For years, marketing positions were filled by "creative types" whose contribution to the bottom line was difficult to measure. But a lean economy and a competitive marketplace have mandated that marketers take a more engineering-based approach to their roles: That is, marketers need to quantify their value to the organization.
Though sales reps triumphantly declare how many deals they close, marketers face three challenges: determining what to measure, how to measure it, and how to improve results so Marketing is recognized as a revenue engine.
What Marketers Should Measure
Sales leads are the most obvious candidate for what marketers should measure.
The relatively low cost of email marketing programs has made it easy for companies to blast messages to prospects. Unfortunately, the low barrier to entry (i.e., low cost) means every business-to-business company takes the same approach. As a result, it has become harder and harder for Marketing to produce enough leads to satisfy the sales team. Moreover, marketers are beginning to get pushback from Sales for sending poor-quality leads.
Nevertheless, Marketing can and should focus on the identification, and subsequent qualification, of leads. It's the easiest and most predictable marketing result, and it's the one deliverable that can be tracked through to revenue.
Measuring Sales Leads
In search of a solution to the problem of too many poor-quality leads, sophisticated marketing departments began implementing so-called "inbound marketing campaigns." Inbound marketing is based on the premise that if a marketer creates relevant content, prospects will themselves seek out the company and engage with it.
But creating such a mutually beneficial relationship goes against the "more is better" theory of lead generation; it requires a shift in focus from quantity to quality. The marketer's challenge was to find a way to measure the quality of sales leads, then determine a prospect's interest level before passing it to Sales.
Advanced marketing automation tools with integrated business intelligence capabilities have made that job easier. These systems come fully loaded with reports and dashboards that slice and dice lead data 101 ways. As leads come into the marketing automation system, marketers can quickly and easily assess a prospect's true intent and readiness to buy, and which lead-nurturing approach is best.
For marketers hell-bent on demonstrating their value, these systems are like shiny new toys. With the ability to confidently explain exactly what is and is not working in their marketing programs, marketers can expect the full attention, and respect, of the CMO, CFO, and CEO.
Improving Marketing Results
To clearly demonstrate Marketing's impact on sales, many marketers measure the number of qualified leads, the projected dollar value of leads in the sales pipeline, and the number of successfully closed opportunities that were touched by marketing campaigns. The important thing about those metrics is that they focus on the production of quality leads, which have a commensurate impact on sales effectiveness.
These advanced metrics also require that the analysis continue throughout the sales cycle. This approach is best for improving results. By monitoring which lead channels are most successful, Marketing can focus on programs that produce the best leads, rather than those that produce the most leads. Again, marketing automation tools with integrated business intelligence functionality make all the difference. Insights gleaned from reports generated by those tools ensure that Marketing and Sales will always be on the same page and they will be organized to meet common business goals.
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Marketing is reinventing itself out of necessity, but the move to analytics-based program evaluation is both logical and necessary. To continue elevating Marketing's reputation, marketers need to do more than execute campaigns smoothly; they need to focus on getting to the root of campaign ROI.
Only when marketers become serious about campaign analysis will Marketing's seat at the revenue table be secure.