What are CEOs most looking for in a B2B marketing department? Clarity. They want to see clear results that show that their marketing efforts are generating ROI.
CEOs expect their marketing leaders to be accountable for exceeding their numbers just as their sales leaders.
CEOs can become frustrated when they are only provided with ambiguous brand data, activity reports and engagement reports from lead marketers. They want their metrics to directly relate to revenue.
Customer acquisition cost and ROI are the two most important metrics that B2B marketing professionals want to see.
Knowing the right metrics will help you plan, execute, track and analyze your marketing efforts strategically.
Reporting on large-picture KPIs gives your executives more clarity. This will give them confidence in your marketing efforts.
Why are B2B Marketing Metrics So Important?
Many B2B companies started Marketing because they needed to hire people to manage events or create brochures. Marketing was more of an in-house agency that provided creative services for sales.
B2B marketing evolved into demand generation, brand, paid media, marketing operations, content marketing, and marketing operations roles. The importance of metrics and KPIs has become more critical. Chief executives expect Marketing to be transparent. CFOs expect marketing to justify their budgets. Many B2B companies are increasingly relying on marketing as a strategic asset.
Advertising, branding, and sponsorships are the main marketing channels in large B2B companies. But it's the content, digital, and demand generation marketing professionals who must fight for every dollar.
Budgets can be justified by measuring. It's the best way to determine what works and improve marketing results, mainly increased sales revenue.
The Most Important Metrics for B2B Marketing
DemandGen Report recently conducted a survey to determine which metrics are most important to B2B marketers moving forward.
- Channels can improve ROI
- Marketing metrics that are deeper and more account-based
- Content influence can increase ROI
- Acquisition of customers at a cost
- Closed-won deal analysis
40% of marketers think they need to improve their ability measure and analyze marketing performance. 82% of marketers intend to improve their reporting capabilities to show how marketing activities impact a company's revenue and pipeline.
Fortella reports that 80% of B2B marketers use revenue to measure their performance. This is followed closely by pipeline (79%), ROI (74%), leads (70%), and booked sales meetings (58%). Only 49% of marketers used awareness metrics to assess the effectiveness and efficiency of their marketing activities.
Measurement of B2B Marketing: 4 Models
During my time with SAP, I used the 5 V's Model for Marketing Measurement.
- Volume: How Many MQLs/SQLs, SQLs or SALs did we convert and who were they?
- Value: What is the pipeline value for those leads and new business? We also measured pipeline influence in some cases as an additional measure of multi-touch marketing attribution.
- Velocity How long does it take for our leads to go from being qualified to being accepted to closing?
- Variety Are there leads for all segments (country, region vs. small, industry)?
- Viscosity How did leads convert? Which marketing programs had the highest conversion rate?
All the metrics listed below could be grouped under the 5 V model in some cases. These are mostly internal marketing metrics, which helped us to determine what was working and what we needed to improve. CEOs want simple answers such as: How much revenue have you brought us? It is recurring? How much did it cost to acquire that revenue?
Smart CEOs and Venture Capitalists will ask these questions more in depth.
This list doesn't include the following:
- Website traffic
- Emails sent
- Social media "engagement" (mentions, likes)
B2B Marketing Metrics That Will Give Your CEO More Clarity
Every CEO is concerned about revenue from new customers, the lifetime value of a new customer (LTV), and their acquisition cost (CAC). We'll discuss this below. To prove your success, you need to include more than that in your marketing reports.
These are the top marketing metrics that CEOs need to know. These marketing KPIs can give you a competitive advantage and help you to evaluate the effectiveness of your marketing campaigns. Your CEO will be able to see the value of your team's contribution.
1. Marketing Influenced Customer Percentage
This will tell you how much of your marketing efforts influenced new customers. This ratio can be calculated by taking the total number and dividing it by the number new customers that were influenced by a marketing activity.
Questions to Answer
- What are the effects of your marketing investments on sales productivity?
- How does this impact your company's sales pipeline
- What are the effects of your efforts on revenue velocity?
2. Marketing-Originated Customer Percentage
Tell your CEO how much new business marketing you are driving. This ratio can be calculated by taking the number of customers that you have signed up during a given period. Next, find out how many of these customers were marketing-generated leads. If you have closed-loop marketing analytics, this measurement will be easier to track.
Questions to Answer
- How much of your customers are marketing-generated
- What percentage of your revenue can sales leads from account-based marketing or demand generation be attributed to?
- How many customers were started as qualified marketing leads?
3. LTV stands for Lifetime Value of a Customer
LTV is a way to predict the lifetime value of a customer's purchase of your products and services. This number can be used to calculate how much you should charge to acquire new customers or retain existing ones.
Take the revenue that a customer has paid you in a given period and subtract the gross margin. Divide this number by the customer's cancellation rate (churn percentage). This will calculate your customer's lifetime value. Another way to calculate LTV involves taking the average purchase times the number of customers who buy from you each year times and the average length of a customer relationship in years.
Questions to Answer
- What is the cost to get a new customer and maintain a profitable relationship with them?
- What products and services are most profitable?
- Which buyer is your most successful?
4. Return on Marketing Investment (ROMI).
The ROMI (or just ROI) metric will allow you to determine the marketing budget and revenue generated. This metric can be used to determine the revenue generated by individual campaigns.
Calculating your ROMI is as easy as taking your total sales revenue for a period and dividing it by the marketing spend made during that period.
Questions to Answer
- Which ROMI is yours?
- What are your marketing costs? What return are you getting?
- Are your campaigns contributing towards company growth?
- Is it possible to recoup the time and money spent on marketing campaigns development and execution?
5. Time to revenue
Time to revenue is the time between when a contract was executed and when a purchase or deal is closed.
Questions to Answer
- How did the marketing team reduce time it took to generate revenue?
- What can marketing do to reduce the expense-to-revenue ratio for both sales and marketing activities?
6. Customer Acquisition Cost (CAC).
Calculate the cost of acquiring new customers by taking the total cost of all your marketing and sales efforts during a period. Divide this cost by how many new customers you have acquired during the same period.
Questions to Answer
- How much does it cost to acquire a new customer?
- How much did your demand generation efforts and lead account-based marketing cost during a given period? Include all compensation to your marketing team, as well as expenses for vendors, marketing technology and other materials.
7. Marketing Percentage of CAC, M%-CAC
Take your total marketing expenditure for a period to calculate your marketing percentage of customer acquisition costs. Divide that number by the total number of customers you have attracted during this period.
The lower the number the better. A high marketing CAC could indicate that your marketing team is spending too much or that your sales team is underperforming.
Questions to Answer
- How does your marketing team impact CAC?
- Is there anything your team can do to reduce this number?
8. Ratio of CAC's Lifetime Value to CAC. (LTV:CAC).
This ratio can be calculated once you have determined your LTV/CAC. Higher ROI is indicated by a higher ratio. If your ratio is excessively, you might want to spend more on sales and marketing. You can aim for 3:1 or 4:1.
Questions to Answer
- Is it too expensive to acquire every customer (a ratio of less than 3:1)?
- Are you missing opportunities because you don't spend enough?
This periodic table of B2B marketing metrics by pmg provides a more comprehensive list and some benchmarks.
Here's a cheat sheet by Hubspot that will help you with the metrics we have described:
Make B2B marketing content that converts
Marketing Insider Group can help you create top-quality content that will get you the results you want. Marketing Insider Group will create the targeted content that your customers want to increase traffic to their website and win you new customers. We can help you calculate and measure ROI, as well as other important metrics.
Learn more about our Content Builder Services.
Marketing Insider Group's 8 most important B2B marketing metrics for CEOs was first published on Marketing Insider Group.
Frequently Asked Questions
How to Build an Ecommerce Marketing Plan?
The first step is to identify what you want to sell. These should include products and/or services relevant to your business, but also enough variety to keep customers engaged.
The second step in marketing is to decide how much money you want to spend on advertising and promotions. Multi-channel marketing may be necessary, such as email blasts, direct mail, social media, search engine optimization and other methods.
Once you have an idea of how much money is needed, you can begin to create a budget. A professional who specializes in emarketing might be able to help you choose the best marketing method for your company. They can help you determine which marketing method is best for your business.
Once you have your plan in place you can begin to implement it. It is possible to hire someone else to assist you in this process.
Start from scratch, you don't have to reinvent the wheel. Try proven strategies that have worked in the past for other online shops. Before making any changes, make sure to test it all.
It is important to remember that your ultimate goal in eCommerce marketing is to increase profits and sales. Your eCommerce marketing strategy must consider both short-term goals as well as long-term plans.
Our article on eCommerce marketing tips will help you increase your sales. We hope they can help you achieve your goals!
What is search engine marketing?
Search Engine Marketing (SEM) is one of the most essential components of digital marketing. SEM covers paid search engine optimization (SEO), sponsored links, display advertisements, paid inclusion and social media marketing.
What are some examples in indirect marketing?
To promote your business, think about indirect marketing methods. One example is a social media campaign that encourages people to upload pictures of their products. This would help spread the word about your brand.
Advertise in local papers if you are an auto shop owner.
Another example is to send coupons to customers via e-mail or place ads on bulletin boards at public locations.
Direct marketing is a great option because it's not expensive.
Building trust takes time, so patience is a must when promoting your company.
It is also important to track how effective your campaigns have been. Measure the number and quality of leads that each method generates.
This will let you know which methods are best for you.
- According to statistics, 60% of online shoppers worldwide actively search for coupons before purchasing from a virtual shop. (influencermarketinghub.com)
- Companies that use personalization are seeing revenue increases ranging from 6-10%. (blog.hubspot.com)
- Today, 81% of brands around the world have affiliate programs. (influencermarketinghub.com)
- 81% of brands employ affiliate marketing, and eCommerce sites are particularly good candidates. (blog.hubspot.com)
- A poll earlier this year found that 14% of older Gen Z's had bought an item in the previous six months based on an influencer's recommendation. (influencermarketinghub.com)
Top Brands Share Their Online Marketing Tips and Tricks
When creating content for online marketing, ensure it's relevant to your audience. Your blog posts should not be about products or services that aren't important to your audience.
Consider fashion accessories as an example. Make sure that you have relevant content. Not general web design tips.
Use social media platforms such as Facebook, Twitter, LinkedIn, and Instagram as an effective way to promote your business. Social media platforms allow businesses to connect with customers and share their information.
You also have the opportunity to make connections with current and potential clients via social media.
You should create content that engages users, encourages them to share and encourages them. Shared content is more popular and can increase traffic to your website.
Regular updates are a great way to keep your content updated. Posting every other day or weekly is more effective than posting once per month.
Posted content receives more attention because readers expect to see new material.
In your content, include links that point back to your homepage. This helps visitors find additional resources on your site.
Make sure your content is mobile-friendly. Mobile devices now outnumber desktop computers. A recent survey found that more than half of internet users now access websites through their smartphones.
It is important to test it on different mobile and tablet browsers in order to ensure that the content appears well on small screens. The mobile-first approach is a must-have for website developers and owners.
It's also not all about aesthetics. Mobile sites convert more than desktop websites. Not only are they easier to navigate, but they also tend to load faster because of the smaller size of the site.
Content that is valuable to your audience.
By: Michael Brenner
Title: The 8 Most Important B2B Marketing Metrics for CEOs
Sourced From: marketinginsidergroup.com/content-marketing/the-most-important-b2b-marketing-metrics-for-ceos/
Published Date: Sun, 29 Jan 2023 16:45:00 +0000