3 Ways Revenue Performance Management is NOT Marketing Automation

Published: January 10, 2012

Driving top-line growth is the universal C-suite challenge, which is why RPM immediately caught on so quickly. Simply put, RPM is a good night’s sleep for an executive who tosses and turns over revenue fears.

Since RPM emerged out of the marketing automation space, it’s understandable that many have questioned the differences between marketing automation and RPM. We’ve heard questions like: Is marketing automation for marketing and RPM for sales? If I implement marketing automation, by default am I implementing RPM? And the popular, can I buy RPM?

Below you will find three ways RPM and marketing automation differ … along with answers to the above popular questions.

1.)  RPM is a strategy, Marketing Automation is a Technology

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RPM is a strategy that brings together technology with best practices, methodologies with business processes. It’s not software, whether in the cloud or on premise.

While RPM may be a successful business strategy – it’s still just that, a strategy. RPM requires the right mix of people, processes and technology to be effective. Marketing automation is a critical piece of enabling technology, but it is not the only technology. For example, social media tracking tools (like Radian6), webs ite analytics (think: Omniture or Webtrends), and sales force automation (i.e., Salesforce.com) can play a vital role in an RPM strategy. Having the right technology in place to accurately measure and report on revenue indicators is a critical component of RPM, but technology alone can’t substantially increase a company’s revenue growth.

Similar to other business strategies, RPM is not a quick fix and should be considered a journey. Implementing marketing automation technology is one stop on the RPM journey.

2.) RPM addresses the needs of the C-Suite, Marketing Automation addresses the needs of Marketing & Sales

RPM speaks to the C-level executives. While marketing automation certainly has a role in the corner office, most of the users – and many of the buyers – tend to be hands-on marketing practitioners. This is, of course, a good thing. Marketing automation is the central nervous system for successful marketing departments. RPM enables leaders to make strategic, actionable decisions that will directly impact future revenue. Given the loftiness of that goal, the strategy is more relevant to the executive decision-maker. In fact, as the space continues to evolve, one direction we are seeing is a set of dashboards tailored to the unique interests of each member of the executive team. Marketing automation doesn’t necessarily relate to the CFO’s function, but RPM can and often does.

3.) RPM forecasts long-term revenue growth; Marketing Automation measures marketing and sales performance.

One of the fundamental differences between RPM and marketing automation involves measurement. Marketing automation systems provide a trailing view of campaign results and ROI. Certainly this historical perspective can enable marketers to make smarter decisions moving forward, but marketing automation itself doesn’t forecast long-term growth.

RPM takes sales and marketing measurement further by analyzing the complete revenue cycle and zeroing in on specific revenue indicators such as velocity and reach. Executives can take these revenue cycle measurements – we call them RPIs, or revenue performance indicators – and begin to form an accurate picture of sales several quarters into the future.

After reviewing interactions across the buying process from start to finish, some businesses can not only forecast quarters ahead but can also determine where revenue is going to come from (segment) and for what offers (product mix).

It’s an exciting time for marketing and sales professionals, alike. With marketing automation, the two lines of business took a giant step closer to one another. Now with the emergence of RPM, another group has entered the fold: the executive team. And that is the most fundamental difference between marketing automation technologies and Revenue Performance Management solutions.

Joseph Payne is Chief Executive Officer of Eloqua, the leading provider of on-demand Revenue Performance Management solutions. With 20 years of leadership and a proven track record with high growth software companies, Joe drives Eloqua’s strategic direction and oversees all operations of the company. Prior to Eloqua, Joe was President and COO of iDefense, a VeriSign company where he was responsible for the operations of the company. Prior to joining iDefense, he was President and CEO of eSecurity Inc., and President and CEO of eGrail. 

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