By Stephanie Carrillo, Senior Marketing Consultant at Heinz Marketing
Most of my digital marketing career has been running campaigns for eCommerce companies. In this setting, we would live and die by analytics and pivoted daily based on what the data was telling us.
Shifting to the B2B space, I was surprised by the lack of reporting, tracking, and reporting options available in many of the tools. It took me some time to adjust to B2B marketing, where analytics have not always played a significant part in decision making for many of our clients. But without proper benchmarking and analytics, meeting lead and sales expectations is tough– Especially if you are unable to forecast how campaigns might perform or set appropriate marketing budgets to achieve sales goals.
How to benchmark your marketing channels
Where do you begin? A good starting point is to look at each of your marketing channels in the last quarter to see how they performed. Your ads must be appropriately tagged to track them separately from other website traffic. We always recommend appending UTM codes to each of your ads to determine which channels drove the conversion. When creating your benchmarks, you need to consider many variables that might throw your averages off, such as seasonality, a big launch, or a possible increase in ad spend. If you have a month’s worth of data, I suggest you look at weekly performance to forecast for the next month; however, I would not use this data for long term forecasting until you can collect at least 60-90 days of data.
First, I start by creating an excel spreadsheet listing each channel separately and recording impressions, clicks, click-through rate, number of leads generated, conversion rate, ad spend, and cost per lead. Depending on how you plan to use benchmarks, you may want to break down your quarterly totals to monthly averages.
Calculating funnel stage Percentages
Many companies have lead or marketing qualified lead (MQL) goals, and I recommend tracking the lead movement from each channel through the lead funnel stages. For instance, I recommend monitoring lead to MQL percentage, MQL to sales opportunity percentage, and opportunity to closed-won rate. I know not everyone has proper tracking to see this by channel. An alternative way to determine a baseline is to calculate it for all leads regardless of the source and apply those percentages to calculate the total number of leads for each lead stage by channel. It will not be 100% accurate but will help give you a decent baseline. Because sales cycles are different for each company, you may need to pull campaign data from six months to a year ago to see full-funnel metrics. However, If you do not have that amount of data, then start with the top funnel stages until you have enough data to calculate the full funnel.
Here are the standard advertising formulas used:
Click-Through Rate (CTR) = Impressions/number of click
Conversion Rate (CR) = Total number of conversion/Total Number of Clicks
Cost Per lead = Total number of leads/Total ad spend
Other Marketing Channel metrics to track outside of advertising channels
For email, you will want to track the total number of emails sent, the total number of opens, open rate, the total number of clicks, click-through rate, and then conversion (if it applies), and lead funnel numbers. If a nurture track, then use total numbers of contacts instead of conversions to calculate lead funnel percentages.
I recommend breaking out the types of emails like nurture tracks, ABM campaigns, and separate emails for events.
If you are creating marketing budgets with lead forecasting, include your website metrics in your benchmarks to get a complete channel view. For your website information, segment information by direct traffic, organic traffic, and paid traffic. If you accounted for paid advertising in your campaigns, then do not include it here. For each of these channels, you want to look at Unique Visitors or New Users (depending on your analytics platform terminology), the number of conversions, or leads driven by this web traffic, conversion rate, and lead stages percentages.
Now you have established benchmarks
In summary, after completing this exercise, you should now have marketing benchmarks for most or all your marketing channels. You can now use this information in many ways to help inform marketing decisions. Ways to use the information:
- Determine if your current campaigns are performing better or worse than past campaigns
- Develop marketing budgets and identify areas for additional spend
- Determine where there are performance gaps
- Identify areas where you can shift budget
- Determine what lead sources provide the most funnel opportunities
- Show leadership what is and is not working
In my next blog post, I will provide some examples of how to use these benchmarks to forecast future campaigns and list some suggestions of what to do if you are starting from scratch.
Feel free to write a comment if you have any questions or find this post helpful.