The Case for Rapid — Not Gradual — Digital Demand Transformation
Marketing and sales once were considered separate, but allied, disciplines, but major change is afoot. Companies are starting to consider “go-to-market” more holistically and so they’re building teams focused around integrative concepts such as “Revenue Operations” (RevOps) and “Strategic Demand.” Taking a rapid approach to digital demand transformation is key to this process.
This movement is more than simply bringing together marketing and sales activities. It represents a fundamental shift towards aligning people, process, content, technology and data around the buyer journey. Instead of just creating more and more leads, we’re emphasizing how all of the different marketing and sales touchpoints work together to drive the buyer towards revenue goals. The objective is to build a repeatable, optimizable, go-to-market engine to drive growth with clear levers for success.
This is a substantial change for most companies in the marketplace. Shifting from tactical, activity-based goals to strategic, outcome-oriented goals is a major undertaking, and you can’t get there with incremental changes. It’s an evolution, and it’s transformational.
Moving away from tactical activities to strategic, outcome-oriented demand requires true Digital Demand Transformation. A Digital Demand Transformation is an emerging discipline that brings both science and change management as solutions to the challenge of demand optimization in a business environment.
But to succeed with transformation, companies must move quickly to achieve results faster and ensure these results are fully realized and engrained.
Why transform demand?
As noted in a recent blog post, numbers don’t lie.
We see a state in the marketplace today of lead-to-revenue activities that are substantially inefficient.
According to SiriusDecisions, the typical lead-to-revenue conversion rate ranges from 0.375% to 0.6%, depending on the type of market. That’s not great.
Companies that have transformed demand and shifted to a Strategic Demand state can substantially improve lead-to-revenue conversion – typically 4-5X the industry average (i.e., 400-500%). That’s substantial!
Aligning around buyer journey addresses a key arbitrage opportunity and can clearly provide sales lift. But it also has other benefits including:
- Improvement in the customer experience
- More sustainable and predictable pipeline
- Higher ROI of marketing and sales investments
Why rapid transformation vs. incremental change?
There are many reasons why rapid transformation is necessary for a successful Digital Demand Transformation, but these are the five most important.
- The sooner the better: This one is obvious. The sooner you get there, the better. If you can provide 4-5X sales lift in your business, why wait?
- Competitive advantage: Moving quickly with Digital Demand Transformation offers a critical, competitive advantage. It enables companies to significantly outpace their cohort in go-to-market efficiency with targeted segments. So not only does transformation improve results, it also distances your company from the pack, and the faster you can drive this distance, the more competitive benefit you achieve.
- Sustaining your transformation: When transformation is approached incrementally, and the process is dragged out it often encourages organizations to revert back to a previous state. In fact, the longer it takes to move to the ‘new,’ the more likely the ‘old’ will remain – especially as organizations get caught up in cultural and political elements of transformation. Moving quickly helps organizations transcend those elements that can block transformation, and thus it can be critical to ensuring the change is engrained and sustained.
- Keeping pace with buyer change: At the core of Digital Demand Transformation is an effort to better align go-to-market motions to the rapidly changing buyer journey. Moving slowly to tackle this change can mean that the buyer insights driving the new model may have changed by the time the transformation is complete. Keeping pace with your buyer requires moving quickly.
- Achieving your ‘full’ objectives: It’s important to approach transformation in a way that ensures you’ll achieve the goal of buyer-centricity throughout the entire business. Companies pursuing this evolution are not merely trying to notch up performance a few percentage points; rather, they are attempting to change the fundamental dynamics of their business model — setting their sights high.Approaching transformation in an incremental way and/or insufficiently setting and communicating targets can result in transformation failing to meet its objectives. McKinsey highlights in a recent post:
“[E]xecutives propose fundamental changes in how the business operates but don’t go through the hard process of setting commensurate performance targets. They often set targets too low, aiming for incremental change. When they do set their sights appropriately high, they often fail to adequately make clear to key stakeholders who owns the goals and responsibilities associated with various elements of the transformation. As a result, value can end up ‘leaking’ even from good initiatives, which can sap companies’ efforts to meet bottom-line targets, drain momentum from good investments, and impede buy-in for change efforts generally.”
You want to fail fast.
A Forbes post notes, “as counter-intuitive as it might sound for those of us trained in the leadership model of the industrial era, iterating fast failures achieves a desired result faster than perfecting the solution.”
Transformation initiatives are not perfect; in fact, multiple elements of your original hypothesis will be disproven. A Digital Demand Transformation is complex and multi-faceted.
The faster you move, the more quickly you learn from any failures that occur and course correct, and the more quickly you can tackle the multiple layers involved in the transformation initiative.
Getting to the bigger vision means tackling a lot of smaller elements along the way. Parsing it out as a series of smaller elements is always more digestible; moreover, signaling that mistakes will be made along the way improves the likelihood of the overall initiative succeeding. And this is where speed comes in: the problem is that when organizations move slowly, the minute something doesn’t work out as planned, they immediately get caught up in the mistakes and fail to grow to the next level.
Speed is crucial. Clearly there is a very strong case for rapid – not gradual – Digital Demand Transformation.
To learn more, read Taking a Phased Approach to Digital Demand Transformation.