In many organisations, it’s an eyebrow-raising moment when the words “marketing” and “maths” are uttered in the same sentence.
Many marketers are blissfully ignorant of the harsh realities of business, revenue and profits, making decisions based on instinct whilst the sales team huff and puff about how marketing live in cloud cuckoo land, not the real world of monthly targets. CEOs and CFOs allocate the marketing budget as a cost centre and scoff at the idea of a marketer taking a seat at the boardroom table. However, a new era is dawning. Smart marketers, equipped with the right tools, now have the ability to prove their worth through the calculation of marketing ROI.
What do all smart marketers have in common? They know their marketing maths!
Smart marketers understand funnel maths. They understand their go to market funnel as well as the multiple stages in the buyer journey and different types of buyers in complex B2B sales. They also know that everyone moves through the funnel at a different pace and that many people don’t make it to the next stage. Smart marketers know that the funnel is prone to leakage.
Smart marketers know the leakage rate of each stage in their funnel and they know the lag time from first engagement with their prospect to the time they become a loyal customer. Armed with this valuable information, along with knowledge of businesses revenue goals and an average selling price, they can model their funnel accordingly. Smart marketers know how many visitors and contacts they need at the top of the funnel in order to drive revenue at the bottom of the funnel.
With this information, marketing and sales can apply the right marketing effort, in the right quantity and the right time to deliver against the organisations revenue goals.
Marketers who are not doing this, are simply performing “random acts of marketing” in the hope that something sticks.
Many marketers run their campaigns on a quarterly cycle.
In the world of B2B sales, this doesn’t make much sense. Why on earth would you run a marketing campaign that is shorter than the typical buying cycle?
By limiting themselves to market only to a certain stage of the funnel, marketers end up running price driven, “knee jerk” tactics such as end of quarter promotions and discounts.
Successful B2B marketing is about creating a lead engine that contributes to the momentum of the business. Without knowing your marketing maths you have no sense of the volume of marketing that is required to generate leads to feed the sales team.
If you want to be a successful B2B marketer you need to know your marketing maths.
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Chris Fell is the Managing Director of g2m Solutions, and an accredited align.me Funnel Coach. To read more of his insights, go to the g2M Solutions blog.