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What Innovation Teams can learn from Sales and Marketing

Lessons from the past to prepare for the future

calendar icon March 8, 2021

Selling enterprise software is dramatically different today than it was 20 or 30 years ago. Back then salespeople had to engage in long and expensive sales cycles, leading to high customer acquisition costs. These costs had to be absorbed through large initial contract sizes, which limited the addressable market for these solutions. Visibility into the selling process was relatively poor by today’s standards, meaning that there was comparatively weak data on what sales strategies were working and where the process was stalling. From a customer’s point of view, the experience was time consuming and required substantial financial commitments before there was proof that the solution actually met their needs.

Digitization of sales and marketing

Fast forwarding to the present, SaaS has dramatically reduced deployment costs and sales in many software categories are now managed via self-service and/or inside sales teams using Zoom. This has dramatically lowered customer acquisition costs, increased sales velocity and enabled smaller initial deal sizes that reduce risk for customers and expand market opportunity for vendors.

Purpose-built software enables all of that. It helps marketing and sales teams nurture leads and move prospects through highly personalized journeys. Marketing teams use data to measure the effectiveness of campaigns, test messaging, and segment markets and channels with precision. Product-led growth has further reduced friction, shifting the role of sales teams to after initial adoption and proof-of-value.

Both vendors and customers have benefited from these changes. And there have been dramatic shifts in the competitive position of vendors based on how quickly they adapted. Industry leaders in many categories today are those who embraced the digitization of sales and marketing early on. They invest heavily in software and analytics and continuously improve their processes based on rigorously studying data on every aspect of customer acquisition, retention and expansion.

What’s to come for innovation

There are clear analogies between the digitization of sales and marketing and how innovation will be managed in the future. Historically, many innovation teams have leaned heavily on interpersonal relationships and their business processes have either been manual or managed through generic tools poorly suited to the work. In a post last September I highlighted some of the consequences of these approaches, including pattern matching, tunnel vision and wasted effort. As the pace of technology change continues to accelerate, pressure is mounting on innovation teams to help their organizations adapt and compete. The only way to meet these expectations is for innovation to digitally transform.

This transformation is not just about accessing databases or using generic software. Enterprises need to adopt tools that reflect the unique requirements of the innovation function, from managing internal innovation initiatives to engaging external ecosystems. These tools need to help innovation teams capture internal needs, drive cross-functional collaboration, and deliver strategic market intelligence. They need to help tap into the expertise and relationships that exist across the organization, expand access to information, and reduce duplication of effort.

Those organizations that invest in these tools will realize efficiency gains similar to those experienced by sales and marketing teams. These gains will help innovation teams drive time-to-market, efficiency and growth for their organizations. Those who delay run the risk of falling behind the digitization curve and being consistently out-innovated.