A New Year, a New Marketing Budget?
It’s that time of the year, where marketing plans are being crafted and budget is being committed. Marketing budgets are at risk of being cut when lowering operational costs is the aim. However, Marketing+Sales = Revenue Engine; cuts in this area, are a risk to future revenue.
It is very common for C-level leaders to question and reduce the marketing budget…unless you can draw a clear line from budget line items to ROI. However, there are other ways to measure the impact of marketing investments – as long as the intent of the investment is clearly communicated, and leadership agrees the investment is warranted.
The focus on ROI for marketing investments is a fiscally responsible approach, however, it is not the end-all factor as the measurement of marketing success. There is another school of thought about marketing investments, although it’s not popular when ROI is the only focus in the firm. Marketing investments should remain a delicate balance between salesy initiatives with the intent of finding and converting leads to wins, and educational and PR initiatives aimed at improving and advancing the profession.
Marketing Budget Accountability
Marketing budget accountability is easy to map when you’ve got a CRM and it is being used by marketing to track lead acquisition and marketing touches, and sales to track activities with prospects while in the sales pipeline.
If you are in the services profession, and responsible for finding and converting leads, you need a CRM to track leads from the time they enter the CRM, through conversion, to win. A CRM will tell you exactly – in real time - where your best deals come from, how long they were in the pipeline, and more. Failing at this primary step in accountability, makes every marketing spend in the future, suspect, and riddled with guesses. Guessing is not a recommended strategy.
Not every marketing investment can be measured for ROI. Branding, PR, education, and thought-leadership initiatives are important and necessary, but not easily tied to ROI. Finding ways to rise above the noise of being just another provider shilling your wares and committing some level of your marketing investments to these initiatives, can pay-off and build a followership that organically generates leads.
When building your marketing plan, also ask for the opinion of your sales leader. They will tell you which lead sources produce the best leads – a CRM will confirm this – provided it is being used by both marketing and sales to track deals through the pipeline. Opinions around which leads convert the fastest is not a reliable method for making marketing investment decisions; opinions will, however, be validated with what the CRM is showing.
10 Questions to Help Justify Marketing Investments
What metrics does marketing use to identify a Marketing Qualified Lead?
Are marketing metrics in line with what the salesperson identifies as a “qualified” lead?
How quickly does marketing get a MQL to the salesperson?
How much time elapses between MQL handoff to sales, and sales first contact following this handoff?
On average, how many touches does it takes to convert a qualified lead to a win?
What is your average time-to-close for your Wins in the last 12-months?
What is your conversion rate from MQL to Win?
Where did your fastest converting leads come from, and will you repeat this initiative?
Where did you most lucrative leads come from, and will you repeat this initiative?
What is the most common Buyer’s Journey, and can that timeline be accelerated or streamlined?