I didn’t understand the joke then, and I’m still confused by T accounts now.
Thankfully, in a stint as a bank credit analyst, I did finally gain some fluency with business numbers. I learned to cope with, if not exactly love, current ratios, inventory turnover, and return on equity calculations.
This experience with numbers can come in handy in marketing.
Measure, measure, measure
There’s plenty of room in marketing for creative designers and copy writers. But if you’re managing a marketing group, you’ll also need to know your way around a spreadsheet too. Measuring is a big part of the job.
Marketers, and software-as-a-service (SaaS) marketers in particular, can’t afford to make decisions based solely on gut feelings or anecdotal evidence. They need hard, quantitative data:
- Which marketing programs are driving the most traffic?
- What keywords are producing?
- What’s the free trial-to-purchase conversion rate?
- What’s the return on social media?
Yes, gather and analyze quantitative data, but proceed with caution. Be careful in how you measure and what you measure.
One common measurement flaw is assigning a lead to one particular source. Salesforce.com and other systems have wonderful mechanisms to identify the source of each individual lead. It will tell you tell how many leads were generated by each source. And using that data, you can calculate the cost per lead per source and then make decisions on which programs to continue funding and which to stop funding.
The problem is that identifying a single source for any particular lead isn’t really as simple as that. The fact is that over the course of the purchase process, most business customers are likely to touch your company through multiple sources, not just one.
The first contact may be through a keyword search, but later they’ll read your newsletter, download a white paper, attend a webinar, and perhaps meet you at a tradeshow. How do you identify which single one of these activities is the sole “lead source?”
Leads are just the start of the process
The focus on leads and lead sources can also distort your view of what programs are really having an impact on your business. “Leads” are only the entry point in the sales pipeline. “Leads” need to be nurtured into “qualified opportunities” and then converted to “closed wins” in order to generate revenue.
If your entire focus is on counting “leads,” you may be missing the bigger picture. Besides calculating “leads per campaign” and “cost per lead,” marketers should also be tracking “cost per qualified opportunity” and” cost per closed win.” You may find that campaigns that generate few leads actually produce many qualified opportunities and paying customers.
Remember, the goal of marketing isn’t “leads,” “followers,” “friends,” or “contacts.” The goal is revenues.
This work by Peter Cohen, SaaS Marketing Strategy Advisors is licensed under a Creative Commons Attribution 3.0 Unported License.