The Relationship Between Sales and Marketing
Author: Justin Funk, Managing Partner, Agri Studies
One of the more significant challenges in any business is finding the best way to get sales teams and marketing managers on the same page. While this may seem like a simple task that comes down to organizational and reporting structure, in reality, it isn’t that easy. The fact of the matter is, when you look at the basic purposes of sales and marketing teams, it comes down to this: marketing is responsible for developing strategy, while salespeople are responsible for implementing strategy. To use more marketing-friendly terminology, marketing develops the value proposition, while salespeople are the stewards of the value proposition. Without proper lines of communication, understanding and buy-in, strategy—as good as the intention may be—can fall flat due to improper implementation. In some cases, it can lead to conflict and frustration. Here is an example:
I have had many conversations with marketing managers over their frustration with pricing. The feeling is that the marketing department develops strong products with a lot of thought and effort. They do their research and create visually appealing messages to be sent to the market—all in the spirit of creating value and earning margin. The product is then put in the hands of the sales team who then, instead of acting strategically, become very tactical and do whatever they need to do to make a sale. One of these tactics is using price as a tool to earn sales, which erodes margins, devalues the product and renders the marketing strategy useless.
Similarly, salespeople are often critical of marketing departments, suggesting that they don’t understand the challenges associated with selling in their local markets. This is understandable, especially considering that in agriculture, many marketing departments are located in office buildings in major centers while salespeople are scattered throughout the countryside in rural communities, potentially on opposite ends of the state or country. As a result, the strategies being put together by the marketing team are perceived as being “out of touch” with the local market situation and customer base.
So who’s fault is this? I don’t think it is fair to point fingers at one group or another, but simply recognize there are things that can be done on both sides to help create more alignment.
1) Involve salespeople in the strategic planning process. I have had the privilege of working with a lot of different organizations through the strategic planning process, and every time I’m given a chance to do this, I have one condition—the task-force or working group that is assembled to take part in this process contains a cross section of representatives from the company. Having salespeople involved in the strategy process is important. It ensures their views are represented, but more importantly, salespeople often have a closer relationship with the customer and see things that marketing is not necessarily able to see from the office. So not only does this benefit the strategy, it also helps with implementation as it creates buy-in from the sales team knowing they were part of the process.
2) Engage the sales team more often. While conducting formal marketing research is an important and often necessary activity for any organization when making decisions, don’t ignore the opinions that come from the field. Salespeople can be one of your best sources of market intelligence as they know subtleties about local markets, competition and customers. This is often a very under-utilized resource. Marketing people should, at least once a year, visit with some salespeople and ride around making customer calls in an attempt to better understand salespeople and glean observations from the local markets.
3) Offer incentives based on margin or effort, not volume. While marketing strategies are built around achieving volume and margin targets, the message can be easily lost through translation when salespeople are given regional volume targets. The “margin” piece gets clouded over by volume, often because of reward structures based on volume, and volume is understandable and easy to measure. Instead of incentivizing on volume and using this language as a measurement of success, find other more meaningful ways like margin targets, attracting specific customer segments or measurements of customer satisfaction.
4) Ensure the sales team understands marketing strategy. While this is a broad statement, it’s often more likely that someone currently in a marketing role started in sales than a sales person started in a marketing role. As a result, it’s imperative that salespeople not only understand selling skills, but also develop a conceptual understanding of marketing. By having a better understanding of the theories, tools, terminology and tactics used in a marketing strategy, salespeople can better understand why they are being asked to do certain things. With this understanding comes better execution and a more cohesive sales/marketing effort.
For over 18 years, I have had the opportunity to teach marketing programs to managers in agriculture. While traditionally participants in these programs have carried titles such as marketing manager, product/brand manager or marketing controller, more recently I am starting to see a lot more territory/district sales manager or sales agronomist titles on registration lists. This is encouraging—it shows not only recognition of the fact that sales and marketing need to be more integrated with one another, but a desire to want to do something about it.
Beyond the Blog
Learn more from Justin Funk and Dr. Scott Downey at the Agribusiness Marketing Level 1: Building the Foundations of Agri-Marketing professional development program. It will be held July 23-25, 2019 on Purdue University’s West Lafayette, IN campus. Register now, or check out other upcoming open enrollment programs to fit your area-specific needs.