Demystifying Marketing Analytics and ROI: A Guide for Senior Marketing Leaders
- marqeu
- Feb 4, 2024
- 6 min read
Updated: Jul 21
Marketing Analytics and ROI are no longer just buzzwords in the B2B marketing ecosystem—they are strategic imperatives. In fact, their rising prominence has started to eclipse even the widespread enthusiasm for Account-Based Marketing (ABM). But what do these terms really mean for marketing leaders, and why have they become such a high priority. Our Marketing Analytics and ROI Guide has these details for you.
As a practitioner in Marketing Analytics Consulting Services at marqeu with over a decade of experience at marketing analytics implementations across some of the most innovative and fastest growing B2B organizations like Workday, Marketo, Databricks, Fastly, I aim to bridge the gap between hype and reality, translating these concepts into actionable frameworks that empower marketing organizations to thrive.
Senior marketing leaders today are navigating a landscape characterized by heightened scrutiny over budgets, which has become increasingly prevalent in recent years. This scrutiny is not merely a matter of oversight; it reflects a broader trend where stakeholders, including executives and board members, are demanding more transparency and accountability regarding how marketing expenditures translate into tangible business results. As a result, marketing leaders are under immense pressure to quantify the impact of their marketing efforts on overall revenue generation.
This expectation has shifted the focus of marketing from traditional brand-building activities to a more results-oriented approach that emphasizes measurable outcomes.
The challenges faced by these leaders necessitate engaging in data-driven conversations with the C-suite, where the language of marketing must align with financial metrics and business objectives. This means that marketing leaders must not only present data but also interpret it in a way that resonates with executives who prioritize return on investment (ROI) and profitability.
This shift requires a deep understanding of analytics and the ability to translate complex data into actionable insights that can influence strategic decision-making at the highest levels of the organization.
Moreover, the increasing demand for accountability has inspired a culture of performance-driven rewards within marketing teams. Leaders are now incentivizing their teams to focus on key performance indicators (KPIs) that directly correlate with revenue outcomes. This approach fosters a sense of ownership and motivation among team members, encouraging them to innovate and optimize their marketing strategies continuously. As a result, teams are more likely to experiment with new tactics, adjust campaigns in real-time, and leverage customer insights to enhance their effectiveness. In this evolving environment, marketing strategies must be optimized for maximum impact, which involves a rigorous examination of all marketing channels and tactics. Senior marketing leaders are expected to adopt a holistic view of their marketing ecosystem, integrating various channels such as digital marketing, social media, content marketing, and traditional advertising to create a cohesive strategy that drives results. Currently, marketing leaders are most frequently asked to demonstrate the measurable impact their organizations have on the sales pipeline. This involves not only tracking leads generated through marketing initiatives but also analyzing the conversion rates and the overall contribution of marketing to the sales process. By developing robust metrics and reporting frameworks, marketing leaders can provide clear evidence of their contributions to the organization's growth, thereby solidifying their role as key players in the business strategy. Ultimately, the ability to quantify marketing's impact on revenue will not only enhance the credibility of marketing leaders but also secure the necessary resources and support to drive future initiatives.
Each marketing organization has a collection of “Strategic Metrics” (defined uniquely according to how a company functions) that it monitors to assess performance.
For leaders who take on these responsibilities, the insights gained from Marketing Analytics are essential. Let’s delve into the fundamental metrics that propel marketing performance and ROI, organized into four main categories. This combination of metrics forms the key levers they can use to boost performance and comprehend what is effective.
1. New Engagements: Volume and Quality
New engagements are the starting point for driving pipeline growth. The quality and volume of interactions with target customers determine the efficacy of your marketing funnel. Ensuring the right customers and accounts engage with your brand sets the stage for successful qualification and nurturing before handing leads off to sales.
Establishing a framework to track engagement performance against goals is essential. For example:
Volume Metrics: Total new leads generated, unique website visitors, and content downloads.
Quality Metrics: Engagement from high-priority accounts, time spent on key resources, and repeat visits.
Real-time tracking tools like Tableau, Looker, Snowflake, Redshift, BigQuery, SQL, Python, DBT, Prefect etc. can help create data models for the dashboards that can visualize progress against established goals. Leveraging intent data platforms such as Bombora, Intentsify or 6sense can further enhance your ability to qualify leads based on behavioral signals.
2. Cohort-Based Demand Waterfall Conversions
While new engagements focus on top-of-funnel activity,
cohort-based demand waterfall conversions measure the efficiency of lead progression through the funnel.
This insight reveals how well marketing activities align with sales enablement.
Key Performance Indicators (KPIs)
Lead-to-MQL Conversion Rate: Tracks the percentage of leads meeting the qualification threshold.
MQL-to-SAL Conversion Rate: Measures how effectively marketing-qualified leads transition into sales-accepted leads.
SAL-to-SQL Conversion Rate: Highlights sales’ ability to advance accepted leads.
SQL-to-Closed Won Conversion Rate: Indicates the ultimate impact on revenue.
A SaaS company might find that a 15% drop in MQL-to-SAL conversions signals a need for better alignment on lead scoring criteria between marketing and sales teams. With tools like Marketo, HubSpot, or Salesforce, this misalignment can be quickly identified and addressed.
3. Influenced and Sourced Pipeline / Opportunities
Pipeline generation and acceleration have always been critical KPIs for marketing. In today’s competitive landscape, demonstrating marketing’s influence on the pipeline is more vital than ever. The two commonly used metrics to illustrate marketing's impact are: Marketing Pipeline Acceleration/Influence and New Pipeline Sourcing. These metrics enable organizations to measure marketing-driven engagement across accounts and link it to pipeline impact.
These correlations provide valuable insights into "when" new opportunities arise in marketing-engaged accounts and, for accounts with existing opportunities, how marketing influences deal expansions and accelerates closures.
These KPIs lay the groundwork for marketing leaders to have meaningful discussions with their sales counterparts. Additionally, these KPIs are crucial for assessing the market mix across various marketing tactics and channels throughout different phases of the buying cycle.
Marketing-Sourced Pipeline: Revenue from opportunities created directly through marketing efforts.
Marketing-Influenced Pipeline: Opportunities where marketing activities contributed to progression or deal expansion.
Marketing leaders can identify when new opportunities were generated within accounts engaged by marketing. They can demonstrate how particular campaigns expedited ongoing deals and refine the marketing mix across strategies such as email, webinars, and paid advertisements.
An enterprise-focused business might discover that accounts engaged in both webinars and personalized email campaigns are 25% more likely to progress to SQL status. These insights, surfaced through tools like Bizible or Terminus, enable better budget allocation to high-performing channels.
4. Multi-Touch Attribution
In today's world, organizations employ a variety of marketing tactics and channels to connect with customers. Each deal, particularly in the enterprise sector, involves numerous marketing interactions, ranging from web engagement (visits, clicks) to email interactions, webinars, e-books, white papers, and in-person events, among others. Although these interactions have different levels of impact on deals, they all incur costs from the limited marketing budget. It is unfair for marketing leaders to distribute their budgets across various tactics without understanding how these tactics perform. The era when marketers could allocate budgets based solely on intuition is over. Finance and sales departments expect marketing leaders to make informed decisions about budget allocation, and
within marketing teams, leaders increasingly seek confidence in these decisions, as they are crucial for achieving pipeline goals. This is where multi-touch campaign attribution becomes essential
and it is the most valuable KPI because it informs marketing investment decisions which ultimately drives results for the marketing organization. Whether using First Touch, Last Touch, Multi-Touch, Equal Weight Multi-Touch, or Weighted approaches to marketing attribution, when properly implemented and validated, the insights gained are extremely valuable for the marketing organization.
Attribution Models
First Touch: Attributes all credit to the first interaction.
Last Touch: Focuses on the final interaction before conversion.
Multi-Touch (Equal Weight): Distributes credit evenly across all touchpoints.
Weighted Multi-Touch: Allocates credit based on the relative influence of each interaction.
Modern marketing technology and analytics platforms have simplified the process of actively monitoring marketing performance and expenditures (by creating budget tracking apps within the CRM platform instead of purchasing additional tools), engagement with marketing programs, and the pipeline linked to those engagements.
With the appropriate analytics strategy and tools, we collaborate with marketing leaders to empower their teams with these essential data points, enabling each team member to actively contribute to cultivating a data-driven culture within the organization.
These KPIs offer strategic insights to marketing leaders and CMOs so they can confidently illustrate the impact their organizations are making and help foster a strong working relationship for marketing within the c-suite, especially with the CFOs.
We are always interested in learning your perspective on how your organization measures marketing performance. Which metrics are you tracking, and what tools do you use to gain these insights?
Let’s discuss how marketing analytics can transform your marketing strategy and make it a cornerstone of your marketing success. Reach out today, and let’s build your next big win together!
With our marketing analytics consulting services, let us evaluate your current stack and give you a roadmap to advanced marketing analytics capabilities.
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