A couple weeks back, Scott Vaughan’s post titled “Marketing Standardization: The Must Have for Marketers in 2015” exhorted the need for marketing orgs to standardize data, systems, measurements and expectations to free valuable resources that would be better used for other endeavors. While I wholeheartedly agree with his central thesis, I would take it a step further, at least with regard to standardizing measurement processes.
Standardizing measurement enables marketers to peform better. It allows them to:
- More quickly compare the value of lead sources, assets, marketing tech systems, media investments, etc.
- Do all this with greater accuracy to better inform decisions and make more effective optimizations.
Standardization is critical to automation and increasing marketing’s effectiveness; however, every company is unique, with differing products, buyer personas, sales cycles, marketing roles and duties, and operational expenses. And developing your org's standardized process for measuring marketing performance and using those metrics effectively necessitates great ingenuity.
There’s no one magical metric
The value of any piece of information varies with regard to context. And that’s why creating a strategic process for how your team analyzes and leverages specific metrics is vital. This process must take into account who will be leveraging the data and when that info will be of most value to them.
When you analyze a metric is as important as the metric itself
Like everything, the value of information changes with time. So, identifying when a certain metric provides the greatest benefit is crucial to any marketing strategy. Of course, this will vary from organization to organization – measuring a campaign’s opportunity-to-customer conversion rate a couple weeks into a B2B tech sales cycle is unlikely to be helpful, and may even result in ill-advized program alterations.
On the other hand, evaluating various data sources (media partners, events, etc.) and assets (white paper, ebook) by lead volume and higher-funnel conversion rates (e.g., a subsequent registration to a webinar) a couple weeks into a program is quite useful.
Adjusting the timing of program measurement and analysis is itself an art form, with many variables that are unique to every organization. It’s similar to the process by which a great chef creates a recipe – a lot of trial and error that eventually results in the desired outcome, at which time the ingredients and ways in which they’re used become standardized (but always open to further improvements).
Feeding people the info they need
Carrying on with the cooking analogy, Gordon Ramsay may make the best roasted lamb dish ever, but if his customer is a vegan, it won’t matter much. The same goes for your process of pulling and analyzing data. C-level execs likely couldn’t care less about which blog post resulted in 50 white paper downloads. And while a marketing ops specialist may be interested to know that marketing as whole was responsible for a 22% increase in revenue the previous quarter, it won’t exactly have much effect on that individual’s current efforts.
In other words, the effectiveness of metrics depends on getting the right people the right information, and not wasting valuable resources gathering, analyzing and conveying the data that is neither sought nor used.
Again, every organization is different, and it’s important to identify who requires what information and when. “Requires” is an important word here. Some metrics, often referred to as vanity metrics, such as social shares and webinar registrations may make you feel all warm and fuzzy inside, but they don’t mean much unless they lead to qualified leads and sales opportunities – those are the program metrics that bring value to demand generation marketers. Just like lead velocity and data accuracy are important to marketing ops practitioners, and revenue, profit and growth are critical to the executive team.
Mapping your process for standardized metrics
You should seek to standardize your marketing metrics by developing a process customized to your organization’s marketing/sales funnel. This process should include both granular operational/program measurement (tactical metrics) as well as aggregate performance measurement (strategic metrics).
With regard to granular metrics, it’s good to focus on your org’s funnel segments (e.g., prospect/qualified lead/sales accepted lead/opportunity/customer) and then itemize each with their relative goals/KPIs (e.g., lead volume, conversion rates, velocity, cost per opportunity, etc.). With the goals in hand, you can then list the specific metrics stakeholders need (and when they need them) in order to optimize their programs and increase performance relative to set KPIs.
Mapping this procedural framework will ensure a standardized system that will ensure program measurements aren’t tainted by changing variables, such as time of evaluation.
Similarly, a procedure for measuring aggregate marketing performance, which refers to the high-level metrics such as average ROI of a closed customer and revenue engine effectiveness (i.e., total revenue divided by total marketing and sales investment) should be standardized. This allows marketing leadership to make informed strategic alterations and provide forecasts to the executive team.
Each organization will require its own tailored process. And it’ll need to test and tweak it substantially before it has its standardized system of measurement and analysis down cold. And even then, it’ll be a susceptible to the rapid evolution of marketing. But this doesn’t mean developing a standardized processes for analyzing metrics isn’t important – it actually makes it more important, because it’ll enable you to better understand how such industry changes are affecting your marketing org’s efforts, which will allow your team to continue to feed the execs the revenue, profit and growth figures for which marketing is now accountable.