Marketing continues to be at the centre of attention when it comes to spend. Whilst it makes perfect sense to maintain this focus in a continually tough economy, the adjustment of meaningful metrics must remain with marketing and therefore the business.
By definition Marketing is all about creating inbound interest in your product or service. That includes a range of markets, including new, repeat, upsell and reclaim. Many will argue it is more than that… but in the spirit of helping business generate more revenue, even as a non-for-profit, creating inbound interest is a key pillar to the business plan. The marketers role and value are a given.
However, in recent times marketers have not really helped themselves by applying marketing magic to the business leaders. Business leaders continue to be bamboozled by the art of marketing and the ability to measure performance.
To help leaders we suggest three core metrics are best used to justify and hold accountable the role of marketing and the overall spend to create inbound interest.
Rightfully, the breadth of marketing skill is more than what we are about to share, but that in truth is most of the problem. Businesses can cut through this breadth of complexity and make it simple.
Three things to measure marketing performance;
- The count of accepted leads: This should be done on a weekly basis at least. The count of leads needs to be mapped against a defined and agree target. That target, in reality is what the business plan should be based on. If not, there is every chance your “Revenue Engine®” is flawed from the start. Read more about a “Revenue Engine®” here.
- The velocity of leads: the time it takes to attract, capture, educate and qualify a lead. The velocity of leads is often overlooked as a metric and with modern technology is no longer unreachable.
- The cost of leads: the elephant in the room is defining and agreeing on the cost of lead. In our experience, marketing undervalue their efforts… meaning that marketing ignore the residual value on historical marketing efforts. Granted getting an accurate cost of lead will take time but with collective value attributed to the cost of lead, the ability to quantify marketing ROI becomes a reality.
These core metrics are in fact the basis of any business plan. It rightfully prompts the questions;
- How many leads do we need?
- How fast can we attract them?
- How much will we spend on acquiring them?
If a business is unable to answer those questions, then what does that say about the business plan?
It could be worse… businesses could continue asking marketing to set the metrics and accept their old school reports.
Either way you now know there is another way to look at measuring marketing performance.