Modern marketing in 2021 is going to look different than at the beginning of any other decade.  2020 brought new challenges and ideas for marketing teams as businesses packed up and moved from the office to homes.  This shift caused challenges for find and reaching your audience through the normal outreach activities.

What’s a marketer to do?  In this conversation with Chris Walker of Refine Labs we discuss the state of marketing, goto market models, outreach culture, and building a performance-based marketing team.  You might be surprised how this conversation from 2019 resonates and hits home in the wake of COVID.

Intro: (00:00)
Welcome to the summit. A podcast focused on bringing you the knowledge and insights for industry leaders. I’m your host Kyle hammer, and I’m on a mission to help you exceed your potential. As a sales guy, turned marketer, I am passionate about building sustainable businesses. And if there’s one thing I’ve learned in my 20 year career is that you won’t find an overnight growth scheme, a shortcut to success or way to hack yourself to the top. Nope. Success is the by-product of hard work, great relationships and deep understanding done over and over. We’re here to help you unlock that success with some secrets from other people, one conversation at a time. Can you hear me?

Kyle Hamer: (00:36)
Hey Chris.

Chris Walker: (00:39)
Hey Kyle, how you doing, man? Good. How are you? Things are great.

Kyle Hamer: (00:44)
Good. Can you hear me okay? Yeah, absolutely. It sounds great. Awesome. I still trying to figure out to this pull audio thing. So yeah. Tell me, tell me a little bit about yourself. Like you know, I’ve, I’ve, I’ve seen you online, it looks like maybe you’re in a shared space or something, but I mean, I did a little bit of like background creeping on your LinkedIn profile, but I’m months ago you’re a director of marketing and now you’re like doing your own thing. So tell me about that adventure.

Chris Walker: (01:17)
Yeah, absolutely. Well, it’s been quite the adventure, so I, I studied biomedical engineering in college, which was weird. I really was passionate about always passionate about about medical devices and then got out of college and into an, into a job and quickly realized that I wasn’t, I wasn’t a really good engineer and, and too, I cared way more about how customers applied the product and actually building the technology. And so I was lucky to be in a very large corporate organization that helped me move in that direction. So I slowly moved from engineering to product management, focused on new product development, and then to product management focused more on downstream with existing products that were commercial and then marketing management, which was all commercial. So we had a separate team that was building the products, and then once they were commercialized, then I was responsible for marketing to them and, you know, commercializing the product and then and then took a, the, this director of marketing role at a startup.

Chris Walker: (02:30)
And so what happened was the last two companies that I worked for, one was called beta therm venture backed medical device company growing at somewhere between 25 and 40% year over year during the time I was there. So like, and they’re, they’re a 40 or $50 million business. So they’re making some considerable moves in that space. And and so I, I came in, I applied what I call this like formula, which was a mix of a technology stack, modern marketing and communication, and making it easier for buyers to buy. And it, it accelerated the business growth. And so, and then the next company I went to when I left, they put their own was Emerson, much smaller company venture back. I applied the same formula. The business grew at a similar rate, but I was able to accomplish it more quickly. And so they put their arm, it took 15 months to see like some really good traction.

Chris Walker: (03:34)
And at every sound, the second time I did it, it took nine months. And so I got, I felt like I made them some mistakes. I got better at it. I learned, and now I, I apply that formula to a lot of clients. And so that’s, that’s kind of what I did is, is it’s an interesting perspective too, from if you think about other agencies that most agencies have, people that have only worked at agencies. And so what what I’ve done is I’ve, I’ve been in house for seven years. I understand organizational change challenges. I understand you know, what it takes to get some of this stuff done. I’ve done it myself in companies, and now I, I help other companies take some more journeys to either modern marketing or martyr modern go to market strategies.

Kyle Hamer: (04:22)
Cool. So are you like a one man show or do you have like, w where does, where does, where does engaging with Chris begin in the what what’s

Chris Walker: (04:34)
Yeah, for sure. So, so I started this four months ago as I thought that I was just going to be a consultant for a handful of companies and probably make more money than my job and help some people grow. And that was it. And it picked up a lot more attraction than I was expecting. And so at this point I have my first full-time employee starting on September 1st. We’re thinking of having a second employee, we’re moving into an office and now I have this, I have a much different vision for what, what this could be. And really what we’re, what we’re after is we’re trying to build a, a revenue generating marketing agency that helps small to mid-sized B2B companies take on modern, progressive marketing techniques as a gateway to grow their business faster.

Kyle Hamer: (05:39)
That’s a mouthful by the way, modern, modern marketing techniques.

Chris Walker: (05:44)
Yeah. I mean, when you, when you assess what’s going on in the, you know, let’s just take companies under 50 million in revenue in B2B, we focus mostly on hardware. We have some software clients as well, but it’s mostly be B2B. Hardware is where the, where the main client base is. And when you look at those companies, 30, 40% of their marketing budget spent on trade shows and events and conferences. So they, they have a very large inefficient Salesforce, usually. They’re spending money on, on print and on conference sponsorships and on brochures and collateral for the sales team that’s printed. And so when you look at the the activities that they’re doing, they’re, they’re wasting a lot of money on things that aren’t as effective anymore. And so what we try to do is one help them make the most of their existing marketing budget.

Chris Walker: (06:43)
So yes, you should absolutely still go to that conference, but don’t buy the 20 by 30 booth. What’s do a 10 by 10, and let’s send an extra sales rep because what you’re actually getting value from in a trade show right now is moving for existing relationships, not generating leads. And so we’re changing a trade show strategy for them. But we’re not adding incremental, incremental budget at the beginning. So we, we move around their marketing budget. They start to see results. We add incremental budget typically is what happens. They start to see more results. And then we start to, as they start to see it work, they have the power to start to change how they go to market. So maybe they start to shift away from an SDR outbound model because they have enough inbound flow and they have confidence that there’s consistent inbound flow as they don’t need. As many SDRs is. One is one way when with, with those outbound, you typically have lower win rates, longer sales cycles overall just less efficient revenue generation. And so those are some of the things when I talk about modern marketing techniques is that’s kind of how I think about it.

Kyle Hamer: (07:56)
So, I mean, are you, are you working with companies who have marketing departments in play and they’re just bloated and lazy and don’t know what to do, or is it, we don’t have it. We’ve been working with the traditional agency and now we’re, you know, our sales team is getting frustrated. So we’re looking for a way to, to modernize our, our agency relationship with, I mean, what’s, how are you finding these, these

Chris Walker: (08:20)
Yeah, 100. So the, the place where the model works best is when the company has an existing marketing department and just needs the guidance and the strategy. And so we provide a modern content strategy, but they have the tools to get it done. So they have marketing managers that can go out and build the content and can execute the webinars. And we help them through that process. We then create distribution strategy. We handle the distribution. So once you do, once you have the webinar ready, how do you promote it? How does that work operationally? How do you deliver the recording? How do you chop up that recording into six pieces for LinkedIn three for Facebook ads, a couple of blogs, a couple of YouTube posts. How do you, we call it post-production, but how do you make the most out of that? One piece of content is another service that we offer.

Chris Walker: (09:23)
And so that’s, that’s where it fits really well, too. I mean, the companies that, that see the most, the fastest results have already taken a couple of the big quote, unquote marketing steps. They have a grip, they have a modern website. They have marketing staff, typically somewhere between at least four marketing staff. They have revenues over 25 million, which is a surrogate for that. They have traction and product market fit, and they have a sustainable sales process. And so once you, if they have those core elements and you layer on top, just effective communication with the market, you can see really awesome results. And so that’s, that’s, that’s where we love to play. And we also have clients that are in a smaller revenue range where we do everything, and we’re, we’re the outsource agency for them outsource marketing department.

Kyle Hamer: (10:19)
Cool. just and curious, cause but you know, at some point I’ll, I’ll share my story if you’re interested, but it definitely how many clients are you, are you handling right now? So is it I’ve got five, is that you’ve got 20 where, I mean, how, how rapid has your growth been over the last five months?

Chris Walker: (10:43)
Yeah, so right now we’re, we’re with, we work with five companies all on long-term agreements and the and the idea is to grow that to somewhere around 15 by this time next year. And so we are, and that’s, that’s the, that’s the growth path right now. So we spend we spend a lot of time really trying to help companies. And one thing that’s different about how, how I go about it is that eventually I want the clients have the option to not, w not have to work with us, which is not typically a value prop of the agency. And so at the last two companies where I was employed by them, what I did was I came in, I ran that formula. I built the tech stack. I hired people. I gave them the content strategy, I’d be able to the distribution strategy.

Chris Walker: (11:43)
And they, at that point, they could go on their way and I could leave. And so I’ve done that at, at two companies. And so my, my goal and how we’re going to continue grow, what we’re going to do is basically map out a vision where in nine to 24 months, the company could operate a really great strategy without us. And we would love to continue to work with people. But that is something that I don’t think a lot of other agencies are talking about. The reason that I say it is because the reason that I positioned it like that is because it’s better for my clients, if they can do it themselves. And so my goal is just to make them as successful as possible. And so over the next, I mean, I would say today, but over the next five years, certainly you need to have these capabilities in house. You need to produce content. You need to know how to prose post produce it. You need to know how to distribute it. And so a lot of companies don’t have these capabilities. In-House, they’re outsourcing it to an agency. It will be a, it’s a competitive advantage in the short term and not being able to do it will be a vulnerability in the longterm.

Kyle Hamer: (12:58)
Hmm. So w w I mean, are you more focused on content production and, you know, the, the ground game, if you will, the organic or inorganic ground game, if there’s a guy that posted and I think he’s a political science guy or a political marketer, and, you know, there’s a, there’s a time and a place for having the expertise in house, and there’s a time and a place for, for shopping it out. Are you really focused on saying, okay, look, we come in and we act as a content augmentation or content development, and then deployment, you, you’ve got the expertise, we take the expertise and we show you how to talk about it, show you how to segment it, show you how to make it interesting. And then drive traffic inbound. Is that the, is that kind of the niche or the I’m not trying to put pigeon, that’s just what I’ve kind of heard and to do.

Chris Walker: (13:58)
Yeah, no, I appreciate you kind of bringing it back to me. So so our, our strategies are built entirely on how do you effectively communicate with your target audience? And so how do you do that present day? The most effective way to communicate with people is over the internet, right? At least at scale and cost-effectively. And so we, we don’t pretend to be a content production agency, because what I’ve learned over working with a lot of different businesses is that you need to be a subject matter expert in order to produce good content. And so we, you know, we work with companies that sell, you know, huge fire extinguishing systems and different SAS platforms, and we are not experts or understand their customer base well enough to pretend like we can produce for them. My content has been working on LinkedIn because I am great at marketing.

Chris Walker: (14:58)
And I talk about marketing. And so, right. So if I tried to translate that and be an outsource content production house for the fire extinguishers, like I don’t understand people that work at Boeing or general electric, I don’t understand their buyers. And so we, don’t, what we do is we, we provide the guidance for, for what content to create, how it’s positioned, what, what priorities should be. We help the team, we guide the team and how to go in and build the content. And then we focus on the re-purposing and deployment of it, as well as the, the measurement, the conversions, the tracking through the sales process, looking at ROI and attribution for how well it’s working. They can bring that back to their executive team and look for further investment so that we continue to move the model. And so you just build this, the goal is to build a communication machine that is, that drives awareness, education and convergence.

Chris Walker: (16:02)
And so we typically do that through through, we accelerate that process through paid advertising on Facebook as a content distribution mechanism, not as a lead generation mechanism, which is what a lot of people have wrong today is they’re using those, these types of tools like LinkedIn or Instagram or Facebook, most aren’t using Facebook, but they’re trying to use them as lead generation tools. We use them as content distribution tools. And so it’s a, it’s a nuance. But when you have, when you put out a blog that has nothing to do with your product, and you show it to 50,000 people in your target market and they read it and they’re on your website and they see your logo, and then they share it with that decision maker. And that decision maker comes back on desktop and sees your value property converts. That’s, that’s the model that we, we execute on, which is different than how a lot of people are doing it today.

Kyle Hamer: (17:06)
I mean, is that fundamentally, that’s just a, it’s a ground game for an account based marketing strategy. At least I’m not trying to put it into buzzwords, but that’s the, you know, if you get it right, that’s really what you’re doing, right? You’re, you’re targeting somebody who’s downstream that can’t make a decision with some content that’s interesting and engages them with the, the hope that they share it with their boss or communication for the person who can make a decision. And that they’re the person who’s, who’s converting on the website. And as you look at the multi-attribute across what’s happening against an account that that helps create insight for, well, the value in either brand awareness or content that we’re creating, those elements are actually coming from somebody who can’t make a decision, but they are having heavily influenced conversations with somebody who is, and that you’re getting more. Decision-Makers it’s more of a question. So you’re, you’re driving more, decision-makers through this more decision-makers into the funnel through this through the tactic of, of reaching just kind of more of a blanket audience initially, is that my understanding?

Chris Walker: (18:22)
Yeah, a couple of things on that one is I really don’t like to position it as account based marketing for, for a couple of reasons, we, we certainly have, and we talked about Boeing and general electric for some clients, we have an account-based strategy. But I think that there’s a lot of confusion in the marketplace created by the industry of ABM, which is that having an account-based strategy is very different than what the ABM companies are selling. The ABM companies are selling a SAS platform. That’s expensive to deliver banner ads and measure how your direct mail works. And so we don’t do that. Mainly because I don’t believe that those, those executions are effective or actually drive business results. And so what we do is agnostic, but there’s, there’s a nuance here, which is the companies that we work with have average contract value is less than 50 K, right?

Chris Walker: (19:20)
So maybe it does make sense to have an ABM strategy when your clients are, you know, whatever ACV is over a hundred K or a million dollars or somewhere in that range. I still wouldn’t do it the way that they’re doing, but I think that it does make sense at some level, but we’re targeting broadly. Like, let’s say for instance, we’re the going after we have a product for the emergency department we’re going after emergency medicine physicians that work in a hospital. I am not, we’re not targeting Boston children’s hospital, we’re talking, targeting emergency medicine physicians broadly, and the influencers that work with those people. So there’s nurses, respiratory therapists direct, you know medical directors. And we, what we’re doing is just delivering educational content, because if you deliver good content and you have a good product and people are aware of it, we just trade on basically the awareness that’s generated through that. And so I kind of went on a rant about ABM, so I’m not sure that I fully answered your original question, but I I’ve tried. So if I, and you can just, you can maybe reiterate it.

Kyle Hamer: (20:36)
Okay. Just again, just curious, Chris, I mean, how you define it. There’s, there’s a lot of nuance in, in marketing, and there’s definitely a lot of buzz words today. What, when I say account based to me account based is not what we think about at an enterprise level where I’m targeting an IBM or a Google or a Walmart. That’s a, that’s a nuance strategy in and of itself. What I’m, what I’m speaking of. I think more specifically for account-based is, is this is a targeted group of folks who are likely to convert. And I may not be able to get to the decision maker because I don’t own that contact, or I haven’t created that relationship yet, but I do know that by focusing on either this geography, this account type, this specific job title, and in the way that I put together my content and my education I’ll influence the account to actually come in as an inbound lead. And that, I mean, at its core account based marketing is actually marketing. Somebody just put a bigger or a different term on it.

Kyle Hamer: (21:49)
It gets more complex as you look at, you know, trying to get Walmart to buy your e-commerce pay-per-click solution or something, right? Like there’s so many layers that you’re trying to convert to, but I guess it’s my belief that every business, if they know their market, they know who they want to be, their customers like, they’re like, Hey, I know I want these 50 or these hundred hospitals in your example, or acute care facilities or clinics. Right. If I could get these 10 doctors, right. Those would be the people that would make a difference to my organization. And you don’t necessarily get there directly. I mean, I suppose you could. And some guys do, but the reality is, is that there’s a, there’s a ground game or a market development strategy using content and the internet. It sounds like maybe you figured out a formula that seems to work.

Chris Walker: (22:49)
Yeah, it has. It has really been working. We have, I mean, we built it. We’ve made it go faster. And for every business we’ve worked with, since, since I was doing this in 2016 has seen similar growth path, very predictable. And so we’ve been able to figure out one the order of the activities to do we’ve figured out what tools we need, what tools we don’t need, we’ve made mistakes. And so we don’t make them again. And so, yeah, I think we do have something that that’s working. One thing that you mentioned that I thought was, I’d never thought about it this way, but there are a lot of businesses that target broadly across a lot of industries. Right. And so like a SAS platform they’re selling you know, VIP phone solution or something like that. They have so many industries that to after then, it’s really hard to create meaningful content for any of them.

Chris Walker: (23:50)
And so one thing that I’ve just, as you were talking about it, that I realized is that all of the clients that see really great success from our work have a well-defined target ideal customer profile that allows you to go very deep in that area. Right. that was something that I hadn’t hadn’t thought about, but that might be why our content strategies work so well. Is that over time? We just, yeah. Like we’re putting out content running ads on it. So we’re getting feedback from almost the entire market. Like, you know, we we’re running Facebook ads. There are 50,000 respiratory therapists in the United States and we’re touching 46,000 of them in 24 hours. Like that’s just the power of the platform. And so we can put something out, get feedback immediately, you get 200 comments from people that feeds your content strategy. It’s just like this never it’s, it just continues to perpetuate.

Chris Walker: (25:00)
And so that might be why it works so well because we can, we can iteratively understand the audience better and continue to give them what they want and continue to learn from them, which creates this cycle of also improving just your general marketing messaging. So we’ve used it to test messaging before as well, or launch products or promote webinars. The application of the tool is Facebook ads that is, or I’d say Facebook, it includes Instagram or other media properties that Facebook owns is just so powerful and has so much attention of the United States. And so people will sometimes tell me my, my audience doesn’t use Facebook. Like, that’s great. I understand that it works for, it’s worked for those six businesses, but you know, our we’re going after brain surgeons and they don’t use Facebook. And then all you do is it takes me three seconds to go in and do the research and look for the title, you know, brain surgeon or whatever the actual professional title is for that position. And it’ll tell you immediately how many daily users in that job site will go on Facebook and it’s not zero. And so I think people, the one that they have an adapted to, to the idea, because it’s a social platform, but it’s our job as marketers to, to know where people are and then adapt our messaging to the platform that they’re using. And so that’s something else that I think we take, we do very well here is how to communicate a B2B message within a platform that is traditionally viewed as B2C.

Kyle Hamer: (26:56)
Interesting. All right, look, it, it, it it’s obviously working, which is fantastic for you, but you know what, one of the reasons that I wanted to get together today and chat was, you know, we you posted something and said, Hey, look, this is no longer the this is no longer the 19 hundreds like marketing can actually attribute there. They’re probably driving as much sales specifically, as you get into SAS, the blend between a sales person, a marketing person is, is is very that the variance there is getting smaller and smaller. And you said, Hey, maybe it’s about time for marketing to step to the table and start talking about their value and maybe earning variable comp equitable to, to a CRO or a VP of sales. And, and what does that look like? So it was really interested to get your perspective and where that kind of came from. And then talk about that a little bit.

Chris Walker: (27:58)
Yeah, 100%. So a couple a couple points to maybe clarify on that. And I try to do my best in the comments. One is that in order for that to work, the marketing team needs to be advanced. And by advanced, I mean, they have to be able to actually drive results and actually measure them. And so that eliminates quite a few marketing teams from this discussion straight away, right? There are a lot of teams, marketing teams that are doing these activities. They’re not measuring them in a way that makes, that is able to have a compelling proposition. And so those people, this may not be the right conversation for it, but there are also marketing teams that are, that are communicating effectively, are driving leads that are closing faster and at a higher rate than outbound. And so the way that I looked at it, and I think it’s a good way to communicate is we are paying SPRs on variable comp to generate leads that are A’s close.

Chris Walker: (29:00)
So why wouldn’t we think, at least consider the idea of paying marketing on variable comp for doing the exact same thing that SDRs are doing just in a different way, because that’s what we’re doing, right? We’re delivering content, we’re educating people, we’re creating leads. That’s what an SDR does. We’re just doing it a different way. And so I think when you think about it that way, it’s, it’s it’s a more interesting conversation because the, the, the value that marketing brings to a business has changed dramatically over the past 10 years, the, the importance of a, of a high, exceptional marketing team inside of an organization that’s trying to grow fast is really, really important. And I think that the analogy I mentioned to the post was that this it’s not Salesforce 2002 anymore. You can’t just hire you. Can’t double the size of your sales team and expect that you’re going to double your sales.

Chris Walker: (30:01)
It actually doesn’t, it used to, it did work like that at one point, but it was probably in the, in the 1980s and nineties, but it does not work like that anymore. And so, and, and I’m not saying that in theory, I’ve watched companies make that mistake and hire twice as many double the reps from 20 to 40 expecting that the revenue is going to double because they doubled the quota and that’s not how it works. And so you need, you need a marketing engine to fuel your sales productivity. And if those pieces of the revenue engine aren’t aligned, then all you’re doing is just lowering your sales productivity, because you are refusing to invest either the right marketing talent or the right marketing activities. And so that’s the way that I that’s the way that I see it.

Kyle Hamer: (30:49)
So you said a couple of things that I think are, that are interesting. The first thing you said is marketers who are doing it right? Could it’s at least implied. It may not be explicit, but implied that could replace us the RS. The, the other thing that I think you said that was, was interesting there, Chris is this concept of you need the right talent. What, so first, first question for you is, is, does marketing really effectively replace SDRs? And then the second question is what, what are the right skillsets that you think are required for these companies that have the four to six person team in that $25 million a year to, to effectively have an impact on sales?

Chris Walker: (31:38)
Yeah, absolutely. The answer to your first question, is this a mechanism to replace SDRs? The answer is no. I think that you will, you should have contributions from multiple sources, but the fact of the matter is that outbound sales is declining in effectiveness for most companies, unless you have an absolutely killer product. People are harder to reach. And so and I’ve seen this at all the companies that we work with that use an outbound model and we’d go into them and they’re doing outbound. Their outbound leads are converting from demo to sale, to sale somewhere between two and 7%. And if you can layer on an inbound model where we’ve had this happen, where inbound leads are closing at 30 to 35%, it just balances, it balances your pipeline and it lowers your sales overhead, and it increases your revenue efficiency just by making these small tweaks.

Chris Walker: (32:38)
And this is, it’s not, it’s not going away. It’s kind of like, this is the start of getting on the treadmill for when you’re going to run the marathon in five years. Like you, you need to have these core capabilities because the, but outbound SDR model, as it stands today is not going to work for that much longer in my view. And I, and there’s plenty of people that would argue that point. I believe that people that the way buyers buy things is changing considerably. I look at my own behavior. I look around, I see how smart companies are changing, what they’re doing. They are no longer dating demos. They’re publishing a demo live on their website. They’re publishing all of their pricing. You can buy a $30,000 contract over the internet and people do that. And so, and that’s, that’s going to become the norm for the smart companies that move in that direction.

Chris Walker: (33:52)
Then the other side you’ve mentioned, what are the skills that companies need? So let’s say they’re in the $25 million range at the $25 million range. Your, your communicate marketing communications downstream marketing team is probably somewhere between three and eight, depending on what type of business you’re in and the business model. And so what skills do you need? The number one thing that you need is you need the architect. So the person that can see, I mean, you could call that the director of marketing, you need someone that can see the whole field. And, and then you build specializations around that. But without the, I I’ve made analogies to being the conductor of the orchestra or anything, there needs to be someone that’s delivering the strategy, because if you just hire a bunch of specialists with no cohesive strategy, you’re not going to get the effect that I’m talking that you could get.

Chris Walker: (34:51)
Okay. And so underneath that you need number one, somebody that can produce content. So I would think that person, I was on the phone with a startup in San Francisco on Monday, and they were talking and they were like, we try, we have the SAS product, and we’re trying to sell it to sales enablement, but we want to hire a content marketer. And I said, no, if you want to sell to sales enablement, then you should hire someone. That’s an expert in sales enablement, and either teach them how to do content or hire someone else that can pull the content out of them and then deliver it, if that makes sense. And so you gotta have a, you have to have someone that’s an expert in the audience that you’re going after. Number one, the second one is you got to have someone that can build pictures, videos, all of that stuff.

Chris Walker: (35:45)
Cause that’s how we, that’s how communication happens over the internet today is in videos and pictures and words on websites and social media platforms. Essentially the last person that you need is the person that does the distribution. So ads analytics, measurement, all of those types of pieces to deliver the content to the right people. And so if I was building built build teams like this, so it’s not like if I was, I had built teams like this you need, you need that’s. The core is you need those, the, the leader in those three people.

Kyle Hamer: (36:31)
So you get the, the leader in those three people who gets compensated like the SDRs, who gets the variable portion of the comp. So is that the, the entire marketing team, is that just the leader and the architect? Where does, where does, you know, as we explore this topic of paying marketers, like a salesperson, who’s the variable comp actually rolled down to like, who’s, who’s got upside tied into this.

Chris Walker: (36:54)
Yeah. I mean, I think to be honest, I think it’s all or nothing on that, on that side. And so I think it’s the, in the companies where I’ve operated in and I’ve seen the revenue generation, and I understand the sales commissions that are paid on, on the leads that I’m delivering that are converting to revenue. You know, I wanted, when I was working in this company companies, I wanted a piece of the action because I could consistently deliver leads that were converting to revenue much better than other lead sources. And so I, you know, I would feel compelled to, to get on that program and, and have the entire marketing team aligned on the same thing. And I don’t, I really don’t think this works for a lot of businesses. I do think that for a select few, it would work well, and I would not in any, any fashion pay marketers on leads, the metric, the metrics would be revenue.

Chris Walker: (38:05)
And so potentially, and I’m, I’m really thinking out loud here. I have not thought about this at all. Is that a, what’s a say for sake of congregants, say community numbers, a hundred grand salary initially for a marketer with like a S a small, but let’s just say 10% potential bonus. So they, at most, they’re making one 10 and their current thing. And the way that you could change it to is instead of the hundred salary go to 70 in salary, but they get a 50% upside. So that could what their, their OTE somewhere. I mean, I’m doing the math in my head right now, and I thought it was going to be simple, but it’s not. Part of which has go back to part of their variable compensation could be on the contribution of inbound revenue. So in, in teams that I’ve operated in that are running the model, you should have an inbound contribution to revenue of at least 30%.

Chris Walker: (39:14)
And so if that’s the case, score them on that gross value of the contribution. And then potentially there’s another piece of the, of the comp plan where it’s just did the company hit their revenue goal, which would be mainly, would be objective of creating more alignment between the marketing communications team and the sales team. And so I’m trying to find ways here. I think one of, I mean, there’s several real issues that I see in sales and marketing alignment, and it’s just kind of like my, this is from my experience. And all of them are a lot of people give these tips on, you know, have more meetings with your sales team, but the sales and marketing alignment issues are created at the executive level and at a strategic level, not a tactical level. And so the, the issues with the alignment are the sales and marketing, the CMO, and if CRO or whatever their titles are, are not aligned on go-to-market strategy, they’re not aligned on their compensation plans.

Chris Walker: (40:25)
They have misaligned metrics and that just moves downstream throughout the organization. But the, the how you solve the alignment issues are, is that you’ve fixed the metrics, the compensation and the you have full alignment on go to market strategy is, and that’s put very, that’s a very simplistic way to think about it. I know it’s much more complicated. But that’s, you know, some of the things that I would start to look at if I was, if I really cared about sales and marketing alignment, those are some of the things that I would look at.

Kyle Hamer: (40:55)
So, I mean, there’s a, there’s a couple of questions I have in there that, you know, one of the things that you said was, is, you know, I watched, I watched it was coming in and I saw that we converted better. And I knew that we had a 30% attribution to the inbound portion related directly to the revenue. So we were contributing 30%, you know, some sales leaders is going to look at you and say, Chris, that just sounds like sour grapes, man. I mean, you’re the guy who signed up for the guy who signed up for marketing, and we’re the people that actually have to get them across the line and close. How do you, how do you resolve that for the sales leaders or the, the organizations that are resistant to this, this concept of, you know, commission-based marketing.

Chris Walker: (41:38)
So the way that I always try and look at this is from a long-term business perspective. And so if we look at it long-term as a CEO CRO CMO conversation, like right in the middle of this, bro, I’m like right on the call. Can you, yeah. I mean, sure. It’s just really distracting. Sorry about that. What was the question again?

Kyle Hamer: (42:13)
So the question is, is sounds like sour grapes, and you said, you know, if you were really thinking about this, trying to align sales and marketing and make it a commission-based marketing, right. So marketers are going to get some sort of sales action. How would you, how would you talk to the, the sales leader? How would you, you know, how would, how would you move an organization away from thinking about it as you know, the salespeople are the only people doing the closing?

Chris Walker: (42:42)
Yeah. So I th I, I think we need to look at this from a, from a long-term business perspective. And so when we look at that the first, the first thing that if you don’t recognize this point, then it’s never going to work is that the value of marketing has increased consider that the necessity for marketing has increased considerably over the past 10 years, 10 years ago, you could have a 40 person sales team and one marketer and do well, that does not exist anymore. You’re going to burn cash or have a cost center from, as a sales team. If you operate that way, the reason being is that buyers changed. And so the, this is not a it’s, it’s a really tough conversation to have, if you think about it from your own perspective. But if you look at it from a buyer’s perspective, there’s plenty of research out there that shows that buyers actually spend more time with the information that marketing distributes than they do with the sales team.

Chris Walker: (43:45)
The, the estimate from Gardner on this year is that during B2B complexity to be buying process, they’ll spend a buyer will spend 6% of their time with a vendor. 17% total split across three vendors is 6% of the entire buying process is they’re going to spend with our sales team. And so how do we make that 6% of work so much? Like how, how do we as marketers use the rest of that time so that when our sales rep gets that slot of time, that they are the most effective, they can be, how do we arm the buyers with the right information? How do we deliver the right message? How do we get them so ready for that conversation, that the bot that the sales rep can do, they do best, which is help someone solve a problem and, and, and buy a product.

Chris Walker: (44:39)
Right? And so I think a lot of there’s a lot of stuff going on in sales right now, where salespeople are having to convince people that the product is right for them. If you do your marketing, right, the buyer’s already convinced. And so we see that, and that shows in sales cycles and win rates when inbound leads come in, and this is the assist from my experience. But if you’re not seeing these results and there’s something wrong with your inbound activity is that inbound should, should close at a rate at least three X higher than outbounds. So if your outbounds are closing at 10%, your inbound should be closing at 30% or higher. Your sales cycle length should be at least 50% shorter on inbounds. So if your sales cycles are one 80, they should be at least nine, at least under 90 days from inbounds.

Chris Walker: (45:30)
We’ve seen them at under 60 days. So like, if you think about it from a pipeline velocity, how fast you can move deals through your funnel, you’ve just accelerated your growth by three X by cutting your sales cycle like that. And so when you kind of bring it back to a macro business conversation, how do we get more of those opportunities in the funnel that are closing faster in the higher rate so that our sales team can be more productive and more efficient? It’s a, it’s a, it’s an obvious business conversation to have, if you understand the concept of pipeline velocity.

Kyle Hamer: (46:06)
So what do you do with the so what do you do with the revenue? I mean, it’s, it’s or your cost of goods sold. Do you expect that inbound leads are retained better? Do you tie a retention metric against that for your marketing team, or is the marketing team only focused on driving leads? I mean, there’s marketing is so much bigger than just just demand gen. How do you, how do you compensate fairly and appropriately across the other, the other elements of what a marketer’s got to do?

Chris Walker: (46:46)
Yeah, I mean, that’s a, that’s a fantastic question. So I mean, one of the businesses that I’ve worked with most, and that’s what I’m going to be speaking to right now, it’s businesses that have very high customer lifetime values and very high retention, and they have a great success program. Okay. The hardest part is acquiring new businesses, which is going to fuel the growth because as you bring more customers in, you can, it’s usually a land and expand. So you have a small sale, you go in and you go, and you do run that success program to get the customer to recognize the value. And you grow in that account considerably. The problem is actually getting into account. So most companies will have this. Most, most companies will have some type of similar model unless they’re doing something very transactional or super enterprise, right?

Chris Walker: (47:40)
So if you think about HubSpot’s program, they want to get you into the $50 plan, and they want you to see value so that you get on the $4,000 a month plan, eventually that’s their goal. And so we will look at companies that do that at varying scales of terms of money. And so, yes, I do believe that there’s a piece on there, that marketers should be focused on brand and success and things like that. My real narrow focus has been on the acquisition because I think it’s the most, it’s the easiest place to attack right now with, with these types of activities. And to be honest, most companies have already had a very good retention program. So it hasn’t been a focus for me, to be honest, I guess I didn’t answer your question.

Kyle Hamer: (48:42)
No, it’s, it’s, it’s, it’s just, it’s, it’s interesting when you say very good retention, what is that? Is that a 90% retention rate? Is that a 70% retention rate? What did, what do you

Chris Walker: (48:54)
Well, well, yeah, above 95, 95 to 97.5. And so that means your [inaudible] are 20 years. Like that’s that’s or, or your, your customer lifetime, if you’re at 95% or 95% retention is 20 years. Right. And so obviously not every customer is going to stay that long, but on average, at least if you extrapolate out based on the current retention rate, that’s a, that’s a strong retention.

Kyle Hamer: (49:28)
Well, it sounds to me, like up to this point, you’ve been, you’ve been fortunate with companies that have, have that figured out, but a lot of, a lot of organizations don’t experience that time. I mean, in, in a hyper-growth, right. So, I mean, we, we cause the, the model you’re mixing here, which, which is interesting is your mint, you’re mixing a highly sticky long-term can’t live without you. Great product market fit organization with a hypergrowth compensation model, which is typically drive lots of logos into the organization, converted high velocity and expand your market footprint. But the systems, the operation of the business is usually not built to digest that type of, I mean, they’re there they’re built for steady, consistent, you know, predictable growth. If you know, all of a sudden you start, you start converting at a higher rate or start driving in a tremendously you triple their, their closing volume.

Kyle Hamer: (50:37)
The organization is going to have trouble maintaining that same level of, of customer support and customer care, just because it, it, it’s going to be a shock to the whole system, right. Accounting is not going to know what to do because they’re processing more invoices, customer services is going to know. I mean, we haven’t scaled, right. I mean, it just, it causes lots of organizational challenges as, as a by-product of, you know, compensating a marketer as a salesperson, at least that’s a thought, did I miss that? I miscategorize that from, from a like, Hey, we’ve got this really healthy whole land, not late. Yeah. Late in expanded model, but you know, they’re going to be around for a really long time in this hyper-growth model. Like who, at least who, who do you know, that’s out there? That’s doing that well today.

Chris Walker: (51:27)
Yeah. I think one interesting point that I want to make is that I actually don’t believe that the compensation model changes behavior. Like if I was compensated this, that way, I would be doing the exact same things that I am today. The reason that I think that marketers should be confident that the right marketers should be compensated that way is twofold. One, because they are so critical to a modern revenue engine, they should be compensated that way and aligned with sales. Number two is that you need to retain top marketing talent, and this is a mechanism to do so. And so you know, I don’t think $150,000 salaries for marketing managers is the right way to do this. But I do think that if you have a team of three marketing managers that are crushing and driving considerable business and your sales team is beating quota, and all the AEs are making one 20 to 200, that the marketing managers should be able to celebrate that from a financial perspective as well, because they are part of the engine. And so that’s, that’s really,

Kyle Hamer: (52:42)
Yeah. Look in, in you know, I’m, I made this, I made this comment in the, in the LinkedIn comment, I think. Yeah. I think there’s a couple of things here. There’s a couple of things here that at least I wouldn’t say need to be thought through, but you need to be careful with the perspective a sales manager on target earnings, right? A sales manager is going to make 120 to $180,000 a year, depending on the organization. That’s a sales manager, the sales leader, the director is going to make one 80 plus. And if you get into the VP and CRO levels, you’re looking at two 50 plus, right. For an organization to say, okay, now we’re going to pay the marketing person equally. There’s a, there’s a, there’s a tremendous consideration that has to happen there right across, across the whole, the whole organization.

Kyle Hamer: (53:41)
And what I don’t want to do is get out here and talk about equitable pay for marketers and, and retention, and then undercut the market. Because if the value is the value is right, how many people say, why do value based pricing? Great. You charged $60,000 for something that costs a penny to make cool, pay me, like, like pay me like the value that I’m bringing to the organization. And I don’t think that there’s anything wrong with that. But there’s a lot of risk associated with that. And there’s a lot of risks on the building, right? If you, if you’re a marketer you’re Chris, eight years ago, right before you took this first job before you had all these mistakes, before you figured out this whizzbang, you know, Hey, I got this philosophy, you’re eating ramen noodles, dude. Right? Like you’re starving. Right.

Kyle Hamer: (54:31)
And by the way, so as the organization, like, there’s a, there’s a challenge with that. And then what do you do? What do you do when they change sales mechanisms? What do you choose when they change sales strategies? Then they go, they go from I got a sales leader, who’s high velocity to a sales leader. Who’s like, man, I’m a little more applauding. We’ll get there. When we get there to a sales leader, who’s like, you know what, this is more of an enterprise sale. It’s going to take 90 to 180 days or more. I’m not worried about it, but your compensation and your model and your velocity trap is built around the you know, the high velocity guy. Like how, how, how do marketers navigate those types of things as it relates to compensation? Because those are the things that they can’t, they can’t control. Ultimately, a marketer cannot control what’s closed, and that’s gonna be the that’s going to be the, the rub for this conversation. I think for a very long time is they’re gonna say, well, the marketer didn’t actually close the deal the sales person did, or the sales process data, the conversations that we had.

Kyle Hamer: (55:36)
What do you, what do you think about that? Like,

Chris Walker: (55:39)
Yeah. Yeah. I hear you loud and clear. And I think he makes some really great points. One, one thing I am not in any means advocating for equal pay. I do not believe that a marketer and a salesperson shouldn’t be paid equally. I believe that they should be that they should have aligned incentives. Right. And so that’s, I think that’s a nuance that I might’ve missed in the post. I don’t want both people to be making the same amount of money. I, as a, as a marketer that works with plenty of salespeople, the salespeople should make more money. Like if they’re doing their job and the marketers doing their job, the salesperson should make more money. And I I’ve met would never argue. At least, at least I would not argue that today. And we’ll see in a decade, I won’t say never. But for now, absolutely the salesperson should, should be compensated at a higher level than a marketer for, for that. I

Kyle Hamer: (56:43)
Can, I, can

Chris Walker: (56:44)
I, can we comment on that statement? Yeah. So here’s where I think you and I might disagree

Kyle Hamer: (56:53)
If it’s a high velocity transaction, let’s say it’s sub 20 days. Okay. The sales rep, how much selling are they really doing? Like, like, let’s be really honest if you said it’s 6%, right? 6% of the time they’re going to spend in this sales cycle. It’s 21 days. That’s how long it takes to close this transaction who actually did the majority of the selling, the marketer or the sales person, like who really wants to go backwards. Right? Like it’s,

Chris Walker: (57:23)
You’re preaching, you’re preaching. I think,

Kyle Hamer: (57:27)
I think to, to a small degree, actually, I, to a small degree, I think to a large degree as marketers across the board marketing has given themselves a black eye by saying, well, we’re not actually selling. Yes, you are. The second somebody is introduced to your Facebook ad the second even if it’s just a piece of content, right? Oh, I’m not selling. Yes. You are like, you’re starting a conversation. It’s like, it’s like somebody saying, Hey, I walked into the bar and I saw somebody who is attractive of the opposite sex or the same sex or somebody that I was interested in. And I didn’t dress appropriately. But I came back in my, my well to do’s and then over like three weeks, they’re like, Oh, I remember you. You’re the person with the wingtip shoes, whatever it is. Right. Like that is part of selling.

Kyle Hamer: (58:09)
But it starts as like the sales doesn’t start at the point, which the lead is handed to somebody that becomes the phone. Like, Hey Chris, this is Kyle from XYZ company. And I’m calling you because you filled out our lead form. Like that’s not where the sale starts. And, and I agree. And I think in, in, in marketers today, we’re like, we’re also focused on leads or we’re also focused on you know, brand awareness. Yeah. Looks like, ah, yes, that’s important. Don’t get me wrong. Like, I’m not, I’m not saying the brand is not important, but the sales team only has X amount of days to engage with somebody the rest of the time. We’re, we’re, we’re cutting our T moving a lead through the process, trying to figure out what the sales process is before they entered the closing cycle before they enter that here’s my credit card, right? Our job, if we do our, I know this is a personal belief. My personal belief is that if marketers are doing their job, somebody shows up and says, Hey, Chris, I’m Kyle, here’s $30,000 in my credit card. I want this. Right. Like if we did our job, right, the sales team is effectively the drive-thru order-taker. And McDonald’s like, it’s, it’s, it’s transactional. If we

Chris Walker: (59:22)
Did with great marketing holes just pulls product through distribution. And so right now teams or teams are built on pushing their product into the market. And the companies that, that really grow in win are the ones that have marketed. And the customer pulls the product through the channel.

Kyle Hamer: (59:40)
Yeah. It in your green here. Oh no. I th we we’ve been in agreement the whole time.

Chris Walker: (59:48)
I wasn’t an organization

Kyle Hamer: (59:50)
For for, for quite a while where I was compensated equitably. And when I say equitably, I mean, on the pay scale was the exact same as the VP of sales. Like it was when I walked in and said, I’m not taking the job. If I’m equal, equal work, equal pay, and you have a, you have an engine that’s busted right now. If you want to get it fixed, this is how we, this is how we fix it. And I’m going to tell you for the first year and a half, I didn’t make a single penny in commission. And it was Rudel. Right. I took a pay cut. I took a step back. And you know, I didn’t, I didn’t make as much money now when we got to figure it out, the upside was pretty nice, but it took a year and a half to figure it out.

Kyle Hamer: (01:00:33)
It took a year and a half to figure out what was, what was busted in that particular model. And it would, you know, I came here with same as she was like, I got a preconceived, if this is how this flywheel works, and this is how that goes, but the organization wasn’t in a position to execute well. We also went through four sales leaders in three years, high velocity guy, mid mid range guy, guy didn’t really know what he was doing. A person that wanted to build an enterprise SDR STR model. None of that had, but if you build your flywheel for one of them, and new guy comes in, your flywheel, doesn’t work for the next guy. And so those are things that as we have this compensation conversation, most marketers are adaptive enough to handle the next, the next transition, the next person coming in.

Kyle Hamer: (01:01:20)
But the, the, the reality of we’re excited with this, Oh, the, the reality of, of the chain, the time it takes to change how they’re working, somebody through that sales process, based on the closing or the final, you know, the final 60 days, the final 20 days, the final 15, it takes time to change all of your tactics upstream to make that, make that velocity change or make that, make that flywheel work. And, and those are things that the marketers who are going to try and pound the table for equal pay, they need to understand, Oh, this is going to be, they’re going to hire a new high velocity guy. And I’m more of an enterprise play. There’s probably not a good place for me to try and get my commission, right. Or, Hey, you’re an enterprise organization when you sell this and it takes 180 days, but I’m really good at delivering transactions that happen under 20. Yeah. I probably, I probably shouldn’t take on this position and expect to make this thing. And it just, it’s, it’s setting our own expectations so that it doesn’t create fodder for, for failure. It’s knowing when to say no.

Chris Walker: (01:02:28)
So when we, when we hire a new sales rep, they get a ramp. And depending on the business, that ramp is three to 12 months, right? They gotta, they have to learn the product. They need to build pipeline. They need to they were in the sales process, any of the, where the market. So if you had had, if we were going to move to this model, then marketers should get a ramp to,

Kyle Hamer: (01:02:52)
So the, the nuance to that ramp, and it depends on the organization because the organization that I was involved in there was a ramp, but the ramp meant you, you weren’t making commission. You weren’t, you weren’t even actually getting overhead the, even close to your OTE. You were getting your base, you were getting costumes, like, look, you either do these things. These are the things that you’re getting to get your base. Your base helps offset that you’re not making any money until you start delivering quota until you start delivering deals. So there wasn’t a, Hey, you start out at $9,000 a month. And then by the time you’re fully ramped, you’re down to six and you make up the difference with commission. It was, you start off at three, $4,000 a month. You want to start earning $9,000 a month, figure it out fast.

Chris Walker: (01:03:37)
Yeah. I mean, I, I don’t think that’s the winds for anybody. Like, I don’t think that’s the model that I would, that I would implement. I have also been at a at a company where it was where I was the head of marketing and I was equal pay with the head of sales. And let’s be very clear that equal, equal pay does not mean that everything is just going to magically work, right. That is embedded. It’s absolutely not. That is absolutely not how it works. And so there are there’s a, there’s a big ecosystem of decisions here. And think variables that are in play that come down to leadership, culture, budget, compensation, you know trust, like they can get into a lot of different, different places about how that relationship actually works. And we need to make sure as a company that we are, that we’re compensated, if we are going move to a variable compensation model that we’re using on the right marketers, right?

Chris Walker: (01:04:54)
Because we can not have marketing strategists that are responsible for longterm business outcomes of sustainability compensated on short-term metrics. That’s where this starts to get really messy. Because I, I take pride that I am both at a tactician. I think that I’m a very good one and the strategist, so I can see, I can see both sides. I’m far better tactician, but I can understand and, and deliver a, a well-thought-out, you know, compelling strategy. And so if we, if we have strategists that are on variable compensation plans, they’re not going to do the important work. And so that’s, I mean, when you start getting into larger companies that are on you know, traded on stock market, and you have a CMIO that’s bonus for the stock price, that’s, that’s why you see businesses not do things that are going to make them successful in the longterm. What do you think? So

Kyle Hamer: (01:05:57)
Were just laid off 400 people, right? I mean, Uber, Uber, just having a $5.2 billion loss in the last quarter, the marketing engine is what grew them. They don’t have a traditional sales, right. So marketing grew them to where they were and they’re like, Oh, look, we lost $5 billion and we’re going to blame it on marketing. And you’re right. Like the, the behavior of the department head has to align with the, the expected outcomes for the street in a large organization. So I did, there’s a conversation that he’s going to go on for years. I don’t, I don’t think it’s, I don’t think it’s going to fix itself overnight.

Chris Walker: (01:06:38)
Yeah. And I mean, it it’s Uber’s problem is a business problem, not a marketing problem. They have a unsustainable business model. That’s built around raising a bunch of money and trying to grow top line and losing so much money right there. They lose money on every ride. They are trying to acquire customers. Their customer acquisition is flat. There’s more competitors in the marketplace. Like they have they have a real problem. And that there’s a lot of very large brands that are considered successful that lose billions of dollars every year. And so, I mean, at some point they’re going to have to generate a profit if they want to be a business, because you can’t just continue to lose $5 billion every year. And the problem is that the losses grow like the revenues growing, but not as fast as the losses, I’m in a WeWork right now, and their losses are outpacing their revenue growth. It’s a problem.

Kyle Hamer: (01:07:49)
Well, and I think the nuance there though is Amazon posted losses for years, right? And now they’re the first or second trillion dollar company. They flipped it. The challenge with these other companies is we’re either going to experience what we experienced with the housing and the bad debt crisis, where you have these companies that are coming in bad debt over leveraged bleeding cash, and we’re going to make the public buy them. And they’re going to, they’re going to go bankrupt. I mean, just look at, just look at the transition. Tumbler went through, right. Tumbler sells to Yahoo for 3 billion Yahoo sells to whatever. I mean, I was reading today and then today they were sold back to WordPress, the owners of WordPress for $3 million. Right. Like we, we’ve got these companies out here today that there’s some really good marketing or, Hey, there’s some really good salesmanship going on and we’re selling the public something that there’s, there’s not a whole lot of profit or sustainability or, or meat inside of it. And you’re basically purchasing somebody else’s debt.

Chris Walker: (01:09:04)
Yeah. I mean, I’ve worked at I worked at worked with and worked at a lot of venture backed startups that I mean, this is this isn’t specific to these, the companies that I’ve worked at it’s across the board is that these companies are, are just trying to make it to the next round. They’re not, it’s not a it’s, it’s not a businesses can survive longterm. They’re just trying to make it to an exit and dump dump it either on the market or on acquire, right. They’re just trying to hit metrics on profit margin and revenue growth and a couple other like tack a couple other metrics so that they can sell to, you know, Google or whoever the, the, some of the, you know, the consolidators in that whatever space they’re in. And, and then that company goes on, it gets integrated with Google.

Chris Walker: (01:10:06)
And three years later, the business unit fails. Like that’s, that’s what we see I’ve seen a lot and that, you know, that it gets blamed for a couple of different ways. It could be that the integration of the company into the larger organization was flawed, but more often it’s because the large organization bought this company and either the company was destined to fail or the company, in some cases, the company has set themselves up to be sold. They stopped investing in R and D. They hired more salespeople. They had, they had one product that they could talk about that wasn’t close to commercialization, but help their story to sell. And then they get a, you know, eight X valuation on their business. And it’s, it’s dead once it’s bought, because you have a, you have no innovation, you have no product pipeline, you just pumped up the, the margins and the profitability, but you have not built a business that can sustain itself longterm. So see a lot, you see a lot of that going on right now.

Kyle Hamer: (01:11:16)
Yeah. It, look, it what I think, you know, you come back around to this, the compensation for sales and marketing being paid equally, you know, getting some sort of very sustainable or, or slice of variable comp organizations are going to have to figure out how to do their pricing models differently. They’re going to have to do, to figure out how to do they’re the underpinnings of their business for sustainability you know, in the VC and PE world, I’m sure that it’s more attractive because you can get guys that can drive a velocity wheel on the front end. The challenge I think is, is that for it to be sustainable and really to have an impact across the, across the business front, and truly aligned sales and marketing I genuinely think that it’s gonna change the, the financial model and it’s going to take time for that to happen. Like it’s, it’s going to take a long time for that to happen

Chris Walker: (01:12:16)
100%. So it’s, it’s a reason why I’ve picked the target customers that I’ve picked is that they’re smaller companies. They’re more malleable. They can change like the enterprise customer. I’m not going after because they cannot change. They are stuck, right. But the $25 million company can make some, some changes as they start to see things work at least a lot easier than, than a larger company. And so the, my theory on this is that you actually need, you actually wouldn’t have to change much about the business model for this to work. And so if you were investing more in marketing, which in theory, it should drive sales, channel efficiency, that’s ho that’s better than what’s happening today and is, is more efficient than what’s happening today. Then you could, you would just rebalance your budget allocation that allocated more to marketing. Your salespeople could make the same money, but you would have less of them. And they would, it might make more money cause they’d all be operating more efficiently, right? And so if you gave each sales rep an extra, you know, it really depends on the scale. So the analogies not going to work. So just kind of go with me here is that if you get each rep, each rep’s quota was a hundred grand a quarter and you gave them, you know, and they’re producing three X their pipeline, and you gave them an extra three X pipeline every month.

Chris Walker: (01:13:45)
Is it feasible to consider that they might be two times more productive once they have the pipeline full? I think that’s a reasonable conclusion. It could actually be even higher than that. If you’re in, are converting at a higher rate and they’re winning faster. And so if marketing can do their job, and in my view, the job of a modern marketing person is to educate the market and increase sales efficiency, and, and improve the, the overall customer buying experience. Then you may not need to make that many changes to your pricing or your margins or things like that. It’s just a reallocation of the dollars,

Kyle Hamer: (01:14:37)
Maybe. I mean, maybe,

Chris Walker: (01:14:40)
Yeah, it’s a complete theory. It’s it has not been it has not been tested

Kyle Hamer: (01:14:48)
Look having, and again, having gone through four different sales leaders in three years, seeing different models, seeing how each sales leader wanted to handle its budget, seeing the total overall cost of goods sold and understood where when business operators come in, they look to cut in the first place they look to cut is in marketing because they think marketing is advertising, Oh, we need to cut our marketing expenses. Okay. you know, and then six months later, they’re like, well, why isn’t our sales? Aren’t where they’re supposed to be. We doubled our sales side and we cut our, cut, our marketing, the, the business fundamentals. And that’s why I said, I think it’s going to take some time for these models to change and operators to change the, the market is shifting. And we’ve got a lot of stars. Mark Bennett from Salesforce is one right where they’ve grown their organization through spreadsheets,

Chris Walker: (01:15:46)
Brute force sales. That’s right. Yeah. I mean,

Kyle Hamer: (01:15:50)
Gorilla sales. And as people become less and less responsive, they come more and more mobile and less and less responsive to people calling them. And there’s more and more AI flooded into the market that the balance is going to shift. I mean, I, I genuinely believe we’ll see a day in our lifetime where sales and marketing is no longer distinguishable one department from another. They are literally the same thing.

Chris Walker: (01:16:21)
100% agree. And the reason that the brute force sales model doesn’t work as well anymore is not because people don’t answer their phones as much. It’s because buyers have more power. They are armed with education. They don’t need to talk with a rep to get the reviews, the pricing, the integrations, they have all of this information. So they’re when they have the information, they have more power over their own buying process. And that is the reason why outbound brute force sales is becoming less effective. And so what we need to do as markers, I call it buyer enablement. That might be a buzz word that we can use on the is we need to empower buyers with the information that they need so that they can make their own buying decisions. How do you, how do you guide a buyer through a buying process and not need a rep?

Chris Walker: (01:17:23)
You make demos available, you have, you know, on demand support, waiting to answer questions. Do you have all of these different guides and information? That’s where I think this is, is going to move because people will continue. I mean, there are very few sales processes and I buy a lot of software and I advise our clients on a lot of different B2B business purchases that can be in the range of 2000 to 50,000 ACV. And we pretty much decided what we want to buy before we ever talked to someone. And that’s just the truth. And so yeah, I just think that, I think that companies need to take a hard look at what behaviors buyers are actually having and adapt to them. Well, I think that’s a good place to, yeah.

Kyle Hamer: (01:18:25)
I w we’ve we’ve been all over the spectrum today. I appreciate the time to, to chat. We’ve kept you longer than we thought. And I, I do have that here in about 10 minutes. So we’ll go ahead and wrap and thanks for, thanks for taking the time though. It’s good to actually kind of meet you, hear your story and you know, two on this big old topic of sales and marketing being equally compensated, I mean, it’s it’s, it’s a meaty topic and I’m sure if we invited a sales person or, or sales leadership to it, it’d be even more, right. There’d be, there’d be a lot. Yeah.

Chris Walker: (01:19:00)
I mean I kind of, I mean, a lot of the points made, I kind of have rethought my position on it. Like, it’s just, it’s just really interesting to to debate it, right? Cause it’s not, there’s no, there’s no real right or wrong answer. It’s just, what’s, it’s all individual business decisions.

Kyle Hamer: (01:19:22)
It is, but it’s also, I mean, it, it is important. I think to, to keep an open mind and explore, explore is probably not the right word to understand that the, the behavior mechanism for transacting a sale is changing quicker than our sales force and our our current business models are, and that’s going to lead to a lot of conflict and friction that organizations are gonna have to sort through. So, all right, man. Well, I gotta, I gotta bounce. Yeah.

Chris Walker: (01:19:54)
Do you could be, want to get ahold of you shoot me the zoo. Oh yeah. Sorry. you could find me on LinkedIn. That’s probably the easiest way. Cool. or my email email is refined labs.com.

Kyle Hamer: (01:20:08)
Cool. Yeah, I’ll shoot you the zoom. I’m going to listen through it to make sure that I don’t I don’t get myself in any hot water with the previous organization. I’ll make a make. Yeah,

Chris Walker: (01:20:18)
Yeah. Do it, man. But I’ll do what you gotta do.

Kyle Hamer: (01:20:20)
I’ll send it, I’ll send it to you once I have it done. We’ve got the video recording. We got an audio and then, you know, I’ll get that to you in the next day or two. Okay.

Chris Walker: (01:20:32)
Yeah. That’s cool. Yeah. 90 minutes should give us a ton of stuff to chop, to put out on social. So, and I’ll tag in stuff. Cool. Thanks man. Have a good one. Cool. Thanks man. Good to meet you. See ya. Bye.