Sales | The Ultimate Hiring Guide
Cowen Partners, a national sales executive search firm, has put together what we believe is the ultimate guide to hiring sales leadership, including a sales team and growing sales. Designed for CEO’s, founders, and HR leaders, we outline the major issues encountered by an organization when building a high-performing sales function.
About Cowen Partners | A 5-Star Sales Executive Recruiter for Every Industry
Cowen Partners is one of the nation’s best executive search firms. Our clients are both small and large, including publicly traded and pre-IPO companies, as well as private and non-profit organizations. Clients are typically $50 million to multi-billion dollar revenue Fortune 1000 companies or have assets between $500 million to $15 billion. Successful placements span the entire C-Suite and include VP and Director level leadership roles.
Table of Contents
Click on a linked heading below to jump directly to that section.
- How to Build A Winning Sales Team
- Sales Team Compensation
- Sales Executive Recruitment
- How to Scale an SaaS Company to $100 Million ARR
- How to Build a Successful Demand Generation Team
- 5 Reasons to Use Account-Based Marketing in Your Business
- How to Reimagine the Chief Marketing Officer Role
- How to Hire the Best CMO for Your Startup
- Chief Revenue Officer Job Description & Responsibilities
- VP Sales Job Description & Responsibilities
How to Build A Winning Sales Team
“Hire sales people who are really smart problem solvers, but lack courage, hunger and competitiveness, and your company will go out of business.”— Ben Horowitz
At the very beginning stages of a startup there are very few employees, and most of the time a sales representative is not one of them. This means you, as the CEO or founder, are likely the person in charge of pitching and selling the product to potential clients. At this point in time, you should be doing sales exploration to gain a deeper understanding of your customers while also testing different sales strategies and gaining insight into the overall market.
As the CEO of the company, it’s likely sales are not be your favorite aspect of running a business. You’d much rather be focusing on new innovations and conceptualizing ways to improve your product, but sales are how you grow. Your first few sales and the market research you collect are vital for achieving the next three phases of startup sales growth.
Stage 1: Your first two sales reps
The next stage in the growth of your startup is to hire your first two sales representatives. At this early stage, you should be looking at young sales reps who are just starting out, not a veteran representative. You want the fresh-faced sales reps for a couple of reasons. First, young sales representatives are often eager to develop their skills and try new sales methods to see what works for your company. Second, less-experienced sales reps are cheaper to hire. You can bring two salespeople onto your team right at the beginning to increase your outreach without paying them quite as much as a more veteran sales leader.
Before diving into hiring, however, you need to make sure your business is ready for this growth stage.
Timing is key
It can be difficult to pinpoint exactly when you should hire your first couple of sales representatives. You need to ensure you have room in the budget for another salary, plus you need to make sure you fully understand your market and sales cycle. Below are a few key milestones you should hit before hiring your first sales representative.
- 10 Clients
You should aim to have at least 10 solid customers before you start outsourcing any sales talent. Ten clients tell you two important things. One, you know people are willing to buy your product/service, and two, you understand how to sell your service. - Solid Sales Process
You really shouldn’t hire a sales representative if you don’t have a sales process in place. You want your new hire to jump right into the sales game with a structured sales framework, not a haphazard vague idea of how to approach customers. A sales playbook will give a new sales hire all of the information they need to succeed and make your company successful, too. The following is a list of a few details your sales playbook should include:- Summary of the company and product/service
- Outline of the sales cycle
- Customer profile
- Call scripts and email templates
- Key performance indicators
- Established Lead Generation Strategy
You’re definitely ready to hire some sales help if you have more orders/clients coming into your pipeline than you can manage alone. Lead generation helps keep potential customers cycling into your business, so once that is set up and running smoothly, you’re ready to hire more help.
Stage 2: Establishing sales leadership
By stage two of startup growth, you should be seeing consistent sales and growth within your company. You have an effective sales strategy and sales funnel as well as 3 to 15 sales representatives working for your company. At this point, it’s time to start hiring sales leadership positions such as a sales manager or sales director.
What to look for in a sales manager
When reviewing possible candidates for your sales manager, you want to find someone with experience leading sales and demand gen teams as small as three people to as many as 30. Look for a candidate with a background as a junior sales representative who worked their way up to a leadership role. The sales manager will help ramp up your company’s growth and expand your capabilities.
The main three goals of a sales manager should be to refine the sales process, effectively manage the sales team, and lead the team through various training and coaching. Below are a few main characteristics you should focus on when reviewing potential sales leader candidates.
- Passion
You want a passionate sales manager on your team. A person with passion who believes in your company will work much harder and be more engaging than a sales manager who is just in it for the money. - Persistency
Working for a startup takes a certain level of persistence. You need a sales manager who is willing to go the extra mile for clients and who can push a sale like no other. - Tech-savviness
The ever-evolving digital landscape makes tech-savvy leaders imperative to the growth of your business. This is particularly important if you run a SaaS startup. Your SaaS sales leader needs to not only understand your product but also how it fits into the industry and market.
Stage 3: The senior sales leader
The next move to stage three of your startup sales hiring is crucial. A senior sales leader will play a major role in your growing company. Not only is this position important, but it’s also expensive. To lure a VP of sales to your startup, you’re going to have to offer a hefty salary as well as equity in your company and extremely competitive benefits. Of course, the high price point that comes with hiring a VP of sales is worth the return.
Once you reach 25 or more sales representatives, it could be time to start thinking about hiring a senior sales leader. It’s around 25 sales reps that you start needing someone who can manage all of your sales directors/managers. Along with managing the junior sales leadership, the VP of sales is responsible for opening new offices, closing big client deals, and scaling your sales channels, just to name a few. An experienced senior sales leader has the potential to skyrocket your company growth, so make sure you put serious consideration into the candidate you choose for the role.
Building a winning sales team should start with strong sales leadership. At Cowen Partners, we’ve seen an increase in fast-growing companies retaining our agency to find them strong sales leaders to build around. After an analysis of their environment, our clients know what hasn’t worked in the past, what they currently have, and where they want to be.
One mistake companies often make is trying to turn a top-producing individual contributor into a team leader (or vice versa). They want their “Director of Sales” to hunt and close large opportunities while hiring, training, and mentoring the team. Unless you have a simple sales process and a very small team, this is not the right move.
The player-coach concept hasn’t worked in the NBA since Bill Russell and The Celtics in the late-60s, and it’s probably not the best strategy for your modern company. A better move is to first determine where you need your company to be in 12–24 months, then hire either a tactical or strategic leader to get you there.
Sales Team Compensation
You need to build a solid sales team to lead your business, and one way to attract top sales performers is offering the right sales team compensation plan. If it’s your first time setting up a sales team, however, it can be difficult to determine which incentives to offer your team. By breaking down the different incentive categories you can easily come up with an attractive compensation package that will keep your sales team motivated to perform.
Individual Account Executive
The first incentive category to focus on when creating your compensation package is what you will provide the individual account executives. Each individual account executive sales plan should include five key components: a base salary, commission rate, quota, on-target earnings, and variable pay.
Base salary
A compensation package should always start with a solid base salary. Top sales executives will not be impressed with their commission or other incentives if the base salary isn’t up to par. Carefully research what other SaaS companies are offering account executives for a salary so you can make sure you’re offering a competitive rate.
Commission rate
Once the base salary is established you can move onto the commission rate. Most industries have a standard commission rate you can reference. For example, SaaS products typically have a 10 percent commission rate for sales reps. If an account executive closes a deal worth $10,000 in annual recurring revenue, then the commission for that sale would be $1,000.
Quota
When determining the quota, you set for your sales representatives it’s important to set a goal that is realistic. To start, look at the performance of your best sales rep then analyze sales and conversion rates. Using this data, you should be able to put together a quota that is attainable for at least 60 percent of your sales team. You probably won’t get the quota right the first time, but that’s OK. You can always make adjustments later. A standard rule many companies follow is the rule of 10. They’ll set an account executives quota by making it equal to 10x the rep’s base salary. This means if you’re paying a sales representative a $50,000 salary, the annual quota for that employee would then be $500,000.
On-target earnings
On-target earnings give account executives a goal to work toward. It lets them know just how much they can earn if they hit all of their quarterly sales goals. It’s relatively simple to calculate an OTE for an account executive, too. Essentially, the OTE is the sum of an employee’s base salary and on-target commissions. If you’re paying a sales rep a base salary of $50,000 and the on-target commission rate is $30,000, then the OTE would be $80,000.
Variable pay
Variable pay can be a great incentive to sales representatives and an alternative sales team compensation if used appropriately. The variable pay is typically compensation determined based on sales performance. There are three different types of variable pay companies provide, and it’s up to you to decide which option is best for your company and employees. The three types of variable pay are: commission structure, bonus, and management by objectives. The commission structure is essentially a tiered plan. As a sales rep closes more deals and comes closer to quota, they can hit new commission tiers. For example, you could have account executives start at a 7 percent commission rate but bump that number to 10 percent once they’ve hit $100,000 in sales.
Bonus are typically paid out a bit differently than commission tiers. A sales rep will receive a bonus after hitting a goal, but the bonus usually gets paid out quarterly or annually. Bonuses are also a fixed payment amount while the tiered commissions can vary between each sales rep. Finally, a management by objective variable pay option is very individualized. Employees can set goals that help them work toward their incentive pay.
Territory areas
Assigning territory areas to each sales representative is essential for avoiding sales conflicts and for optimizing coverage. A sales territory defines where an account executive can sell. There are typically three types of territory structures companies choose from when structuring territories.
Geographical locations
Territories assigned by geographical location is a common structure used by SaaS companies. However, when structuring geographic territories, you should be less concerned with physical land size and instead ensure an equal number of leads is split between each territory. If territories are equally split in terms of leads, then sales representatives won’t be concerned about which territory they’re assigned.
Round-robin
A round-robin territory schedule helps equally assign leads to sales teams. This is done by distributing one lead to a sales representative then moving onto the next account executive until everyone is assigned a lead. Once everyone has been assigned a lead, the process begins again at the start of the assignee list until all of the leads have been divvied out. As new leads come into the sales funnel, the next representative in line will receive the new lead. This structure is popular with smaller teams who don’t have the resources to maintain a geographical territory map or a sales vertical.
Sales Verticals
Another territory structure implemented by SaaS companies is industry verticals. Verticals focus on a specific market sector instead of the whole industry. This is particularly useful when a SaaS product applies to very specific customers.
Quota Capacity
The total team quota for your sales team is known as the quota capacity. Your sales team should be able to attain 70 percent of their quota capacity. Calculating the quota capacity is quite simple. You just have to sum the quotas of each of your sales reps. For example, if you have four account executives with $100,000 quotas, then the team quota capacity would be $400,000.
Growing Your Sales Team
If your sales team is already achieving 70 percent or more of their quota capacity, it’s time to start expanding the sales team. Of course, only expand if you have enough leads to keep new sales hires busy. Building a functioning sales team takes time and hashing out all of the incentive packages can take a little reworking before you find the right compensation package mix. Working with some of the numbers above, however, will start you out on the right foot and keep your account executives satisfied as you build the team.
Cowen Partners is a national sales leadership recruitment firm and has a strong record of identifying and recruiting sales leadership for fast-growing public and private companies. Contact us if you would like to discuss recruiting an exceptional sales and marketing executive team or leader for your organization.
Sales Executive Recruitment
A tactical Sales Manager will be focused on the team’s metrics and activity. Their aim will be driving maximum output from each rep on the team, hiring well-connected reps who can leverage decision-maker relationships, and ramping up new hires fast. The short-term revenue spike will come in exchange for developing scalable and repeatable processes.
If multiple years of steady growth are what you’re after, you will need a strategic Director or VP of Sales. A strategic sales leader will design and implement processes that are scalable and repeatable. They will have a track-record of leading prolonged growth, writing a sales playbook, and creating effective hiring, on-boarding, and training programs that are repeatable.
Once you have decided on a strategy and a sales leader is hired (either tactical or strategic), individual contributors will be added. If you chose a strategic leader, this is where the benefits of that hire will become evident from a personnel standpoint.
The strategic VP of Sales knows what will work in the long run. The processes they implement are practical, and if given enough time they will increase revenue and decrease costs. These strategies help the current team sell more competently and lead to lower turnover.
Salespeople who are selling efficiently are generally happy. Removing roadblocks and providing opportunities for development will attract high-caliber reps, increase hiring success ratios, and create transparency. Clearly defined metrics of success will keep the team’s top performers motivated and indicate when it’s time to course-correct underachievers.
Top-level sales reps are driven by one or more of the following: money, autonomy, and recognition. They are hungry, competitive, and loyal. If they consider making a strategic career move, they will look for companies where they know they can apply their skills, background, and intangibles to proven processes. The strategic VP or Director sets the stage for talented reps to perform their best.
Once your sales team is process-oriented, exceeding targets, and there’s low turnover, you have a high-performance “winning” culture providing steady growth for years to come — all due to hiring and empowering a strategic sales leader.
What to look for in a leader
Hiring your first sales leader isn’t easy, but it’s a necessary step to creating a more powerful sales team. Below are three important questions you should ask a potential sales leader during the interview process.
- What are the differences between your previous company and this one, and how would those differences impact your sales methodology?
Sales leaders tend to lean heavily on past experience when selecting sales methodologies and compensation plans. Asking about the difference between your company and the candidate’s past employers will give you an idea of potential weak points in the leader’s experience as it relates to your business. Make sure you also know your own company’s sales methodology so you can find someone with the right experience, whether you do freemium sales, inside sales, field sales, or another avenue.
- What kind of salesperson would you hire?
You don’t want a candidate who hires the same type of salesperson every time. You need a leader who will choose a sales member based on company needs. As the candidate goes over what kind of salesperson they believe is right for your company, make sure you also ask what kind of salespeople they’ve hired in the past. If they’ve only hired one type of salesperson, it could be a warning sign they’re not a right fit.
- How would you structure the compensation plan to fit our business?
Compensation plans are a crucial aspect of any sales team, so make sure the leader you’re hiring understands your business model, sales model, and company expectations. If the leader is to structure the compensation plan, they’ll need to understand how to adjust expectations and benefits based on what your company has to offer.
Ultimately, you want to choose a sales leader who is willing to think outside the box and adjust their sales team model to fit your needs. You don’t want someone who is going to copy everything they did for their last employer because chances are the same structure won’t work. A great sales leader will know how to structure the sales process and strategies to fit your business and meet your goals.
Perfect the sales hiring process
Once your sales leader is in place, you’ll need to work together to perfect the sales hiring process. One reason sales position turnover is 27 percent is because companies don’t take the time to properly construct their hiring process. Below is a seven-step plan you can use to improve your sales hiring process.
- Construct a candidate profile
A strong idea of the perfect sales candidate will make the hiring process a lot easier. If you know what characteristics, qualities, and experiences you’re looking for, it’ll help you weed through candidates a lot faster. To construct your candidate profile, take a look at your top team sellers. What aspects of their backgrounds, traits, selling styles and motivations do they have in common?
- Develop an interview strategy
Structure your interview strategy around your candidate profile by creating a list of questions and interview techniques that reveal the various qualities and characteristics of your candidates. For example, roleplaying can be particularly beneficial during sales interviews. During a roleplay scenario, you get the opportunity to see how a candidate thinks on their feet as well as assess many other characteristics.
- Set a hiring timeframe
A hiring pipeline is important for keeping the hiring process moving and timely. Set realistic time frames for accepting applications, contacting candidates, interviewing people, hiring, and onboarding. A solid timeline and hiring pipeline will keep your company organized and efficient during the long hiring process.
- Construct a job description
The sales executive job description has two main roles. First, it needs to highlight your company and sell the team. Second, it needs to accurately describe the job role and expectations. When constructing the job description, pull from your candidate profile when listing background, qualities, and other main candidate characteristics, however, make sure to break everything up into required, preferred, and bonus categories. The perfect candidate doesn’t exist, so be sure not to set unrealistic expectations in the job description.
- Interview qualified applicants
Standardizing your interviews is a great way to ensure you select the right person for the job. It’s easy to be swayed by how well you connected with a candidate versus the necessary qualifications if you don’t have a solid interview standardization in place. A few tools that will standardize interviews and help them run more smoothly are listed below:
- Candidate scorecards
- Interviews with multiple company leaders applicable to the role
- A standardized list of interview questions
- Make an offer
Selecting a final candidate for the sales role is a major decision and one that everyone on the hiring team should take very seriously. It’s expensive to hire someone new, but it can be even more expensive to fire someone. Have a meeting with everyone involved in the interview process to gauge candidate impressions and get a sense of top hire preferences.
As you go through the process of selecting your new salesperson, you may have several top contenders but only one position available. Make an offer to the salesperson you choose, but let the other top candidates know you were impressed with their interview. Use the rejection email or phone call as an opportunity to form a connection and stay in touch with the other candidates. A few months down the road when you decide to expand your sales team even more, you’ll already have a small pool of candidates who are perfect for the job.
How to Scale Your SaaS Company to $100 Million ARR
The $100 million annual recurring revenue mark is a significant milestone for SaaS companies that signifies sustainable company growth. While every startup wants to hit this number as soon as possible, it’s a process that takes time. According to Kimchi Hill, on average it takes 4.5 years to hit the $10 million ARR mark and at least 50 percent of companies take between 5 and 10 years to finally hit $100 million ARR.
Successfully scaling your SaaS business takes time, dedication, and the right business strategy. These tips can help you start to craft the right scaling strategy:
- Recognize when you’re ready to scale
- Avoid the Common Mistakes
Recognize when you’re ready to scale
The path to the first $1 million ARR is when most SaaS startups go through a strong learning phase. As you work toward $1 million ARR, you should be learning what works for your company and what doesn’t. For example, by the time you hit $1 million ARR, you should have determined the right product for your market, identified new customer leads, secured long-term business contracts, and have repeat customers, just to name a few. If you’ve seen consistent growth for a least two years in addition to ironing out your business strategy, you should be ready to scale your business.
Avoid common mistakes
Scaling a SaaS company takes skill and not all startups follow best practices. There are a number of common mistakes seen in the SaaS startup realm, but below are the top four you should avoid as you work to scale your business.
Offering too many discounts
Startups are eager to attract customers, and a common strategy they’ll use to gain customers is discounts. People love discount deals, so it can be tempting to offer big discounts to bring more people to your service. The problem, however, is that SaaS companies start offering excessive discounts which can lead to attracting the wrong audience for the product and undervaluing the service. Instead of focusing on discounts, create a plan that includes customer incentives instead. This way customers are still encouraged to purchase the product, but you’re not giving away too much.
Ignoring current customers
A common fallacy among startups is that new customers are more valuable than current customers. This is simply not true. Customer retention is a huge aspect of business success. Your current customers can bring you repeat business, and they’re also a valuable source of referral business. Too often startups become overly focused on acquiring new clients or leads and forget to give their current customers the best experience possible.
Hiring the wrong people
Hiring decisions are always difficult, but startups seem to have an especially hard time finding the right people. The main problem is that startups tend to focus too much on technical skills and not enough on candidate qualities and culture fit. SaaS startups have unique cultures and expectations that employees need to understand and accept before being hired. If you’re adding new positions to your team, make sure you review candidate characteristics in addition to their overall experience and background.
Avoid growth hacking
Growth hacking has become such a buzzword in the startup scene. Startup leaders are trying to figure out the fastest way to achieve rapid growth, but don’t be fooled by growth hacking strategies. There are several problems that startups run into when attempting to growth-hack their business. First, growth hacking often involves a number of shortcuts which leads to missed learning opportunities. Second, by scaling too rapidly, startups can’t keep up internally with growth and the management of the company falls apart. Finally, growth hacking often leaves customers feeling unheard and undervalued. All this to say, shortcuts will have a negative impact on your SaaS company long-term if you try to growth hack your startup.
Build your employee base
A major aspect of scaling is effectively growing various teams. In particular, the $10 million ARR mark is typically when startups begin to hire middle managers to oversee more of the business process and separate C-suite leaders from the general business process.
Adding another layer of sales management is also done at this time and can be especially difficult. Startup CEOs are accustomed to being involved in the sales process, but now the crucial role of managing sales falls on the VP of sales and department managers. The sales department needs particular attention as the startup scales and becomes larger, too. By the time you hit $10 million in ARR your company should have a dedicated sales team with a reliable sales pipeline in place for acquiring and driving business. As your startup grows, make sure you’re not neglecting this vital growth department.
Demand generation marketing strategies are tactics used to generate interest and demand for a company’s products or services.
What Is Demand Generation?
Demand generation can include a variety of communication channels from blog posts and social media messaging to targeted promotions and list creation. When all is said and done, demand gen is typically involved in every aspect of a business’s sales funnel. Every marketing strategy should include some sort of demand generation process for attracting people to the brand and pushing them through the sales funnel.
Demand generation is the focus of targeted marketing programs to drive awareness and interest in a company’s products and/or services.
Looking for a Demand Generation Job Description? Click here!
Demand Generation vs Lead Generation
A lot of companies actually mistake demand gen for lead generation. These two terms, while related, are not the same thing. Lead generation refers to a specific subset of demand gen. Demand gen attracts people to business and piques interest in the overall brand, product, or service. Lead gen then comes in and turns the interested parties into more concrete sales leads by collecting contact information.
Every company needs some form of lead generation if they want to continue growing and to see success. Without lead generation, targeted marketing efforts are much more difficult. Once the lead generation is complete, demand gen takes back over to continue pushing people down the sales cycle with more targeted content and value.
The problem with demand gen is that it takes a lot more work and manpower to accomplish successfully than businesses realize. This is not a process that can be managed by a single employee. To properly run a demand gen strategy, you need a full team or department working on the process.
In marketing, lead generation is the initiation of consumer interest or enquiry into products or services of a business. Leads can be created for purposes such as list building, e-newsletter list acquisition or for sales leads
What a Demand Generation Department Does
One main role of the demand gen team or department is to bridge the gap between marketing and sales. The overall demand gen campaign process includes multiple components that require a lot of work. A few of aspects of demand gen covered by the demand team are listed below:
Strategy
The demand gen team is constantly reviewing customer insights to ensure the sales funnel is working appropriately. By monitoring what works and what doesn’t, the team can tweak the marketing strategy as necessary to continue generating growth and sales.
Analytics
The sales funnel encompasses many key metrics, all of which should be tracked by your company. Detailing customer experiences, engagements, and decisions can lead to more efficient and accurate campaigns in the future.
Content
The demand generation team knows not only what to say to potential customers but also how to say it. Value and customer-relevant information are conveyed through a variety of content delivery systems. Each message must be carefully constructed and targeted to convey the most important information to customers.
Delivery
In today’s tech-heavy world, companies have a number of delivery systems they can use for reaching customers. Email, social media, blog content, and advertisements are all content delivery options available to your company. A demand gen team knows which delivery system is best for your content and goals.
Revenue generation is one of the most important activities any business can engage in. It is defined as a process by which a company plans how to market and sell its products or services, in order to generate income.
How to Build a Demand Gen Team
There are two positions in the C-suite that facilitate the overall success of the demand generation team. These two positions are chief growth officer (CGO) and chief revenue officer (CRO). A CGO monitors all aspects of the business that help drive growth and the CRO is responsible for ensuring the company is leveraging all marketing opportunities to generate the most sales. Together, these two leadership roles help shape and drive the overall marketing strategy involved in demand generation.
Under these two important positions, you’ll often find the VP sales and the VP marketing. The vice presidents of these two departments are responsible for overseeing the demand generation process, from strategy to revenue goals. These two positions help create the overall demand gen campaign funnel and monitor the progress to ensure metrics are being hit.
Finally, you have marketing managers and sales development representatives. These team members are responsible for executing the overall demand gen strategy and nurturing potential customers throughout the sales cycle.
These positions are just a few of the main roles needed for a successful demand generation team. Since demand generation touches on sales and marketing, you need people who can confidently handle every part of customer development. In addition to managing customer development and business growth, you also need leaders in these positions who can work well together throughout the sales cycle. Demand gen teams can struggle when sales representatives and marketing managers fail to communicate important data insights and value propositions.
A demand generation team is a must for the future success of your business. Determine which essential demand gen positions are missing from your company and fill those roles as soon as possible so you can see an improvement in company growth.
Demand Generation Team Roles
- VP Sales & Marketing – $200,000 average salary
- VP of Demand Generation – $175,000 average salary
- Director of Demand Generation – $125,000 average salary
- Demand Generation Marketing Manager – $85,000 average salary
- Demand Generation Specialist – $55,000 average salary
5 Reasons to Use Account-Based Marketing in Your Business
Businesses utilize a variety of different marketing strategies with the goal of connecting to high-value clients in the target market. Marketing campaigns typically reach a wide audience, but the leads generated are not always an ideal fit. That’s why more and more businesses are turning to account-based marketing strategies.
In fact, according to the 2020 State of ABM Report, more than 94 percent of respondents had some form of active AMB program running. Companies with mature account-based marketing programs even credited ABM with up to 73 percent of their total revenue.
What Is Account-Based Marketing?
The numbers clearly show that account-based marketing is effective, but what exactly is it? ABM is a marketing strategy that targets specific market accounts and then uses personalized campaigns to engage directly with the target customer. Another important aspect of ABM is targeting existing customers by focusing on upselling or cross selling. For businesses that target larger accounts, the account-based marketing strategy makes it easier to engage and connect directly with a high-profile client.
Benefits of Account-Based Marketing
ABM is a marketing strategy that can make a huge difference to your business. Below are five reasons why you should be using account-based marketing in your business.
1. Personalized Marketing
More traditional demand generation marketing tools can be effective, but they have their limitations. The main issue is that the marketing message is crafted for a wide audience and therefore is not very personal. Traditional marketing strategies use one message to reach a bunch of different people. ABM, on the other hand, targets specific high-value clients with personalized messages and offers. ABM allows you to tailor your marketing efforts to the specific needs and interests of individual high-value clients.
2. Alignment of sales and marketing
The marketing and sales teams often work separately from each other in a company. The division between these two departments can be quickly bridged through account-based marketing. ABM requires the collaboration of your sales and marketing organizations to accurately target and identify the right accounts for the campaign. The alignment of sales and marketing also creates an opportunity to move leads further down the sales pipeline. The sales team can identify accounts that need reminders or additional offers to keep them engaged with the brand and moving forward with the sales process.
3. Measurable ROI
It’s difficult to measure the revenue generated by traditional marketing campaigns. Businesses can see an increase in brand engagement, but this doesn’t always immediately translate into sales. However, ABM has a clearly measurable return on investment since you’re targeting individual accounts with each campaign. One survey found more than 80 percent of marketers reported ABM programs outperformed their other marketing initiatives.
4. Streamlined Sales Cycle
Account-based marketing can help your business streamline the sales cycle for large accounts. With traditional marketing campaigns, you send out a message, wait for a potential client to connect, and then you start the research process to present to the client. ABM is a more direct approach that identifies ideal customers early on so you can present products and services directly to them with the most impactful messaging. The ABM approach helps you connect with ideal accounts early to build a strong and lasting relationship that will quickly convert into a sale.
5. Expand Customer Relationships
ABM requires a heavy investment of resources into the marketing campaign. The approach focuses on a narrower account pool, but when done successfully the converted clients are more likely to stick with your company long-term. The personalized marketing approach makes clients feel appreciated and understood, so they will want to continue working with you. This also makes it easier to gain more sales from their accounts in the future.
As you rollout more products and services, you’ll have developed a strong relationship with existing accounts. These clients will be eager to learn about your new offerings and keep growing along with your business.
Why You Need to Shift to Account-Based Marketing
The internet makes it exceedingly easy for companies to reach a wide audience. At first glance, this seems like a fantastic opportunity to bring your product or service to everyone. In reality, it’s caused a lot of companies to focus too heavily on a wider and wider customer base instead of investing in the loyal customers they already have.
ABM is bringing businesses back to personal relationships with client accounts. Instead of focusing on quantity, marketing and sales efforts should go toward quality. You want quality clients that align with your business so you can work together long-term and continue growing the relationship. If account-based marketing isn’t part of your marketing strategy yet, it’s time to add it to the agenda.
How to Reimagine the Chief Marketing Officer Role
The chief marketing officer (CMO) role has always been a contentious one. Businesses recognize the importance of marketing to a company’s success and growth, but many CEOs and top executives are hesitant to assign a CMO position. Part of the reluctance comes from the inability to track the impact of a marketing campaign on the company’s bottom line.
Demand generation is the main responsibility of a CMO, which is to say a CMO creates targeted campaigns to bring awareness to a business’s products and services. A company can see an increase in engagement and brand awareness after a marketing campaign, but the sales increase can take longer to spot. It’s also often unclear what responsibilities should fall under the CMO umbrella. The role is often extremely varied from company to company and the job responsibilities are always inconsistent. The vague nature of the role has given it one of the highest turnover rates in the C-suite group. On average, a CMO stays with a company 3.5 years. In comparison, a CEO sticks with a company an average of about 7 years.
Why the CMO role should get an upgrade
The advancement of technology is just one of the reasons why the CMO role needs to be reexamined. The speed with which market trends change and audience attention shifts these days makes customer engagement more important than ever. It also makes it increasingly difficult to focus energy on long-term brand building, which is a big part of the CMO role. Another common issue with CMOs is that their position focus is becoming increasingly narrow. Many CMOs put all of their energy into marketing communications when there are so many other important business aspects that could use their attention. For example, many companies are having the CMO expand the focus to customer experiences and product road mapping.
Expanding the CMO role has several benefits. First, by working with more teams such as sales and customer experience, the CMO can bring these departments together into a more cohesive unit. Marketing is a core aspect of the business and should be integrated into nearly every aspect of business processes. By allowing the CMO to work with the VP of sales and coordinate with the chief revenue officer, this can be accomplished.
Second, the more responsibility the CMO has, the more they’ll feel heard and like a real member of the C-suite. CMOs tend to be left out of the big decisions because CEOs and COOs see them as simple marketers. More responsibility will give them a bigger voice in the company and require more say in important company decisions.
Marketing impact will stay the same
Expanding the CMO role shouldn’t have an impact on your company’s marketing efforts. If anything, it’ll actually make marketing more effective because the CMO will have a more comprehensive understanding of customer needs, sales cycles, and more. The CMO will still be focusing on expanding the company brand and audience, but now excellent customer service can be integrated into the approach. Combining these two business aspects is particularly vital because marketing interacts with customers wherever they’re at through social media channels, events, and even product placement. In effect, the CMO should also be viewed as a steward of the customer experience.
Conclusion
Review the CMO position within your own company to see what changes could possibly be implemented. Perhaps your CMO is already effectively managing your marketing needs. If this is the case, don’t feel pressure to reinvent the position. However, it doesn’t hurt to look for potential areas of improvement. Have a conversation with your CMO to get their take on the role and what it could be missing. They might tell you they need more interaction with the VP of sales to ensure a consistent brand message, or maybe they’ll express interest in working more with the product development team.
Reimagining the CMO role is an opportunity to shake things up at your company and get people thinking about innovative new communication techniques and branding ideas. If the CMO role isn’t having the impact you want right now, reinventing the position to cover more areas could be the key to more effective communication. The change may require a title adjustment as well. Perhaps instead of CMO, the position will morph into chief growth officer (CGO) or a combination chief marketing and business management officer. With the CMO role changing for so many businesses, now is a good time to ask whether your company needs to make a change as well.
5 Tips to Help You Hire the Best CMO for Your Startup
A chief marketing officer (CMO) is an essential role within any startup. The right CMO can build out your marketing team, improve brand awareness, and drive sales. Hiring for this role, however, can be a bit complicated, especially for startups. Many startup CEOs have a hard time accurately assessing the right time to hire a CMO. In many cases, the CMO is brought on too early or the wrong person is selected for the role.
When should you hire a CMO?
At a certain point, a startup CEO’s knowledge of marketing is no longer adequate for the business’s growth. When you’re first starting, the CEO or COO may do a great job managing the marketing side of the company. As the business grows, however, the marketing becomes more complex and questions arise that require a more experienced marketing perspective. When your business reaches this point, you’ll notice competitors pulling ahead and your growth flatlining. A CMO can come in and revitalize the business and reignite growth.
Another clear sign it’s time to hire a CMO is if your team is telling you they need more leadership. Talk to the marketing managers and get their insight. They may require more direction and industry experience to move the business forward. If your marketing staff needs a leader, it could be time to hire a CMO.
Choosing the best CMO for your startup
Now that you’ve determined you need a CMO for your startup, it’s time to figure out what kind of CMO would be best for your company. Below are five tips that will help you find the right person.
- Figure out what kind of CMO you need
CMOs can specialize in different aspects of marketing. For example, there is the storyteller CMO who will perfect your brand voice and image. The storyteller will help you connect with customers and will build an excellent brand strategy through content marketing, partnerships, and events.
The analytic CMO, on the other hand, is more experienced in market analysis. The analytic CMO is experienced in growth marketing and will know how to track trends, measure campaign success, and create lead generation funnels.
Understanding business needs will help you determine which areas of the marketing strategy you need to improve. It’s difficult to find a CMO who is the full package, often referred to as a unicorn. As long as you understand your biggest areas of need, however, you should be able to find someone to fill your most pressing marketing gaps.
- Choose someone who knows how to structure teams
No matter the main experience and skill set of your CMO, you need someone who can strategically structure the various marketing departments. During the interview process, ask candidates how they’d structure your teams and have them work together. A few teams that fall under the CMO’s control include content marketing, customer relationships management, brand marketing, marketing communications, and product marketing. Your business may have a few more or could be missing a unit that would drastically improve sales. A CMO should be able to come in and structure the groups into a cohesive working whole.
- Ask for specific referrals
During CMO recruiting, don’t just ask colleagues for CMO referrals. Simply asking for a CMO referral will get you a wide assortment of contacts. Get specific with your needs and say, “Do you know any CMOs who are expert storytellers with experience in brand building and customer outreach?” The more specific you can be, the more likely you’ll be to find a qualifying candidate.
- Get insight from a marketing professional
You may think you know what your company needs, but it’s easy to miss the mark when you’re busy focusing on other aspects of the business. Pull in a marketing professional to gain more insight on marketing talent and demands. You may be surprised by the assessment you receive from the marketing advisor.
- Perfect the job description
A big reason startups fail to attract the CMOs they need is because of a poor job description. Before posting anything, review the document to make sure expectations are set and realistic. Don’t be too broad with your description either. If you have specific areas of marketing that need attention, cater the job description to fill that role. This will help you narrow your CMO search, and it’ll also make it easier for a sales executive recruiter to find you the right person for the job.
Chief Revenue Officer Job Description & Responsibilities
Companies are evolving to aim for greater and sustained revenue growth, focusing on revenue creation, and capitalizing on opportunities created by digital services and products, which has made hiring the right Chief Revenue Officer (CRO) one of the most critical hires a company can make.
As the CRO role grows in popularity, it’s important to understand not only the attributes and experience needed, but also how the responsibilities and job description may be nuanced by industry, company size, and other factors.
What Does A CRO Do?
Before we determine who to hire, it’s important we understand what a CRO’s objective is and what they do.
The CRO aligns and optimizes the entire customer experience with the aim of increasing revenue. They have a long-term perspective, understand and embrace the differences between sales and marketing, and streamline how these departments work together.
They remove defects and improve cohesion between departments by placing the right tools, metrics, and strategies in place that will have a significant impact on revenue growth. In short, the Chief Revenue Officer is responsible for all activities that generate revenue by integrating and aligning marketing, sales, customer support, pricing, and revenue management.
Unique Experience Needed
Since a keen understanding of multiple teams and their functions is required to be an effective CRO, assigning this role to the wrong person can have substantial consequences. More than just an expanded role for the VP of Sales, a high-level, disciplined, and strategic vision is favorable over the short-term horizon usually embraced by sales leaders.
Sales leadership is, however, a “must-have” in the toolkit of a CRO. The position was originally popularized by Silicon Valley companies that had CEOs with product and engineering backgrounds, but needed forward-thinking sales leaders to translate initial traction into lasting revenue growth. The CRO has their finger on the pulse of revenue growth across departments, identifies activities that lead to revenue growth — namely, sales and marketing — and brings them together.
Primary objectives and responsibilities can vary depending on the size of company. Large company CROs should have a track-record of successfully scaling revenues, building lasting C-level relationships at Fortune 500 and Fortune 1000 companies, and managing large sales teams. At smaller companies and startups, the CRO should be an expert in leading rapid revenue growth.
Regardless of company size, the Chief Revenue Officer will oversee channel and partner development, adding new and profitable sales channels, partners, and resellers. They will:
- Evangelize the company at industry events
- Skillfully negotiate contracts
- Actively participate in strategic business unit planning to develop accurate projections for budgets
- Establish and refine strategies to analyze sales performance
The CRO will have extensive marketing experience and a deep understanding of cross-channel marketing, native advertising, and programmatic advertising. They will remain up-to-date on the latest trends in advertising, and how these trends may be leveraged for revenue growth.
Personality Traits Of Effective CROs
Character attributes are subjective, but an effective CRO should have most, if not all, of the following personality traits:
- High integrity: strong moral and ethical principles.
- Natural leader: motivational and energetic, with a high emotional intelligence.
- Critical thinker: objective analysis of an issue in order to form a judgment.
- Goal oriented: driven by purpose.
- Self starter: compelled to take action without being told to or encouraged by others.
- High business acumen: quickness in understanding and dealing with business situations.
- Maturity: awareness of how to behave and knowing when to act, according to circumstances.
Salary & Total Compensation
Chief Revenue Officer salaries vary greatly by location, years of experience, company size, maturity of company, required skills, and additional compensation (bonuses, profit sharing, etc.).
At the time of this writing, Payscale lists the “Average Chief Revenue Officer Salary” at $191,132, while Glassdoor has the average salary at $240,590. LinkedIn Salaries says the median CRO salary is $200K, with a total compensation of $345K including stock options, commissions, and bonuses.
For a Chief Revenue Officer job description example, or to help determine if your company needs a CRO, please visit the Cowen Partners Executive Search website.
Cowen Partners, a leading sales executive search firm, has crafted this VP Sales Job Description to assist you in finding the best talent for your sales leadership roles. Detailing the fundamental skills, qualifications, and requirements needed for a VP sales, this job description can be customized to fit your company’s specific needs and objectives.
VP Sales Job Description and Responsibilities
This VP sales role will oversee a team of sellers for one of our largest markets. Additionally, you will manage and maintain relationships with clients as you expand sales throughout your region.
VP Sales: Job Skills & Requirements
- 8 years total successful sales experience in the XYZ space
- At least 5 years of proven success in leading a successful sales team
- Experience Hunter with Enterprise level SaaS software sales experience, with emphasis on a Challenger approach to growing existing accounts and opening new buying centers
- Proven track record of delivering high-quality results in a timely manner, including consecutively exceeding past sales quotas
- Deep understanding of multiple facets of retailer, agency, and consumer products with prior experience selling into marketing, shopper, and/or consumer insights
- Deep knowledge base of the sales process with the ability to engage senior-level executives in strategic meetings to ensure top-down alignment regarding strategy and objectives
- Skilled at building and managing customer relationships, including stakeholder management
- Strong oral, written, and presentation skills
- Bachelor’s or Master’s Degree (preferred)
- Able to travel up to 50%
If this sounds like something you would like to be part of, we’d love for you to apply! Don’t worry if you think that you don’t meet all the qualifications here. The tools, technology, and methodologies we use are constantly changing and we value talent and interest over specific experience.
We are an equal opportunity employer and all qualified applicants will receive consideration for employment without regard to race, color, religion, sex, national origin, disability status, protected veteran status, or any other characteristic protected by law.
Cowen Partners has a strong record of identifying and recruiting sales leadership for fast-growing public and private companies. Contact us to talk to a 5-star sales executive recruiter about finding exceptional talent for your organization.
Get in Touch.
Fill out the email request form to learn more about our approach.