Big Data is a hot topic these days, with analytics vendors touting their ability to analyze and make sense of “any” data and predict behaviors based on data you are already collecting. Experienced demand marketing leaders, however, know that not all data is created equal, as the old “garbage in, garbage out” problem is still one of the biggest challenges they have to deal with, preventing them from understanding performance around important demand marketing KPIs.
So, what is the key to better demand marketing analytics? How can we better close the loop between content/channel interactions and opportunities to make better decisions about our demand marketing optimization? We must take a different approach, a more structured approach to demand marketing analytics. The following set of key performance indicators are a great start.
Content is a key component in any demand marketing program, and if you’ve examined your buyer’s journey and created a content strategy to support it, you’ve probably produced a lot of content to meet the needs of all the buying stakeholders at various stages of their process. With all that content in hand, how do you narrow in on what is working hard or hardly working? You can’t look at email and download metrics alone and expect to see downstream impact. After all, which is the more effective piece of content – the one with 100 downloads that sourced one sale, or the piece with 10 downloads and three sales?
To determine if your content really is king and not court jester, give your content offers the royal treatment when measuring effectiveness by looking at the following:
- Total number of downloads (by channel and by persona)
- Lead stage elasticity per content offer (the percentage of downloads that became sales)
- Lead stage velocity per content offer (how quickly prospects that download a content offer advance through the funnel)
Lead Management Performance
How long does it take (on average) for a prospect to move from engaging with one of your initial content offers to ending up in the sales pipeline? Monitor this by using engagement to opportunity timeframe metrics to discover the overall health of your nurture program, with the goal being the optimization of the program to move prospects through the funnel faster.
The following measurements underline what’s working, and provide insight to optimize areas that need enhancement:
- Conversion rate per lead stage (how effectively are we advancing prospects at every lead qualification stage)
- Velocity per lead stage (how much time are prospects spending at each lead stage)
- Growth rate per lead stage (how quickly are we adding prospects at each stage, and is our funnel growing?)
As mentioned above, outbound email (via a targeted list or nurture) is only one element of a demand marketing program. However, the most effective demand marketing programs are multi-channel. This means that inbound channels such as organic SEO, paid search, partner channels, and even additional outbound channels (like events, list rentals and content syndication) should be leveraged and tracked for effectiveness according to the following:
- Number of impressions per channel (which channels are exposing us to the most prospects)
- Number of engaged buyers per channel (how effective is each channel at generating prospects that are engaged)
- Cost per engaged buyer per channel (which channels are most cost-effectively generating qualified leads)
This requires a robustly integrated technology stack. You probably already have the tools in place, but they need to be connected. To get started read: Is Your Martech Stack Orchestrating Engagement or Just Blasting Outbound Emails? Once you have the right technology implemented, not only should you be tracking the above metrics, but you absolutely must optimize your engagement channel strategy. This article explains how to do that.
In the report “Data Rich: The Payoff of Marketing Measurement on Revenue Performance” published by DemandGen Report, only half (53%) of marketers are responsible for a revenue goal. Those not responsible for revenue are still measuring vanity metrics such as “Number of Leads” and “Web Traffic.” However, the evidence for a move towards revenue (and away from volume) is compelling, and supports the move towards a revenue goal for marketers.
Those measuring revenue contribution consistently ranked five to 10 percentage points higher on key pipeline performance indicators such as ‘impact of lead nurturing campaigns’, ‘Lead Quality’, and ‘Lead Conversion’. Not to mention the fact that when communicating program impact to executives, revenue performance is at the top of their list.
Highlight the value of your efforts through the following demand marketing KPIs:
- Estimated pipeline value per lead stage (based on the average deal size, and the percentage of prospects at each stage that become customers)
- Win rates for opportunities attributed to your demand marketing program (making sure that your programs are getting credit for the opportunities they have sourced or influenced)
- Closed revenue attributed to your demand marketing program (again, requiring diligent sourcing attribution for all closed/won deals. But be careful when setting up your attribution models. We strongly recommend reading The Dark Side of Marketing Attribution before making any big changes to your reporting structure.)
Implementing Higher Standards of Reporting
Effective implementation of these metrics requires strategic planning, process creation and some technical components to ensure all the data that is needed to feed these demand marketing KPIs is available and in a format that can be leveraged to create the reporting you need.
There are several steps marketers must take in order to deliver accurate data:
- Overcome Process Challenges
Consistent processes across sales and marketing are a pre-requisite for enabling demand marketing metrics. Every step of the process from Lead Creation to Closed Won should be mapped out and defined. Without a consistent process you won’t have consistent metrics.
- Don’t Forget the Buyer
Organizations are often “heads down,” creating a repeatable process that works for sales and marketing but that neglect the buyer. When creating the repeatable demand process strategy, which is the backbone of your demand marketing strategy, the buyer should be front and center.
- Align with Sales Early
Most new customers in a complex B2B sale don’t convert after a single interaction – sales reps are the lynchpin in the process. More often than not, however, sales are brought into process discussions too late in the game, and may agree to changes simply to “get marketing off their back.” By involving sales early in the discussions, and helping them to understand the importance of this measurement (from their perspective), the more willing sales will be to modify processes.
- Implement Change Management
Arguably, the most critical factor in any demand marketing strategy is the ability to implement and manage change. Typically, sales and marketing will adhere in the early stages of change but often revert back to old habits fairly quickly, especially if the optimized process includes a few extra clicks of the mouse. Marketing and sales leaders need to work together closely to ensure all resources understand the criticality of adhering to the process by conducting regular training and process refresher sessions that solicit feedback from all parties. From a management perspective the adherence to change must be monitored closely, and action taken quickly to resolve any deviations. Involving front-line reps in candid discussions about how to make the process easier for them will help to ensure an adherence to process.
- Technology Challenges
Technology by itself is not going to provide marketers with all of the analytics they need. As described in the points above, a clearly defined process must first be mapped out and then enabled by technology. For example, marketing automation would ideally be integrated with CRM, which would also have feeds from the ERP system (if utilized, for actual revenue information) that would then feed into a BI tool which is also pulling traffic information from the website. That being said, a lack of technology should not be an excuse for an absence of optimization strategy or measurement process. Many organizations have very limited technology budgets or antiquated systems, yet they are still able to measure revenue and ROI.
Leveraging Demand Marketing KPIs to Make Decisions
Measurement for its own sake is not helpful, or productive. Consider not only which reports will create an accurate picture of program performance intelligence, but also how to translate the reports into discrete, actionable, strategic activities.
If you’re consistently managing these metrics, you’ll see what parts of your program can be tweaked to deliver better results.
Strategic demand marketing programs are not a collection of tactical, siloed activities or campaigns, so it stands to reason that measurement should not rely on myopic methods to assess performance. By utilizing cross-functional metrics and implementing the right supporting processes, marketers can take a strategic, thoughtful approach to measurement and reporting demand marketing KPIs.
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