Smart marketers are realizing that measurement tools allow them to “reverse-engineer” their strategies and processes, providing fact-based intelligence on factors such as:

• Campaign performance;
• Media mix;
• Content offers;
• Market segmentation; and
• Revenue contribution.

The following white paper will present a deeper analysis into the survey results, including:

• The average visibility executives currently have into marketing’s impact on revenue;
• The impact of lead nurturing campaigns;
• Benchmarks into the current metrics being used to track revenue performance; and
• The disparity in revenue contribution between organizations with deep measurement capabilities versus those without.

Marketing’s Increased Visibility

While the pressure to justify spend may have jumpstarted the measurement movement in marketing, it is clear that there is a big appetite for insights beyond basic ROI metrics. As the analytics 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 on revenue, and 21% of CFOs now have direct visibility into the revenue performance of marketing.

A majority (63%) of respondents said CMOs are now providing reports that show marketing’s impact on revenue.

Leading marketing consultants point to this increased visibility into marketing’s impact as part of a transformation that is taking place within most high growth companies. “For any marketing organization that wants to be viewed as a driver of growth, rather than just a cost center, the ability to map activity to revenue is mandatory,” said Amy Bills, VP of Marketing at Bulldog Solutions, an Austin, TX-based firm specializing in BtoB demand generation practices. “When marketing can validate a specific contribution to revenue and is able to use the pipeline data to make improvements at every stage, there is real power there.”

This increased visibility correlates to the technology solutions now being used by organizations to tie marketing investments to revenue performance. Nearly three quarters (72%) of respondents are using their CRM system to measure and track marketing’s impact, 69% are using a web analytics application, and 54% are using a marketing automation platform.

[Download PDF to see Bar Chart]

The top metrics for marketing performance are still rooted in volume and traffic, but the survey did show more sophisticated metrics are emerging. For example, the top metrics cited were number of leads generated (88%) followed by web traffic (72%).

However, the majority of companies are starting to dig deeper into how those volume metrics are equating to real opportunities and revenue.

The growing areas of marketing measurement included:

• 66% use contact/lead quality and campaign effectiveness;
• 64% analyze lead conversion at funnel stages;
• 63% measuring marketing-sourced leads; and
• 43% track marketing’s influence on revenue/deals.

As marketers begin to look deeper at conversion rates and other pipeline metrics, the survey also showed increased activity and measurement around lead nurturing initiatives. More than 4 in 10 (43%) said they are currently tracking the impact of nurturing, while an additional 30% said they plan to begin measuring the impact of nurturing over the next 3-6 months. Only 27% of respondents had no plans to start measuring the impact of lead nurturing campaigns.

For those that are analyzing the impact of lead nurturing, the top metric is conversion rate (72%), followed by shortened sales cycles (39%), number of re-engaged leads (36%) and improved intelligence for sales prioritization(33%).

Measuring Marketing’s Impact On Revenue

Ultimately, ROI and other metrics point to how marketing is helping to influence and drive revenue, and more marketers are being evaluated and compensated against revenue performance metrics. More than half of survey respondents (53%) said their marketing department is now responsible for a revenue goal.

That contribution is proving to represent a healthy portion of the pipeline, with 72% of those departments with revenue goals indicating marketing’s revenue contribution is 20% or more, and 30% of respondents showing marketing responsible for 40% of more. As visibility into marketing contributions increase, so are expectations, as 56% of respondents said their revenue contribution goals have increased over the past 12 to 24 months.

Once marketing is responsible for a revenue goal, the most common methods of tracking performance were:

• Pipeline reports (67%);
• Management review (65%); and
• Shared goals with sales (61%).

[Download PDF to see Graph]

Another positive trend that emerged from the survey data was the high level of confidence among marketers that they would reach their revenue contribution goals, as 91% said they were either somewhat or very confident that they would hit their number for the current year.

For the limited number of marketers concerned that they would not reach their goal, the leading inhibitors were either due to a lack of alignment with sales or spending limits.

The top three hurdles for reaching revenue contribution were:

• Insufficient budget to run campaigns (30%);
• Limited/inability to see volume and quality of leads in pipeline (28%); and
• Limited insight into lead volume and quality (21%).

Gap Analysis In Marketing Analytics

In addition to the implication of a growing trend toward the adoption of marketing measurement, the survey also uncovered a developing disparity between those marketers who are tied to revenue goals versus those that are evaluated against more traditional metrics.

Demonstrating the contrast between marketers with deeper experience in using analytics versus those earlier in the adoption curve, the survey found that marketing departments currently responsible for a revenue goal consistently ranked an average of 5 to 10 percentage points higher on key pipeline performance indicators.

In comparing the total sample against a cross-tab of marketer with revenue goals, the survey showed significant differences their ability to demonstrate and influence revenue. Illustrating this point:

[Download PDF to see Table]

Want more like this?

Want more like this?

Insight delivered to your inbox

Keep up to date with our free email. Hand picked whitepapers and posts from our blog, as well as exclusive videos and webinar invitations keep our Users one step ahead.

sign up

By clicking 'SIGN UP', you agree to our Terms of Use and Privacy Policy

SIGN UP

By clicking 'SIGN UP', you agree to our Terms of Use and Privacy Policy

Conversely, those marketers that are not being tracked on revenue contribution are still being tied to the outdated volume-based metrics that have traditionally caused breakdowns in alignment between sales and marketing. According to the survey, two of the top metrics in place for marketers who are not tied to revenue were:

• Number of leads (54%)
• Web traffic (33%)

[Download PDF to see Image]

The Next Legs Of The Revenue Journey

While the research showed analytics tools are quickly emerging as a competitive differentiator, it also underscored that most marketers still have significant opportunities to better apply the data and intelligence available from analytics tools.

The survey found marketing measurement is still a relatively new process for the majority of respondents. When asked to categorize their current stage on the marketing analytics journey, slightly more than half of respondents (51%) said they are just starting out or are in the early stages. Only a quarter (25%) said they are fairly mature and 18% classified their organizations as “very sophisticated” and ahead of the curve.

The data showed adoption of analytics tools are on the rise, but it also reinforced that any technology by itself is not sufficient to improve marketing and sales results. When asked which hurdles were standing in the way from collecting and analyzing data, survey respondents cited lack of internal processes as the top response (48%).

Because many organizations still struggle with their internal processes for lead management, industry analysts suggest that marketing metrics should be used to improve sales and marketing collaboration. Illustrating this point, only 43% of survey respondents said their VP of Sales is actively tracking marketing metrics.

“Marketers should be using this opportunity to improve their overall lead management processes and in so doing form a strong alliance with sales, which is lacking in most organizations,” said Carlos Hidalgo, CEO of The Annuitas Group, a consultancy specializing in lead management processes.

Survey respondents agreed and recognized that people and process were equally important to technology in making marketing more predictable in impacting revenue. When asked how they planned to advance to the next stage of marketing analytics maturity, the results pointed to:

• 76% plan to develop better processes;
• 60% plan to improve alignment between sales and marketing;
• 41% plan to invest in new technology; and
• 28% plan to hire new talent.

[Download PDF to see Pie Chart]

In terms of the long-term potential of analytics, marketers are already looking ahead to further insights that can make their demand generation programs and revenue contribution more predictable.

The wish list for additional metrics marketers cited included:

• Campaign influence/attribution (64%);
• Predictability of lead conversion (61%);
• Trends over time (55%);
• Additional pipeline forecasting capabilities (46%); and
• Cost per qualified lead (46%).

About the Survey Sample

The BtoB Marketing Measurement survey was conducted in June 2011. Respondents were comprised of BtoB professionals in the DemandGen Report subscriber base, and represented a range of different functional departments and industries.

In terms of roles and responsibilities, the survey sample included (respondents were able to choose multiple options):

• 86% involved in marketing;
• 66% working specifically in marketing operations;
• 48% in sales;
• 36% in sales operations; and
• 41% from CRM administration.

The survey sample also included a mix of SMB, midmarket and larger companies. In terms of revenue:

• 49% of respondents worked at companies with between $10 million and $50 million in revenue;
• 20% of companies had revenue between $50 million and $250 million;
• 9% were in the $250 to $500 million range;
• 10% were from companies with $500 million to $1 billion; and
• 13% represented organizations with revenue $1 billion and above.

The largest segments in terms of industry verticals were high tech/software (46%) and 28% were in professional services; 8% in worked in financial services; 8% in health care; 6% in telecom; 5% in consumer products; 5% from other industries.

[Download PDF to see Bar Graph]

Discovering Pipeline Opportunity

The early days of marketing measurement were driven primarily by the motivation to justify investments in branding. However, as more BtoB organizations look to increase their demand generation strategies and practices, there is an opportunity and need to dig deeper into how marketing is impacting pipeline performance and revenue.

Those organizations that can make marketing more predictable and use pipeline intelligence to drive strategic decisions are likely to have an advantage on their competitors. The ability to measure conversion and lead progression gives marketers a meaningful seat in boardroom discussions.

“Marketing organizations with granular campaign visibility can be smarter about the way they spend 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 budget dollar, Bills added that measurement is another strategic asset when in comes to internal planning sessions. “When planning for 2012 starts, marketers with a handle on revenue contribution can request budget based on a data-validated business case of what is working,” she said. “I would much, much rather be able to walk in to a budget session and say ‘These campaigns drove this much revenue and to make that work in 2012, I need the following budget.’”