. This kind of cluster is typical of the consumer packaged goods industry.

3. Sales Rules, a structure where the sales unit dominates and is most knowledgeable in terms of products and markets. Marketing has low product knowledge and has the highest short-term orientation of all the clusters identified. It plays an operative support role to the dominant sales unit and this is evidenced by the lack of structured cooperation (ie formalisation, joint planning or teamwork). It is a structure often found in the machinery and automotive industries.

4. Marketing-driven Devil’s Advocacy. In this structure, sales has the most short-term, operative focus of the five clusters, while marketing has a long-term strategic focus. As a consequence, marketing has the strongest product orientation of all the clusters and high product knowledge, while sales has the lowest product knowledge of all clusters. There is formalised cooperation between the two, where the often contrary sales (the operative customer voice) and the marketing (a strategic product voice) perspectives are both expressed as a means of achieving optimally balanced decisions ¬– although marketing has the final word. It is typical of industries with capital-intensive production assets, such as the chemical and electronic industries.

5. The Sales Driven Symbiosis structure is a cluster of complementary skills. Marketing’s product knowledge is low, while sales’ product knowledge is high. Conversely, marketing’s market knowledge is high and sales’ market knowledge is moderate. Both groups are highly customer-focused, teamwork is in the highest range of all clusters, and formalisation and joint planning are also high. Sales is more powerful, but the teams are interdependent and have complementary skills. This configuration is typical of utility companies (where long term contracts are the norm).

The authors rated each cluster in terms of outcomes achieved (ie cooperation quality, market performance and profitability). The Ivory Tower was typically the poorest performing of the five, with profitability consistently in the lowest category. “This is not surprising,” the authors comment, “given the low levels of market knowledge, information sharing, and structural linkages”.

At the other end of the scale, the Brand-focused Professionals typically outperformed the other structures, and consistently did so for several years following initial the survey.

The Sales Rules cluster on the other hand was one of the weaker structures, with all three outcomes in the lowest range of all the clusters, which caused Homburg et al to note, “This cluster’s most noticeable features, the low extent of structural linkages and the highly unilateral power concentration, are not a promising solution for the [marketing and sales] interface.”

Marketing-driven Devil’s Advocacy, not surprisingly, had the lowest cooperation quality of all clusters and, while it can produce fairly good decisions, its market performance was only mid range and its profitability in subsequent years was consistently in the lowest range.

Sales-driven Symbiosis was in the second highest performance bracket in regard to all three outcomes.

The two most successful configurations (Brand-focused professionals and Sales Driven Symbiosis) shared several characteristics. These were:

• An intense use of structural linkages
• High market knowledge within the marketing unit
• A long-term orientation of the sales unit.

“These two clusters are characterized by a clear, but not extreme, power distribution between [marketing and sales]. The pattern that pervades the less successful configurations is low levels of information sharing, structural linkages, and knowledge as well as extreme power distribution.” This suggests that teamwork and joint planning should be fostered and that high market and product knowledge levels within both sales and marketing is important.

And finally, the authors make one very reassuring observation that’s sure to please marketers the world over, “The Brand-focused Professionals cluster, the most successful configuration, is characterized by a fairly strong marketing function. Thus, the findings challenge the doubts about the necessity of a marketing department that are sometimes uttered in managerial practice”. Phew!