Sales and Marketing, Defined
It has come to my attention, rather abruptly, that more companies these days are really blurring the lines between the all-too-important sales and marketing functions. Perhaps it’s the crummy economy, a desire to cut costs, or uncertain business futures that are forcing executives to quickly dis-intermediate one, more often than not—Marketing, hastily passing along responsibilities to her more easily-defined bottom-line contributing brother, Sales. This is a potentially damaging move for any business no matter what sized sales and number of employees. It’s high time we revisit the difference between these two functions; their roles and responsibilities and why each is equally important and vital for business success.
Let’s start with some formal and not-so-formal definitions of each:
(According to the American Marketing Association Board of Directors): Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. (Approved October 2007)
(According to Dan Kennedy) Getting the right message to the right people using the right media and methods.
(my add-on) What Dan said and …to create, grow or sustain profitable customer relationships.
(According to freedictionary.com) The exchange of goods or services for an amount of money or its equivalent; the act of selling.
(According to Mirriam Webster dictionary): the act of selling; specifically : the transfer of ownership of and title to property from one person to another for a price
Plural operations and activities involved in promoting and selling goods or services <vice-president in charge of sales>
Hmmmnn. Lots going on here. In the formal verb definitions, the one for marketing is an activity, a set of institutions and processes for doing something that have value to a specific audience. Notice, there’s a clear subject to the verb here. In another definition, for sales, it is an exchange, or a transaction. Call it an event, the act of “selling.”
Here’s where it gets confusing… In the marketing definitions above that follow the formal ones, for marketing—the building brands and customer relationships references is clearly marketing skewed. However, the adjective “profitable” assumes accountability for the transactional phase, which is the sales function, as determined above. Furthermore, in the Mirriam Webster definition of sales (plural noun) they include operations and activities “involved in promoting…” Promoting? That is more aligned with marketing in most cases. Therefore, it’s safe to say that the two words do in fact share some commonalities and perhaps there is some overlap. Still, this does not present reason for replacing one with the other or full consolidation, in my opinion. Apples and oranges.
To more clearly understand the differences and relationship among the two functions, I like to refer to an all encompassing definition a mentor once shared with me. It reads as follows:
“Marketing hooks ‘em and Sales reels them in.”
To be more specific, this definition explains the two as separate functions that work together, yet each with its own set of objectives and accountability. There appears to be a real hand-off in this definition. Yet, both are equally important and serve a common, greater goal–‘landing the fish in the boat,’ (to continue the metaphor) or achievement of the sale. The two functions, without saying, require different skillsets and happen at different times in the cycle. Marketing comes before sales and sales ends the process! It can also be said that the two are interdependent; without hooking em, there’s nothing to reel in and, on the contrary, reeling in makes no sense if there’s nothing hooked. Hence, my point.
In applying this to a small to medium-sized business (SMB) where all, or most functions, including sales AND marketing, lie in the hands of one singular business owner or entrepreneur, it’s just as important understand and make the distinction. Here are some reasons:
- Success tracking. For example, you could have good sales but are not sufficiently generating leads (hooking them). This could get you into a pickle when sales start to slow down or change. Or, conversely, you could be great at generating interest, awareness and leads, yet sales are not tracking. This could mean your sales effort needs help.
- Outsourcing and/or hiring. There may come a time in your business’ growth whereby you need to bring on employees or outside consultants to take on these functions. Understanding where when stops and the other begins and not blurring the lines will save costs, increase efficiencies and focus, and help manage expectations.
- Realistic sales and pipeline forecasting. As you may have heard in sales circles “It’s a numbers game!” Well, in order to properly hook the right amount that will lead to reeling them in, it is true that some basic math is necessary. For example, a business might have a marketing expectation of 1% conversion from a direct mail effort, meaning from those pieces sent, 1% is likely to respond with an inquiry, becoming a qualified sales lead (‘hooks em’). Of that, sales may have an expected average of 25% conversion, for example, of a qualified leads to a sale (‘reels them in’). Multiply that by the average revenue per sale less costs and it’s easy to estimate sales revenues and profitability by campaign and/or product launch (remember, marketing helps create, build and/or sustain profitable customer relationships). Need more sales? Having proper sale and marketing forecasts and being able to determine the length of the pipeline can help minimize risk and improve expected return on your marketing and sales investment.
- Expense Tracking and write-offs. With a clear understanding of what events and activities are marketing and which are sales, it will help support proper expense tracking and write-offs. PR and branding events like a charitable contribution could easily be seen as marketing whereas a dinner with a high-value prospect client could be seen as a sales expense. Being able to separate the two will help with subsequent accounting cycles.
So, if you are one of those businesses that is considering removing your marketing function and consolidating it with sales, I ask that you please reconsider. Be sure to evaluate each function based on the value they provide. Carefully analyze the costs. Determine separate realistic expectations for each and realize the contributions towards the main business objective. Don’t forget, without one, you can’t have the other…
About the Author
Angelo Biasi is General Manager of SMART Marketing Solutions, LLC, a leading full-service integrated marketing company in Naples, FL since 2001. He has helped create and execute marketing plans and integrated marketing solutions for companies such as Playtex, Bic, Rogaine, Tauck, and over 35 colleges and universities, to name a few. Angelo has an MBA in Marketing from the University of Connecticut and teaches Marketing at New York University where he has for over five years. For more information or to learn more, email him at abiasismartmarketingllccom (abiasismartmarketingllccom) , visit www.smartmarketingllc.com or call 239.963.9396.