B2B marketing executives are rethinking their approach to metrics and reporting as they look to speak the languages of the C-suite and have a deeper connection to sales and company revenue.
Preliminary findings from a new study conducted by Madison Logic and Demand Gen Report show that more than half (52%) of B2B companies stated that "extending marketing's influence across the buying journey" is there top priority. Other key priorities for B2B organizations include analyzing and understanding attribution metrics on account-based ROI (35%), as well as being able to measure and understand specific account engagement (35%).
Jim Lenskold, President and Founder of the Lenskold Group, agreed. “Ideally, from a business standpoint, you’d like marketing to be focused on sales-oriented metrics,” he said in an interview with Demand Gen Report.
Some examples of sales-oriented metrics Lenskold noted include:
- Marketing generated sales volume;
- Incremental revenue;
- Incremental revenue per sale; and
- New accounts.
Lenskold added that some organizations’ marketing departments are still using “soft” metrics — such as Web traffic — that are focused around branding goals. “They don’t have this credibility with the business heads who are working on revenue.”
Building department credibility in a fluid marketing ecosystem is an ongoing challenge. Preliminary findings from the same Madison Logic survey found that 59% of execs see marketing as a cost center rather than as a revenue center. What’s frustrating for marketers is that 62% of execs say they’re already “focusing on revenue metrics for marketing.”
“The problem is that our leadership is changing the KPIs that we're measured against, but the organizational culture around our leadership isn't changing how they perceive us as a department and as a discipline within the company,” said Sanjoy Ganguly, Chief Product Officer for Madison Logic. “That's where things are starting to be broken in the industry and that's what we as industry leaders have to change. We have to change that culture across the organization.”
Let Data Tell The Story
Industry experts agree that the data marketers are reporting must tell the story that their sales and leadership teams want to hear. Therefore, marketing must take a step back to identify and understand the metrics that articulate those stories to tell the right story.
Judy Ash, Head of Corporate Marketing for Big Switch Networks, said that valuable marketing data falls into two categories — granular, one-on-one connection data for deeper personalization, and more universal metrics that demonstrate marketing ROI. “The question [my leadership team] is asking is, ‘We're giving you X amount of money for marketing. How is that returning to my business?’” said Ash. “To simplify the matter, we focus on the metrics that answer that question: revenue growth and pipeline. From there I think about how my programs are running — or campaign KPIs — and then there's everything else.”
Pergolino agreed: “Companies have top-line and bottom-line targets, and there's a certain amount of spend we want to do to show growth in the business,” she said. “For example, if we were spending too little in marketing, it would look like we weren't making the proper investments. So, it’s about understanding what the business defines as success, being able to talk as a peer to finance — not as a subordinate to finance — and similar for sales.”
Eric Boller, Salesforce.com developer at Nextiva, said that despite the findings from the Madison Logic survey, he has seen progress in the reporting metrics used across sales and marketing. “We’re leveraging our tools to be most effective at nurturing prospects and accelerating sales cycles for our sales team,” Boller said. “Therefore, time to contact [as a metric] is huge,” he said. “And really getting reporting standardized across multiple systems has always been another big challenge for us, too.” The reality is there are always opportunities to enhance reporting capabilities to benefit both departments.
Mapping Department Success To Scale Reporting
One way to approach the metrics conundrum is to work backwards from a successful outcome to identify the metrics and reporting structure that clearly highlights marketing impact on closed business. That has been Pergolino’s approach at Anaplan. She said she started by making a list of things that the organization needed to do and then built an organization and reporting structure that aligned to those goals.
“Think about, for each position, how you would measure success,” she said. “I like to group teams by where there are common metrics. There's part of your team, maybe ABM or maybe field marketing, that are looking at deal acceleration metrics and making sure that they're grouped together so that as a marketing leader, I can understand the effectiveness in each area.”
This ultimately helps Pergolino determine where to invest marketing spending. “Should I put a dollar more in events? Or should I put it into the website? By grouping those with similar metrics together, I can do those comparisons,” she said.
Ash said she also works backwards from desired results. “I think about them from top-of-funnel, middle-of-funnel, and then sales acceleration to close,” she said. “So basically, for us, that's stage four, beyond where it's truly an opportunity and it's about to convert and what's our rate of conversion between those three segments.”
Experts concluded by saying that technology is positioning organizations to better gather and analyze sales and marketing activity. “What we're doing is we're adding tools to our tool belt,” said Pergolino. “So, it's not that we stopped doing search optimization, PPC, lead nurturing or lead scoring and all the way up to ABM. It's that we have to become masters of these things, have them in our tool belt and then continue to add.”