Posted by Alden Cushman on Fri, Aug 27, 2010 @ 10:37 AM
We've all suffered through one of those conversations with an endless series of questions: “What are you doing? Why? What are you doing? Why?....” As many know, sometimes the only way to end the cycle is to answer with: “Why not?” Well, during the past year we've noticed a somewhat troubling trend in marketing data reporting questions that sounds a lot like “Why not?”
We start by identifying the drivers of this behavior. Four market forces are pushing most marketing organizations to improve and increase their reporting of marketing metrics and key performance indicators (KPIs):
- Increasing focus on marketing ROI
- Improving marketing processes and skills
- Increasing implementation of marketing automation platforms, and related systems and tools
- Increasing number of marketing service agencies that report campaign and program ROI measures
One of the interesting, and some might say unfortunate, consequences of being able to track the results of marketing campaigns, programs and tactics is the desire to search for answers by analyzing and reporting as much data as possible as often as possible. Senior management demands better information and intelligence to make better business decisions and improve results. However, since many companies (especially public ones) run on a quarterly cycle of reporting financial results every three months, many marketing groups have adopted the same reporting mentality.
The biggest problem is that most of our B2B clients have marketing and selling cycles that last well beyond three months, so they are reporting on marketing lead generation and nurturing activities that do not fit neatly into a quarterly view. The result is usually a potpourri of misleading conversion ratios between program response rates, inquires, marketing qualified leads, marketing sourced pipeline, marketing influenced pipeline, and a handful of other measures. We don’t advise that marketing groups refuse requests for quarterly or even monthly data, but do yourself (and senior management) a favor and put it within the context of the company’s regular marketing and selling cycles.
Begin by uncovering the decisions senior management is wrestling with and use those to determine which marketing metrics and KPIs impact them the most. Don’t measure and report on everything you can. Generating pages and pages of marketing activities only confirms what many senior managers believe, that marketing has no idea how to prove its return on investment. Report on fewer items and make sure to compare last quarter’s marketing metrics and KPIs to the same quarter of the previous year; don’t compare them to year-end numbers. Prove to senior management you understand their underlying business issues, you are investing in campaigns and programs designed to address those issues, and you can report the right indicators in the right timeframe to show concrete positive results.
Posted by Megan Heuer on Fri, Jul 30, 2010 @ 09:00 AM
Are your marketing programs attracting the right kinds of prospects? Only your data can tell you. While it’s tempting to stop at reviewing email response rate, opt-out percentages or unique visitor growth on the website, understanding and optimizing B2B marketing tactic effectiveness requires a little more digging. You need to look into the details behind those numbers and how tactics impact the overall health of the contact database. Here are some guidelines for using the contact database to shed light on what works and what doesn’t.
Define Who You Need to Attract. It’s hard to know if a tactic is encouraging interactions with the right contacts if a clear goal has not been set as to who the desired audience is. Who exactly is your desired audience for the tactic and what goal are you supporting with them? One this is defined, if you are pursuing an outbound tactic, take a look in your database to see how many of these individuals you already know. If the universe in there is smaller than you know it to be, consider targeted contact acquisition. If the tactic is inbound (meaning not sent out to specific names but positioned where the right kinds of contacts go to encourage them to respond and identify themselves), then define the baseline of contacts that meet your criteria so you know when additions are made. The initial goal is to estimate a rough size for the segment you want to reach and what percentage of it you already know so it’s clear when gains or losses happen in the database.
Build a Segment Data Snapshot. For your target segments, track overall contact gains and losses monthly to see what the net impact of marketing programs is on building the contact database. As part of your normal database reporting, compare the number of names and the percent of total database added each month (de-duped from existing contacts) to the number of contacts lost or no longer usable. This not only shows whether the database is growing or shrinking, but at how rapid a pace movement is taking place. The calculation also can be used to determine incremental return on investment for specific addition efforts; for example, a demand creation program might contribute 100 leads, but if it also added 500 new names to the database and helped with the completion of 250 more records as well, there is incremental value that should be identified and reported.
Put together, these elements provide a warning system for changes that could hurt down the road. They’re also a way to identify highly successful approaches that should be shared and emulated to boost others’ contact acquisition results.
Posted by John Neeson on Wed, Jul 14, 2010 @ 10:06 AM
Well it's that time of year again. Many of you will begin your annual planning for 2011 or are well on your way to creating your budgets. This is the time of year where we do many budget benchmarks to show you trends in marketing spend that are often used to support the changes you are looking for. As we consider the improvements we have observed in sales and marketing alignment, here are three best practices to consider in your plans:
- Create a “menu” of programs sales is requesting. Very often marketing focuses on the top-line programs but not what they manifest into at the sales level. Build out the programs you will need in a menu model for sales. Include a description for each program showing what sales problem is solved with program and written in sales language not marketing. Show what will be on the menu for lead generation for new accounts, existing accounts, for sales enablement, and what will be done for targeting. Also show how the menu might be different by sales channel.
- Reverse the waterfall. Now with your menu created, determine the marketing requirements needed to achieve these sales programs. Establish what the number of leads will be, what marketing will source and what they will influence.
- Brand to demand ratio. Finally, determine what has been the ratio of awareness required to create demand. Look at what you've spent in years past on communications and advertising and see what the ratio has been for every dollar spent on demand generation, what has been spent in driving awareness.
Active dialogue is at the heart of B2B marketing and sales alignment, and fostering this dialogue should be a part of every planning process. Without using such a planning model as we've presented here, marketing is often left with assuming the impact that it can have on sales and, subsequently, the business.
Posted by Megan Heuer on Mon, Apr 19, 2010 @ 10:51 AM
One topic dominated conversations during my travels and on client calls the last several weeks: marketing tactic return-on-investment (ROI). This is hotly debated by analysts and consultants, not to mention pretty much anyone who has ever had to run or defend budget for a marketing program. Like any good question for the ages, the answer is “it depends,” but we can offer some clarity around what it depends upon and what can be measured.
Let’s start with the definition of a lead, because that’s where the ROI calculation trouble usually begins. For the record, we don’t believe every inquiry is a lead. It’s an inquiry, which means someone who has raised his or her hand to take some action you have made available. An inquiry can be anything from a newsletter sign up to a whitepaper download to an event registration and more. On its own, an inquiry does not signal readiness to buy, which means it is not a lead (yet). Our years of benchmark data show companies who treat every inquiry as if it is a lead and send it to sales do not perform as well as those who have a process to nurture contacts from inquiries until they are properly qualified and ready for sales. When marketing teams follow this pattern of sending every inquiry to sales, they reduce potential to deliver against goals in the most effective way possible, and by extension this reduces potential for sales to be more effective and efficient. Now in the rare case where an inquiry says “call me I’m looking to buy,” the qualification process is a lot shorter, but this type of inquiry is less common than, say, a whitepaper download. Case in point: this week alone I got two calls from companies after I completed forms to download whitepapers in which I clearly stated I was an industry analyst and not looking to buy. In both cases, a competent and polite sales rep called and asked me about my inquiry. If they had read the form, they would have known the call was a waste of time. Calls are not free, so sending an unqualified contact to sales also wasted money.
Based on this thinking, let’s tackle the tactic ROI question. Specifically, marketers want to attribute dollar return based on closed deals to a single tactic, when no single tactic deserves that much credit. If you know your sales cycle involves multiple touches from marketing before you can consider a lead qualified and ready for sales, then it is impossible to attribute revenue from a closed deal to any single tactic. Some systems are set up to attribute a first or last marketing touch to each lead that is passed to sales and that’s the tactic that gets credit for the close. This results in a flawed view of what really works because all you see is one touch, when in fact there may have been tens of touches over a long period of time that in combination supported qualification of a lead. It’s just not that simple in B2B, and trying to make it simpler can hurt marketers’ ability to allocate resources. Instead, take a more realistic and practical view of the role of tactics by monitoring cost per response (from new or existing contacts) and cost per contact added to the database. Next look at the appearance of those tactics in the buyer’s journey. First look at the number of touches it typically takes to qualify and what those are, then look at the touches present all the way from qualification to close. This will provide a more accurate view of the relative success of various tactics vs. their cost. The key is not to confuse tactic ROI with overall marketing ROI, because doing so sells them both short.
Posted by Megan Heuer on Fri, Mar 26, 2010 @ 10:20 AM
If data is the lifeblood of demand creation, shouldn’t it have a heart monitor attached? I talk with many companies about their reporting and dashboards, and data is rarely part of the conversation. That should change. The best leading indicator of demand creation throughput is the effectiveness of tactics designed to add contacts to the database. When the focus is only on downstream results, including conversions and marketing qualified leads, it is more difficult to pinpoint problems upstream that clog the flow of data. Adding data to regular reporting allows another level of diagnosis, and some of the problems it finds can have a huge impact.
Take the case of an organization that invests heavily in inbound marketing activities to draw people to its website to request assets. The marketing operations team gathers reports from the web team, which show the number of visits to the site and the pages viewed. What they don’t see is how many of those web visitors hit a form page, completed the form, and were added to the database as marketable contacts. They also don’t see how many of the contacts who came in via inbound tactics fit the most desirable demographics for marketing to attract. Marketing ops may also get reports from the field marketing team or demand center, showing click-throughs and conversions on emails, and all leads created by campaign. They also don’t see how many of the individuals who clicked through an emails and saw a form, but did not complete it and were not added to the database; and if the name came from a list rental, then that’s money out the window. And, there’s no ability with this reporting to monitor on a cumulative basis how many of the most desirable contacts (or all contacts for that matter) are opting out and the impact that has on database growth.
The solution is adding at least one key performance indicator (KPI) plus a few key metrics around database health. Together, they provide the basic foundation:
- Net monthly database growth: Percentage of records gained minus percentage of records lost (opt-outs, bad data, etc.)
- Total percentage of usable records in the database
- Percentage of new contacts added each month
- Percentage of contacts lost each month, separated by opt-out/unsubscribe percentage vs. lost to data issues (bounce, bad address, etc.)
- Percentage of those who reach a form and complete it
If the organization described above was tracking these metrics, then the marketing ops team would identify the fact that specific web forms have low completion rates and need to be revised and tested for better results to improve database growth to take better advantage of good inbound traffic levels. They would also be able to see that specific inbound activities are attracting contacts from a different segment than the one intended. They might also sound the alarm on increasing opt-outs that appear to be tied to specific third-party data sources. This knowledge can save money and improve effectiveness, and that’s the definition of good reporting.
Your action item: Add data health metrics to your dashboard and let it be known the doctor is in.
Posted by Megan Heuer on Fri, Feb 12, 2010 @ 08:58 AM
I am about to reveal the number-one, top-secret tip for successful marketing reports and dashboards. The one CMOs ask for every time. This is the big one. I mean it.
Here it is...
Include a summary at the Beginning.
Feeling let down? Saying “duh” out loud? Sure you are. Now take a look at your report. What’s the first thing you see? It’s data in charts, isn’t it? Most marketers, in their quest to deliver credible performance numbers, go right for the charts. But what most dashboards skip is what marketers should be best at: telling a story. When numbers are all that is shown, the report makes it too easy to focus on minutiae and not the bigger picture of what happened and why. Worse still, when too many numbers are shown without context, it is impossible to tell what matters and what’s really happening. The numbers and charts become an end in themselves and not a diagnostic tool.
Why is this a problem? Because lack of context for numbers results in unconstructive dialog about the numbers themselves, and not about what’s being done to improve them. The numbers-only approach leaves senior managers frustrated that they don’t know what marketing delivers, despite so much data. It leaves marketers wondering why no one uses the report when they provide such detailed numbers. The fix is simple: Senior marketing leaders tell us that, while they appreciate and need numbers, what they really want is a summary upfront that simply tells them what it all means.
Here’s the action item: Before you get to the numbers, add a summary. Put numbers into perspective so the rest of the report backs up the headlines. Include what happened, why, and what is being done to fix the bad and do more of the good. Caution: A summary will not fix bad data, or cure the fact that a report has the wrong metrics, or too many metrics, in it. A summary will require careful thought about what the numbers mean, and which ones are most valuable to determine past performance and future requirements. Marketing reporting should be more than a litany of available facts. It serves to illuminate facts with diagnosis and insights that support better decision making.
What’s in your dashboard?
Posted by Jonathan Block on Wed, Jan 20, 2010 @ 09:22 AM
Social media monitoring is a popular topic these day, and deservedly so. From our perspective monitoring is one of the four cornerstones of an effective social media strategy, which consists of Monitoring, Engagement, Awareness and Demand Creation. But where vendor functionality regularly outpaced a B2B organization's skills and process capabilities, users are finding such monitoring tools lacking in some key areas. This is not unlike the the marketing automation platforms (MAP) space; it's only in the last couple of years that B2B marketers have evolved to the point where they can take full advantage of MAP capabilities.
Let's look at what we're hearing from clients on two fronts:
- Integration: Again, not unlike MAPs, ease of integration of social monitoring platforms with other enterprise systems will become a differentiator for many customers. And we mean true integration, not just importing and exporting data. If you're only interested in tracking mentions, keywords and sentiment, as well as some indication of your level of engagement, then a standalone monitoring tool will be sufficient. But most B2B organizations look beyond communication goals to social media marketing, which requires tracking all customer and prospect interactions (what we call "following the social media breadcrumbs"), and integrating this data into MAP and CRM systems is critical. This explains why social tools are finding their way into such systems, either through partnering, acquisition, or the vendors building such functionality themselves.
- From reporting to analytics: Most clients tell us that social media monitoring platforms are good at reporting what people are talking about, where they're doing that talking, and offering some indication of sentiment, but many B2B marketers are disappointed at the lack of analysis they get. To be fair, agencies are still a significant user base of monitoring tools and many provide this analysis as a value-add to their customers, but more and more marketers are interested in leveraging these tools themselves. If monitoring solutions don't provide the analysis customers need, they'll need to integrate with systems that can such as a web analytics or business intelligence solution.
Social media monitoring is a still a relatively new market and growing pains are to be expected. While some users complain about usability issues (whither the concept of robust online help?), B2B organizations realize they must continue to evolve from a skills and process perspective to best take advantage of social monitoring tools. But these solutions also need to evolve from data aggregation to a solution for insight and action, providing not just activity information (read: who, what and where) but some indication of the impact these activities.
How would you like to see social media monitoring evolve?
Posted by Jonathan Block on Fri, Jan 15, 2010 @ 09:55 AM
More and more B2B organizations recognize the value of having a clear strategy when it comes to social media to optimize returns and resources. According to our research data, over 60 percent of B2B organizations are doing something with social media (if only a blog) but of those only 30 percent have a documented strategy that seeks to interlock these activities with other marketing efforts. Given this reality, B2B organizations are looking to their peers but aren’t necessarily finding the answers they need. But there’s a good reason for that; most of the well-publicized success stories regarding social media are clearly in the B2C space. This really isn’t surprising since with such short sales cycles (i.e., transactional sales) it doesn’t take long to develop a critical mass of success stories and best practices. What becomes a stumbling block is when B2B organizations expect such quick hits. Well, sorry to say, it’s not going to happen. With the longer and more complex sales cycles that typify B2B, it takes a fair amount of time to be able to gauge the influence that social media is having on the business.
But this shouldn’t be an excuse to do nothing. Most likely your customers and prospects are already participating in social media (whether in online communities or Twitter) and may even be talking about you and your market. So even if you have no great social media aspirations at this time, or it’s not the way your target market consumes content, you should be monitoring to find out if people are talking about you, your competitors and market, and where these conversations are taking place. If you’re already participating you should be tracking all of these interactions. Without collecting such data you’ll never be able to determine what part social media plays among the series of interactions that typify the b-to-b buying process.
At the same time we regularly tell our customers not to ignore the internal value that social media can bring to the organization from a collaboration and best practices sharing perspective. Such internal uses, particularly between marketing and sales, can provide the quick hits you need to justify further investments that both internal and external uses of social media require. But remember that while social media may be inexpensive from a money perspective, it will require a large investment in time and money.
Posted by Megan Heuer on Mon, Dec 28, 2009 @ 05:08 PM
What is it about the December holidays that causes fits of nostalgia and list making? No analyst is immune, so cliché as it may be, here’s my addition to the 2009 retrospective: A list of five things that surprised me in the world of b-to-b marketing, and what can be done about them.
- Too many marketers still treat a “response” like it’s a lead. The simple act of responding to a marketing offer is just that: a response. An inquiry. In and of itself, the act of responding does not signal readiness to move into an active buying process. It never has. If you’re still sending raw inquiries to sales and partners, make 2010 the year you fix that. Our benchmark data proves you will be happy you did.
- The gap between marketing planning and buyer preferences is huge. It’s a buyer’s world, baby, and we marketers must embrace it. Trouble is, so much marketing activity is driven by siloed tactic planning and generating one-time inquiries (see number 1, above) that we lose sight of what prospects and customers need and want over the course of a long-term buying process. Embracing buyer focus is even harder when tactic-oriented myopia is institutionalized in the marketing planning process. Remember what assuming does to you and me when we fail to use what we know about the people with whom we want to build relationships. It’s time to change marketing planning to map to the buying cycle, not how we want to sell.
- Twitter is really, really useful. What a great tool for marketers to learn from each other and share ideas. But you can’t win if you don’t play, so if you aren’t convinced about the merits of social media in general and Twitter in particular, I challenge you to follow the #b2b tweet stream for one day. Let me know if you can end that day without learning at least a little something.
- Bad data is the root of most marketing evil. So maybe this isn’t a surprise so much as an inconvenient truth growing more obvious. Data quality, once a frightfully dull topic to most marketers, is now the one I can’t go a day without talking about. The curse of past poor data management is its impact on nearly everything marketers want to implement right now, from marketing automation and lead nurturing to better dashboards. Focusing on data as a strategic asset must become a central marketing effort.
- Marketers want definitive, hard-dollar metrics. It’s the rise of the left brain in marketing these days. So many companies I speak to are looking for more accurate ways to measure the impact of marketing, but they’re frustrated by a lack of quality data and the time and complexity involved in doing that. If 2009 was the year marketers got serious about defining measurement shortcomings, then 2010 should see great progress on fixing them because marketers are determined to make this happen. Not coincidentally, reporting tools are getting better and better to keep up with the demand. My hope is that the biggest surprise of 2010 will be how quickly marketers embrace quantitative analytics as key to improving program performance, not just tracking results.