This is the first in a series of posts of tying B2B marketing result to revenue. This is the framework for the discussion on how marketing drives revenue for their enterprise organization.
A key aspect for business to business marketing to focus on is delivering activity (sales qualified leads or sales ready leads) that close to actual revenue – ‘revenue’ is language the head of sales, CEO, CFO, and board of directors understand.
But what do I measure as someone in a B2B marketing organization?
Too often, marketing teams and leaders measure their internal impact for the sake of measuring and are not making the direct connection from their activities to revenue either by channel type or geographic region. Some call it ‘activity’ vs. ‘impact’. Measuring followers on Twitter, Facebook fans, webviews, etc. while impressive to those in marketing really have no true tie to what non-marketers truly understand – the contribution to revenue. This is what drives business!
Let’s take an explicit example. The contribution marketing makes can vary widely by the type of company and it’s distribution channels. I’ve been involved with companies that marketing has sourced 16% of annual contract value and have seen other companies, particularly SaaS companies sourcing beyond 50% of revenue through their marketing activity. Benchmark companies like Forrester and SiriusDecisions also have similar percentage contributions for enterprise companies – your percentage will vary on company type, geography, and buying cycle characteristics.
Look for this trend to continue of more revenue getting sourced through marketing – prospects today are spending more time in online communities or researching online their needs before engaging with sales organizations.
To do this kind of measuring, automation fundamentals need to be in place (Eloqua, Marketo, Aprimo), processes need to be installed, and an executive agreement needs to be discussed on outcome. Our next posting will dig into key steps on how we will tie revenue to results in these areas!