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87% of senior marketers do not feel confident in their ability to impact the sales forecast as a result of their programs, and it’s easy to see why. Most marketers are still being asked to report on metrics like email opens, clicks, and downloads, not marketing ROI. But therein lies the problem… if you can’t measure your marketing-influenced revenue, then you can’t predict the amount of revenue your marketing programs will generate moving forward. Which makes it a lot harder to justify your Marketing budget and Marketing’s overall value to the company.
So, how can you start tracking marketing ROI at your organization? We will show how in 6 steps:
The first step to tracking marketing ROI at your organization is to map out your sales and marketing technology stack. So, open up a Word doc or get out a piece of paper, and start listing all of the different technologies you currently use to store your marketing data. Your list should include:
Now that you’ve outlined all of your different platforms, you need to decide where your Marketing ROI reporting data will live. Most marketers choose to house this data in their marketing automation system, but it will really depend on your organization, technology stack and resources. It’s important to identify where you are going to track this data, however, because all of your data from your different platforms and lead sources must ultimately be stored there.
Now that you’ve mapped your technology landscape, you need to figure out how to organize your marketing ROI data. Start outlining your campaign hierarchy by answering the following questions:
After you create your campaign hierarchy, you need to implement it into your technology stack. Naming conventions are a good place to start. For example, you may need to title all of your campaigns in the US starting with US followed by the business unit name, followed by the campaign topic, followed by the program type or channel. In addition to the use of naming conventions, your technology may also allow you to use tagging and other properties to organize your data. Use these where possible to make pulling reporting cleaner and easier.
Once you’ve organized your campaigns, the next step is to understand how you want to look at your marketing ROI data from an attribution standpoint. There are four common attribution models used in marketing:
The goal in attribution modeling is not to select one specific model, but to analyze your data in the context of multiple models. This helps us to understand which programs are best at acquiring new leads vs. pushing leads through the lifecycle vs. pushing an opportunity to a close.
Now that you’ve built the foundation for how to start tracking marketing ROI at your organization, it’s time to determine what you want your final reporting to look like. First, you need to define what metrics you want to include in your report. Here are some example metrics you might include:
Next, you need to determine what format to use. Should it be a bubble chart? A line graph? A bar chart? Once again, there is no wrong way to present your data. If you have an opinionated executive, let them help you shape the vision so that you can ensure you’re giving them the metrics/view that they want to see. Get their input before you begin building your ROI tracking solution.
At Step #5, you’re now at the point where you start entering and tracking the data into your systems. A good place to start is by checking to see what out-of-the-box functionality your technology stack has to help you track your Marketing program spend. For example: Marketo, a popular Marketing Automation platform, allows you to input the program-level cost on every campaign.
But, how do you know what costs you should associate with your campaign? We recommend capturing variable costs instead of fixed costs such as headcount and capital resources. Fixed costs can be difficult to calculate and add in a different layer of complexity. And the primary goal of tracking ROI for most marketers is comparative – to understand which campaigns perform best. Relative data calculated via variable costs accomplishes this goal, with out the need to add in fixed costs.
Regardless of how you decide to track spend at your organization, the key to success is to track spend as you go instead of waiting until the end of the quarter or year.
To accurately start tying your marketing programs to revenue, you need to understand that marketing occurs at the person level. People must be associated with the deal, opportunity or account to accurately track/attribute revenue. People must also be tied to the correct marketing program or activity for revenue tracking to truly work.
Setting this up at your organization will require some work, but by partnering with your marketing and sales organization, and implementing the proper automation and training, you should be able to build the foundation to start tying people back to revenue in no time.
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