If you’re struggling to measure the success of your marketing programs, there’s a good chance you’re focusing on the wrong things. B2B lead generation needs to be revenue focused if marketing wants to become a driving force within your organization.
This is a significant shift from the less tangible metrics that dominated marketing circles less than a decade ago. Back then, marketing departments touted brand awareness and database size as indicators of success. They backed up these claims with awareness studies and other metrics that were regarded as “smoke and mirrors” because they weren’t easily quantifiable.
Today, these elements still play a critical role, but are overshadowed by more valuable, and clearly defendable metrics that link your marketing spend directly to an increase in revenue. This change is the natural evolution from brand and database strategies; and is made possible through the implementation of improved marketing processes and customer relationship management (CRM) technologies. These marketing processes and tools expand the level of data available to marketers and provide a definitive link between prospect acquisition and awareness to actual sales.
In addition to providing a clear measurement of your marketing ROI, this increase in data has made it possible for marketers to provide vital insights into the health of your organization such as:
The Pipeline Forecast
Having a clear view of your prospect database and a better understanding of the sales process allows marketers to more accurately predict the likelihood new and existing prospects will make a purchase within a given timeframe. It’s an expansion of the sales pipeline report to include more early stage opportunities. This in-turn allows organizations to level off peaks and valleys in their sales pipeline.
One of the biggest advantages of a revenue focused marketing strategy is your ability optimize program spend using quantifiable metrics. Linking each program directly to sales activity allows you to quickly determine which programs produce the most revenue, not just the most leads. This is a subtle, but important delineation because more leads are not always good leads. Choosing programs should be done based on a formula that weighs lead quality, value and number against program cost to determine the actual value to the organization.
Cost Per Lead & Sales
Closely related to program optimization is your cost per lead and cost per sale. Knowing the cost per lead or sale is vital to improving your marketing and sales processes to reduce overhead. Armed with this information, you can work to trim-the-fat that is cutting into your margins to make both marketing and sales more profitable.
While the concept of a revenue focused marketing organization is not new, it has still not been widely adopted due to the lack of the processes, tools and data required to support its implementation. Regardless, as a marketing professional you must strive for greater alignment between cost and revenue.
One easy place to start is by changing how you evaluate programs to measure the value of each lead acquired rather than total volume. This will then help you generate higher quality leads and build more meaningful relationships with prospects over time; and that will translate into improved revenues and a more direct cause and effect relationship between marketing spend and organizational profitability.