April 19, 2018
In 2017, 92% of global B2B marketing decision makers said that improving the ROI of marketing or effectiveness of marketing would be among their top marketing initiatives over the 12 months that followed.
Turns out this was a bit of a pickle, because 77% of the same group of respondents said that lacking the ability to measure results was one of their top marketing concerns.
Measure Outcomes, Not Outputs: The Metrics That Matter
There are six categories of metrics that marketers can use to measure and analyze the factors that drive performance. Here’s a description of each and a corresponding fun fact for each:
- Volume measures indicate how many opportunities are in each sales stage, how fast each population is growing over time, and how many get added each period. Unplanned dips in volume call for programmatic changes to course-correct baseline sales stage flow. Fun fact: This is the only metrics category where quantity matters.
- Velocity metrics capture the time it takes for a prospect (or customer considering an upsell or expansion) to advance through sales stages. Fun fact: Many marketers miss the opportunity to understand velocity in early funnel stages. Understanding trends, like how long various prospect types spend in various sales stages, enables the identification of chokepoints.
- Value is a function of forecast revenue at each sales stage. Fun fact: Marketers often overlook the benefit of positioning their products and solutions against high-value segments in favor of volume. This is a great metrics category to help reset vision from volume to revenue.
- Effectiveness metrics reflect conversions from one stage to the next. Fun fact: The permutations here are endless. This metrics category is key to answering questions such as: What content moves prospects forward? What channels are effective at which stage gates? Which types of lead sources uncover prospects that convert at the fastest rates?
- Efficiency metrics show how well tactics convert costs into returns. Fun fact: Lots of folks want to compare efficiency metrics to other firms. Please don’t do that.
- Engagement metrics capture leading indicators in behavior that warrant monitoring and action. Fun fact: Look . . . we all know that signals of engagement aren’t exactly reliable revenue indicators, but marketers that have adopted ABM principles — pursuing revenue with outbound tactics rather than just curating inbound leads — have breathed new life into metrics like time spent on site, email opens, and web conversions. If you’re pursuing accounts that don’t have you on their radar, emphasize engagement metrics to your stakeholders. They are early but promising indicators that your tactics are working.
Measure Performance At Key Milestones Throughout The Sales Cycle
For any of these metrics to work as intended, they must apply to logical portions of your internal process. (I’d love to tell you they need to map to the buyer’s journey, but it’s better that you create your own framework and vocabulary than apply a different measuring methodology to every journey.)
This Part Is Important
As a prerequisite for this, marketing and sales leaders must calibrate internally focused customer engagement processes to the buyer’s purchase journey — not vice versa — while extending performance measurement to post-sale activity. This requires you to define common stage names and set the rules that govern movement from one stage to the next.
I hope this is helpful to all, but Forrester clients can read more detail in the “Metrics That Matter For B2B Marketers” report. In the report, I share further background on the circumstances that trouble marketers, demonstrate how to incorporate measurement into the customer life cycle, and offer recommendations on developing a better approach to marketing measurement.
PS. Wondering what the metrics are that matter in ABM? Hopefully the same ones that matter to you already.