Why Marketing Should Almost Never Report to Sales

Dear SaaStr: When Is It a Good Idea for Marketing to Report to Sales?

This is an important but subtle one.

On paper, it can seem to make sense for marketing to report to sales in many cases:

• Your VP of Sales / CRO is often your top leader
• Marketing’s customer is Sales, so having a reporting gap can seem inefficient.
• Sales + Marketing alignment becomes automatic, and frictions reduced
• If the CEO doesn’t really “know” marketing, it can seem simpler to offload ownership to sales, who even if they don’t really “know” marketing, at least knows what to do with a lead or an MQL

And yet, I rarely see it work well in practice.

The above video clip explains it well, but the reasons it tends not to work well in practice include:

• Budget.  This is the #1 issue.  Sales really doesn’t care about the budget, or to some extent, CAC.  They just care about hitting the number, whatever it takes.  Now a seasoned VPS/CRO will care to some extent about CAC since it’s their job.  But never as much as a stand-alone marketing org will.  So I almost always see a huge amount of spend when marketing reports to sales.  Especially in well-funded start-ups.  “GET ME THE LEADS. I DON’T CARE WHAT IT COSTS!” 😉
• Patience.  This is the #2 issue.  Strong VPs of Sales and CROs know they need pipeline every quarter, not just today, so they are patient in many ways.  But in the end, they focus on marketing that brings leads in now, not down the road.  So longer term marketing initiatives, from brand to events often fall by the wayside to some extent with marketing doesn’t report to the CEO.  If nothing else, the CRO mainly wants to do marketing they believe in and understand.  That’s just a subset of what you probably need to be doing.
• Marketing is the CEO.  At almost every tech company, the CEO is the CMO, is the #1 marketer.  Look at Zuck today or Benioff always.  They are the #1 marketer.  Many product-focused CEOs don’t want to deal with marketing.  But even if your marketing is very product-focused, that’s still marketing.

If you are well capitalized and the CEO really doesn’t want to manage marketing, you can try it.  It won’t not work.  But it likely will be really expensive and be very short-term biased.

I rarely see it work out.

Much more here:

(Image from here)