What every marketing chief needs to know about RevOps

Grow­ing rev­enue is often seen as a dark art, with few busi­ness­es hold­ing a recipe for suc­cess. Rev­enue oper­a­tions (RevOps) aims to change all that.  

RevOps brings the oper­a­tional side of sales, mar­ket­ing and cus­tomer ser­vice togeth­er in a way that har­monis­es process­es, tech­nol­o­gy and data to dri­ve growth. It has been dri­ven by a rev­o­lu­tion in data ana­lyt­ics and the emer­gence of dig­i­tal sell­ing tech­nol­o­gy, which have yield­ed unprece­dent­ed vis­i­bil­i­ty and con­trol of the full rev­enue cycle. 

The con­cept is the focus of a new book, Rev­enue Oper­a­tions: A New Way to Align Sales & Mar­ket­ing, Mon­e­tize Data and Ignite Growth, from Stephen G Dio­rio, exec­u­tive direc­tor of the Rev­enue Enable­ment Insti­tute, and Chris K Hum­mel, the institute’s man­ag­ing direc­tor, who has pre­vi­ous­ly held glob­al CMO roles with Schnei­der Elec­tric, Unit­ed Rentals and Uni­fy. It high­lights three RevOps organ­i­sa­tion­al struc­tures that are becom­ing pop­u­lar.

The ‘tsar mod­el’ sees the entire sales, mar­ket­ing and cus­tomer ser­vice organ­i­sa­tions unite under a sin­gle chief rev­enue or growth offi­cer. The ‘fed­er­a­tion’ approach is an alliance between the lead­er­ship func­tions with rules of engage­ment, in which they man­age growth ini­tia­tives and work togeth­er to remove obsta­cles.  And final­ly, there’s the ‘chief of staff’ approach, where the sales and mar­ket­ing oper­a­tions, sales enable­ment and cus­tomer ana­lyt­ics are merged into a unit under a sin­gle leader, rather than the sales, mar­ket­ing and ser­vice func­tions as a whole.

Pro­po­nents of RevOps says it pro­vides busi­ness own­ers and CEOs with a prac­ti­cal and proven sys­tem for grow­ing their busi­ness, based on tech­nol­o­gy and sys­tem­at­ic and repeat­able process­es. It can also dri­ve greater and faster rev­enue gen­er­a­tion.  When teams are aligned in a RevOps struc­ture, they can gen­er­ate 38% more rev­enue in 27% less time, accord­ing to sales man­age­ment plat­form Vari­cent.

A grow­ing num­ber of major com­pa­nies are now adopt­ing the approach. Gart­ner has fore­cast that by 2025, 75% of the high­est growth com­pa­nies in the world will deploy a RevOps mod­el. 

Busi­ness lead­ers are start­ing to recog­nise that func­tion­al silos are a bar­ri­er to rev­enue growth, said Doug Bushée, a senior direc­tor in the company’s sales prac­tice, who revealed the research in 2021. Under this siloed approach, clients are hand­ed from one func­tion to anoth­er, using dif­fer­ent tech­nolo­gies, peo­ple, and process­es.  

“As a result, pro­gres­sive organ­i­sa­tions are begin­ning to align sales, mar­ket­ing and cus­tomer suc­cess tech­nol­o­gy, data and KPIs to pro­vide an end-to-end view of the rev­enue-gen­er­at­ing engine,” Bushée said.

Systematic approach

The new book by Dio­rio and Hum­mel says that a sys­tem­at­ic approach to rev­enue and growth is long over­due. 

“Every part of the busi­ness has been sys­tem­a­tised in the cor­po­rate world – back office, finance, HR, logis­tics and sup­ply chain – but growth and rev­enue, the lifeblood of the com­pa­ny, has not,” says Dio­rio.

The new pub­li­ca­tion is a recipe book for com­pa­nies that want to intro­duce a RevOps struc­ture, accord­ing to the authors. The book offers a “peri­od­ic table” of bite­size ele­ments that can change the way com­pa­nies oper­ate and improve rev­enue prospects, rather than out­lin­ing a whole­sale cor­po­rate trans­for­ma­tion that could take years to imple­ment. 

RevOps is vital because com­pa­nies have lost con­trol of the buy­er jour­ney, says Hum­mel. “So many peo­ple are focused on the fun­nel and acquir­ing a cus­tomer that they for­get what hap­pens after­wards,” he says. 

The rev­enue cycle now looks like a bowtie. Activ­i­ties to dri­ve demand are on the left, those aimed at dri­ving pur­chase are the knot in the cen­tre, and activ­i­ties to deep­en rela­tion­ships with cus­tomers are on the right. The right-hand side is becom­ing increas­ing­ly impor­tant as more than half of all pur­chas­es are now repeats or based on a sub­scrip­tion mod­el, says Dio­rio.

“The CMO job is a tran­si­to­ry life­form built on media and pro­mo­tion [things like tele­vi­sion, radio, print and out of home] and these amount to around a third of the pie,” Dio­rio says. “All of the mon­ey has moved into what we called owned dig­i­tal chan­nels: email, blogs, apps, ecom­merce and the voice of the cus­tomer.”

Challenges and opportunities

But for senior mar­ket­ing peo­ple who have worked hard to carve out the role of the CMO and win a seat at the top table, the idea of hand­ing over their new­ly found pow­er to a chief rev­enue offi­cer is wor­ry­ing. Some fear that any new rev­enue-focused leader will come from the sales organ­i­sa­tion, send­ing mar­ket­ing back into the wilder­ness.

Hum­mel thinks CMOs won’t have to go back to the tra­di­tion­al role of man­ag­ing media and build­ing brand in this new organ­i­sa­tion­al struc­ture. They have an oppor­tu­ni­ty to become this new growth leader instead.

“Any­one who can fos­ter col­lab­o­ra­tion and who can influ­ence things they don’t own is real­ly impor­tant. CMOs tend to have that,” says Hum­mel. CMOs often under­stand the cus­tomer, not just how to sell to them, he adds. They also know how to use data and under­stand what data-dri­ven sell­ing is all about, he notes. 

“That is why RevOps often falls to the CMO; they are more nat­u­ral­ly com­fort­able with the data, com­fort­able with the holis­tic cus­tomer point of view and are good at dri­ving col­lab­o­ra­tion.”

There’s a dan­ger that sales teams believe they own the last mile of rev­enue and come to see RevOps as a nat­ur­al addi­tion to their own silo.  “The CMO has all these skills, but they don’t own the rev­enue and strug­gle with finan­cial jus­ti­fi­ca­tions for what they do,” says Hum­mel. “A sales rep can say they sold $1m of prod­uct but they wouldn’t have sold that with­out all the brand­ing and sup­port from the finance and prod­uct teams.”

Dio­rio says that with­out change, CMOs may be doomed. At its most impact­ful, mar­ket­ing can play an orches­trat­ing role, engag­ing with all oth­er parts of the com­pa­ny, pro­vid­ing holis­tic views of the cus­tomer per­spec­tive and ampli­fy­ing the rest of the organ­i­sa­tion. It can cre­ate a whole that is greater than the sum of its indi­vid­ual parts, he says.  

“Oth­er­wise, like a decay­ing satel­lite, the mar­ket­ing func­tion will con­tin­ue to appear quite sophis­ti­cat­ed and even cool from out­side, as it inex­orably heads toward its own demise.”