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The Payoff of Marketing Measurement on Revenue Performance
 

The Payoff of Marketing Measurement on Revenue Performance

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    The Payoff of Marketing Measurement on Revenue Performance The Payoff of Marketing Measurement on Revenue Performance Document Transcript

    • A WhitePaperData Rich: The Payoff Of MarketingMeasurement On Revenue Performance New Survey Highlights The Connection Between Analytics & Contribution To Revenue Sponsored by
    • 2An emphasis on measurement has become part of Smart marketers are realizing that measurementthe job description for most marketers in the current tools allow them to “reverse-engineer” theirbusiness climate. Nearly 9 in 10 (88%) of marketers strategies and processes, providing fact-basedhave increased their analytics efforts over the past intelligence on factors such as:12 to 24 months, according to a new survey of BtoB ▷▷ Campaign performance;marketers conducted by DemandGen Report.The main drivers of the increased focus on metrics, ▷▷ Media mix;according to the BtoB Marketing MeasurementSurvey, are the pressure to justify spend (68%) and ▷▷ Content offers;management’s push for pipeline visibility (64%). ▷▷ Market segmentation; andHowever, the survey also revealed that ▷▷ Revenue contribution.measurement is not viewed simply as reporting tasksfor marketing teams to prove return on investment The following white paper will present a deeper(ROI.) The ability to track key performance analysis into the survey results, including:indicators with analytics tools is emerging as a path ✓✓ The average visibility executives currentlyto greatly increase marketers’ ability to impact have into marketing’s impact on revenue;revenue performance. Progressive marketersare now using these tools as “radar” to spot and ✓✓ The impact of lead nurturing campaigns;accelerate the programs having the biggest impacton the pipeline. ✓✓ Benchmarks into the current metrics being used to track revenue performance; andThe survey showed that marketers with greater ✓✓ The disparity in revenue contributionaccess to and experience in using analytics tools between organizations with deepare able to track and respond to which programs measurement capabilities versus thosegenerated the highest quality leads, as well as without.which campaigns created the strongest ROI interms of leads that actually converted to closed Marketing’s Increased Visibilitydeals. While the pressure to justify spend may haveHas your company increased on MarketingMeasurement over the past 12-24 months? jumpstarted the measurement movement in marketing, it is clear that there is a big appetite for insights beyond basic ROI metrics. As the analytics 11% tools and processes available continue to improve and expand, the visibility of marketing’s role in revenue generation is quickly climbing. According to the survey, more than 4 in 10 CEOs (42%) are now actively tracking marketing’s impact 89% on revenue, and 21% of CFOs now have direct visibility into the revenue performance of marketing. Data Rich: The Payoff Of Marketing Measurement On Revenue Performance
    • 3 A majority (63%) of respondents said CMOs are now The top metrics for marketing performance are providing reports that show marketing’s impact on still rooted in volume and traffic, but the survey did revenue. show more sophisticated metrics are emerging. For example, the top metrics cited were number Leading marketing consultants point to this of leads generated (88%) followed by web traffic increased visibility into marketing’s impact as part (72%). of a transformation that is taking place within most high growth companies. “For any marketing However, the majority of companies are starting organization that wants to be viewed as a driver to dig deeper into how those volume metrics are of growth, rather than just a cost center, the ability equating to real opportunities and revenue. to map activity to revenue is mandatory,” said Amy Bills, VP of Marketing at Bulldog Solutions, The growing areas of marketing measurement an Austin, TX-based firm specializing in BtoB included: demand generation practices. “When marketing ✓✓ 66% use contact/lead quality and can validate a specific contribution to revenue campaign effectiveness; and is able to use the pipeline data to make improvements at every stage, there is real power ✓✓ 64% analyze lead conversion at funnel there.” stages; This increased visibility correlates to the technology ✓✓ 63% measuring marketing-sourced leads; solutions now being used by organizations to tie and marketing investments to revenue performance. ✓✓ 43% track marketing’s influence on Nearly three quarters (72%) of respondents are using revenue/deals. their CRM system to measure and track marketing’s impact, 69% are using a web analytics application, As marketers begin to look deeper at conversion and 54% are using a marketing automation rates and other pipeline metrics, the survey also platform. showed increased activity and measurement around lead nurturing initiatives. More than 4 in 10 What are the business drivers that have increased (43%) said they are currently tracking the impact of the focus on marketing measurement? nurturing, while an additional 30% said they plan to (check all that apply) begin measuring the impact of nurturing over the next 3-6 months. Only 27% of respondents had noPressure to justify spend 68% plans to start measuring the impact of lead nurturing campaigns.Management’s push for 65%better pipeline visibility For those that are analyzing the impact of leadSales team looking for 58% nurturing, the top metric is conversion rate (72%),more leads followed by shortened sales cycles (39%), number ofNeed for deeper re-engaged leads (36%) and improved intelligenceintelligence on customer 45% for sales prioritization (33%).segments Data Rich: The Payoff Of Marketing Measurement On Revenue Performance
    • 4 Measuring Marketing’s Another positive trend that emerged from the survey data was the high level of confidence among Impact On Revenue marketers that they would reach their revenue contribution goals, as 91% said they were either Ultimately, ROI and other metrics point to how somewhat or very confident that they would hit their marketing is helping to influence and drive revenue, number for the current year. and more marketers are being evaluated and compensated against revenue performance For the limited number of marketers concerned that metrics. More than half of survey respondents (53%) they would not reach their goal, the leading inhibitors said their marketing department is now responsible were either due to a lack of alignment with sales or for a revenue goal. spending limits. That contribution is proving to represent a The top three hurdles for reaching revenue healthy portion of the pipeline, with 72% of those contribution were: departments with revenue goals indicating marketing’s revenue contribution is 20% or more, ✓✓ Insufficient budget to run campaigns (30%); and 30% of respondents showing marketing responsible for 40% of more. As visibility into marketing ✓✓ Limited/inability to see volume and quality contributions increase, so are expectations, as 56% of leads in pipeline (28%); and of respondents said their revenue contribution goals ✓✓ Limited insight into lead volume and quality have increased over the past 12 to 24 months. (21%). Once marketing is responsible for a revenue goal, Gap Analysis In the most common methods of tracking performance were: Marketing Analytics ▷▷ Pipeline reports (67%); In addition to the implication of a growing trend ▷▷ Management review (65%); and toward the adoption of marketing measurement, the survey also uncovered a developing disparity ▷▷ Shared goals with sales (61%). between those marketers who are tied to revenue goals versus those that are evaluated against more How much visibility is there currently within your traditional metrics. executive management team into marketing measurement and its impact on revenue? (check all that apply) Demonstrating the contrast between marketers with deeper experience in using analytics versus thoseIncluded in marketing 63% earlier in the adoption curve, the survey found thatreports from CMO marketing departments currently responsible for aTracked by VP of Sales 43% revenue goal consistently ranked an average of 5 to 10 percentage points higher on key pipelineActively tracked by CEO 42% performance indicators.Actively tracked by CFO 21% Data Rich: The Payoff Of Marketing Measurement On Revenue Performance
    • 5In comparing the total sample against a cross-tabof marketer with revenue goals, the survey showed REVENUEsignificant differences their ability to demonstrateand influence revenue. Illustrating this point: Total Marketers Sample with Rev Goal Has budget increased 56% 62% in last 12-24 Marketing’s impact on 42% 51% revenue tracked by CEO Using a marketing 54% 62% The Next Legs Of automation system The Revenue Journey Tracking contact/lead 66% 82% quality While the research showed analytics tools are Tracking campaign 66% 73% quickly emerging as a competitive differentiator, effectiveness it also underscored that most marketers still have Tracking lead 64% 80% significant opportunities to better apply the data conversion at stages and intelligence available from analytics tools. Tracking marketing 63% 80% sourced leads The survey found marketing measurement is Tracking influence on 43% 55% still a relatively new process for the majority of revenue/deals respondents. When asked to categorize their Measuring impact 43% 56% current stage on the marketing analytics journey, of lead nurturing campaigns slightly more than half of respondents (51%) said they are just starting out or are in the early stages.Conversely, those marketers that are not being Only a quarter (25%) said they are fairly maturetracked on revenue contribution are still being tied and 18% classified their organizations as “veryto the outdated volume-based metrics that have sophisticated” and ahead of the curve.traditionally caused breakdowns in alignmentbetween sales and marketing. According to the The data showed adoption of analytics tools are onsurvey, two of the top metrics in place for marketers the rise, but it also reinforced that any technologywho are not tied to revenue were: by itself is not sufficient to improve marketing and sales results. When asked which hurdles were ▷▷ Number of leads (54%) standing in the way from collecting and analyzing data, survey respondents cited lack of internal ▷▷ Web traffic (33%) processes as the top response (48%). Because many organizations still struggle with their internal processes for lead management, industry Data Rich: The Payoff Of Marketing Measurement On Revenue Performance
    • 6 analysts suggest that marketing metrics should be In terms of the long-term potential of analytics, used to improve sales and marketing collaboration. marketers are already looking ahead to further Illustrating this point, only 43% of survey respondents insights that can make their demand generation said their VP of Sales is actively tracking marketing programs and revenue contribution more metrics. predictable. “Marketers should be using this opportunity to The wish list for additional metrics marketers cited improve their overall lead management processes included: and in so doing form a strong alliance with sales, ▷▷ Campaign influence/attribution (64%); which is lacking in most organizations,” said Carlos Hidalgo, CEO of The Annuitas Group, a consultancy ▷▷ Predictability of lead conversion (61%); specializing in lead management processes. ▷▷ Trends over time (55%); Survey respondents agreed and recognized that ▷▷ Additional pipeline forecasting capabilities people and process were equally important to (46%); and technology in making marketing more predictable in impacting revenue. When asked how they ▷▷ Cost per qualified lead (46%). planned to advance to the next stage of marketing analytics maturity, the results pointed to: About the Survey Sample ▷▷ 76% plan to develop better processes; The BtoB Marketing Measurement survey was ▷▷ 60% plan to improve alignment between conducted in June 2011. Respondents were sales and marketing; comprised of BtoB professionals in the DemandGen Report subscriber base, and represented a range of ▷▷ 41% plan to invest in new technology; and different functional departments and industries. ▷▷ 28% plan to hire new talent. In terms of roles and responsibilities, the survey sample included (respondents were able to choose multiple options):Is your marketing department currently responsible for a revenue goal? ▷▷ 86% involved in marketing; ▷▷ 66% working specifically in marketing operations; ▷▷ 48% in sales; 53% 47% Yes No ▷▷ 36% in sales operations; and ▷▷ 41% from CRM administration. Data Rich: The Payoff Of Marketing Measurement On Revenue Performance
    • 7 The survey sample also included a mix of SMB, mid- Discovering Pipeline Opportunity market and larger companies. In terms of revenue: The early days of marketing measurement ▷▷ 49% of respondents worked at companies were driven primarily by the motivation to justify with between $10 million and $50 million in investments in branding. However, as more BtoB revenue; organizations look to increase their demand ▷▷ 20% of companies had revenue between generation strategies and practices, there is an $50 million and $250 million; opportunity and need to dig deeper into how marketing is impacting pipeline performance and ▷▷ 9% were in the $250 to $500 million range; revenue. ▷▷ 10% were from companies with $500 million Those organizations that can make marketing more to $1 billion; and predictable and use pipeline intelligence to drive ▷▷ 13% represented organizations with revenue strategic decisions are likely to have an advantage $1 billion and above. on their competitors. The ability to measure conversion and lead progression gives marketers a The largest segments in terms of industry verticals meaningful seat in boardroom discussions. were high tech/software (46%) and 28% were in professional services; 8% in worked in financial “Marketing organizations with granular campaign services; 8% in health care; 6% in telecom; 5% in visibility can be smarter about the way they spend consumer products; 5% from other industries. their budget,” Bills said. “They know specifically what is working and what they need to do to repeat that, and they can eliminate under- performing programs.” With many marketers still having to fight for every If you are currently struggling to gather the metrics you’d like to budget dollar, Bills added that measurement isanalyze, what are the hurdles preventing you from collecting and another strategic asset when in comes to internal analyzing the data? planning sessions. “When planning for 2012 starts, (check all that apply) marketers with a handle on revenue contributionLimitations of tools/ can request budget based on a data-validatedtechnology 45% business case of what is working,” she said. “I would much, much rather be able to walk in to a budgetInability to integratedata across technology 43% session and say ‘These campaigns drove this muchplatforms revenue and to make that work in 2012, I need the following budget.’”Lack of internal 48%processesLack of knowledge/ 34%resources in this area Data Rich: The Payoff Of Marketing Measurement On Revenue Performance
    • 8 About Eloqua Eloqua is the category creator and leading provider of1921 Gallows Road 500 demand generation applications and best-practiceVienna, VA 22181-3900 expertise for business marketers around the world. Thousands1.866.327.8764 of customers rely on the power of Eloqua’s products andwww.eloqua.com services to execute, automate and measure programs that generate revenue. Eloqua is headquartered in Vienna, Virginia, with offices in Toronto, London, Singapore and throughout North America. About DemandGen Report DemandGen Report is a targeted e-media publication411 State RT 17, Suite 410 spotlighting the strategies and solutions that help companiesHasbrouck Heights, NJ 07604 better align their sales and marketing organizations, and ultimately, drive growth. A key component of our coverage1.888.603.3626www.demandgenreport.com focuses on the sales and marketing automation tools that enable companies to better measure and manage their multi-channel demand generation efforts. Data Rich: The Payoff Of Marketing Measurement On Revenue Performance