Marketing Analytics and ROI

Marketing Analytics and ROI are the 2 terms making a lot of noise across the marketing world to the point that they are almost beating “ABM” in the popularity.

What do these terms actually mean for a marketer and why are they becoming a top priority for all marketing organizations? Being a practitioner in the field of Marketing Analytics for the past 10+ years, I would like to share some thoughts and experience to help translate these buzzwords into tangible assets that marketers can leverage.

The most common ask from the marketing leaders these days is to demonstrate the quantifiable impact that their organizations are making on the pipeline. Given the growing scrutiny around marketing budgets and the asks for returns from the marketing spend, marketing performance insights not only empower marketing leaders to have data-driven conversations with the c-suite, inspire/reward their teams based on performance but also optimize the execution of their strategy. If you belong to this tribe of revenue marketing leaders, you will find this post interesting.

Every marketing organization has a set of “Strategic Metrics” (with different definitions, unique to how a company operates) that it tracks to measure performance. Combination of such metrics makes up the key levers that they can pull to accelerate the performance and understand what is working

Across all my engagements at marqeu, I have been building marketing BI, data warehousing infrastructure (using popular tools like Amazon Redshift, Snowflake, Alteryx, MySQL, Periscope, Looker, Pentaho, Tableau, QlikView, PowerBI) and self serve dashboards that enable tracking of these metrics on an on-going basis. Though the definitions of such metrics vary there are 4 broad categories of metrics that define #MarketingAnalytics and #ROI

• New Engagements – Volume and Quality: the only way to influence new deals is to have the right customers and accounts engage, actively qualify and nurture them before they are handed over to sales. Goals are the key drivers to ensure that marketing organizations put together aggressive plans for driving such engagements. To make sure marketers have the real-time visibility into the performance against goals, we have designed a framework to track the actuals against goals.
• Cohort-Based Demand Waterfall Conversions: while new engagements are focused on driving top of the funnel volumes, it is the “cohort-based” demand waterfall conversions that determine the quality of these engagements. Demand Waterfall conversions generally track 4 KPIs with some degrees of variation – Leads to MQLs, MQLs to SALs, SALs to SQLs and SQLs to Deals. These 4 KPIs provide insights into efficiency across the funnel and help with accelerating deals.
• Influenced and Sourced Pipeline: Driving new pipeline has always been the most important KPI for any marketing organization. The importance of demonstrating how marketing is impacting the pipeline has grown manifolds in the recent times. The 2 commonly used metrics that demonstrate the impact of marketing are: Marketing Pipeline Acceleration/Influence and New Pipeline Sourcing With these 2 metrics, organizations are able to quantify marketing driven engagement across the accounts and relate them to the impact on pipeline. These pipeline correlations of the marketing activities provide valuable insights when it comes to understanding “when” the new opportunities were created in marketing engaged accounts and for the accounts with existing opportunities, how marketing was able to influence deal expansions and accelerate deal closures. These 2 KPIs provide a foundation for marketing leaders have impactful conversations with their sales counterparts. At the same time, these KPIs are very influential when it comes to evaluating the market mix across marketing tactics and channels in different phases of the buying cycle.
• Multi-Touch Attribution: We live in a world wherein multitude of marketing tactics and channels are used by organizations to engage with customers. For every deal (especially in the enterprise space), countless marketing touches are involved from web engagement (visits, clicks) to email engagement, to webinars, e-books, white papers, in-person events and the list of all the touches goes on and on. While all such touches have a varied degree of influence on the deals, they all come at a cost from the limited marketing budget. It is not fair on part of marketing leaders to allocate their budgets to different tactics without having access to the insights around how these tactics perform. Gone are the days when a marketer could just go about doing budget allocations based only on what she “felt” was right. Finance and sales organizations expect marketing leaders to make smart decisions when it comes to budget allocation and more importantly within the marketing organizations, the leaders increasingly want to feel confident about these decisions because it is these decisions that will help them meet their pipeline goals. This is where multi-touch campaign attribution comes into play and it is the most valuable of all the KPIs as it powers the marketing investment decision making which in turn drives the results for the marketing organization. Whether it is the First Touch, Last Touch, Multi-Touch, Equal Weight Multi-Touch or Weighted approach to marketing attribution, when implemented correctly and validated, the insights provided are of immense value for the marketing organization.

Modern marketing technology and analytics platforms have made it easy to actively track marketing spend (building budget tracking apps within the CRM platform instead of buying additional tools), engagement with the marketing programs and the pipeline associated with those engagements.

With the right analytics strategy and tools, we work with marketing leaders to empower their teams with these critical data points so that each team member is able to actively contribute towards fostering data-driven culture within the organization.These KPIs provide strategic insights to the marketing leaders and CMOs so that they can confidently demonstrate the impact that their organizations are making and help foster a strong working relationship for marketing within the c-suite especially with the CFOs.

I would love to know your thoughts on how you are measuring marketing performance in your organization. What metrics you are tracking and what tools you are using to provide these insights?