Adding ‘Revenue Performance Management’ To Your Vocabulary
Our peers at Marketo, Callidus and Eloqua (among others) have reshaped the sales and marketing vocabulary over the past 12 months. The term Revenue Performance Management is now well established and can become a powerful addition to the vocabulary of any President or EVP of sales and marketing.
What Is Revenue Performance Management?
The idea behind Revenue Performance Management is to better track, measure and optimize the relationship between what goes on in sales and marketing and the revenue of the corporation. That is a big idea. It has to be one of the top priorities for 2013.
It has long been a popular complaint that sales and marketing is high in spend, but low in visibility. It is often seen by others, for example the CFO, as a black box.
The CFO wants to know what he, or she will get for his, or her money (that is the resources the company invests in sales or marketing activities and campaigns). He, or she wants to know how spending more on sales and marketing will impact on revenue performance.
What Is Your Revenue Performance Management?
The term Revenue Performance Management (RPM) appeals to all those who want increased levels of visibility, predictability and control in respect of sales/marketing.
So the question is: ‘How visible, predictable and efficient is the link between your sales/marketing and revenue performance?’ Well, before you answer ask your CFO.
RPM although a relatively new term, but a popular one – type it into Google search and it will return up to 64 million results. So, it is already firmly established as part of the key messaging for sales system vendors.
They have found that it is a powerful term in setting the agenda for sales and marketing, which probably means it is a term you should be using.
Why Think Revenue Performance Management?
RPM is another important step in the application of business process re-engineering and related principles to sales and marketing. Here are some reasons why it should form part of your sales vocabulary:
1. It is the quest for a more predictable, manageable and efficient way of generating leads and converting them through the sales process into revenue.
2. It is not just about generating leads and converting them into sales opportunities but about full lifecycle from the download of a whitepaper or clicking of a Google ad right through to the point of sale.
3. With longer and more complex sales cycles the focus on revenue performance management is become more important.
4. It is a new way of looking at the issue of sales success, moving the focus from the salesperson to the sales process, sales system and all other dimensions of sales.
5. It is a new bridge between sales and marketing, between lead generation and the rest of selling.
6. It is also a new way of looking at the funnel, as well as activity versus effectiveness in sales and marketing and value for money.
Our Revenue Track™ sales performance toolkit has helped Engineering practices, leading ICT vendors and media organizations improve RPM to:
- Provide a visual representation of the process for converting leads to orders.
- Highlight bottlenecks or gaps that impact on RPM.
- Calculate the impact on revenue of changes to the sales process, sales skills, etc.
- Provide internal and external best practice comparison.
- Bring a range of sales KPIs related to RPM to the fore.
What will your RPM strategy be in 2013?