By Rebecca Smith, Senior Marketing Consultant for Heinz Marketing
FOREWARNING: I know I’m going to bother a handful of people here when I say vanity metrics don’t matter, but for all intents and purposes, I’m going to stick with it throughout this entire article. Brace yourself.
As marketers, it’s really easy to get obsessed with what we call vanity metrics: opens, clicks, web visits, click-thru-rates (CTR), etc. And while these can be interesting initial performance indicators, they are nearly impossible to tie back to revenue. They primarily lead you to understand your short-term success. Vanity metrics are important in the right context. But when you’re in the business for the long haul, don’t you want to understand your successes long-term? (And more importantly) the overall revenue you and your marketing team are desperately working to bring in?
That’s why we’ve been thinking a lot over here at Heinz Marketing about this thing we like to call Marketing Performance Management (all thanks to Brian Hansford for getting us intrigued and thinking differently).
Marketing Performance Management (you’ll see MPM for short as you keep reading) is dedicated to tying marketing efforts back to revenue. It’s a disciplined approach to driving revenue over a period of time to see what’s working, what’s not and how to budget effectively to actually make your efforts drive results.
So, are you using an MPM approach to track performance effectively in your organization?
Here’s a quick 5-min activity to get you thinking about your own MPM. Use the next 5 minutes to answer these questions below.
How is marketing in your organization currently measured? MQLS? SQLs? Opportunities? Revenue?
What percentage of your organization’s revenue is the marketing budget?
Which current marketing actions are delivering the strongest impact on sales pipeline from top of funnel to closed-won? How about delivering the best ROI?
How effective is your organization’s marketing and sales alignment?
How confident are you in the data to measure overall marketing performance?
Are you able to tie new business to your current marketing efforts? ____________________________________
How many of these questions were you able to answer with confidence? If you could answer 50% confidently, I’ll be seriously impressed. This stuff isn’t easy and it usually takes a lot of strategy, a handful of tools and some serious manpower to get this under way.
But it’s worth it.
Understanding if your marketing efforts are working will only lead to stronger campaigns and, honestly, more budget to be able to do the marketing you want to do. And when you can tie your efforts back to tangible revenue, management will be that much more confident in the work you’re doing thus leading to better business in the coming months.
So, unfortunately, vanity metrics aren’t going to help you to answer the questions I asked you above. Sure, they could lead some insight of what captures attention, but will they tie back to hard-earned revenue?
Want to learn how to tie marketing efforts to attribution? Brian Hansford and Matt Heinz are going to dig deep into how to set up MPM for your organization in our next online Modern Marketer’s Workshop. Learn how to properly plan, set-up and implement a Marketing Performance Management practice that ties back to company revenue goals. Register now!