Marketing Metrics: Rethinking them Again!

It always seems that marketing metrics is a fertile topic to discuss and write about but after reading a few recent Forrester research reports I think they really helped me to crystallize how I am going to be tracking metrics going forward but they also gave me a sense of what importance I should give to each of them.

While not plagiarizing them outright – I think I have adapted them to things I have blogged about before. I still feel there is only one metric that counts – SALES. Ringing the cash register is the best if not the only way to prove marketing value (as I have told you in the past). And our lead nurturing platform has been immensely helpful in giving transparency into that process and showing that value.

But many of you have questioned my outright simplicity of just using one metric by saying to me – don’t you measure Impressions? or don’t you measure Cost per Click?

Well of course I do but do I then email those stats to the CEO? No. But I do feel they have a place in your metrics so let me give you my 3 tiers of marketing metrics:

1) Reach metrics – Web site impressions, page views, radio impressions etc…
2) Efficiency metrics – Cost per click, time spent on the website, downloads of a paper or podcast etc.
3) Value – Contribution to Pipeline, contribution to Bookings, ROI on overall bookings.

So there you have it and these tiers infer some priority to them – reach being the least and value being the most.

I am also going to begin to look at reach metrics PAIRED with value metrics – ex – graph my weekly lead flow against my media budget looking for spikes or relative lift. This could be a good way to prove lift on a media budget for those budget discussions we all have.

14 comments to Marketing Metrics: Rethinking them Again!

  • Cliff Allen

    In addition to marketing being able to use these metrics to analyze recent audience behavior, salespeople can use this data on individual prospects to help close more sales.

    I like for sales reps to be able to see a prospect’s clickthroughs, form submissions, and other metrics in real-time while they are on the phone together. Many prospects click around on a site while talking to a rep, so this gives a rep insights into what the prospect is thinking and feeling.

    Having sales and marketing use the same data helps the two operations work together better.

  • Paul Dunay

    Cliff

    You make a great point and I am working on exactly that – getting the right data out to the sales team as far as what is being downloaded and looked at. (think RSS feed)

    Only downside or caution point could be if sales is acting on the information and so is inside sales we could have an instance of ‘whose on first’

  • Martin Edic

    I try to understand the cost of a qualified lead so I can know how much I should be willing to pay to get that lead.
    First, a specific definition of what a ‘qualified lead’ is, mutually agreed upon by marketing and sales.
    Then a conversion tracking model to estimate cost of acquisition.
    Then enough metrics to know how many leads it takes to make a sale.
    Then the profit per sale before lead gen costs. This has to be more than the cost per lead times number of leads needed to close.
    The problem is that a lot of my ‘marketing’ is social media interaction (we’re a social media service) so my only measurable metric on that is the cost of my time…

  • Paul Dunay

    Martin

    Interesting challenge since most of your marketing is social

    I would say try to find some way to measure interaction to tie to new contract starts for your service

    And if you can profile that interaction that would nirvana!

  • chris uschan

    I like to look at life like this.

    Metrics —
    (Visits, new leads, etc) – simple things to monitor and compare. You have to take this to the next level… defining them as efficiency and reach as you mentioned is fine.

    Conversions — (KPIs)
    1. Site visitors who completed a form compared to total visitors on the web site.
    2. Completed forms to Opportunities

    Then close the loop to Sales
    3. Oppty to Proposal
    4. Proposal won/lost

    etc.

    However, even with these, you need
    to drill into the details of your SEM and SEO… what keywords are working… how is eac of your SEM campaigns running over time (more impressions?, less clicks?). Find out what is working and double down on that.

    We use hubspot for inbound traffic and SEO. And use pardot for forms, conversions, intelligence and automated marketing. Pardot is great as you can push marketing intelligence right to the sales reps finger tips regardless of the CRM you use.

    Pairing these with Salesforce.com optimizes metric and KPI monitoring.

  • Cliff Allen

    By the way, the e-book “The Big Book of Key Performance Indicators”
    is great. It has a huge number of KPIs to monitor.

    http://www.webanalyticsdemystified.com/about_kpi_book.asp

  • MarketingHoodie

    I particularly like the way you’ve tiered the measures – but I think that if you take sales as your starting point then you can often end up with very different measures for different business units/solution areas.

    On the principle that what gets measured gets done, we need to look at what the key things for marketing to deliver are for each area that a sales target is set for. Don’t you think that the metrics would be very different for these two different challenges (I’ve perhaps exaggerated the contrast):

    1. Selling ERP upgrades where the sales challenge is that we’re not on the RFP for enough deals (focus needs to be at the top of the pipeline and measures from the size of the prospect databse, through attracting the audience to nurturing)

    2. Business Alignment consulting deals in Utilities, where we’re on the shortlist for almost every deal but not converting enough (do we need new measures about creating opportunities for face time with prospects? or bid support activity? or identifying opportunities before another supplier is helping the prospect write the RFP?)

  • Paul Dunay

    MarketingHoodie

    I absolutely think you need 2 different set of metrics for those 2 challenges

    the Upgrades one I think is a stripped down version of what I professed – since really you can achieve this with an inside sales team banging the phones (assuming you have the right list or could get one)

    the Utilities play sounds more long term / considered sale – which I think my approach would work better for

    hope that helps

  • Chris Slocumb

    Your 3 tiers are very helpful. I was just talking to a prospect today about SEO metrics and linking more to lead or demand generation than straight web analytics stats such as page views.

  • Lewis Green

    Paul,

    I didn’t see any reference to metrics regarding inbound marketing. Until we begin prioritizing and focusing on inbound (meaning alignment across customer touch points and focus on gathering customer knowledge), our marketing efforts will cost more than is necessary and reap fewer revenues. Sales, Marketing and Customer Reps need to be gathering and sharing the same information and working toward the same sales goals.

  • Alan Mangelsdorf

    I’m not sure how these would exactly fit within your tiers or frameworks, but I tend to look at two distinct sets of metrics. While our organization uses SFDC and leads, conversion to opportunity, value to pipeline, etc., I have always felt it is incomplete.

    With the rare exception, a good portion of marketers’ job is often dedicated to helping internal customers (sales, management, product, etc.) understand what marketing does and its value (BEYOND lead gen). As such, I tend to structure metrics into those that measure output (i.e. how is the marketing engine performing) and then the market impact of those efforts (leads, coverage, web stats, etc.).

    This gives the business, as well as marketing, the ability to look at marketing more holistically. If the metrics say the “engine” is performing, but the “impact” is off, then we examine why –wrong message? wrong medium?

    More importantly, it puts marketing in a strong position to demonstrate success and educate its internal customers.

  • Mike Ashworth

    Great post Paul.

    I think some of the issues with metrics is that they are often driven by the functions within Companies.

    The Marketing function has sets of metrics, then Sales does too, and Customer Service another (get ppl off the phone ASAP – love that one!). Often these groups operate as if the other did not exist.

    I think once Companies embrace a more holistic approach to their activities things will get easier.

    Perhaps as Joseph Jaffe pointed out in his book “Join the Conversation” their needs to be something that crosses the functions called “conversation” and then have metrics that everyone buys into.

    One of the challenges is that the various functions within an organisation have sets of Goals at the beginning of each year and often these metrics then cascade down from that.

    Often you can read this as “things to beat the staff up about if they don’t meet the target”.

    Often they are obsessed about having things to measure not the externals by, but how the staff or teams internally are performing.

    I think, for some Companies the changes required to understand this more fully will be quite challenging.

    Mike Ashworth
    Marketing Coach and Consultant
    Brighton and Hove, Sussex, UK

  • sometimes Sales Management takes a lot of effort and skill.~;~

  • Sales Management is very essential in making your business succeed, every part of a business should be managed carefully.”~.

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