Some B2B marketers tend to think of Marketing Automation as the silver bullet that will solve their lead generation crisis. Of course, Marketing Automation alone cannot live up to those hyped up expectations and has to take the brunt of the blame.
That is unfortunate because Marketing Automation software is a very useful tool and in my opinion, a necessity these days. However, B2B and/or industrial marketers must learn to use it correctly in order to harness its true power.
Let’s get one thing straight from the get go, if you are in a declining market with low demand for your products and services, no amount of automation will help you generate new leads. You need to rethink your business model first and fast.
Marketing Automation software is widely used to execute key marketing functions like lead scoring and routing, nurturing via drip marketing, creating email campaigns and landing pages, tracking, measuring and reporting using a unified dashboard. There’s is no question that marketing departments do become a lot more efficient by automating many of these marketing tasks.
However, is improving efficiency enough to justify investing in Marketing Automation? Or do we need to show a verifiable ROI? To most C-level execs that really means answering the question, “How much revenue did it generate?” It is the second question that seems to cause the most problems.
Preventing Marketing Automation Failures
Let’s first look at why Marketing Automation fails to live up to its promises. I found a good answer to that in a comment by Mike Gospe on a blog post at leadsloth.com where he wrote, “But when it comes to marketing automation, I recommend caution. I’ve seen too many marketers crash and burn because they believed that by “automating” all of their lead gen problems would be over. They forgot to first set a strategy that carefully targets prospects with relevant messaging. Automating the “garbage in, garbage out” marketing approach benefits no one.”
Mike suggests that before you buy into marketing automation software, you should make sure you have:
- Defined the target audience/personas
- Crafted a positioning statement that maps to the target
- Developed the “story” that you want to unfold through the course of the campaign
- Planned your moves with a “marketing blueprint” that links your activities and offers together in a way that’s meaningful and relevant
Measuring Marketing Automation Successes
What should you measure and track to prove ROI and revenue contributions? For the answer to that question, I went to the “The 9 Metrics Every Marketer Must Track” webinar by Megan Heuer, Research Director, SiriusDecisions and Craig Rosenberg, Vice President, Products & Services, Tippit.
Here are the key takeaways from the webinar:
- Don’t confuse marketing activity with results. Number of campaigns sent out, trade shows attended or press releases published do not generate revenues.
- Learn to differentiate between metrics and key performance indicators (KPI). The first is a diagnostic tool and the second one measures the health of the business.
- Four KPIs that show marketing’s revenue contributions are:
- Marketing Sourced Pipeline — % of sales pipeline uniquely created by marketing
- Marketing Influenced Pipeline — % of sales pipeline touched by marketing
- Investment-to-Pipeline — average cost of demand creation of the sales pipeline
- Investment-to-Revenue — average revenue generated from $1 invested in demand creation
- Metrics that matter the most are:
- Number of inquiries
- Marketing Qualified Leads (MQL)
- Sales Accepted Leads (SAL)
- Sales Qualified Leads (SQL)
- Closed/Won Business
The bottom line is use Marketing Automation software to implement key marketing functions, track and measure metrics and KPIs that prove marketing’s contribution to revenue generation. Don’t think of it as the panacea for your lead generation problems.