Marketo Analytics Webinar Slides

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The Definitive Guide to Marketing Metrics: Webinar

Jon Miller, VP Marketing and Co-Founder

Author of the Definitive Guide

Page 2© 2011 Marketo, Inc. Marketo Proprietary and Confidential

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Topics• Building Marketing

Credibility• The Right Metrics• Revenue Metrics

• Marketing Program Performance

• Forecasting• Dashboards


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12%

20%

15%

9%

44%

Improve profits by more than 20%Improve profits by 10% to 20%Improve profits up to 10%No major change in profits generatedDon't Know

What Profits Can Be Generated With 10% More Budget?

#1 Answer:Don’t Know

Source: 2010 Lenskold Group / emedia Lead Generation Marketing ROI Study

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Part 2: Planning for Marketing ROI


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Planning for Marketing MeasurementMeasure ROI to find not just what works, but what works better.

Source: Lenskold Group

Establish Goals and ROI Estimates Up-Front

Design Programs to Be Measurable

Focus on the Decisions that Improve ROI

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Part 3: The Right Metrics


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Where Metrics Go Wrong

Vanity MetricsSound good and impress people, but don’t measure impact on revenue or profitability


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Activity MetricsMeasure what you do instead of what results and impact you have


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Cost MetricsFrame marketing in terms of cost and spending instead of results and outcomes


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The Right Metrics

Revenue Metrics

Aggregate impact on company revenue

Marketing Program Performance

Incremental contribution and ROI of individual marketing programs

Other Metrics Areas (less tied to Revenue/Finance)Customer Profitability, Net Promoter, Web Analytics, Public Relations Effectiveness, Product Performance, Brand Preference and Health, Sales Tool Usage


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The Right Metrics

Performance Metrics & KPIs

Past: How did we do?

Diagnostics Present: What is working? How can we do better?

Leading Indicators

Future: How will we be doing?

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Part 4: Revenue Metrics


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Key Idea: Model the Revenue Cycle

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Sale

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MQLSAL

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Nurturing Database

Marketing SDR Sales


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Marketo’s Revenue Cycle

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Marketing SDR Sales

Names are just names.


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Marketing SDR Sales

Meaningful interaction with us.


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Nurturing Database

Marketing SDR Sales

Qualified, engaged potential buyers.


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Marketing SDR Sales

Showing buying signs or significant engagement.


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Marketing SDR Sales

Qualified as sales-ready by a human.


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Sale

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Nurturing Database

Marketing SDR Sales

Accepted and actively worked by sales


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Model the Full Revenue Cycle

Screenshot: Marketo Revenue Cycle Analytics


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Filter/Drill into data, e.g. by Program Type, Business Unit, Geography, etc.

Key topic areas:• Balance• Flow• Conversion• Velocity

Trends over time

SLA violationsScreenshot: Marketo Revenue Cycle Analytics


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Marketo Revenue Cycle Metrics

Opportunities 130 / mo($2,000)

New Customers($5,800)

Leads2,000 / mo($137.50)

Prospects3,800 / mo¾ paid ($73)

¼ unpaid ($0)($55 average)

20%Active Prospect

Database

4.0% / month 75%

Paid Names

($29.33)

10%UnpaidNames

($0)

40%

Inactive (Last 6

Months)

Lead Type Variants• Source• Channel• Division• Size

80%

80% of all deals follow this model • Lead to Sales Lead: 7%

• Sales Lead to Opp: 80%• 1.4 people per Opp1,000 Leads = 40 Opps

9,500 / mo


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Drill In AnalyticsProspect to Lead by Lead Source



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The Single Most Important Metric

Revenue Engine Effectiveness

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Part 5: Marketing Program Performance


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Why Measuring Programs is Hard

• Multiple touches. Seven touches needed to convert a cold lead into a sale

• Multiple influencers. Typical buying committee has 5-21 people

• Tyranny of time. The money you invest today will have an uncertain impact at an uncertain point in the future


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Ways that Companies Measure

• 20%: No tracking• 45%: Single Attribution • 21%: Attribute Across Multiple Programs and

People

• 11%: Test and Control Groups• 3%: Market Mix ModelingSource: 2010 Lenskold Group / emedia Lead Generation Marketing ROI Study


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Example: Single Attribution

100% of pipeline and revenue allocation to the program that sourced the primary contact



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Single Attribution: First / Last Touch

Pros• Relatively easy and low

cost• Insight into the lead

acquisition• Straightforward insight

into “investment per” lead metrics

Cons• Ignores influence of

subsequent nurturing / sales touches

• Hard to account for quality until deal closes


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Single Attribution W/Revenue ProjectionSource Prospects Invest-

ment%

LeadVelocity(Days)

Lead to OppIndex

Trade Show – Virtual 3,793 $25.44 17% 81 1.03rd Party Email Blast 3,302 $34.65 18% 43 0.5Trade Show 2,703 $221.30 23% 61 1.9Paid Webinar 1,760 $68.50 21% 60 1.0PPC 990 $158.10 45% 42 1.4Content Syndication 536 $82.84 12% 59 0.3Other Paid 208 $187.50 13% 93 1.3Website 2,871 58% 27 2.6Sales Prospecting 1,888 26% 46 2.2Partner Co-Marketing 903 17% 102 1.1AppExchange 353 78% 37 3.4Referral 80 36% 12 1.0Other Inbound 370 100% 19 9.0


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Example: Attribute across Multiple Programs and People?A deal worth $100,000 recently closed. Three people were involved in the deal: • Person A attended Seminar A and Trade Show B• Person B attended Trade Show B• Person C was sent Direct Mail C

$100,000 Revenue

$25,000 $25,000 $25,000 $25,000

Seminar A$25,000

Tradeshow B$50,000

Direct Mail C$25,000


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Need to Track All Touches Across People



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Programs Analyzer


First-touch allocation, multi-touch allocation, investment, volume, etc


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Attribute across Multiple Programs and People

Pros• Incorporates all touches,

not just lead generation• Useful for long revenue

cycles• Focuses on all contacts

associated with deal

Cons• Assumptions can add

bias• Risk of over-crediting

low impact touch points


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Example: Test and Control

Source: Lenskold Group

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Part 6: Marketing Forecasting


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Introducing Marketing Forecasts

• Where the CSO lacks “bottom-up” visibility, marketing forecasts can fill the void

• Marketing has long-term view and visibility into the early stages of the revenue cycle

Traditional Marketing Forecast

The market will grow by an estimated 4.2% overall and by 5.1% in the Western region.

Highly Accountable Marketing Forecast

Marketing will generate an incremental 30 new deals worth $4.0 million of bookings that are not currently in the sales forecast.


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Forecasting Conversion Over Time

• Predict conversions from one stage to another over time• One model per transition per lead type• Create plans / forecasts about future

y = 50.749x-0.571

R² = 0.4301

0

10

20

30

40

50

60

70

3 13 23 33 43 53 63 73

Marginal Conversion

y = 994.2x0.1352

R² = 0.9551

-200 400 600 800

1,000 1,200 1,400 1,600 1,800 2,000

3 13 23 33 43 53 63 73

Cumulative Conversion


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Final Demand Generation Forecast

Plan Forecast Actual

1/1: Modified Lead definition to include all SDR activity

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Part 7: Dashboards


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Dashboard Provide Clear, Consistent Insights

4

Metrics vs. Goals Trends AlertsSelect Details


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Key Takeaways

• Buying has changed forever – the role of marketing must change as well

• Reporting is less important than DECISIONS that improve ROI

• Focus on financial metrics that matter to the CFO (profit, cash, revenue)

• Avoid cost and spend metrics – focus on investment and return

• A trusted marketing forecast is the single most important step to make marketing a revenue driver, not a cost center


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Additional Resources

• The Definitive Guide to Lead Nurturing bit.ly/DGtoLN

• The Definitive Guide to Lead Scoring bit.ly/DGtoLS

• Marketo Demowww.marketo.com/demo

http://bit.ly/DGtoLN�

http://bit.ly/DGtoLS�

http://www.marketo.com/demo�


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Marketo, Inc.901 Mariners IslandSuite 200San Mateo, CA 94404

Phone: +1.650.376-2300

blog.marketo.comwww.marketo.com

JON MILLERVP Marketing

[email protected]@jonmiller2

Question and Answer

Marketing Forecasting Whitepaperhttp://bit.ly/marketing-forecasting

http://bit.ly/marketing-forecasting�

Thank you!


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• >1,200 customers; 315% YOY growth

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