The B2B marketing world has changed quite a bit over the past decade with an especially important new trend and growing emphasis on measurement and analysis. According to a 2011 Demand Gen International study, nearly 90% of marketing organizations increased their analytics efforts over the previous 24 months. This really highlights the fact that marketers are increasingly faced with making their decisions based on tangible data as a result of their efforts.What is also interesting is that roughly 70% of these marketers are turning to metrics to help justify their budgets. Historically, marketing budgets may have been created based on the previous year’s budget plus 10%. But now, there is more scrutiny on budget creation, how it is being spent, and the actual impact of the manner in which the budget is spent.Perhaps most telling of all, is that more than 40% of CEOs now actively track their marketing teams’ impact on revenue and then use that information to determine future budgets and where the marketing team will focus moving forward.Echoing the words of David Lewis, “One of the biggest investments a company makes is in its marketing organization. The pressure on marketers to say how these investments are paying off is enormous, and it’s going to keep growing.” I think David’s quote really highlights the points and trends marketers are facing
Many choices – one of the big challenges for B2B marketers is sifting through the variety of metrics.The good news is that you don’t need to spend the resources on tracking and analyzing every possible data point to build your successful measurement strategy. Keep it simple – Usually, the best approach is to Keep it Simple and take the straightforward approachfocusing on a relatively Small Set of Clear Metricsthat you can understand, can put to work right away, and really ties to your business model providing key insights to help you move your business forward.Big Picture – They also need to focus on the Big Picture which can be split into two categories of: Revenue Metrics and Program Metrics. You may think of these two in terms of “strategic” versus day-to-day tactical, but think of them in this way:Revenue metrics are what your CEO, CFO, and board want to see. These metrics document marketing’s tangible contribution to revenue and profit growth. Program metrics are what you’ll use internally to gauge the impact of your campaigns, database management and sales-marketing alignment. What I would like to do is dive a little bit deeper into both types of metrics and discuss some specific examples.
Revenue Metrics: Painting The Big PictureRevenue metrics are easy to understand especially if you picture yourself explaining the marketing plan to your CEO and CFO. A good way to look at this is to think of which metrics tell a story that they want to understand and embrace. This is particularly important when planning and when it is time to justify your budget.All of this begins with your marketing funnel and continues through your company’s sales pipeline. By tracking the proper metrics, you can quantify your marketing team’s impact in terms of converting leads to closed deals and revenue – steps all of your customers will take.One of the first key revenue-related metrics that accomplish this goal is Marketing Lead MetricsI like to think of this step broken-down a bit further into three key items. First is Inquiries or, what may hear referred to as Names or Raw Leads. These are typically the first metric that matters to a CEO. It is the point where your marketing team actually begins its qualification process and separates the “suspects” from the “prospects.” Second is the metric of Net New Leads or those that are not already in your marketing contact database. It is very important for you to continuously build the number of net new leads which allows marketers to demonstrate that they can generate the raw material required to feed your company’s funnel. And thirdly, Marketing Qualified Leads , or most commonly referred to asMQLs,representing individual prospects that show the right level of buying intent. These are the individuals that appear to be actively “engaged” with your company (i.e. website navigations, email opens, downloading activity, etc.), are then “qualified” based on criteria you may have created through lead scoring, and are then passed along to sales. The marketing lead metrics really highlight those first few touches with the prospects coming into your sales funnel. Sales Lead MetricsThe Secondkey revenue-related metric you need to consider is Sales Accepted Leads (SALs) which are the MQLs that the sales team has qualified and moved them into the sales pipeline. This step is a very important indicator of your marketing and sales team being on the same page about what your company considers a qualified lead. What I have seen in the past that works successfully is to ensure the following criteria factors are in place:Job titles and firmographics, such as “CIOs of companies with 100 or more employees”; or Online behavior, such as “people who downloaded at least three pieces of content and visited our web site more than twice in the past month.” Opportunities, also known as Sales Qualified Leads (SQLs), have been moved into the sales pipeline and get actively worked by sales reps. This is a critical metric for both the sales and marketing team: It’s the point where leads are entered into Salesforce.com or some other CRM. As a result, this is also the point where a lead is often associated with a potential revenue value. Many CRM systems or third-party metric tools allow a sales team to measure this revenue potential as it moves through the pipeline. When this is combined with data on a sales team’s historical close rates, you can start to make accurate revenue forecasts.Higher conversion rates, especially as leads turn into opportunities and then customers, indicate a more efficient marketing effort that delivers what the sales team needs to hit its numbers – undoubtedly, your CEO and executive staff will be keenly interested in this metric.KEY: Big picture metrics that answer the simplest of questions prove most useful
Conversion MetricsThe Thirdkey revenue-related metric you need to consider is your Conversion Metric which look at the conversions from one funnel segment to the next. This really is a function of the other metrics previously mentioned as they are interconnected and tied together. Higher conversion rates, especially as leads turn into opportunities and then customers, indicates a more efficient marketing effort of delivering what the sales team needs in order to hit its numbers. The same applies to velocity metrics which actually measures how long it takes for leads and opportunities to move through each stage of the marketing funnel or sales pipeline. Higher velocity usually indicates more efficient marketing activities that generate faster, higher ROI. But be careful not to “push” leads through the funnel prematurely. It is far more important to nurture your prospects and pull them through the funnel when they are ready and exhibit characteristics that qualify them for the next stage of the funnel. Nurturing Metrics:Which takes us to the next key revenue related metric of Nurturing. Specifically, Lead nurturing gives you a way to stay engaged with leads that aren’t ready to buy yet but will be in the future. Re-engagement metrics cover situations such as leads that don’t score high enough to convert to MQLs, or SALs that turn out not to be valid opportunities. The better you are at placing these leads in a nurturing campaign, and ultimately moving them back into the sales pipeline, the more you’ll contribute to revenue growth.KEY:Create metrics that idnetify when a prospect should move to the next funnel stage
Program Metrics: dealing with the DetailsYour CEO may not want to hear the details about which programs or campaigns deliver the best results, but your marketing team certainly does. After all, your day-to-day program execution (from email and social media to webinars and web site content) provides the raw material that ultimately drives your strategic revenue-building efforts.There are so many things to consider and we don’t have enough time to discuss all of the metrics that you can extract from email campaigns, web analytics, webinar attendance and other sources. But there are some general measurement criteria that you can use to sort through them all:For today, I will focus on four major buckets of metrics that can provide you with some of the most insightful and actionable information that you can put to use right awayBenchmarking MetricsSocial Media MetricsLead Source MetricsDatabase and Data Quality Metrics
Benchmarking MetricsMarketers track a wide variety of day-to-day program activities from quality of service provided, time to complete tasks, and the costs associated with a variety of efforts. Typically, management identifies the best firms in their industry (or another industry where similar processes exist) and compares the results and processes. From this, they develop targets against their own results and processes. This helps you and your company learn how well the targets perform and, more importantly, the business processes that explain why these firms are successful.Many benchmarking metrics can be difficult to analyze so it is important to establish easy and understandable measures that provide insight and identify a call to action. This will then in turn allow you to develop plans on how to make improvements or adapt specific best practices, usually with the aim of increasing some aspect of performance. Try to avoid the “one-off” approach and focus more on establishing consistent benchmarking metrics that are a continuous process in which you can continually seek to improve your practices.Email open rates and click-through ratesWeb site visits and page viewsContent asset downloadsWeb site form completion and abandonment rates These numbers can be very useful; if your email open rates, for example, are lower than the industry average, then it’s time to examine your email campaigns for potential problems. The same is true for web analytics, especially when you compare current data versus historical trends. Just be careful not to dwell upon these metrics, because they don’t always have a direct impact on marketing campaign performance.KEY: Keep your benchmarking metrics easy, understandable, and insightful measures
Social Media MetricsThere are hundreds of social media and web metrics you could look at everyday if there was enough time and context to understand each of them. But it is very important to focus on a few key metrics that mean the most to you and your company as you monitor the pulse of your social business.Social media mentions, connections, “likes” and conversations are similar to other benchmarking metrics you can track. And you should be comparing your metrics to industry averages, your competitors’ numbers, or your own historical data to get an idea of what is going on and if you are gaining or losing momentum. Many marketing automation tools, for example, now allow B2B marketers to track social activity on Twitter, LinkedIn and FaceBook, and benchmark their own activity against their competitors’. What is important here, as with benchmarking metrics, is not to confuse social media success with bottom-line impact. It’s one thing to celebrate a record number of Twitter followers but it’s quite another to demonstrate just how those followers convert into leads, opportunities and revenue for a B2B organization.KEY: Followers are good but converting them to leads, opportunities and revenue is better
Lead Source MetricsLead source is a critical piece of data you need in order to assess the value of your marketing campaigns and part of proper lead management initiatives. Creating and establishing lead source metrics allow you to measure the value of your marketing campaign efforts, a baseline to create an ROI analysis, and enables you to communicate with sales key characteristics and important information about leads coming into your funnel.Some marketing automation tools allow companies to create complicated, multiple-attribution systems to decide which campaigns actually generate prospects. For most companies, however, simpler single-attribution systems work just fine. Single attribution – deciding, for example, whether a new prospect was recruited via an email campaign or direct mail effort – allows you to do some relatively simple calculations for the investment required per prospect. SourcesEmail campaignsDirect mail effortsWebsite navigation habitsPhone inquiriesPurchased listsKEY: Single Attribution allows you to calculate the ROI for your campaigns.
Database and Data Quality MetricsData quality issues are a growing problem for marketing organizations; databases with outdated or inaccurate records tend to increase costs and drive down campaign ROI. Tracking metrics such as database size, average lead age and performance by database/list source can tell you whether there are potentially serious data quality problems lurking in your marketing database.Some of the key points you need to keep in mind as you approach your database and data quality metrics are similar to the points we have covered today:PointsSelect a few of your identified critical business impacts associated with poor data qualityEvaluate the data dependencies associated with that business impact and list the associated data expectationsEstablish reasonable targets for improvement – small incremental improvements over time create huge improvementsContinue to monitor and adjust – be open to input and feedback from others within your organizationKEY: The end result is a set of measurement processes that provide raw data quality scores that can roll up to quantify conformance to business user data quality expectations. Measurements that do not meet the specified acceptability thresholds indicate non-conformance, indicating that some data remediation is necessary and you need to take action right away.
The Payoff of Marketing MeasurementStrategic revenue-building efforts - Your CEO may not want to hear the details about which programs or campaigns deliver the best results, but your marketing team certainly does. After all, your day-to-day program execution – everything from email and social media to webinars and web site content – provides the raw material that ultimately drives your strategic revenue-building efforts. Coherent story - Most marketers know that metrics are important, and they already attempt to track at least some of the data points discussed here. The real payoff, however, comes when a B2B marketing organization learns how to automate its data-collection process and to present this data to tell a coherent story about its contributions. That’s where marketing automation plays such an important role for B2B marketers. According to a 2012 Lenskold Group study, for example, companies that track revenue metrics as part of an integrated marketing automation strategy are 30% more likely to outgrow their competitors. That’s because marketing automation offers the tools to identify, track and analyze key metrics, rather than concentrating time and effort on spreadsheets and other manual tracking methods. Effective measurement – Marketing metrics are still a work in progress for even the most successful companies. As a result, it’s important for any marketing team to experiment with its own metrics and test new approaches. But for today’s B2B marketing organizations, it’s clear that effective measurement is a tool you can’t afford to work without.KEY: Invest today for continued payoff
Today’s presentation is based upon the Act-On White Paper highlighted here which is available for you to download and it goes into more detail about the important trend and growing emphasis on measurement and analysis.
Before wrapping up today’s session, I want to let you all know about a recent recognition we received from Forbes as one of the most promising companies. As you can imagine, we are excited about the momentum this has created.So feel free to visit our Platform where you can learn more about our dedication to your success, download whitepapers, read our case studies or find out about upcoming webinars and industry topics we will be covering. Or, if you would prefer to schedule your own personal 1:1 demo with one of our Representatives pick up the phone give us a call or go to our website and fill out the contact us form. I would like to thank B2B Marketing for providing me this opportunity to speak with you and appreciate your time as a participant in this presentation!! Act-On looks forward to working with you soon and I hope you enjoy the rest of your day.
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Transcript of "Getting Started With Marketing Measurement"
Getting Started with MarketingMeasurement Join the @ActOnSoftware conversation on Twitter and discover what others are saying about us: #ActOnSW www.act-on.com | @ActOnSoftware | #ActOnSW
Welcome! Thanks for joining us today. Janelle Johnson Director, DemandGen Act-On Software @janelle_johnson www.act-on.com | @ActOnSoftware | #ActOnSW
Agenda• Overview and Insights• Picking the Right Metrics• The Payoff of Marketing Measurement• Closing / Q&A www.act-on.com | @ActOnSoftware | #ActOnSW
Overview and Insights of marketing organisations90% increased their analytics efforts over the previous 24 months “One of the biggest investments a company makes is in its marketing organization. The of B2B marketers are turning to pressure on marketers to70% metrics to help them justify their budgets say how these investments are paying off is enormous, and it’s going to keep growing.” of CEOs now actively track their40% marketing teams’ impact on revenue David Lewis President and CEO DemandGen International * DemandGen Report – 2011 www.act-on.com | @ActOnSoftware | #ActOnSW
Picking the Right Metrics www.act-on.com | @ActOnSoftware | #ActOnSW
Picking the Right Metrics• Many Choices• Keep it Simple• Small Set of Metrics• Big Picture – Revenue vs. Program www.act-on.com | @ActOnSoftware | #ActOnSW
Revenue Metrics – Painting the Big Picture Marketing Lead Metrics Sales Lead Metrics • Inquiries • SAL - Sales Accepted Leads • Net New Leads • Opportunities • MQL – Marketing Qualified Leads • SQL – Sales Qualified LeadsKEY: Big picture metrics that answer the simplest of questions prove most useful www.act-on.com | @ActOnSoftware | #ActOnSW
Revenue Metrics – Painting the Big Picture • Conversion Metrics • Conversions • Velocity metrics • Nurturing Metrics • Lead nurturing • Re-engagement metricsKEY: Metrics that identify when a prospect should move to the next stage in the funnel www.act-on.com | @ActOnSoftware | #ActOnSW
Program Metrics – Dealing with the Details Benchmarking Social Media Metrics Metrics Lead Source Database and Data Metrics Quality Metrics www.act-on.com | @ActOnSoftware | #ActOnSW
Program Metrics – Dealing with the Details • Benchmarking Metrics • Email open rates • Content/asset download • Website visits and page views • Form completion • Abandonment ratesKEY: Keep your benchmarking metrics easy, understandable, and insightful www.act-on.com | @ActOnSoftware | #ActOnSW
Program Metrics – Dealing with the Details • Social Media Metrics • Mentions • Connections • “Likes” • FollowersKEY: Followers are good but converting them to leads, opportunities and revenue is better www.act-on.com | @ActOnSoftware | #ActOnSW
Program Metrics – Dealing with the Details • Lead Source Metrics • Email campaigns • Direct mail efforts • Website navigation habits • Purchased listsKEY: Single attribution allows you to calculate the ROI for your campaigns www.act-on.com | @ActOnSoftware | #ActOnSW
Program Metrics – Dealing with the Details • Database and Data Quality Metrics • Select the right DQ measures • Identify data dependencies • Establish improvement targets • Monitor and adjust for successKEY: Create measurements that quantify conformance to business user DQ expectations www.act-on.com | @ActOnSoftware | #ActOnSW
The Payoff to MarketingMeasurement www.act-on.com | @ActOnSoftware | #ActOnSW
The Payoff of Marketing Measurement • Strategic Revenue-Building • Coherent Story • Effective Measurement Companies that track revenue metrics as part of 30% an integrated marketing automation strategy are 30% more likely to outgrow their competitors Lenskold Group study – 2012KEY: Invest today to profit tomorrow www.act-on.com | @ActOnSoftware | #ActOnSW
Next Steps and Q&A www.act-on.com | @ActOnSoftware | #ActOnSW
ClosingWhite PaperIntroduction To Integrated MarketingGetting Started With Marketing Measurement Download the White Paper Or visit Act-On -> www.act-on.com -> Resources -> Measurement & Analytics www.act-on.com | @ActOnSoftware | #ActOnSW
Next Steps www.act-on.com Int’l +91 80 4098-5338 U.S. 1.877.530.1550Manage your online Get higher-quality Align sales and Track and measureMarketing leads marketing your resultsAll the tools you need, in Solutions that drive lead Integrations that work >> Real-time, actionableone place >> generation >> reporting >> www.act-on.com | @ActOnSoftware | #ActOnSW