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The pressures on Marketers are greater than ever due to new media, new buying processes and new technology. Higher expectations are being set for Marketers every day. What’s the result? A greater need for measurement and proof of success. Marketers agree that measuring ROI is important, however, studies show that few Marketers are actually measuring ROI. Where is the disconnect? And what are the metrics that matter? Join David Raab, Principal of Raab Associates, and Jon Miller, VP of Marketing at Marketo, for this on-demand webinar to find out the metrics that really matter for: * Marketing ROI: show the value of marketing * Program ROI: measure program impact * Stage results: understand stage performance * Revenue forecasts: forecast revenue by period
Citation preview
Metrics that Matter for Marketing
Measurement
© 2010 Marketo, Inc.
Page 2
The Speakers
© 2010 Marketo, Inc.
David M. Raab
Principal,
Raab [email protected]
Jon Miller, VP Marketing and Co-Founder, [email protected]
#RevenueMasters
Page 3© 2010 Raab Associates Inc. www.raabassociatesinc.com
Page 4
Pressures on Marketers
new media: more choices
new buying process: more tasks
new technology: more capacity
new expectations: more pressure
result: greater need for measurement
© 2010 Raab Associates Inc. www.raabassociatesinc.com
#RevenueMasters
Page 5
Marketers Agree:
Measurement is Important
Most Important Concepts: 3 Year TrendAnderson Analytics, 2010 Marketing Trends Report
© 2010 Raab Associates Inc. www.raabassociatesinc.com
Page 6
But, marketers…
…measure the wrong things
What Marketing Is MeasuringVisionedge Marketing, 2010 Marketing Performance Measurement and Management
© 2010 Raab Associates Inc. www.raabassociatesinc.com
Page 7
But, marketers…
…don’t get any better at it
Does your firm calculate marketing profitability, ROI (return on investment) or a similar financial measure to assess marketing effectiveness? (n = 303, 326, 226)
2008 2009 2010
Yes, we calculate ROI, net present value (NPV) or other profitability metrics for at least some of our marketing campaigns / investments
26% 24% 27%
Somewhat, we calculate some financial metrics such as cost per lead and cost per sale but not profitability metrics such as ROI and NPV.
34% 42% 43%
No, we use traditional marketing metrics but not financial metrics.
40% 34% 30%
Use of ROI Metrics to Assess Marketing EffectivenessLenskold Group, 2010 Lead Generation Marketing ROI Study
© 2010 Raab Associates Inc. www.raabassociatesinc.com
Page 8
But, marketers…
…spend our money elsewhere
Planned Investments in Key Marketing InitiativesAccenture Marketing Transformation, Onward and Up (2010)
© 2010 Raab Associates Inc. www.raabassociatesinc.com
Page 9
The problem is…everything
Barriers to ImprovementCMG Partners Chadwick Martin Bailey, The Marketing Performance Advantage 2009
© 2010 Raab Associates Inc. www.raabassociatesinc.com
Page 10
Marketers Need an
Integrated Measurement
System
© 2010 Raab Associates Inc. www.raabassociatesinc.com
Page 11
Measurement System Goals
show aggregate value* from marketing
show incremental value* by program
*value = revenue, not leads
© 2010 Raab Associates Inc. www.raabassociatesinc.com
#RevenueMasters
Page 12
Purchase Stages
anonymous
known
interested
qualified
sales ready
opportunity
proposal
sale
© 2010 Raab Associates Inc. www.raabassociatesinc.com
Page 13
Revenue Allocation
anonymous
known
interested
qualified
sales ready
opportunity
proposal
sale
prospect email 5%
landing page 10%
registration page 15%
white paper 10%
Webinar 10%
demo 15%
pricing page 10%
forum query 15%
clients page 10%
© 2010 Raab Associates Inc. www.raabassociatesinc.com
Page 14
Stage-Based Measurement
prospect email 60%
landing page 20%
registration page 20%
white paper 100%
Webinar 100%
demo 70%
pricing page 30%
forum query 100%
clients page 100%
anonymous
known
interested
qualified
sales ready
opportunity
proposal
sale
© 2010 Raab Associates Inc. www.raabassociatesinc.com
Page 15
Delivery Requirements: Data
© 2010 Raab Associates Inc. www.raabassociatesinc.com
Page 16
Delivery Requirements: Stages
© 2010 Raab Associates Inc. www.raabassociatesinc.com
Page 17
Delivery Requirements: Database
© 2010 Raab Associates Inc. www.raabassociatesinc.com
Page 18
Delivery Requirements: Projections
© 2010 Raab Associates Inc. www.raabassociatesinc.com
Page 19
Delivery Requirements: Testing
© 2010 Raab Associates Inc. www.raabassociatesinc.com
Page 20
Other Requirements…
• integrate with source data
• back-fill using historical data
• plans, costs, scenarios
• alerts for over/under performance vs. history, vs. plan, vs. recent
• ad hoc segmentation & data mining
© 2010 Raab Associates Inc. www.raabassociatesinc.com
Page 21
Reports / Metrics
report goal measures & metrics comments
marketing ROI(total or by cohort)
show value of marketing
- marketing costs (all stages)
- revenue (related to cohort)
- ROI (=revenue / cost)
- relate costs and revenue to set of leads
- aggregate, not incremental
program ROI(incremental)
measure program impact
- incremental marketing cost
- incremental revenue
- incremental ROI
- requires testing
- may not capture long-term effects (e.g. brand programs)
stage results understand stage performance
- stage costs
- conversions (to next stage)
- lead inventory by stage
- cost per conversion
- conversion rates
- average time to conversion
- doesn’t show ROI
- need to track trends
- can be aggregate or incremental
revenue forecast
forecast revenue by period
- lead inventory by stage
- conversion rate by stage
- conversion time by stage
- forecast revenue by period
- doesn’t distinguish marketing-influenced leads from other leads
- must consider variations in quality of inventory
© 2010 Raab Associates Inc. www.raabassociatesinc.com
Page 22
What Next?
make a commitment
work in phases: measure response: check your data
measure acquisition: need simple system
measure nurture: need stage-based system
improve results: need testing and optimization
© 2010 Raab Associates Inc. www.raabassociatesinc.com
Page 23
Summary
better measurement is essential
advanced measurement requires stages
systems are increasingly available
better measurement is really essential
© 2010 Raab Associates Inc. www.raabassociatesinc.com
Page 24© 2010 Marketo, Inc.
Metrics That Matter for Marketing
Measurement:
How Marketo Does It
#RevenueMasters
Page 25
Powerful and easy marketing automation
Prioritize the hottest sales leads and opportunities
Measure and predict marketing’s impact on revenue
Adopted by 700 customers in 22 countries in less than three years
© 2010 Marketo, Inc.
Best Marketing Solution
Marketo transforms the way Marketing and Sales teams work – and work together – to improve revenue performance across the revenue cycle
Page 26
Marketo’s Revenue Cycle: Stages
All
Nam
es
Pro
spec
t &
R
ecyc
led
Lead
Aw
aren
ess
Enga
ged
© 2010 Marketo, Inc.
Oppor-tunity
Cust-omer
Sale
s Le
ad
MQL
SAL SQL
Nurturing Database
Marketing SDR Sales
Page 27
Model Your Revenue Cycle
© 2010 Marketo, Inc. Marketo Proprietary and Confidential
Page 28
Transitions Automate Movement
© 2010 Marketo, Inc.
Page 29
Operational Data & Analytical Data
© 2010 Marketo, Inc. Marketo Proprietary and Confidential
REVENUE CYCLE ANALYTICS
LEAD MANAGEMENT
• Optimized for transactions
• Real-time data
• Operational reports
• Optimized for analytics
• Data over time
• Analytical reports
Accurate answers that don’t change over time.
Page 30
Understand The Metrics that Matter
© 2010 Marketo, Inc. Marketo Proprietary and Confidential
Metrics that matter:• Balance• Flow• Conversion• Velocity
Trends over time
Page 31
Drill into Ad Hoc Analytics
© 2009 Marketo, Inc. All rights reserved.
Page 32
Create Custom Dashboards
© 2010 Marketo, Inc.
Page 33
Board Dashboard
Prospect Lead Opportunity Win
© 2010 Marketo, Inc. Marketo Confidential and Proprietary
Page 34
Conversion Over Time
Predict conversions from one stage to another over time
Create plans / forecasts about future
© 2010 Marketo, Inc. Marketo Proprietary and Confidential
y = 50.749x-0.571
R² = 0.4301
0
10
20
30
40
50
60
70
3 13 23 33 43 53 63 73
Marginal Conversion
y = 994.2x0.1352
R² = 0.9551
-
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
3 13 23 33 43 53 63 73
Cumulative Conversion
Page 35
Marketing Forecasts
Leads Apr May Jun Jul Aug Sep Oct Nov
Plan 760 800 825 1000 1069 1374 1434 1512Mar 810 850 875Apr 685 850 875 925May 818 875 900 915Jun 909 1000 1069 1374Jul 924 1200 1374 1434Aug 1280 1414 1450 1512
Opps Apr May Jun Jul Aug Sep Oct NovPlan 67 81 82 90 94 100 104 109Apr 83 83 90 93May 81 88 90 94Jun 91 93 95 101Jul 70 90 100 103Aug 92 101 104 109
Prospects Q2 2010 Q3 2010 Q4 2010
Plan 6,635 7,814 9,150May 7,000 7,520Jun 8,380 8,500Jul 8,500Aug 8,800 10,000
Plan Forecast Actual
© 2010 Marketo, Inc. Marketo Confidential and Proprietary
Page 36
Program Effectiveness Reporting
© 2010 Marketo, Inc.
Page 37
Program Effectiveness Forecasting
© 2010 Marketo, Inc.
y = 50.749x-0.571
R² = 0.4301
0
10
20
30
40
50
60
70
3 13 23 33 43 53 63 73
Conversion Model
Page 38
Q & A
© 2010 Marketo, Inc.
David M. Raab
Principal,
Raab Associates
Jon Miller, VP Marketing and Co-Founder, [email protected]
#RevenueMasters
© 2010 Marketo, Inc.