The Ultimate Guide to Marketing Measurement: Marketing ROI & revenue

“50% of B2B marketing executives find it difficult to attribute marketing activity directly to revenue results as a means to justify budgets.”

Yep, you’re not alone in this. With the rise of digital marketing, attribution & calculating ROI has been top-of-mind for the modern marketer, but it’s a challenge. A challenge that could potentially skyrocket your business growth, when done right. 🚀

But that’s of course the million dollar question: “How do I effectively measure marketing ROI?” And ironically enough, for multinationals with huge advertising budgets, this is in fact a million dollar question.

So let’s cut to the chase! In this article, we’ll discuss how to connect marketing spend to revenue with the help of MarTech tools. But more importantly, which KPIs are important to report on marketing ROI? And how can MarTech integrate this goldmine of insights into their application?

That’s right: if you’re running a marketing SaaS, you’re in a key position to help marketers resolve their biggest pain. Curious to learn more? Let’s hit it.

Aligning the marketing & sales funnel

Marketing & sales are usually 2 separate teams within an organization. However, in a perfect world, they collaborate very closely to obtain – buzzword alert! – sales & marketing alignment.

Now what does that mean, and why is it important? Traditionally, marketing generates leads for sales, who then qualify the leads and eventually close the deal to generate new revenue.

In that classic model, marketing is responsible for pipeline volume, whereas sales is responsible for revenue. So who is to blame if the leads are not qualitative? Exactly, that’s where sales & marketing need to work together and share input, so that leads can move smoothly through the funnel, from lead to customer.

To do so, sales & marketing need to exchange information. Sales needs marketing data: through which channel did the lead find us? Which content or pages did he visit? This helps sales to understand how ready-to-buy the prospect is.

And the other way around, marketing needs sales data: what’s the ideal customer profile? How did new customers find us? This helps marketing understand which campaigns or channels are most successful in terms of revenue.

Let’s zoom in on that topic. What are the KPIs that sales & marketing can jointly track? How can they efficiently start to measure marketing ROI?

What are the key metrics to track marketing ROI?

When we’re talking about tracking marketing ROI, it basically revolves around 2 crucial metrics:

  • Cost: how much budget did I spend on marketing activities?
  • Revenue: how much revenue did these marketing actions yield?

You’ll be comparing those metrics, and setting them off against other factors like marketing channel or marketing campaign. This will help you pinpoint channels or campaigns that are generating more revenue than the marketing cost. And vice versa: it will show you which marketing actions are costing you money, without generating revenue.

Ideally, you’ll also map your marketing costs across all stages of the customer journey: what’s the cost per marketing (MQL) or sales qualified lead (SQL), compared to the cost per actual customer acquisition?

If you want to get started right away, below you’ll find a useful table with all the metrics to track. It also contains categories to drill down, including an overview of which metrics & hierarchies you can (or cannot) combine.

 # leads# customersCostRevenueAverage lead scoreCost per leadCost per customer acquisition
Time
Marketing Channel
Marketing Campaign
Funnel Stage

How to create a marketing ROI dashboard?

Now that we’ve wrapped up the most important KPIs, the time has come to visualize this raw data. How to combine all these metrics into a reporting dashboard that truly align sales & marketing teams?

The dashboard below will show you a concrete example of how you can efficiently track marketing ROI, and compare the costs with the outcome in terms of revenue.

Before we dive into this example, here are a few useful tips to keep in mind if you want to create your own ROI dashboard:

  • Make your dashboard well-structured: group charts that belong together, this makes it much easier to read the dashboard for those who are less familiar with it.
  • Make your dashboard actionable: add target charts or benchmarks to your dashboard, and align the whole team on which actions to take when a certain threshold has or hasn’t been met.
  • Add filters & drill-down options: sales & marketing will look at the data from their own perspectives, so although your dashboard will present a global overview, make sure there are enough options to drill down on specific data.

Now let’s see an example of all this in action. Start filtering the dashboard below and interact with the marketing ROI data as if it’s your own!


How to use the marketing ROI dashboard?

First of all, as a marketer you can use the marketing ROI dashboard to make better budget attributions for your marketing mix. Have a look at the chart below:


It immediately becomes clear that marketing channels such as Display & Direct traffic have translated into the highest amount of revenue.

That doesn’t necessarily mean that these channels generate the highest ROI though. If you change your chart mode to ‘100% stacked’, you can see that the ratio between budget & revenue is actually best for Email traffic.

This means that if you would spend more budget on email marketing, you could potentially generate more revenue for a lower cost. In the dashboard, you can drill down on a specific marketing channel to see:

  1. What is the cost I pay per lead generated via this channel?
  2. What is the average deal size of customers acquired via this channel?

Thanks to the conditional colors, you can spot in no time how that channel compares to the overall average. You can define actions for when a certain channel is performing below (or above) target. For example, cut budget on channels that surpass their Cost Per Lead target.

As a next step, you can look at the chart below to understand where you’re losing opportunities.


When hovering over the ‘lost’ section, you’ll see that most leads are lost either in the ‘Lead’ stage – which can indicate bad lead quality – or in the ‘SQL’ stage – which could indicate that the leads were not properly qualified.

Embed marketing dashboards in your customer portal or MarTech tool

A marketing ROI dashboard helps marketers & sales teams to align & to work together much more efficiently. What’s more, both marketing software providers & marketing agencies can help their end-customers with this, by offering this type of dashboard as part of their services.

As a SaaS platform for marketing, you can easily connect your platform to Cumul.io’s analytics software via API & build dashboards for your users. You can then integrate these ROI dashboards into your own application, so your customers have insights into their marketing spend & sales outcome, directly inside your own platform.

The same goes for performance marketing agencies: build a similar dashboard for your customers, embed it inside your customer portal, and say goodbye to manual reporting for good!

Interested to learn more about dashboards for your marketing platform? You can have your first embedded dashboard up and running in just a few days! Get in touch and we’re happy to show you.

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