It’s no secret that marketers love data.
They love to see data on how their programs or campaigns are performing. They love to use data to analyze the dynamics of the ‘funnel’ and understand unique attributes of contacts and leads.
But just as importantly, marketers would also like to understand what programs don’t work and what kind of leads are not ideal for their business. Insights fueled by data analysis drives their day-to-day decisions.
Why Is This Relevant?
According to a survey conducted by Forrester Research, the average marketing spend today (for B2B marketers) is around 4% of total revenue, and marketers are constantly challenged to justify their budgets.
Here are the top 3 challenges marketers face in setting a marketing budget:
- 52% marketers said that they feel challenged to connect marketing goals to business objectives
- 50% find it difficult to attribute revenue
- 41% said that securing incremental spend for experimentation and innovation is a challenge
Besides these challenges, marketers constantly struggle to stretch dollars, while protecting current program allocations. To put the impact from the above facts in perspective, the possible sources and channels for the CMO to deploy the marketing budget continue to multiply.
So how can marketers achieve better results with their marketing spend?
Focus on Outcome Metrics
Successful marketers allocate their marketing spend based on outcome metrics.
Outcome metrics provide a good indication of where and how you should spend your marketing dollars. So how do successful marketers go about focusing on business outcomes?
What are business outcomes?
The first step is to define business outcomes that are relevant for your business.
Here are some examples:
- Number of content downloads from your website
- Number of Trial or Demo sign-ups
- Number of times contacted by email or phone by a prospect
- Sales of products / services
- Referrals given
Are any of these outcomes relevant for your business? These are just examples, you need to define a manageable list of metrics that help you understand your business.
After you figure out your business outcomes, you can create strategic and tactical plans, and execute them.
Define The Strategic & Tactical Plans
You need to define, manage and execute both strategic and tactical plans to derive the best results. Here is a suggested approach:
Each company adopts a certain methodology for strategic planning and while the framework may vary, here is the high-level approach:
- Identify the marketing objectives specifically in the context of your business objectives
- Identify specific goals that would help achieve these objectives
- Identify key metrics to measure the success of the above approach
- Identify the right people, processes, and tools to implement your objective
- Implement, measure, and iterate your business objectives until you achieve your goals
We drew our inspiration for a strategic plan from this post by Avinash Kaushik. Check it out for more details on how to create a strategic plan that fits your business.
Tactical plans should help you determine where you and your team focus your energy to obtain the best results. Here are some questions to help you get started:
- ROI and cost analysis: Which programs or initiatives yield the best business outcomes and at what cost?
- Role based objectives and results: How do different members of your marketing team leverage marketing spend? And what actions do they need to take to achieve the business outcomes?
- Measure for results and spend on outcomes: What are the relevant metrics? How can results be easily accessible to different members of the marketing team? What metrics are relevant to drive business outcomes?
- Share lessons and best practices: Collaborative effort within the team can help them achieve great results. However, this needs to be achieved in the context of the work and included within the daily flow of work for marketing team members.
- Marketing solutions and analytics: Are you spending too much cost, time and resources on managing different solutions? How do you pull analytics across different marketing solutions to give you a comprehensive view?
To be successful as a marketer, you need to plan, implement, measure and iterate based on your business objectives. It’s important that you don’t get distracted by vanity metrics and lose focus of the business outcomes.
In order to get to your destination on this journey, the key element is data.
Data helps you drive business outcome-based programs and initiatives. But you can’t get bogged down in extracting and managing the data. Let the technology experts manage the data for you.