Definitive Guide to Marketing Metrics and Marketing Analytics Webinar
description
Transcript of Definitive Guide to Marketing Metrics and Marketing Analytics Webinar
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The Definitive Guide to Marketing Metrics: Webinar
Jon Miller, VP Marketing and Co-Founder
Author of the Definitive Guide
Page 2© 2011 Marketo, Inc. Marketo Proprietary and Confidential
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Topics• Building Marketing
Credibility• The Right Metrics• Revenue Metrics
• Marketing Program Performance
• Forecasting• Dashboards
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12%
20%
15%
9%
44%
Improve profits by more than 20%Improve profits by 10% to 20%Improve profits up to 10%No major change in profits generatedDon't Know
What Profits Can Be Generated With 10% More Budget?
#1 Answer:Don’t Know
Source: 2010 Lenskold Group / emedia Lead Generation Marketing ROI Study
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Part 2: Planning for Marketing ROI
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Planning for Marketing MeasurementMeasure ROI to find not just what works, but what works better.
Source: Lenskold Group
Establish Goals and ROI Estimates Up-Front
Design Programs to Be Measurable
Focus on the Decisions that Improve ROI
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Part 3: The Right Metrics
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Where Metrics Go Wrong
Vanity MetricsSound good and impress people, but don’t measure impact on revenue or profitability
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Where Metrics Go Wrong
Activity MetricsMeasure what you do instead of what results and impact you have
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Where Metrics Go Wrong
Cost MetricsFrame marketing in terms of cost and spending instead of results and outcomes
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The Right Metrics
Revenue Metrics
Aggregate impact on company revenue
Marketing Program Performance
Incremental contribution and ROI of individual marketing programs
Other Metrics Areas (less tied to Revenue/Finance)Customer Profitability, Net Promoter, Web Analytics, Public Relations Effectiveness, Product Performance, Brand Preference and Health, Sales Tool Usage
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The Right Metrics
Performance Metrics & KPIs
Past: How did we do?
Diagnostics Present: What is working? How can we do better?
Leading Indicators
Future: How will we be doing?
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Part 4: Revenue Metrics
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Key Idea: Model the Revenue Cycle
All
Nam
es
Pros
pect
&
Recy
cled
Lead
AWA
REN
ESS
Enga
ged
Opportunity Customer
Sale
sLe
ad
MQLSAL
SQL
Nurturing Database
Marketing SDR Sales
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Marketo’s Revenue Cycle
All
Nam
es
Pros
pect
&
Recy
cled
Lead
AWA
REN
ESS
Enga
ged
Opportunity Customer
Sale
sLe
ad
MQLSAL
SQL
Nurturing Database
Marketing SDR Sales
Names are just names.
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Marketo’s Revenue Cycle
All
Nam
es
Pros
pect
&
Recy
cled
Lead
AWA
REN
ESS
Enga
ged
Opportunity Customer
Sale
sLe
ad
MQLSAL
SQL
Nurturing Database
Marketing SDR Sales
Meaningful interaction with us.
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Marketo’s Revenue Cycle
All
Nam
es
Pros
pect
&
Recy
cled
Lead
AWA
REN
ESS
Enga
ged
Opportunity Customer
Sale
sLe
ad
MQLSAL
SQL
Nurturing Database
Marketing SDR Sales
Qualified, engaged potential buyers.
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Marketo’s Revenue Cycle
All
Nam
es
Pros
pect
&
Recy
cled
Lead
AWA
REN
ESS
Enga
ged
Opportunity Customer
Sale
sLe
ad
MQLSAL
SQL
Nurturing Database
Marketing SDR Sales
Showing buying signs or significant engagement.
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Marketo’s Revenue Cycle
All
Nam
es
Pros
pect
&
Recy
cled
Lead
AWA
REN
ESS
Enga
ged
Opportunity Customer
Sale
sLe
ad
MQLSAL
SQL
Nurturing Database
Marketing SDR Sales
Qualified as sales-ready by a human.
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Marketo’s Revenue Cycle
All
Nam
es
Pros
pect
&
Recy
cled
Lead
AWA
REN
ESS
Enga
ged
Opportunity Customer
Sale
sLe
ad
MQLSAL
SQL
Nurturing Database
Marketing SDR Sales
Accepted and actively worked by sales
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Model the Full Revenue Cycle
Screenshot: Marketo Revenue Cycle Analytics
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Filter/Drill into data, e.g. by Program Type, Business Unit, Geography, etc.
Key topic areas:• Balance• Flow• Conversion• Velocity
Trends over time
SLA violationsScreenshot: Marketo Revenue Cycle Analytics
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Marketo Revenue Cycle Metrics
Opportunities 130 / mo($2,000)
New Customers($5,800)
Leads2,000 / mo($137.50)
Prospects3,800 / mo¾ paid ($73)
¼ unpaid ($0)($55 average)
20%Active Prospect
Database
4.0% / month 75%
Paid Names
($29.33)
10%UnpaidNames
($0)
40%
Inactive (Last 6
Months)
Lead Type Variants• Source• Channel• Division• Size
80%
80% of all deals follow this model • Lead to Sales Lead: 7%
• Sales Lead to Opp: 80%• 1.4 people per Opp1,000 Leads = 40 Opps
9,500 / mo
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Drill In AnalyticsProspect to Lead by Lead Source
Screenshot: Marketo Revenue Cycle Analytics
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The Single Most Important Metric
Revenue Engine Effectiveness
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Part 5: Marketing Program Performance
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Why Measuring Programs is Hard
• Multiple touches. Seven touches needed to convert a cold lead into a sale
• Multiple influencers. Typical buying committee has 5-21 people
• Tyranny of time. The money you invest today will have an uncertain impact at an uncertain point in the future
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Ways that Companies Measure
• 20%: No tracking• 45%: Single Attribution • 21%: Attribute Across Multiple Programs and
People
• 11%: Test and Control Groups• 3%: Market Mix ModelingSource: 2010 Lenskold Group / emedia Lead Generation Marketing ROI Study
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Example: Single Attribution
100% of pipeline and revenue allocation to the program that sourced the primary contact
Screenshot: Marketo Revenue Cycle Analytics
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Single Attribution: First / Last Touch
Pros• Relatively easy and low
cost• Insight into the lead
acquisition• Straightforward insight
into “investment per” lead metrics
Cons• Ignores influence of
subsequent nurturing / sales touches
• Hard to account for quality until deal closes
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Single Attribution W/Revenue ProjectionSource Prospects Invest-
ment%
LeadVelocity(Days)
Lead to OppIndex
Trade Show – Virtual 3,793 $25.44 17% 81 1.03rd Party Email Blast 3,302 $34.65 18% 43 0.5Trade Show 2,703 $221.30 23% 61 1.9Paid Webinar 1,760 $68.50 21% 60 1.0PPC 990 $158.10 45% 42 1.4Content Syndication 536 $82.84 12% 59 0.3Other Paid 208 $187.50 13% 93 1.3Website 2,871 58% 27 2.6Sales Prospecting 1,888 26% 46 2.2Partner Co-Marketing 903 17% 102 1.1AppExchange 353 78% 37 3.4Referral 80 36% 12 1.0Other Inbound 370 100% 19 9.0
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Example: Attribute across Multiple Programs and People?A deal worth $100,000 recently closed. Three people were involved in the deal: • Person A attended Seminar A and Trade Show B• Person B attended Trade Show B• Person C was sent Direct Mail C
$100,000 Revenue
$25,000 $25,000 $25,000 $25,000
Seminar A$25,000
Tradeshow B$50,000
Direct Mail C$25,000
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Need to Track All Touches Across People
Screenshot: Marketo Revenue Cycle Analytics
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Programs Analyzer
Screenshot: Marketo Revenue Cycle Analytics
First-touch allocation, multi-touch allocation, investment, volume, etc
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Attribute across Multiple Programs and People
Pros• Incorporates all touches,
not just lead generation• Useful for long revenue
cycles• Focuses on all contacts
associated with deal
Cons• Assumptions can add
bias• Risk of over-crediting
low impact touch points
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Example: Test and Control
Source: Lenskold Group
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Part 6: Marketing Forecasting
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Introducing Marketing Forecasts
• Where the CSO lacks “bottom-up” visibility, marketing forecasts can fill the void
• Marketing has long-term view and visibility into the early stages of the revenue cycle
Traditional Marketing Forecast
The market will grow by an estimated 4.2% overall and by 5.1% in the Western region.
Highly Accountable Marketing Forecast
Marketing will generate an incremental 30 new deals worth $4.0 million of bookings that are not currently in the sales forecast.
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Forecasting Conversion Over Time
• Predict conversions from one stage to another over time• One model per transition per lead type• Create plans / forecasts about future
y = 50.749x-0.571
R² = 0.4301
0
10
20
30
40
50
60
70
3 13 23 33 43 53 63 73
Marginal Conversion
y = 994.2x0.1352
R² = 0.9551
-200 400 600 800
1,000 1,200 1,400 1,600 1,800 2,000
3 13 23 33 43 53 63 73
Cumulative Conversion
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Final Demand Generation Forecast
Plan Forecast Actual
1/1: Modified Lead definition to include all SDR activity
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Part 7: Dashboards
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Dashboard Provide Clear, Consistent Insights
4
Metrics vs. Goals Trends AlertsSelect Details
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Key Takeaways
• Buying has changed forever – the role of marketing must change as well
• Reporting is less important than DECISIONS that improve ROI
• Focus on financial metrics that matter to the CFO (profit, cash, revenue)
• Avoid cost and spend metrics – focus on investment and return
• A trusted marketing forecast is the single most important step to make marketing a revenue driver, not a cost center
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Additional Resources
• The Definitive Guide to Lead Nurturing bit.ly/DGtoLN
• The Definitive Guide to Lead Scoring bit.ly/DGtoLS
• Marketo Demowww.marketo.com/demo
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Marketo, Inc.901 Mariners IslandSuite 200San Mateo, CA 94404
Phone: +1.650.376-2300
blog.marketo.comwww.marketo.com
JON MILLERVP Marketing
[email protected]@jonmiller2
Question and Answer
Marketing Forecasting Whitepaperhttp://bit.ly/marketing-forecasting
Thank you!
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