We have all been there, the team has just spent two days at a trade show, your feet hurt, but you are full of enthusiasm.
“This has been the best show ever.” You have spoken to lots of people and the sales team are leaving with a bag full of leads. Roll forward six months and the reality is that none of those conversations turned into opportunities, yet when the time comes to decide whether you should do the show again, the consensus is overwhelmingly yes; it was brilliant last year.
Herein lies the problem. Far too many marketing decisions are based on opinion and not fact. Many organisations fail to collect the data that could better inform decisions, and in some cases, emotion just blind-sides facts.
Data should be the secret weapon of marketing
The challenge for us marketers is that everyone else is an expert in marketing. We are inundated with people saying marketing should do this, why don’t you try that, why don’t we do what the competition is doing.
Armed with data, marketers are able to make the right decisions, justify these decisions, and push-back on those ideas that have been proven to be less effective.
With more of your activity being digital it is possible to measure everything – to not only track the originating lead source, but also perform attribution tracking across all of the touchpoints. You can measure how each activity is contributing to the top of your funnel, the activity that is progressing leads through the funnel and which leads are converting into business.
Tracking Cost Per Lead (CPL) & Cost Per Sale (CPS)
I find an effective way of tracking the success of marketing activity is capturing cost per lead (CPL); this is simply the cost (including your time) for each activity divided by the number of Marketing Qualified Leads (MQLs) that activity has generated.
Caution should be given to this number as on paper an email campaign may look to generate a much lower cost per lead than say a PPC campaign; in reality this is seldom the case. Therefore, a more accurate way to measure both the volume and the quality aspects is to use Cost Per Sale (CPS); this is the cost of the marketing activity divided by the number of sales that have been generated from these MQLs. What is even better is to take this one step further and divide the revenue from these sales by the cost of the activity and this gives you the ROI.
In the tech sector, sales cycles can be long, and as such, almost all of your marketing year can disappear before you get accurate data to work from. This is why I normally focus on two parameters, the CPL as defined above and the conversion rate (CR) of MQL to Opportunity.
This is normally easy to pull from your CRM system and gives you those important volume and quality metrics that gives a more accurate picture of ROI.
Understanding Influencing Activity
Not all marketing activity is focused on generating leads and it is important that we understand through data the importance of this activity. For example, where we support a lead generation programme with brand building activity we see a measurable uptick in results. On its own the brand building social media does not generate leads, but remove it, and the number of leads generated across all programmes will fall.
This is where marketers can get really smart. At Cremarc, we call it marketing telemetry – the ability to collate and analyse all of the parameters across your marketing activity and understand the cause and effect of each element.
Building marketing telemetry is exciting, game changing and a subject that fascinates me. If this is an area where you are doing something smart or have a question, please reach out to me at firstname.lastname@example.org.
Want to read more about digital advertising, read our blog post on ABM.