Measuring The Influence of Marketing - ROMI

I am delighted to see the B2B industry move towards greater accountability and metrics for Marketing. But the use of marketing automation systems, email platforms, web analytics, and online advertising is flooding marketers with lots of raw data.  I suspect that many marketing folks who didn't have to worry so much about ROMI in the past are struggling to organize the mountain of data in a way that helps them make better decisions, and demonstrates their positive influence on the business results.

Over the coming weeks I want to focus on one marketing KPI (Key performance Indicator) in each post, and elucidate the benefits of it. I want to start with a KPI that shows total responses in the period.

What is Total Marketing Responses Per Period?

A few months ago Megan Heuer from Sirius Decisions gave an excellent presentation on Marketing KPIs, and in it she said "Never confuse activity with results." 

So whilst you may send lots of emails, and host webinars, and attend trade shows, counting the responses to these programs is a good measure of the results! Marketing is tasked with creating demand (lead generation is just a portion of this). An effective measure of demand, in addition to actually linking opportunities back to marketing, is to measure the program responses you are getting. With a marketing intelligence business intelligence database such as the one included with Market2Lead's enterprise edition, one can segment out all responses by contact type. In this way you can tell at a glance how much of your efforts are going to net new lead generation, versus lead nurturing, vs installed base loyalty marketing.

How do you measure it?

What constitutes a response? Is a website visit a response? Is a card swipe at  a trade show a response?  If I register for a webinar, and subsequently attend the webinar is that one response or two? Is downloading a case study which doesn't require an registration a response? The important point here is that you decide these things at the outset, and stick to the definitions, because you want to see the month to month trends. Here are my recommendations:

• A website visit is a single response independent of how many pages were viewed
• Registering for a webinar and subsequent attendance represents two responses
• Downloading "free" assets from your website are not additional responses beyond the website visit
• Downloading premium assets that require registration are each a response
• Every registration is a response, but not every response requires registration
• Card swipes at a trade show because people want to put their name in for a free iPod raffle is not worthy of a response
• Responses from anonymous visits to your website, are real responses.
• Importing a list of contacts who have had no inbound interaction with your company, does not constitute responses.
• Unsubscribes and profile updates are not responses
• Email opens are not responses, but email click throughs are responses
• Telemarketing "connects" are responses
• Incoming calls to telemarketing, and contact us form submissions, are responses
• Syndicated content downloads are responses
• Comments added to a company affiliated blog are responses
• Re-tweets of your twitter content are responses

Don't forget to tag all your contacts with a contact type (prospect, customer, analyst, media, competitor, ex-customer etc) so you can slice and dice the data and figure out who you are really marketing to!  I am interested to hear your responses!

-Kevin

Comments

[Eric Goldman]

Agreed - it's great to see marketers embrace a more rigorous approach, and what better metric to use than ROI?
We have found great success with our approach to calculating ROI. Its not 100% accurate, but what it sacrifices in accuracy it makes up for in simplicity of use. And it's accurate enough to be a very useful measure of how your campaigns stack up against each other and, more importantly, against their cost.
There are three methods, as described in these links:
1) How to calculate the ROI of your website as a whole: http://bit.ly/6bFSvs
2) A list of the 10 best free ROI calculators on the web: http://bit.ly/7fwBkF
3) How to build your own ROI calculator (perhaps for your social media campaign): http://bit.ly/6IGZQh

[Jep Castelein (LeadSloth)]

Kevin, great post. As you suggest, I would always segment this KPI by contact type (new lead, nurture lead, client) because you want to measure the results of your lead generation and lead nurturing activities separately.

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