Marketing in technology markets has become increasingly focused on measurable outcomes. As Marketing execution becomes more and more digital, Marketers are benchmarking email opens, clicks, conversions to leads and so on. But these are merely Marketing metrics – the rubber hits the road where Marketing hands over to Sales and we begin to monetise (to use a modish word) our investment in Marketing.
In short, Marketing needs to prove the Return On Investment (ROI) – sooner rather than later. The closer Marketing metrics are to the money end of the business, the better for the credibility of Marketing. And these are metrics that are primarily influenced by Sales: e.g. lead to opportunity conversion ratios; rate of opportunity leakage from marketing-driven leads; average value of orders derived from marketing leads and so on.
For complex sales cycles, these metrics also help Marketing to determine what tactics work most effectively to nurture sales opportunities and help move them through the pipeline. Events and ROI calculators may be appropriate tactics later in the sales cycle to overcome objections and help drive prospect engagement.
Process First, Automation Second
Marketing automation platforms, such as Eloqua, Marketo, Genius, Silverpop et al, all offer some form of workflow-like automation of marketing processes to make lead scoring, routing and nurturing much easier in the digital world (off-line activity still presents a challenge). But these systems will only provide business value if you have:
- a clearly defined marketing strategy
- clearly defined and understood marketing processes
- a clean and segmented contact database
- Well-trained staff who understand the process and how to set up and execute digital campaigns, and, above all
- clear financial and marketing metrics and targets
Metrics must be appropriate to their user and their role: Digital Marketers need real-time dashboards for email opens, web hits etc. Marketing Directors want standardised reports for volume of leads generated, percentage of leads converted to opportunities, cost per lead/ opportunity. Ultimately, measurement of overall marketing performance is defined by contribution to revenue and profit, so Marketing must be able to account for its total contribution from generating demand through to closed business. These are measurements that the CFO and COO understand.
Marketing Comes of Age
Marketing’s contribution to revenue can no longer be the ‘magic’ that happens somewhere between the Web hit and the Sales team; ROI has to be more directly linked to specific activity. We need to understand marketing operations in detail and be able to explain to the C-suite the value of its contribution. Telling them we generated 1,000 leads this month and that this is more than the same time last year, is just not good enough any more. If Marketing is not an investment, it is simply a cost – and the pressure on costs is always downward.
‘You can’t manage what you don’t measure’, the old management adage, must finally be applied to marketing.