The plate of a marketer is always full—produce killer content (and measure its effectiveness), fine-tune your email marketing strategy, leverage actionable insights from big data, ensure your audience has a consistently standout customer experience, make sure you’re generating leads that empower the sales team to convert . . . and that’s just a snapshot, really. Phew! It’s clear marketers do a lot, but you might be shocked to learn what many of them aren’t doing: Measuring the effectiveness of all that work. It’s true—According to TrackMaven’s 2017 Marketing Leadership Survey, a meager 28 percent of marketers report they’re “very effective” at demonstrating the value of their marketing efforts. Let’s look what those top performers are doing right.
TrackMaven’s research found a substantial percentage of marketers—about two out of three—think it is simpler than ever to track and prove marketing’s impact (see Figure 1). Many of them, though, admit they’re not as effective at actually doing so as they’d like. Of those respondents, 69 percent reported they were “somewhat effective,” leaving a lot of gray area to describe an activity they also report is easier in the digital age. What gives?
Figure 1. Source: TrackMaven’s 2017 Marketing Leadership Survey
Part of the problem, the report found, has to do with finding the right balance of marketing metrics. Figure 2 shows a breakdown of KPIs marketers currently use when evaluating impact. (Don’t let those high percentages fool you, though—remember, only about 28 percent reported their measurement activities were “very effective.”) Keep in mind, too, that 48 percent of respondents also indicated their top marketing challenge was “aligning KPIs with overall business goals”—further evidence of the disconnect.
Figure 2. Source: TrackMaven’s 2017 Marketing Leadership Survey
To bridge the gap between marketing measurement expectations and reality, let’s look at how top-performing marketers measure their impact—and, in the process, build a business case that’s undoubtedly helpful when budget season rolls around.
How Best-in-Class Marketers are Measuring their Impact on Revenue
I recommend marketers should be focused on measuring performance at the top of the funnel—i.e., the amount of leads, conversions to appointments, amount of pipeline created—all the way to the number of closed deals because of those efforts. Easier said than done, right? Recently, a panel of marketing experts addressed this very issue, providing a wealth real-world advice. (You can read the full interviews from Docurated here.) Below are some key insights and other highlights:
- Predictive analytics rules. One expert touted the effectiveness of marketing metrics—specifically operational metrics—as a business-building tool. Predictive analytics falls under that umbrella—i.e., leveraging data to understand, and therefore predict, customer behavior. Marketers who use predictive analytics and bank on an insight that succeeds can clearly point that progress back to their efforts. (For further reading on this subject, click to learn more about Openprise’s free diagnostic tool that assesses data in Marketo, a widely-used marketing automation platform.)
- Follow the money. Multiple experts reported the number one tool for measuring marketing effectiveness was simple: Follow the money—that is, the cost to acquire a new customer. As one industry leader reported, “There are other metrics that are also highly important, but this one will provide a telling view from 30,000 feet.”
- Use the tools available. Experts named several tools and platforms that helped their businesses immensely—names dropped included Optimizely, Keyinsite, Salesforce CRM, HubSpot and more.
- Focus on sales. This sentiment was echoed by several experts, and it may seem like a no-brainer: Exceptional marketing should, theoretically, lead to exceptional sales numbers. That is not an accident! Measuring sales as an indication of marketing’s effectiveness, though, isn’t as common as you might think. To this point, read my favorite quote from the roundup from Urjanet CMO Gary Brooks:
“Smart companies invest in marketing for one reason: to get more buyers to buy more product, more frequently for more money, but many organizations fail to quantitatively track and measure the effectiveness of marketing in terms of pipeline and revenue. This is simply irresponsible. Marketing is an investment, and as stewards of this investment, CMO’s and their teams have a fiduciary responsibility to deliver a positive return on this investment. Marketing ROI must be quantitatively measured in terms that are understood by leadership teams, investors and board members . . . To ensure CMOs and marketing team members remain focused on delivering pipeline and revenue, their compensation plans must be tied to these goals and other metrics that are leading indicators of pipeline and revenue success.”
Yes! Gary hit the nail on the head, and his point is reinforced by—you guessed it—data. That same TrackMaven report I broke down earlier also asked respondents about compensation. While almost all marketers reported their top objective revolved around increasing sales, only about 22.93 percent said they were compensated based on closed business and revenue. This may be a trend worth challenging.
Bottom line: As a marketer, you can do a great job generating and nurturing leads, but if the sales team is going through a tough time or having a challenge closing, you might not get recognized for your good work—financially or otherwise. That’s why, in some cases, measuring how much pipeline is created is a good tool to put high on your list. You measure everything else—why not measure marketing’s impact?
How effective is your marketing team? Are you in that group of best-in-class marketers who use metrics to track your impact? If so, do you have any strategies for success to share? If not, what’s holding you back? I’d love to hear your thoughts.
This article was first published on The Marketing Scope.