Today’s MarTech Top Voice: Forrester VP, Principal Analyst Terry Flaherty.
In this exclusive MarTech Insights Tech Top Voice Interview, we are with Terry Flaherty, Vice President and Principal Analyst at Forrester, whose innovative work on B2B demand generation and revenue process transformation is changing the way organizations interact with the buying groups. By moving companies away from lead-centric models to creating the B2B Revenue Waterfall, Terry has the great advantage of giving us the right insight on how marketing, sales, and AI-powered customer intelligence can be combined to achieve the growth we can measure.
Meet Terry as he imparts his expert views on modern demand generation, the changing role of the buying group, and how AI and martech are redefining engagement strategies for today’s B2B organizations.
MarTech Insights (MTI): Hi, Terry. Welcome to the Marketing Technology (MarTech) Top Voice Interview Series. We are inspired by the work you have done in marketing and sales, and intelligence. How did your background and experience shape the path that led you to grow in your various roles?
Terry: I started my career as an Industrial Engineer, so that gave me a good foundation in process.
But, I found industrial engineering to be fairly dry, so I wound up taking a role as a sales exec in a startup selling communications software.
As common for a sales rep, I had strong opinions about lead quantity and lead volume, and since we were a startup with a pretty flexible environment, I became the marketing department (the president said, “you don’t like the leads… you go figure it out” and my experience in marketing was born.
Throughout my career in marketing, responsible for demand generation, I always had a natural disposition to process. That led me to find the SiriusDecisions demand waterfall, and I adopted it at several companies.
And, when Sirius Decisions had an opening that was focused on the Demand Waterfall, I jumped on that opportunity and focused on helping drive research in that area.
In 2017, I was on the team that recognized that the lead-centric revenue process had some severe limitations, so I was part of the team that introduced a new version of the waterfall that looked at the importance of moving from individual leads (MQLs) and instead focused on buying groups.
About that time, Forrester acquired SiriusDecisions, and buying groups became a key focus for Forrester.
So, for the last 8 years, I’ve been focused on how the adoption of buying groups changes the revenue process for organizations.
It’s been an interesting journey, and we are seeing organizations adopt this transformation and see huge improvement in revenue process performance.
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MTI: Marketers talk about moving past MQLs, but in reality, it’s proving tougher than expected, right? Please tell us why the traditional MQL model is no longer relevant, and what is replacing it as the measure of marketing contribution.
Terry: Yeah, it’s been a little tough, and it’s taken longer than expected.
Our first announcement on buying groups in a revenue process (The Demand Unit Waterfall) was met with lots of curiosity, but pretty limited adoption. And, while adoption was low, we were pretty convinced we were on to something significant, so in 2021, we launched a refined version of a buying group-centric waterfall (The B2B Revenue Waterfall) that looked at the revenue process for cross-sell, upsell, and retention opportunities.
And, in the last 24 months or so, we’re seeing more organizations begin to make the transformation.
Why?
Because a lead-centric revenue process did not represent or support the fact that individual leads are not the buyer, and that, in reality, buying decisions in B2B are made by a group.
So, in a lead-centric process, you only see a single member of the buying group, and the engagement and interactions from the majority of the buying group are hidden or ignored. Limiting insight to a single person prevented sales and marketing from understanding and targeting all of the members of the buying group and had huge negative consequences on the performance of the revenue process.
The really sad part is that insight about multiple buying group members is now available, but the lead-centric process wastes a huge amount of insight.
The good news is that the vendor community is making progress on helping their clients identify buying groups and make them the focus of the process.
MTI: If MQLs are out, what KPIs best reflect buying group engagement and revenue impact for CMOs and CROs?
Terry: When we change the focus of our revenue process from MQLs to buying groups, there are a few significant changes in metrics that give insight on the process.
First, an important concept is that a buying group is a group of people working together to purchase a solution to solve a business problem. That combination of buying ginup with a need that can be addressed by a solution is also thought of as an opportunity. And so one key metric to track is the number of opportunities that an organization is working on. These opportunities will have a variety of stages, either as a potential early-stage opportunity engaging with marketing or a late-stage opportunity that sales is supporting.
The buying group for an opportunity is made up of a variety of people involved in the decision process, and these people play a variety of roles, such as champion, decision maker, influencer, or user.
A best practice is to understand the role of buying group members and drive engagement with message content that is relevant to the individual buying group members. The goal is to drive support and engagement across all of the buying group members, so another key metric to look at is the number of buying group members who are engaged for an opportunity.
We’ve seen that engagement of the buying group is a strong indicator of propensity to buy; seeing multiple buying group members engaged is a positive sign that the buyer is likely to make a purchase.
Lastly, while our focus is on buying groups, it’s critical to recognize that buying groups are made up of people, and we need to engage with people. Engagement with people is still important, and so being able to measure the level and type of engagement from people is still very important.
A crucial element of effective engagement is taking the time to understand the context behind each interaction.
Context means that for every engagement (both named and anonymous) you understand:
- The account for that individual
- The solution that the person is showing interest in with their engagement.
When you understand the account and solution, you then have enough information to start to identify a potential buying group.
As an example, a person from the ACME account who consumes content about our talent management solution should be aligned to an opportunity for talent management.
All people who share the same account (ACME) and have consumed content on talent management are all potential buying group members for that solution.
- One impression is that when we focus on buying groups, that means that people are not important – and that’s absolutely not true.
- The biggest new concept with people is context, which is understanding their account and what solution they are engaging with.
When I see multiple people engaging from the same account and interested in the same solution, there’s a high probability that they are part of the same buying group, and so I want to be able to recognize that cluster of people and align this buying group to an opportunity.
That then translates to the key metrics of:
- Number of potential opportunities that we are engaging with
- Buying group coverage – how many people in the buying group have we engaged with and how many of those people have been verified to be part of the buying group
- We also still want to understand the level of engagement of these people
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MTI: How should B2B organizations rethink their funnel design when buying groups, not individuals, are the focal point?
Terry: First, they should think about the “funnel” starting earlier in the process. This means the funnel starts with opportunities that we are targeting, and as we see relevant buying group members that are aligned to the opportunity, that the alignment of those buying group members is what moves that opportunity through the process.
A major change is the funnel is focused on opportunities with buying group members (instead of individual people/MQLs). That often requires a change in thought about the “opportunity” entity. Often the existence of an opportunity is an indication of quality of a potential deal. The rethink is to view the opportunity as a system container that stores information about a deal. Part of that information is where in our process (i.e. stage) that deal is residing- ranging from target to prioritized to qualified to won.
That means the opportunity entity provides visibility to our entire revenue process using stages. A stage of Target means we believe we should target this opportunity in the account but there has been no engagement.
Qualified indicates that the BDR has engaged and qualified to buying group to be sent to sales, and Proposal indicates that sales has delivered a proposal for this solution to the buying group.
Identifying and engaging with buying group members needs to be the new objective, so it’s buying groups (connected to opportunities) that move through the entire process. Opportunities become the focus and we add new stages to the opportunity that indicate progression of that opportunity through marketing and the BDR team before it gets to sales
MTI: How can marketing leaders package and connect intent signals so they are actionable for revenue development teams?
Terry: For every signal, it’s important to understand the context of that signal. Context is the combination of:
- Understanding the account that this person belongs to.
- Understanding the solution that is related to the assets that the person has engaged with.
I can understand the context of both named and anonymous people, and both scenarios add value and insight
MTI: What role do martech and sales tech platforms play in enabling buying group engagement, and where are the gaps today?
Terry: I think the biggest roles that martech and sales technology vendors can play are:
- Help me identify potential buying groups from my signal universe. Listen to the first and third-party intent from my desired accounts and markets.
- Automatically identify potential buying groups where signals are coming from people in the same account and showing interest in the same solution. This is the start of a potential buying group.
- Packaging this buying group into something that can be used by marketing/BDR/sales (such as the opportunity container) and updating the CRM to reflect the buying group aligned to the opportunity.
- Trigger programs to drive additional engagement across the buying group.
- Route the potential opportunity to the right resource based on the stage and expected next step.
Checkers versus Chess
MTI: Your “checkers vs. chess” analogy for buying groups and how organizations should map roles like champions, blockers, and decision-makers is very popular. Please elaborate on it for the modern-day demand generation teams.
Terry: I think the checkers/chess analogy is highly relevant in the evolution of the buying and selling processes.
There may be a slight simplification in the analogy, but in checkers, all the pieces have equal roles and responsibilities.
In a sense, the game is very “transactional”. The short-term goal is for one checker piece to capture an opposing piece, and whoever “wins” the most transactions is likely the winner of the game. And every piece in the game has the same role and operates in the same way. I think this is similar to B2B Marketing and sales when the focus is on MQLs.
From an overall process perspective, we treat everyone the same and don’t differentiate to the degree that we should.
But in chess, different pieces have different roles (on both sides), and to be successful in chess, it’s critical to recognize that every piece has different roles and different values.
You can’t treat every piece as equal, just like in B2B decisions, there’s a team of people with different roles.
Another point of view on the difference between checkers and chess is the level of collaboration that must exist.
Chess, just like buying groups, requires a much higher level of collaboration across the team to best engage.
I’m not trying to imply that checkers does not have a strategy (and likewise, an MQL-based process needs a strategy), but engaging with buying groups requires a much richer understanding of the roles of the buying group team members and a more advanced strategy of how to best engage. A successful chess player looks beyond the individual pieces to look at the bigger, holistic picture and develop a strategy based on these holistic insights.
The same is absolutely true for the successful sales and marketing players.
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MTI: What are the first three steps companies should take when shifting from leads to buying groups, and what pitfalls should they avoid? How does this shift impact the way SDRs and BDRs are trained, measured, and incentivized?
Terry:
First 3 steps
The first 3 steps in the transformation from MQLs to buying groups include:
- Understand your buying group profile. For the solution and market segment, identify the number of buying group members and the roles of those buying group members in the process.
- Map titles and roles. For each of the roles in the buying group, match the buying group role with the most likely titles for those roles. This will help in automatically mapping individuals collected from most information gathering approaches to the relevant, most likely role in the group.
- Gain consensus of the buying group vision across leadership. This transformation is significant enough that it requires the support of executive leadership to support this cross-functional change. No single department can make this change – it requires support from all functions involved as well as executive leadership.
SDR/BDR Changes
When we look at the changes that are required by the different functional areas of the revenue process, the BDR/SDR/RDR team faces the most significant changes. Here are several of the major changes that are required:
Qualification of the group.
One of the biggest changes for the BDR is what is viewed as the output of the BDR process. Instead of the BDR qualifying a single individual (the MQL) to pass to sales, the BDR now qualifies a group of people who are part of the buying team. This often means that instead of qualifying a single person, the BDR is qualifying a team of 3 or more people who have been attached to the opportunity as a buying group. That means the BDR must know best practices for qualifying the group.
Evolve to a concierge role.
Previously, the qualification of an MQL was a fairly transactional process; an individual would enter the process, and the RDR would focus on qualifying that individual. The pace of the qualification of the individual was fast, intending to qualify and create a meeting that was accomplished quickly.
There was little to no attempt to “connect the dots” between multiple individuals in an account, and the scope of qualification was limited. As the buyer places more emphasis on self-service research, the SDR moves away from a transactional qualification process to become a complement to self-service research.
The BDR is helping to identify gaps in research or invite the prospect to special offers to help support the research process. The RDR becomes a support orchestrator as opposed to a qualification transaction engine.
MTI: Where does alignment between sales, marketing, and customer success break down most often in this transition, and how can leaders fix it?
Terry: The most common breakdown is often based on cultural issues as opposed to system or process issues, so it’s important to recognize that factors like how functions are measured or how they work together will change.
Metrics that are silo-based (such as MQL volume of marketing-sourced pipeline will no longer be relevant, so it’s important to gain support internally that these metrics will change, and most importantly, be able to recognize and commit to process changes as they happen as opposed to falling back to the comfortable (but irrelevant) way the process was done in the past or using old metrics that are comfortable but obsolete.
MTI: Which events are you attending this year?
Terry: We will be at the Forrester events, including Summits in North America, EMEA, and Asia. We will also be at OpStars
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MTI: Looking three to five years ahead, what will define successful demand generation, and how will AI and predictive modeling shape buying groups?
Terry: AI is going to help tremendously in listening to a broad ecosystem of signals and will be valuable in automatically finding the buying groups that existed but were missed because we were not listening and understanding signals correctly.
Identification of these buying groups will then package these groups and align them to the relevant opportunities in CRM. These opportunities will be managed through a process that promotes the opportunity from marketing to the BDR to sales.
In addition, AI will help drive engagement with the members of the buying group, delivering the right context and best actions based on the buyer’s needs in their buying journey.
I think another major impact of AI is a change to the revenue process and the way that buyers buy. Buyers will use AI to dramatically change the research phase of the buyer’s journey. A key deliverable of AI will be the automatic identification/prioritization of vendors that should be on the buyer’s short list – and this short list will be based on key factors like ecosystem, budget, and the inclusion of key capabilities. This automated AI-generated short list will dramatically shorten the time to get to the short list, which is often a manual process when done today.
MTI: What are your predictions for the future of Martech and AI? Which areas of innovation and growth are you keenly following into 2026, and why?
Terry: AI will drive better alignment between the way the buyer wants to buy and how the seller sells. As a result of this alignment, the length of the buying process will shorten.
AI will help maximize the utilization of every signal produced by the buying group, delivering the right information that is needed at that stage of the journey.
MTI: Tag a marketing leader from the industry whose response you would like to see at the MarTech Insights Top Voice program:
Terry:
- Lauren Daley – Palo Alto Networks
- Michael Brown, Reltio
Thank you so much, Terry, for your time today! We look forward to having you again at our Top Voice Series.
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About Terry Flaherty: Terry Flaherty is the Vice President and Principal Analyst at Forrester. He is the one who organizes research on B2B demand generation, revenue process transformation, and buying group engagement. Terry, who has over 20 years of experience in industrial engineering, sales, and marketing, has been a major contributor to the industry’s transition from lead-centric to buying group–centric models. Being a member of the SiriusDecisions team, he played a role in pioneering the Demand Unit and B2B Revenue Waterfalls – the concepts that have influenced how the worldwide organizations implement and evaluate contemporary demand generation.
Terry’s work is very instrumental in helping CMOs, CROs, and revenue teams to rethink funnels, which in turn leads to them being able to use martech and AI to generate growth that is measurable.
About Forrester: Forrester (NASDAQ: FORR) is one of the most powerful research and advisory firms in the world. It is the one that advises the technology, marketing, customer experience, and innovation leaders. Located in Cambridge, Massachusetts, with a global footprint in North America, EMEA, and Asia-Pacific, Forrester is the one that offers the brave insights and tried and tested frameworks necessary for businesses to thrive in the volatile market of today. Among other things, Forrester is recognized for its data-centric research, forward-thinking models like the B2B Revenue Waterfall, and the implementation of strategies that revolve around customers. This is how the firm prepares companies from all over the world to be one step ahead in the game of technologies, to be one step ahead in the game of businesses, and to be able to have better business results by being one step ahead in the game of technologies.
