Numbers are key in any kind of marketing. While some people may want to operate their campaigns using a preferred method or channel, only actual data can show whether or not decisions are successful.
Unfortunately, there’s a lot of confusion among marketers today about what numbers are the most important to track. The huge expansion of the marketing technology sphere over the last decade has led to the creation of all kinds of statistics that may or may not be relevant to your business.
A handful of metrics should matter most for B2B marketers, though. The data you generate from tracking the below numbers will provide the most insight into your marketing efforts and how well they’re performing.
Qualified Leads
A qualified lead is someone vetted as a valid potential customer. Generally speaking, there are two levels of leads generated by marketing activity:
- Marketing qualified leads (MQLs) are prospective customers who have shown some interest in your online marketing. Here, the most common examples include someone signing up for your email newsletter or filling out a form to download a longer lead magnet such as an eBook or white paper.
- Sales qualified leads (SQLs) are the next step beyond an MQL. An SQL is vetted by someone on either the marketing or sales team as a legitimate prospect that is able to purchase what your company is offering. For example, a lead who has exchanged a few emails with someone at your company might be qualified to move from an MQL to an SQL.
To qualify leads, you can refer back to the classic BANT framework: Budget, Authority, Need, and Timeline. If you’re using the BANT formula to qualify a lead, make sure you apply it to the specific person with whom you’re dealing. Just because the company you’re talking to has a need for your offering and can afford it doesn’t mean your contact has the authority to seal the deal.
If you’re using the BANT formula to qualify a lead, make sure you apply it to the specific person with whom you’re dealing. Click To TweetPipeline Size
The size of your pipeline is defined as the number of active deals you have going on at any given time, in any stage of the sales process – from the newest leads to that one major deal your team has been working on for weeks. Your pipeline size is a dollar amount that adds up the total value of all the potential business you might be able to win in the short and mid-term future. Don’t forget to include existing clients that make repeat purchases every month or quarter – though it’s important not to rely too heavily on this type of business.
Knowing your pipeline size can help for a few reasons. First, it enables you to understand whether or not you’re doing enough marketing. A too-small pipeline could indicate that the marketing you’re creating isn’t compelling enough to generate interest in your product or service. How big should your pipeline be? You will hear anecdotal advice and rules of thumb ranging anywhere from 1.5 to 5 times your sales targets. The truth is that your pipeline goals will vary dramatically depending on what you’re selling. It’s impossible to create a one-size-fits-all ratio – instead, you should experiment and see what pipeline size to sales ratio strikes the best balance between growth and overwhelm for your team.
Another helpful pipeline-related metric to track is your pipeline velocity. To calculate your pipeline velocity, multiply your number of deals by average deal size by win percentage, then divide the resulting number by the number of days in your sales cycle.
Source: HubSpot
Your sales pipeline velocity tells you how many deals you are closing and how much revenue is moving through the pipeline each day. A higher velocity is obviously better. If your velocity isn’t where you want it, consider the factors slowing down deals from closing.
Meetings Set
Meetings are an essential part of sales metrics because they represent a significant transition point in the customer journey. To use an analogy from the dating world: it’s like going from having someone’s phone number and exchanging a few texts or phone calls to meeting up with them in real life. Things may or may not work out, but taking that step represents a level of commitment that doesn’t happen with everyone.
Meetings help you understand how often your people are getting in front of qualified customers. Tracking your meetings to leads ratio can help you identify the quality of your leads. If you’re getting lots of engagement with your marketing materials but aren’t setting that many meetings, it could be an issue with the kind of people you’re attracting. On the other hand, if you’re scheduling several meetings, but they aren’t resulting in closed business, it may be a good time to revisit some of your sales processes or refresh your team on best practices.
Customer Acquisition Cost
Customer acquisition cost (or CAC) is a relatively simple metric, but it can reveal a lot about your sales and marketing processes. To calculate your CAC, simply divide the total amount of money spent on all marketing activities by the number of clients generated. For a simple example, if your annual marketing budget is $100,000 and you were able to bring in 200 new customers from that marketing, your CAC is $500.
Once you’ve determined your CAC, an easy way to evaluate the efficiency of your marketing is to compare it to your average customer lifetime value (LTV). Without knowing your LTV, it’s challenging to understand whether or not your CAC is where you want it. Continuing the example above: if an average customer will spend $1,250 with the company, a $500 CAC is excellent. That means you’re getting back roughly $2.50 in revenue for every $1 spent acquiring a customer.
On the other hand, say your LTV is only $250. Then, you have a problem because you’re spending $1 to bring $0.50 worth of business. Again, this is a straightforward example with round numbers for easy calculation. Still, these numbers will help you understand how to apply your CAC within the broader context of your marketing operations.
Conclusion: Only Trust the [Right] Numbers
One thing we aren’t lacking in digital marketing is beliefs on how things should be done. It’s easy to sit around and theorize or talk about what we think might work for B2B marketing.
But the reality is that metrics are the only way to know which ideas are genuinely effective and which are just nice theories to talk about in meetings. Every company will have a slightly different perspective on where their numbers should be and what they should be looking for as they review marketing data. When it comes to metrics, remember to pick the right numbers to track and follow them consistently to gain a comprehensive picture of your marketing and its effectiveness.
Do you need some help filtering through all the marketing data you have to identify what matters? Or maybe you aren’t even sure where to start collecting data and want guidance from a specialist. Fill out this short quiz to learn more about how the conversion rate optimization experts at FunnelEnvy may be able to help.
