TALKING SALES 179: "Measuring Marketing"

John Smibert

Relationship vs pipeline 01"Spend money building relationships, not pipeline" - A 'Talking Sales' discussion with John Bedwany and John Smibert

How do we measure the effectiveness and ROI in marketing?

Should we measure  leads generated and converted? Should we measure the revenue that directly resulting from lead generation activity?

John BedwanyIn this discussion with John Bedwany he claims we might be measuring the wrong thing.

He proposes that we should be spending marketing "money to build relationships, not build pipeline. He claims "pipeline comes from relationships being built as a result of the education they get from your organisation".

"What you'll end up finding is that if you spend money on relationships, pipeline always comes out of that, but the pipeline that comes is pipeline with trusted relationships.

Watch this short 4 min video or read the transcript to understand why John believes that marketing should be investing in building relationships, not pipeline.

The sales productivity strategies discussed here should be of value to CEO's COO's, CSO's and sales leaders.


John Bedwany is the CEO of The Database Dept.  He is a thought leader and a disruptive thinker who helps his clients achieve extraordinary productivity in sales and marketing.


John S: Hello, I've got John Bedwany with me again - welcome back, John!

John B: Hi, John!

John S: Hey John, we've now finished your seven B2B sales challenges that CEOs and sales leaders, etc. face, and I want to move on to some of the issues you see in marketing, so let's start with your challenge number one in marketing in a B2B environment.

John B: Yes, okay. It's really return on investment. How do marketers get measured?

John S: It's all about measuring to me. So many dollars go into marketing, and we really don't understand whether we're getting a return on investment or not, more often than not.

John B: Correct. And when I look at all the clients we work with, and we work with most of the IT global brands in the industry, this is how they all get measured. "Hey Jack, I've got $50,000, I need some pipeline - go." Jack takes the $50,000, or Jackie, depending on...

Relationship vs pipeline 08 - bottomless pit 750x350John S: Jack or Jackie the marketer.

John B: Absolutely, takes the $50,000, they hit 1,000 people with any type of demand generating campaign, it doesn't matter... 50 opportunities, beautiful. I've now got 50 opportunities, 5%

John S: Throw them across to the sales guys...

John B: Throw them across to the sales guys, they accept 50% of them, now I'm down to 25 opportunities. Pipeline to revenue 300%, I've closed eight deals. Average deal size 100k, $800,000 in revenue. I've spent $50,000, 15 times return on investment. "Well done marketing, here's another $50,000." What's wrong with that model?

John S: Based on what you've been telling me up to now, you've made this big investment, and I don't see that as a massive return on investment, but the real issue is you've done nothing to progress the relationship with all those other 950 people out there.

John B: Exactly, John, and this is what we're asking the industries to start to think about. Spend money to build relationships, not build pipeline. The pipeline comes from relationships being built based on the education they get from your organisation.

John S: Spend money building relationships, not pipeline.

John B: Correct.

Relationships vs pipeline 07 750x500John S: That's a bit controversial, because we all measure based on pipeline, don't we?

John B: Absolutely. And what you'll end up finding is that if you spend money on relationships, pipeline always comes out of that, but the pipeline that comes is pipeline with trusted relationships.

John S: Let me throw something at you. We've used this word "relationship" a lot through all the discussions we've had.

John B: Yes.

John S: How do you define a relationship? I ask the question advisedly, because CEB talk about the fact that a relationship sales guy is the wrong sort of salesperson, and they have a certain definition of what "relationship" means. What do you mean by relationship?

John B: Again, the relationship must be owned by the organisation, not by the person, step one. We have a five-step process to build the relationship, it's the journey towards trust.

John S: Okay, so you're talking about a trusted relationship that the customer has with you as an organisation, they believe that you bring something of value to the table and they can trust you.

John B: Absolutely. How do you buy? You buy based on knowledge you gain, and making a decision that that piece of information you get is superior to the other piece of information you get at the right price, and therefore you make the decision.

Relationship vs pipeline 03 750 x440John S: But a lot of how they buy, emotion comes into it as well, so if they feel they trust you, if they feel you give value, the emotions take over and then they look for the logic to support the decision.

John B: John, let's bring friendship into the business world, let's get over ourselves. "If you have money, I'm your best friend in business; if you don't, I forget you." People buy from people they like, people buy from people they trust, so at the end of the day I need to make sure that I'm giving you what you need when you need it as often as you need it until you're ready to buy. If you invest in relationships, trust comes out of that investment and they will buy more from you at a less cost.

John S: Okay. So take it back to the key message for this discussion, which is challenge number one, measuring ROI from a marketing point of view. You're now saying we really have to measure the value we get from building relationships, not how many we put in the pipeline.

John B: Exactly. And in one of the next conversations we'll have, I'll talk more about how do you strategically manage the market and measure that management.

John S: I'm loving these discussions, John, thank you very much - I look forward to the next one!

John B: Thanks, John!


More discussions with John Bedwany:



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