Measuring Outbound vs. “Always-on” Marketing Performance

Whenever I meet customers I always slip in a marketing question or two along the lines of “Where did you hear about us? What brought you in to Redgate?”. One of the answers from a couple of months back was:

Well a year ago, I got a new boss and she told me that I had 6 months to turn our dev team in to a “DevOps” team. I did most of the work then realised the database was causing us real problems. So I did a Google search, found your website, and what you said made complete sense to me – you knew what you were talking about, so I tried your software out.

Okay, great but – how on Earth do you measure the effectiveness of your marketing activity with answers like this? What’s the ROI of this lead? I know the return (the customer bought the products in the end), but the investment? How can you calculate that?

I’ve written endless articles over the years about marketing attribution, “performance management”, lead measurement and so on. All with the stated aim of showing “What’s working?” or “What’s the ROI of my marketing budgets?”. All different ways of asking the same thing.

And yet, years later, after reading many others’ articles, attending conferences, seeing demos from various products claiming to give the “formula” (marketing automation platforms, Google etc), the answers don’t feel any closer. Why is it so difficult?

Firstly, every business is different with, hopefully, different marketing strategies and tactics – some activities are inherently more measurable than others. A B2C business selling gizmos at $10 through Facebook ads is fundamentally different to a B2B org trying to sell $3m deals to the Fortune 500. Measuring the performance of those Facebook ads where the customer buying cycle is likely very short (“I saw your ad, I clicked Buy Now 10 minutes later!”) is a significantly easier task than measuring the impact of four years of concerted marketing plays to win over a multi-national bank. But still, all feel like hard problems.

It’s become a cliché in marketing blogs to quote the cliché about “I know half of my advertising works, I just don’t know which half”; but I include it because I think it can be updated to something like “I know what I do to get half my leads, I just don’t know about the other half”. I feel this better reflects that state of play with marketing performance management, hopefully I can explain why.

At Redgate we fundamentally get two sorts of leads – what I refer to as “Always On” leads, and “Outbound” leads. I think, for the first type, measurement of marketing ROI is integrally difficult, I’d argue impossible. For the 2nd type, you can measure ROI and should do so at all times.

Tackling the latter first – these are leads where you can make a strong argument that, if it wasn’t for a given activity, you wouldn’t have got the lead. An obvious example is an event or a graphical ad in the trade press. There’s a pretty solid chance that if you hadn’t been at that event, or placed that ad, you’d have missed that person. The trigger that caused that person to make an enquiry was paid for, by you. Of course, there are arguments that they might not have really been interested if they hadn’t recognised your brand from years of prior work; or that “Maybe they would have come to your site anyway!”. But that over-complicates what is already a difficult problem. If you spent $10k going to an event, and you made $20k, you should attribute that $20k to that $10k spend – simple.

This is the half you can understand and measure. For media ads, events, webinars, other placement spends, I think you can put together a pretty good spreadsheet or other tool showing the ROI on your investments – you just need to do the graft (or use a tool – I’ve been most impressed by Pardot recently, which seems to do this sort of thing very well).

But what about the first half? What triggered the customer coming in to find out about your offering? It was his boss telling him to find a solution. It was nothing to do with your marketing. Like a lion waiting for her prey to walk past, your job is to be “Always on”, ready with the right material, the thought leadership, the clear CTA, the understanding of the customer. Most of these customers do their own research well before they talk to your sales people – they read your website, they read other peoples’ websites, they talk to their analysts, talk to their colleagues. You may have made investments in all these areas both in terms of $$ spend, and employees’ time (web copy, site architecture, positioning and messaging, briefings with analysts, content placement, blog posts, influencer programs) but really how can you apportion this effort to the lead?

This is a hiding to nothing. Trying to work out how the salary of the individual who spent half of her time talking to Gartner, Forrester and IDC can be attributed to the leads that came in this year is both an impossible and pointless task.

The reason this is called “Always on” lead generation, is because, like the lion waiting for prey, you have to always be there when the customer goes looking. If you’ve got the money, you have a pack of lions covering every location – every analyst, your website, 10 other websites, recommendation sites, articles in the trade press and so on. But when that customer does a Google search, you’re ready and waiting with the greatest copy and thought leadership you can muster.

[A quick aside about SEO and PPC – this is table stakes. If a customer out there has a need for your solution and he/she doesn’t find you very very quickly through Google then you have a more immediate problem that needs fixing immediately. Customers not finding you easily when they’re already out there looking is a fixable problem, primarily through good SEO practice.]

The important subtlety here, and why this is such an issue, is the driver of interest for customers. For the outbound activity, it’s legitimate to say that your actions have precipitated that activity – have, in some way, driven that behaviour. Theoretically if you do more of these activities, spend more money, you’ll get more leads – if I spent $10k this month on webinars, then it’s possible that spending $20k might double the number of leads (ignoring issues like diminishing returns).

But for the “Always On” leads, you haven’t driven this behaviour. If you doubled your spend on say “hiring even better copywriters for our blogs”, would that double leads from this source? No – because the primary drivers are out of your control – they’re in the hands of the businesses you serve. May be you can improve conversion somewhat, but I’d suggest the attribution is very tricky.

So overall, I do think it’s possible, and essential to show where half of your leads come from, the ones where you’re precipitating the activity yourself. This information should be readily available in Excel, PowerBI, Pardot, whatever and you should be reviewing it constantly – was the spend right? What can we double-down on? Cut?

But for the other half – stop worrying. Abstract calculations based on employee time or similar are pointless. You’ll never really understand the complex interaction of customers and touch-points that led to that lead – what value does it bring, knowing that the customer read 129 different parts of your website before getting in touch? – so stop worrying, and focus on measuring what you can measure.


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