How B2B Marketers Can Focus On Growth By Measuring What Matters

The perception that everything is quantifiable in an age of digital marketing creates challenges for marketers. Marketing impacts organisations in multiple ways, creating value that can be hard to measure. Yet, the ability to quantify and communicate that impact has never been more critical.

In two recent surveys, Gartner highlights the pinch point. The CMO Strategic Priorities Survey shows that internal pressures to deliver growth and customer expectations continue to raise the bar. Yet, the Annual CMO Spend Survey indicates that marketing budgets as a percentage of company revenue fell from 11% to 6.4% - the lowest proportion since the survey began.

With marketing budgets under pressure, your department needs to be able to do more than track and report on activities. Your CMO needs to be able to plan, prioritise and justify spend, as well as demonstrate measurable business results and communicate marketing’s value.

The Difficulty of Measuring B2B Marketing

In Deloitte’s 27th CMO Survey, 58.7% of marketing leaders reported increased pressure from CEOs and 45.1% from CFOs to prove the impact of marketing efforts. Under pressure to prove performance, marketing teams can end up doing the opposite. They lean in to reporting measurements that are inaccurate or inadequate for the task.

Take marketing return on investment (ROI), as an example. Organisations invest a lot of money in marketing as a key driver of company value. Understandably executives want proof that it is reaching its objectives and having a direct impact on revenue. However, measuring the ROI of B2B marketing initiatives can be fraught with difficulty.

Research from LinkedIn in 2019 showed that marketers are under pressure to deliver results quickly, often at the expense of accuracy. Although measuring ROI over the length of the sales cycle gives a more accurate outcomes, B2B marketers felt unable to wait that long. While the average length of the B2B sales cycle is 6 months, only 4% of the marketers surveyed were measuring ROI beyond that period. 77% were trying to prove ROI within the month.

As a result, marketers find themselves in a Catch-22. They need to prove ROI to justify marketing spend and approve future budgets. However, a lack of confidence in those measurements leaves their ability to evaluate their strategies, improve results and argue their case on shaky foundations.

A Long-Term Measurement Mindset

To increase confidence, B2B marketers need to challenge short-termism and develop a ‘long-term measurement mindset’.

The first step is to draw a clear line between the use cases for ROI and KPIs. ROI must be defined and measured across the length of the sales cycle to enable an accurate read of past performance and future budget allocation decisions. KPIs, on the other hand, should be defined for ongoing measurement of marketing objectives across the customer journey, performance prediction, and marketing campaign optimisation.

In addition, it should be remembered that success can be demonstrated in numerous ways. Other strategic measures could also be reported

• Customer Lifetime Value,

• Cost Per Customer Acquisition,

• Brand Awareness,

• Marketing Qualified Leads

• Customer Satisfaction.

Don’t be afraid to provide context and clarity to marketing’s broader mission, but equally don’t be fooled into thinking that it provides an adequate substitute for hard facts on the bottom line.

Collaborative Marketing Metrics

As marketers we already understand that to affect change, we have to do multiple jobs. It’s not sufficient to educate internal partners about the challenges marketing faces and the methodologies used, helpful though that might be. To reframe the conversation around marketing measurement, we need to enter a dialogue with the rest of the organisation.

Building transparency and cross-departmental collaboration into your measurement strategy can translate into increased trust, confidence and generate buy-in. If, for example, the CFO and CMO can communicate using shared terms, the former is likely to have more confidence in the value of the marketing budget. This gives the latter more room to manoeuvre, providing the strategic and creative freedom to experiment and come up with innovative solutions.

So, while you might be able to measure almost anything in a digital world, what’s more important is knowing which metrics serve both your purposes and those of others in your organisation. Understanding the questions, concerns, and priorities of your internal audience will help to build a suite of metrics that does more than just improve your team’s performance and ability to respond. You will also be able to communicate marketing’s value and link marketing budget allocation directly to company objectives.

Admittedly, there is no magic wand for achieving this transformation. Listening is key. Breaking down organisational barriers, setting up a unified data infrastructure, and standardising and improving methodologies, all takes work. But the payoff is increased agility, improved marketing effectiveness, transparent communications and, ultimately, the marketing driven growth companies want to see.

How to Make Your CMO Look Good

The first place to start is the huge amount of data already available to marketing. By simplifying its capture, management, tracking, and reporting you can build a data dashboard that helps you to see the big picture in one place and avoid analysis-paralysis. For marketing to prove its ROI, an integrated marketing automation platform capable of multi-touch attribution is essential.

From there, think about what your CMO needs to market the marketing department within the organisation. Working with stakeholders, frame a limited number of high-impact questions and focus on what data you need to answer them.  

When presenting data to the C Suite, they don’t usually need to know the details of marketing’s impact at a campaign level. While it’s important for the marketing team to know about your search engine performance, click through rates, or your level of social engagement, that level of tactical data is less interesting to a CEO.

Aim your story at a higher level and explain how your marketing strategy helps the business to achieve its goals and objectives. Build a data visualisation that will provide answers in an easily digested format.

What is clear is that being able to demonstrate marketing’s role in connecting the company with its customers and building the brand must go hand in hand with how that translates to market share, category share, revenue and growth. Include data on pipeline velocity, lead to customer conversions, and budget performance by key market segments and marketing channels. Build bridges to other departments and encompass operational and financial data. Predictive analytics that can model outcomes for different marketing investments are the holy grail.

However, with an open chocolate box of data points available, it’s important not to over-reach and over-promise on your capabilities. Be realistic about what is achievable with your existing level of resource and expertise, and develop an understanding of what it would take to go further.

If you’d like to find out more about how 1827 Marketing’s marketing automation platform can help measure, justify, and improve your marketing performance, contact us for a demo today.