Francesco Gizzi
Strategy
Sales and marketing alignment: shared goals, leads and KPIs
"The leads coming from marketing are no good." "Sales doesn't follow up on the leads we pass them." If you have heard at least one of these sentences in your company, you already know the problem. Marketing and sales both work, often very hard, but towards different goals, with different definitions and looking at different numbers.
The result is silent waste. The advertising budget generates leads nobody follows up. Salespeople spend hours on deals that will never close. Management receives two reports telling two different stories and decides on gut feeling. In my work with B2B SMEs and startups it is one of the most frequent sticking points, and one of the most solvable.
In this article I explain how to build sales and marketing alignment, sometimes called "smarketing": starting from business goals, defining what a lead is, designing the handoffs between functions and choosing a few shared KPIs. With a numerical example you can redo with your own data.
What aligning marketing and sales means
Aligning marketing and sales does not mean getting them to like each other or organizing one more meeting. It means building a single system, with four shared elements:
- a common goal, expressed in revenue or customers, not in leads or visits;
- common definitions of what a lead, a qualified lead and an opportunity are;
- clear handoffs on who does what, within what time, and what happens to rejected leads;
- common numbers, read together and from the same source.
If one of these elements is missing, each side optimizes its own piece. Marketing maximizes leads, because that is what it is measured on. Sales picks the easiest leads, because it is measured on the month's revenue. Both do their jobs well, and the company as a whole loses out.
The signs of misalignment
With clients I always see the same symptoms recurring: marketing celebrates a record month for leads while revenue stays flat, nobody can say how many of a quarter's leads became customers, salespeople look for customers on their own because they do not trust the leads they receive, and meetings are spent arguing about who is right instead of what to do.
Start from business goals: a practical example
The most effective way to align the two functions is to derive both sets of goals from a single number: revenue from new customers. You start at the end and work backwards. Here is an example with hypothetical numbers, which I recommend redoing with yours.
A B2B company wants to generate €600,000 in revenue from new customers over the next 12 months. The average contract is worth €20,000. So it needs 30 new customers.
- If sales closes 25% of opportunities, you need 120 opportunities.
- If 50% of sales-qualified leads become a real opportunity, you need 240 qualified leads.
- If 30% of marketing-qualified leads pass the sales check, you need 800 marketing leads.
On a monthly basis that means about 67 marketing leads, 20 sales-qualified leads and 10 opportunities. These numbers change the conversation. Marketing no longer has the goal of "bringing in more leads", but of bringing in 67 leads a month with the right characteristics. Sales can no longer say that leads are too few or too poor without pointing to the step where they are lost.
The calculation also shows where to act. If the conversion rate from marketing lead to qualified lead rises from 30% to 40%, you need 600 leads instead of 800: with the same budget, a quarter fewer leads to generate. Improving quality often costs less than increasing volume.
Defining leads: MQL, SQL and opportunity
The "are the leads good or not" argument almost always stems from a lack of definitions. You need a short written agreement that both functions sign up to. These are the three stages I use most often:
- Marketing-qualified lead (MQL). A contact that matches the ideal customer profile and has shown concrete interest. For example: a company with 20 to 200 employees, in the target industry, that has requested a demo or downloaded a price list.
- Sales-qualified lead (SQL). An MQL that sales has contacted and that has confirmed a need, a contact person with decision-making power and a reasonable time horizon.
- Opportunity. An SQL with whom a deal has been opened: a proposal is being prepared or has already been sent, with an estimated value and an expected close date.
The agreement on timing and recycling
Besides definitions, you need service rules. Sales commits to contacting every MQL within a defined time, for example 24 working hours, and to recording the reason for every rejection. Marketing commits to guaranteeing a minimum volume of MQLs with the agreed characteristics. Rejected leads do not disappear: they go back to marketing, which nurtures them with content and newsletters until they are ready. This recycling often recovers some of the leads that seemed lost.
Handoffs between marketing, sales and management
Alignment breaks down at the handoffs, not within the functions. That is why it pays to design them explicitly and give each one an owner:
- From marketing to sales. Who assigns the lead, with what information attached, through which tool. A shared CRM is the foundation: if marketing and sales use separate tools, alignment remains theoretical.
- From sales to marketing. Feedback on rejections and on the most frequent objections. It is the most underused source of information I see in SMEs.
- From the functions to management. A single dashboard, a single version of the numbers, a single moment for reviewing them.
Management's role is decisive. It is management that sets the common goal, arbitrates when definitions need to change and aligns incentives. If marketing gets a bonus based on the number of leads and sales on revenue, no process will hold up for long. Part of both teams' bonus should depend on the same result: new customers acquired.
The rhythm I recommend is simple: a thirty-minute weekly meeting between the heads of marketing and sales on the week's leads, and a monthly meeting with management on the KPIs and the corrections to be made.
The shared KPIs to look at together
Each function will have its own operational indicators. But you need a small group of numbers everyone looks at together, on the same dashboard:
- new customers and revenue from new customers, against the goal;
- number of MQLs, SQLs and opportunities for the month, with the conversion rates between stages;
- customer acquisition cost, meaning marketing and sales spend divided by new customers;
- average sales cycle length;
- value of the open pipeline against the quarter's goal.
Reading conversion rates is more useful than reading volumes. If MQLs grow but the conversion to SQL collapses, the problem is the quality of the campaigns or the definition of the ideal customer. If there are plenty of SQLs but few opportunities, the problem lies in sales qualification. A well-built KPI dashboard for marketing and sales makes these bottlenecks visible in seconds.
Looking at the same numbers also changes the way you invest. When campaigns are judged on the customers they generate rather than on clicks, the budget moves by itself towards the channels that pay off. With a financial company we achieved +110% ROI on online campaigns in 3 months.
Mistakes to avoid
- Aligning without a common goal. Meetings and good intentions are not enough if each side is still measured on a different number.
- Definitions that are too vague. "An interested lead" is not a definition. You need criteria anyone can verify.
- No feedback on rejections. If sales rejects leads without explaining why, marketing cannot improve.
- Data in two different systems. Two sources produce two truths, and meetings turn into arguments about which one is right.
- Changing the rules every month. Definitions should be reviewed, but not before at least a quarter of data has been collected.
- Delegating everything to the tool. A CRM aligns nobody unless the rules it has to follow are clear first.
Where to begin
The first step is concrete: take the data from the last six months and try to reconstruct the journey from leads to customers. If you cannot, you have already found your first priority. Then sit down with the heads of marketing and sales and write the lead definitions together, even in provisional form.
A realistic plan for the first three months could be this:
- Month one. Reconstruction of historical data, backward calculation from the revenue goal to the leads needed, first version of the MQL, SQL and opportunity definitions.
- Month two. CRM configured around the new stages, agreement on contact times and rejection reasons, launch of the weekly meeting between marketing and sales.
- Month three. First shared dashboard, first review of conversion rates and first corrections to campaigns, qualification or sales proposals.
After three months you will not have a perfect system, but you will have reliable data to understand where customers are being lost. That is where the best decisions start.
If you want outside help setting up the system, I work on both fronts: marketing consulting for demand generation and sales consulting for the sales process. And when the company is ready to turn this work into a complete sales strategy, the next step is to define a coherent B2B sales strategy. Write to me and we will start from your numbers.
FAQ
What is smarketing?
It is a term that blends sales and marketing and refers to the alignment between the two functions. In practice it means sharing goals, lead definitions, handoffs and numbers.
What is the difference between an MQL and an SQL?
An MQL is a contact that marketing considers a match for the ideal customer and interested. An SQL is an MQL that sales has verified and that has confirmed need, contact person and timing.
Who should lead the alignment between marketing and sales?
Management, because it is the only one that can set a common goal and align incentives. The heads of the two functions then manage the rules and the operational rhythm.
Do you need a CRM to align marketing and sales?
In most cases yes, because it gives you a single source for leads, stages and conversions. The tool only works, however, once shared rules and definitions have been set.