How to Motivate Marketing to Drive Sales Using Science and Technology

by Mark Roberge

mark-robergeMark Roberge shares with us his expertise on social selling. He is the chief revenue officer at HubSpot and gives us a unique look into what social selling means from his perspective. He shares how to align sales and marketing using science and technology. Specifically, you will learn:

  • Why the buying journey is important and why it matters that it starts online
  • Why sales and marketing are misaligned and why it's the kiss of death
  • Why a service level agreement between sales and marketing can solve the problem and what social selling has to do with it

About Mark Roberge

Mark is Chief Revenue Officer of HubSpot Sales Products. Prior to this role, Mark served as HubSpot's SVP of Worldwide Sales and Services from 2007 to 2013, during which time he increased revenue over 6,000% and expanded the team from 1 to 450 employees. These results placed HubSpot #33 on the 2011 INC 500 Fastest Growing Companies list.

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Webinar Transcript

Jamie: Welcome everybody to another amazing session for the Social Selling Summit. Over the next 30 minutes I want to introduce you to somebody that I've been trying to get a hold of and trying to meet. I know that when I was sitting with Steve Richards at Inbound this year, he said, "You've got to meet Mark Roberge."

So Mark is the CRO, Chief Revenue Officer of HubSpot Sales Division. So at HubSpot, Mark oversees the entire global sales organization. He started this 2007, now all the way to 2013 and beyond, and at which time he grew this business from zero to ninety million dollars. And he did this by growing the team from zero to a few hundred sales professionals. So the result is that HubSpot's become number 33 on the 2011 INC 500 Fastest Growing Companies list. 

Now Mark is also number 19, ranked by Forbes, at the top 30 social sellers on this planet. So Mark, I welcome you. Take it away, show us something amazing.

Mark: Wow, Jamie, that was magical. [laughs] I've gotta bring you on the road with me all the time. Thank you very much, and thanks guys, for having this hour [inaudible 00:01:15]. I've done this a couple of times before, and really like excited to participate again. So I hope everyone enjoys it. 

We're going to switch gears a little bit today. Usually I talk a lot about building sales teams and there's been a lot, a lot of questions these days about properly integrating sales and marketing, especially the sales executive. Trying to figure out how you should be holding marketing accountable. How you should get them on your side, how you should help them to help you drive revenue. And for super successful companies today, that's sort of a theme I'm seeing is, they sort of cracked that nut. 

I'd probably get more credit for the HubSpot success than I deserve, and a lot of it comes from my working with my counterpart, CMO Mike Volpe, who's just done amazingly innovative things on the marketing side and we've worked hard to properly integrate these two organizations. 

Over the next 29 minutes or so I can give you guys some ideas on how to replicate that success over there. Just diving in here, first off, you know, we did have an IPO a couple months ago, so you know nothing I am saying here is speculative of the stock price and you guys can read the stock, the fine print. 

When I go out and speak to organizations and I, Dude, I speak to hundreds every single year, it's rare for me to find a sales and marketing team that actually gets along. For whatever reason, these teams tend to mix like oil and water, and what I typically find is that marketers find that sales people are overpaid spoiled brats and sales think that marketing does art and crafts all day. And today that's, you know what happens is sales will go back to their corner and do a cold call and marketing will go and design their trade booths and work on "branding exercises." That is a kiss of death for a company today. 

Take whatever study you'd like to read, you'll see 76 percent, 93 percent, whatever it is, the bottom line is a lot of buying journeys are starting online today. Less people will actually show up to a trade show, less people are receptive to sales calls. Most people are just empowered by the internet just to go and start research on a Saturday night when they're at home with the kids. And if these sales and marketing teams are not aligned and not in a good hand in hand with the way that they are engaging with their buyers, that really is the kiss of death because you're going to lose that on all those opportunities. So that really sets the stage of what we're trying to do today. 

The first thing I want to talk about is how we align these organizations through an SLA and this is a service level agreement is what SLA stands for. It's a term that often comes from the world of IT, usually referring to up time by an organization in terms of their servers, et cetera, nd we stole that and applied it to our sales and marketing organization many, many years ago. 

The key to this is that this relationship is highly quantified. You probably listened or read some eBooks on this topic before. Step number one is purely defining what a qualified lead is and what the expectations are, and it's absolutely necessary to quantify that. It's really, really important that this relationship between sales and marketing is bi-directional. This is not marketing working for sales. They both need to deliver expectations to one another, we'll talk about that. And science and technologies are really key to enabling this type of an alignment. 

Let me first talk about how we align sales and marketing at HubSpot. The first thing we did is we went out and defined a marketing SLA. Let me just back up for a second here without giving away the punch line. So this is 2007, 2008. We were ramping our inbound lead flow aggressively and ramping our sales team aggressively. And Mike Volpe and I studied the funnel and realized, as an example, our mid-market reps, if we gave them a 150 leads a month, they did quite well. They would usually connect with half those leads, create 40 opportunities, do 15 demos and close 5 customers for somewhere in the $800,000 to $100,000 MRR range. It was a very healthy funnel. 

And that served the foundation as our first round of an SLA. So if each rep needed 150 leads and they had 10 mid-market reps, well that's easy. Give them 1500 mid-market leads a month and we were pretty certain that we'd hit our goal. And that was a pretty good SLA. It's, I would say top 5 or 10 percent of what I see in the market today. But even that level of discipline still created some misalignment and let me explain what happened. We obviously ,under that model, counted a VP of marketing that came to our website and downloaded a white paper as a lead. This is a VP of marketing and a mid-market company coming to our website, downloading a white paper. That is beautiful. 

We also counted a VP of marketing that came to the website and requested a demo as a lead. Now which one do you think was easier for the sales team to work through and have a shorter sale cycle? Absolutely the demo request versus the white paper download. Now, which one do you think was easier for marketing to actually generate and get someone to convert on? The white paper. The educational, easier call to action, as opposed to a demo request. So there was natural misalignment. Each of those leads counted as one lead but it was a lot easier for marketing to get to the white paper, but sales prefer the demo request. 

So any time that we got behind in a month behind with our marketing SLA, all the calls to action switched to white paper downloads and the salesmen were like, "What happened to the demo requests?" That's when Mike and I stepped back and said, "Okay, we've got to fix something here." And we created this kind of a version of this chart. So what this is is, if you look in the up right-hand corner, this analysis is studying our mid-market leads. And we would take like 10,000 of these, some of them are white paper downloads, some of them are demo requests, and we'd study the conversion rate. 

So let's say the top here, any lead in top right mid-market personas at the problem education stage so they're downloaded white paper. They would convert at 2 percent, so 2 out of every 100 of those leads would convert to a customer, and on average they bought $200,000 worth of software. 

Then the next row down, these people were at the demo request line, they were at the solution research stage. They would convert to it at 6 percent, 3 times higher. Six of out of every 100 would convert to a customer. And also when they bought, they bought on average $200,000 worth of software. So if you multiply the conversion rate, times their purchase amount, we can reverse engineer a lead value. Every white paper download that is a mid-market company is worth $4,000 and every demo request from a mid-market company is worth $12,000. 

And now I've put myself in a position to put marketing on a revenue quota. It is no longer about 1500 mid-market leads a month, it is about $2 million of lead value every month. And if they want to get there through whatever the math is, thousands of white paper downloads or hundreds of free trial or demo request, that's up to them. I'm going to make that my number either way. 

This system properly gave marketing credit for leads that were pushed further and further down the buying journey. And literally the week after we implemented this, a large majority of our calls to action switched to demo request, which is great for everybody. Marketing was getting credit for that hard effort and sales was getting a higher quality lead as a result of it. 

Now in this process, sales does not get off the hook right. This has to be a bi-directional relationship. This is not just about marketing working for sales and we're going to do whatever we want. If marketing is going to step up and take this level of accountability, then we need to do the same on the leads that they work hard on and commit to them what we're going to do with them. So there's a whole bunch of things you can do in here. 

And I would always step back and ask myself, "Well, I know that when a lead comes in, we have to call it right away. If we call within minutes versus hours or days, our chances of success is huge, so that's part of the SLA. But when I do call lead and if I do get a voice mail, when should I try it again? This afternoon or tomorrow? And how many times should I try before I give up? Once, twice, five times, ten times? And as a sales executive should I strive to give every single sales person a 1000 leads a month and have them call once? Or should I give them a one lead a month and have them call it a 1000 times?" Well obviously, the right answer is neither of those ends of the spectrum but it's somewhere in between. 

And here was an example of one of the studies we did. What you see here on the X-axis is the total number of attempts that were made against each lead, and we studied like 50,000 leads in this case. Obviously some of the leads were called twice, some of them were called 12 times. If you call a lead 12 times, you're more likely to get on the phone. But it costs more to do that than if you call a lead twice. So that's what the Y-axis, the vertical axis, is showing here is the profitability of that call sequence. 

So that red line here, that's our small business leads, the ideal number of times to call those leads is five times. That's where that calling cadence says, "Maximize profitability." For mid-market companies, the blue line is eight times, and for enterprise companies it's twelve times. Now I'm in a position to stand up in front of the sales team and say, "Guys, we calculated the ideal number of calls, attempts, to make against a lead to make the most money," and they applied it. And, "Guys, we have programmed this call sequence into [inaudible 00:11:11] automatically," so they don't have to think about it and they applied it. And then, "Guys, we set up dash boards that will go out every single night to let you and everyone else know if any of these leads are slipped into a crack." And they kind of like that, as well, so they don't have to think about it and a lead slipped into the crack is lost money for a sales team. 

So that leads to the final step here, is to properly identify this, what we have done is you can see how quantified this is, both for marketing and sales, into the expectations of each other. And now you're in a position to actually measure this on a daily basis, measure a business in your sales and marketing funnel on a daily business. Here's one of the examples of a chart. This is the chart for the marketing SLA and the Y is showing our path from the 0 to 100 percent, and the X-axis is the days of the month. So in September we had to generate, the marketing team had to generate $2 million of lead value and they had to do it every single day. 

So the first day in they need to be 5 percent of the way through. One week in they need to be 25 percent of the way through, and that's what that red line is showing is the perfect journey to a 100 percent. And the blue line shows the actual journey. Now that's the hard part about being in marketing in this type of system is hug that blue line to that red line pretty closely. Because if instead you come out on fire and you get to 80 percent of your goal on the first 2 days, I don't have the sales team to call those leads officially. 

And vice versa, if you come in and have a terrible first three weeks and make your whole [inaudible 00:12;43] the last week, I got reps sitting around for three weeks calling no leads. So when you get to scale, this thing needs to be engineered on a daily basis, and a similar chart goes out for the sales team in terms of any leads that are falling through the crack. And these charts go out to the whole sales team, the whole marketing team, the whole executive team so everyone's accountable to the business every day. 

Hopefully that triggers some ideas for you on how to take the days of, "These leads suck," out of the question. You really have to move beyond that. And as you can see, accurate data is so key to fueling the sales and marketing SLA and the sales and marketing relationship. And one of the challenges we all know is, sales people are not very good at entering data. And when I sold I wasn't either. It's very hard to be that disciplined. Most sales software, unfortunately today, doesn't actually work for sales people. It actually creates work for sales people. 

That's the next thing I want to talk about is how do you get over that, how do you go out and find sales software that doesn't just avoid this admin work that all sales people hate and don't do and is not going to allow you to fuel this relationship, but actually works for sales people and makes them efficient while avoiding the admin work in capturing that data. 

Let me give you a couple of examples in the HubSpot context on what we've done. The first place I'll start is at the very top of the sales funnel and it's actually sourcing leads. We do have an SDR/BDR team, whatever you'd like to call it, that goes out and finds business beyond our inbound needs. When we first started that team many years ago, we bought some lists for those guys, they had no success with the list. They found out half the people on those lists weren't even at the companies anymore, it wasn't very accurate. We provided them some data sources and they just didn't really adopt those data sources too well. So at the end of the day what they would actually do is just do some searches in Google and find companies that were a good fit and start calling them. 

That was a really gruesome process and I represent that process in the left-hand side. They'd essentially do a search in Google, find a website, click through the website, spend two minutes reading it to make sure it was a good fit. If they like it, they'd go in the CRM and check if it was actually taken by someone or if they could call it. And if it was available to be called, they'd go out into social media and find out who the executive team was, and who all the key roles were, and they'd do a little research online to figure out what the email patterns on, the phone patterns are, for that company. They'd figure out what the industry was, what the revenue was, it took 10 minutes just to source one lead. It was a ton of research. 

So we kind of had some hackers on the side, it was like you know, we can really streamline this process and they developed this internal software that we've been using for a couple of years that we've recently commercialized, and basically, these guys now go to the website, click on a button and it's all there. The revenue, the industry, the key contacts from social media, what the email pattern for that company is, whether anyone at our company has emailed anyone at their company. That is gold to find out that our head of legal is cousins with someone in their IT department. I mean that is the best way in. 

And it tells you of five other companies that are just like that one if you like that lead. So the economics, I mean you could take honestly a full day, a week for a BDR to source enough leads to keep themselves busy for that week and now it takes an hour or two a week. It leaves so much more efficiencies and time to actually be [inaudible 00:16:26] on the phone and selling. 

So moving on to the actual calling process, the other thing that we found is I went over and I actually made the first $1m000 at HubSpot and went through this process. I knew I wanted set our sales up for a data-oriented organization and set our sales up for the sales and marketing SLA. I knew I needed to track my calls and learn from this model, this is our funnel and make it efficient and it was terrible. I would go into the CRM and I'd call a prospect and email a prospect, and I'd have to log the call, create an activity, note that it was a call activity, save it, log the email, either send an email to the CRM, which I actually hated to do because I wasn't sure if it was actually going to get there. And if not, I had to copy and paste the email into the CRM, save that and then create a task haphazardly for two or three days later and save that task to call them up. 

It was like 10 clicks and I am doing that 50, 60 times a day at least. So we spent some time way back in 2007 and hacked our CRM and fortunately there's a software out there, and we have some software, too, that does this, but then once we did that hack it was like, "Okay. I'd call them, press the call button, it dialed the number, it recorded the call if it was legal to do that, it logged the call on my behalf, I pressed email right from Gmail where I was actually comfortable working, chose the template that I wanted to use. It personalized it right there in Gmail for me with the data from the CRM and I hit send and that was it." It auto-logged the call, it auto-logged the email and it auto-scheduled the next call for me. And I, as the sales executive, had complete control over that call when that call was going to be made again. 

The reps loved it because they were able to get through all this work without having to guess when they should call them again and click through the CRM ten times every call. And I loved it because I could track all this data that I needed for the sales and marketing SLA and to make the sales funnel efficient. 

So the bottom line here is, if you're going in with the expectation that the sales people are going to fill out information to help you, as the leader or help the company, I don't think you're going to have much success with it. You can find a way to get that data but there needs to be a clear what's in it for the sales person. So create value for them, in addition to capturing the data for yourself, those investments are hugely helpful. 

So I'll close it out here with the last piece. So far we've learned about how to get this relationship quantified and give you some examples of how to hold these organizations accountable to each other. I gave you some examples and told you why it's so important to use sales technology to enable this stuff, and hopefully trigger some ideas for you guys. 

The last part is, how to get marketing to work more for you and to help you drive business, because believe or not, they might not always feel like they want to that but they do. They're just frustrated because they don't know how. And a lot of times what I find is these organizations, they're actually creating content, they're putting together PDFs, they have people there that are supposed to do that, they're putting together web pages for you, they're putting together slide decks and doing webinars, et cetera, and then they'll give it out to sales, they might even run a training program for you, and that's it. It's like a [inaudible 00:19:47]. They have no idea. Do people like it, are they using it, are customers using it, is it driving the sales cycle? They have no visibility. 

So we really tried to work on that and we enabled our marketing team a sort of a central repository that gave them access to this data without putting any work on the sales person's head. So we created this central repository, kind of like your own dropbox or Slideshare or whatever it is, and the marketing team could upload content there, sales could go in and edit it and give feedback on it. And the sales team was highly, highly incented [SP] to send the content from this repository, as opposed to sending it from their email because if they did, it would tell the rep when the person opened up the PDF or when they opened up the slide deck, how long they spent in there and what pages or slides they looked at and for how long. 

And that was gold for the rep. I mean, you send out that PDF, every person in sales has had a prospect that's gone silent on them and they have no idea what's happened on the other side. Did the person actually just drop off the face of the earth and go on vacation, or are they actually looking at it and forward it to their boss? That type of visibility is so key. So we made it really easy for reps to be able to send it. In fact, we allowed them to send it through email, they just drop a link that's a one-click option right from the email to be able to send that out. And then it tracks all that information for the rep as to whether the prospect opened it, which pages they looked at, and whether they forwarded to their boss. 

And that was great for the marketer because now they could generate these beautiful reports for marketing. I can show marketing which, this piece of collateral has been emailed out 27, 2,714 times. It's been opened to 67 percent of the time. And even though it's 17 slides, only half the people make it to slide 8. And this is the slide that they skip over quickly and these are the slides that they actually look at for a while. That is gold for marketing to be able to help us. So it's not that marketing doesn't want to help us drive revenue, it's just that they don't have the tools to know if their efforts are actually working. 

And here's a little slide for you guys. I'm not sure if anyone caught this last year but we put together, we've been tracking a whole bunch of emails across, jeez, probably like 50,000 organizations. I think we studied like 5 or 6 million sales emails that were sent out. And we put together a really nice report. That wasn't just from HubSpot, it was across hundreds of organizations and thousands of companies. 

I'l give you a couple of examples of what's in this study. I put the link in there for you guys to go and check it out if you'd like. It's at getsidekick.com, Email Open Rates Report. But one study that I thought was always interesting was, some of these emails, like a decent percentage, I think it was like 8 percent or something, the rep didn't even put a subject in the email, no subject. 

All these studies around what to put in your subject line and how to avoid the spam blocks, and how to increase your open rate, and these reps are like, "Screw it. I'm not even going to put a subject in there." Well guess which, we study that, we studied the emails that had a subject in there and the ones that don't and guess which ones had the higher open rate? No subject line by 8 percent. I couldn't believe it. I don't know, I just got a kick out of this one. I am by no means advising you to not include subject lines in your emails. Perhaps if you're a highly transactional product with enormous addressable market you may want to try that on your first team. But I thought it was interesting that that actually had a higher rate than subject lines altogether. 

The other one that I think actually has some tactical meaning, too, is we studied the day of the week that these emails were sent and which one had the actual higher open rate. Let me show the results there. What this chart is showing here is, you see the day of the week on the bottom X-axis that the emails are sent. On the left-hand axis is the open rate and the right-hand axis plots that grey line, which is the number of emails that are sent. 

So let me, this one's a little harder to absorb here, but let me interpret for you. Basically the grey line is showing us, the grey line is really, really low on Sunday and Saturday and it's really high on Monday and it kind of tapers off. That's showing how many sales emails are sent, so that makes sense. Reps are all golfing all weekend and then they burn all their money and they're coming in money like, "I got to have a big week," and they send a ton of prospecting emails. And Tuesday's a good day, and Wednesday's a good day and Thursday's a pretty good day but they take off early to go to happy hour and Friday drops off a bit because they're off heading back to the golf course.

Now contrasting that, the black line is the open rates. So you can see the black line is low on Monday, Tuesday, Wednesday, these are the busy executives who coming in and they have like 17 meetings and they're overwhelmed and they don't get to their email till 10:00 at night. I can completely relate to this. And I only get to like 20 percent on my inbox, and Thursday my open rate goes up a little bit because I am trying to sludge through my inbox for the weekend. Friday goes up a little bit more but my open rate is huge on Saturday and Sunday because I never got to those emails. And when the kids are asleep at 9:00 at night, that's when I finally have a chance to step back and no one's around, I can just crank through my inbox. 

So really, really interesting study here. What we did was we actually created some software right in Gmail for us and it works in Outlook, too, is allowing our reps to schedule an email send. So if I'm in a rep and I am prospecting on Friday afternoon, I leave a voice mail, I'm not going to send that email on Friday afternoon, I am going to send it for Saturday and have it delivered then to see if I can catch that executive at the top of their inbox when they're actually going to, might be checking their email. I'm not going to do it every single ping, but if I'm pinging up a busy executive, I might try that once or twice in that process. Check out that report if you'd like to see the full results.

And the last thing I'll leave you with is, I get a lot of questions about how selling needs to change in an inbound environment and just spending two minutes on that here. More and more organizations are generating more and more inbound leads. And a greater percentage of their calls, their sales calls, are going toward heated up, in bound needs, as opposed to completely called out bound prospects. 

And the challenge that I see here is, I'll get a call from one of our professional services people. "Mark, I've got this customer onboard HubSpot, they've been on for six months and they're crushing it. When they first came to us, they were getting like 10 leads a month through their website. They're now getting 500 leads a month. The problem is, their sales people hate the leads, they think they suck. Can you jump on the phone and help them out?" 

And it's amazing, I see the exact same thing every time. What happens is, the sales team has been trained over the years to just do cold prospecting. Call high with the elevator pitch that's appropriate for the C level executive. And then they get this inbound lead and first off, the marketer generates like 500 leads, they throw them all over the fence to the sales team and that's the kiss of death. It's like, let's say even 10 percent of those leads are qualified for the company. Well, if you throw all 500 of them over, they're going to hate you. 

But if you filter them down to the 50 that actually are good, you're going to be called the best marketing team in the world, and they're going to be asking to give you more and more budget. So the first thing is you have to appreciate this model I have here where when you're cold calling, you pick, you cherry pick the best possible companies and the best possible roles, perfect fit people, and then you shake that tree with your cold calls and your direct mail and your cold emails and one percent of them come out with a pain that you actually solved. 

And inbound sales and marketing flips that whole paradigm on its top, which I show on the right-hand side. Everyone that finds you has a pain, they wouldn't have done the Google search, they wouldn't have downloaded the eBook, they wouldn't have read the blog article. But not all of them are a good fit so you have to appreciate that first and whether you filter them as your marketer or your SDR team, and you're running an algorithm to do it, you're upping it large scale, you have to find a way to get only the percentage that are good for the company to sales. 

The other problem is getting back to that sales team that's trained to call out bound is, even if it's a good fit company, it's probably not the right role. It's probably three levels down from the budget authority. Doesn't mean it's a bad lead, you just have to approach it the right way. And if that sales person calls that person, that sort of front line worker, maybe even an intern, with the elevator pitch that was appropriate for the C level suite, the sales person finds that the intern has no idea what they're talking about, and has no budget authority and they hang up the phone and says, 'This lead sucks," but it doesn't suck. 

The fact that that person downloaded the white paper or conducted a free trial is because their boss's boss's boss told them to. And there's something going on there, it just needs to be navigated correctly. 

So you have to conform your sales style. Some people just call directly to power and just say they've been getting some inquiries. Other people engage with the actual contact knowing they're not the buyer, but just to build trust with them and find out what's going on. And then use that intelligence to call the buyer, the actual right contact with a lot more information. 

Just appreciate that this is a different paradigm and it can have a lot more sales success with these particular approaches. 

So I'll leave you with this, as you may know we've had a great run and I helped spot in our marketing software last seven or eight years. In the last year and half or so, we've been diving aggressively with our prior team and the rest the organization into the world of sales. So we launched this sidekick product that's available on getsidekick.com, and a free CRM that we are making available, as we speak, that you can go to the Hubspot.com/sales to sign up for and be a part of our beta program. 

We are working aggressively to basically commercialize all these concepts, all the concepts that I talked to you about today in sales and marketing alignment, and others that ain't tell you about in terms of making your sales team more and more efficient and more align with your buyers' journey, are being developed into these commercialize in this software. 

Feel free to check out these free products and try them out and hopefully replicate some of the stories I told you today. I do have a book coming out that I wrote about building the HubSpot sales team. It's available on Amazon, if you do a research on Mark Roberge, it's called The Sales Acceleration Formula. It's going to come out next month if you want to check that out, as well. 

So that is my time. Guys, thank you so much for including me again in this conference and I hope everyone has a great day at the show.