The Most Important Marketing Metrics and KPIs for B2B Businesses
TABLE OF CONTENTS
- What are marketing metrics and KPIs?
- Data-driven marketing and the need for data at fingertips
- B2B midstage metrics are crucial
- 10 most important marketing metrics and KPIs for B2B businesses
- Bottom line
A high performing sales team or a winning marketing campaign at its core is a mix of a few essentials – the right strategy, the right data, and the right technology to boost efficiency.
Consider email marketing for example – a successful campaign inevitably requires a well-thought-out strategy with powerful content to induce a favorable thought by the prospect. Way before that, it requires an accurate email list containing the contact information of the right decision-makers within the companies that you are targeting.
A large email list filled with the wrong people will never convert effectively. It is extremely important to connect with the people that matter. And, when running the campaign, you need to monitor how campaigns are performing and if there is something wrong, you can proactively fix it.
This means it’s about collecting the right kind of data and utilizing it in the right ways.
Data collection and data usage are both crucial factors determining the success or failure of any marketing venture. Apart from people skills these days, it is the data – both quantitative and qualitative, that support marketing activities. So much so that data has become the backbone of lead generation, customer acquisition, and conversion.
Of course, crafting creative strategies in marketing requires an empathetic and people-oriented approach. It deals with the art aspect of appealing to customers in the right ways. Data, on the other hand, facilitates taking advantage of the science of customer acquisition based on numbers. It gives the marketing team a clear direction to pursue, with the precise goals and benchmarks against which to measure performance. It allows companies to make real-time changes in processes to maximize benefits. In the bigger picture, it provides a certain powerful visibility for businesses to prepare and reap the most benefits.
This is where marketing KPIs find their relevance.
What are marketing metrics and KPIs?
Marketing KPIs or Key Performance Indicators are a series of measurable values that allow businesses to track the progress and effectiveness of marketing activities in an organization. They help assess the success or failure of marketing strategies against the overall objectives of marketing and provide a fair idea of shortcomings, strengths, weaknesses, and impacts of all marketing activities with the help of clear metrics.
In B2B business, it is very important to have these metrics in place as it helps teams stay on track and not lose sight of the end goals. The easy access to products with the rapid growth of technology has paved the way for a more data-driven approach to target customers from the right angles, at the right times, and in the right ways to close deals.
Data-driven marketing and the need for data at fingertips
In this day and age where customers are more aware of their needs and more careful about marketing scams, there is a need for businesses to up their game in personalization and think of more creative ways to appeal to customers. In the B2B industry especially, buyers have to be approached with a clear purpose and a clear solution to help them with their issues.
Extensive, real-time, and relevant data helps you gain competitive advantage and improve customer acquisition at all points.
Measuring various quantitative aspects of marketing about customers or clients can help you figure out exactly what you need to do to get a client to purchase from you.
For example, with a combination of behavioral analytics on your website such as content views and activities, and data related to open and click-through rates on email, you can easily determine what a particular client is looking for and what might be holding them back. With this information, you can craft the perfect strategy to induce a purchase decision from the buyer.
If it’s the price that is holding them back, you can offer them a deal or a discount. And, this can be automated at any scale.
On the other hand, if you find a good percentage of visitors bouncing on any particular page on your website, it could be a technical issue, say, a loading issue that is holding people back. To remedy this, you can quickly analyze and deploy a fix.
This way, important marketing KPIs immensely help make quick data-driven decisions in business, leaving guesswork completely out of the picture. They allow you to make real-time improvements in your product, your processes, or in any aspect of your business based on real-time data reflecting how your marketing efforts are faring.
Most B2B businesses make use of intelligent marketing automation software to stay on top of data. Suffice it to say, the competition is pretty tough.
Put together with Slim Jim’s patience levels of prospective customers, it is very important to retrieve insightful data right at your fingertips. You also need to leverage the data in smart ways to close deals, lest your competitors steal the show.
B2B midstage metrics are crucial
Customer buying cycles are already quite complicated and hardly linear. B2B buying cycles are especially long and more complicated as they hold a lot more at stake with definitely more than one person involved.
According to Gartner, the average B2B purchasing decision involves 6.8 stakeholders.
And all 5 to 6 stages in B2B buying, starting from need recognition to the ultimate purchase decision, require careful efforts by businesses. It can take weeks if not months.
Once the buyer’s needs have been recognized and once you’ve laid out all information sought by your customers related to your product, it’s their turn to start evaluating options in the market. It goes without saying that your competitors have also done their job well.
This makes the mid-stage metrics of your buying processes more crucial and important to take advantage of. With the right data at hand, you can tip your buyer’s thoughts to favor your brand and make a clean sweep. Again, proactive marketing! Leverage data in real-time and facilitate decision making.
Additionally, you also need to sustain the buyer’s interest all through to the end, influencing the decisions of each person involved and solving their concerns; all of which require specific data metrics.
With that being said, here are 10 important marketing metrics and KPIs to look into.
10 most important marketing metrics and KPIs for B2B businesses
Strategy-based Conversion Rate
The conversion rate in respect to different data points will come up several times in this list. For this particular instance, we will calculate the conversion rate from inbound and outbound strategies.
For example, how many of the leads you generated through the opt-in form on your website have converted into customers? How many of your outbound ABM leads have purchased? Keeping these numbers at your fingertips would help you find out which strategies are bringing the most outcomes. You might end up being surprised.
As sales cycles are long, it becomes more difficult to keep track, as a lead from this month can end up converting in the next month. Keeping track of the conversion rate and cost per conversion allows you to see which of your strategies are performing well and also helps in keeping your customer acquisition costs (CACs, discussed later) in check.
Campaign-based conversion statistics
This is very similar to the previous KPI we discussed but take note of the difference. We are talking of campaigns and not strategies. Basically, we are breaking it down into strategies. For example, advertising is part of your inbound strategy. And, you run several campaigns.
It is important to track how each and every single campaign is performing. There are a few reasons for this:
- These metrics allow you to see how well the campaigns were received, and what points of the campaign were most engaging.
- You get to know how impactful these campaigns were in terms of link clicks, website visits, landing page visits, sign-ups, etc.
- You get to analyze the outcome as well and decide which campaigns were the most successful so that you can either re-launch similar campaigns in the future or tweak the same campaign for a better outcome.
You can also optimize your budgeting and route efforts to successful campaigns. If you consider the Pareto principle, 80% of the outcome comes from 20% of the efforts. Shifting your focus on successful campaigns can help you achieve a better Return on Investment. Once you set up proper website tracking, you can keep track of this KPI without dropping a sweat. For example, this is how Salespanel reports show you this data:
Return on investment
Return on Investment or ROI is hands down THE most important metric when it comes to marketing. It is a direct and accurate measurement of the revenue generated through marketing activities. In other words, it gives you an exact value of the amount generated through marketing in relation to the amount invested in marketing.
To put it simply, ROI helps find out if you are profitable.
CTR on marketing campaigns
The CTR or the Click-through Rate is an important metric in different marketing campaigns, more so in advertising campaigns. It gives a reliable value of the number of leads that made use of your Call to action (CTA) and clicked through into your website or landing page. It shows how many viewers were compelled enough to click through to your offering.
CTR helps you understand how well your marketing ‘copies’ or elements are performing. If CTR is poor, you might need to create a more compelling advert. CTR also helps you understand what types of content and what types of strategic campaigns worked with your leads so that you can ideate similar propositions in the future as well.
Lead conversion rate on landing pages, forms, lead magnets, etc.
You may have a ton of lead generation techniques placed strategically throughout your digital presence. Whether that is on your website or your social media or your email, it is important to see which of those lead generation techniques brought in the most amount of high-value leads and conversions. Is it your lead generation form that has the best lead conversion rate? Or was it your lead magnet that induced the most conversions? Was it a dedicated landing page you created?
Again, not to confuse with previously mentioned metrics, this metric helps you understand how your acquisition funnels are performing AFTER leads are brought to your website.
Let’s take an example of an eBook (which is a lead magnet). You have 1000 visitors coming from different campaigns. Out of these 1000, 100 visitors provide their info and download the eBook. The conversion rate of the eBook is 10%.
MQLs in correlation to channels
MQLs or Marketing Qualified Leads are those prospects that match your customer profile and have been determined as MQLs. They are most likely to sign up to receive more content from you in different ways, which opens very promising opportunities for you to influence their decision and put them right at the end of the sales funnel. MQLs are those who marketing determines as a customer-fit.
Not all leads will be MQLs. For example, campaign A brings 100 leads out of which 30 are MQL and campaign B brings 80 leads out of which 40 are MQLs. This means that although campaign A is bringing more leads, campaign B is bringing the better leads.
Analyzing which of your marketing channels brought in the most amounts of MQLs will help you decide which channels to use or invest in for lead nurturing in the future.
SQLs in correlation to MQLs
Determining the number of MQLs that the sales team was able to convert into SQLs or Sales Qualified Leads, is an important metric that lets you understand sales and marketing alignment. SQLs have already shown interest along with a purposeful intent to purchase.
If the marketing team is determining leads as MQLs but the sales team is rejecting many of them after discovery calls, it indicates a problem. A healthy MQL to SQL conversion rate means marketing is bringing the right leads.
The CAC or the Customer Acquisition Cost is the total amount of money spent on acquiring a new paying customer. This includes the efforts and investments made in marketing and sales. Dividing the total amount invested in marketing and sales by the number of customers acquired over a given period will give you an exact value that represents the feasibility of your entire plan. It gives you an idea of how much you need to spend to get one customer, which will help you decide whether you need to reduce spending or increase the same.
The LTV or the Life Time Value is a measure of the total amount of revenue that a customer is likely to bring in for your brand throughout their entire time as a paying customer. This metric is arrived at by calculating the average revenue earned per customer at any given time. Thus the LTV effectively gives you an idea of how much a customer is worth for your brand, which lets you decide how much you should ideally be spending on customer acquisition and retention strategies.
The last on our list, the churn rate is another very crucial metric that allows you to see how many prospective leads and how many paying customers you lost throughout a given period of time. It’s a no-brainer, as for any business, just like measuring success metrics, it is important to measure failure metrics as well. It opens your eyes and gives you specific direction on where you are going wrong, which channels or which product attributes may be off-putting etc. It gives you chances to improve your offerings.
Proactively detecting churn can also help you reduce your churn rate.
As is evident from the above 10 KPIs, it is extremely important for any business in B2B to constantly track, monitor, and analyze important aspects to make effective improvements to improve marketing performance.