Measuring marketing contribution to revenue (MCtR) is a dicey proposition for a variety of reasons. Last post we talked marketing’s work in so many other areas that drives revenue, that to focus purely on lead generation to revenue contribution really under reports marketing’s contribution.
In this post, we look at the complexity and number of touch points in a B2B sales cycle making it difficult to even track MCtR. Look at a typical B2B cycle. A prospect may search for a solution online to a problem, she clicks on an adwords, arrives at your site, then bounces and leaves for whatever reason. Next week, she shows up at a tradeshow, wanders by your booth, remembers the ad, and when approached by a sales rep, starts talking. A follow on email and phone call from the inside sales team yields nothing.
Two weeks later, someone else from the company phones in to sales and the deal closes three weeks later. The systems will report out 0% contribution to marketing for the deal.
Take perhaps a more plausible scenario. Take the same sales cycle, but this time, after the trade show nothing happens. Marketing then sends emails every three weeks to the prospect. Eight months later, a sales rep calls into the prospect as part of a tickler program to old contacts. The prospect engages, and a deal closes three weeks later. Depending on how the system reports out marketing contribution, this deal may or may not be marketing contributed. Some companies use time frames that say once a prospect hasn’t responded to marketing within x months, then any follow on activity from the prospect doesn’t count toward marketing. Other companies may count this deal towards marketing since there are some marketing activities associated with the prospect, but may only call the deal “influenced” not originated.
It is enough to make your head hurt.
Then there is the case of the sales cold call that goes nowhere, followed by the cold call target downloading a white paper and being passed by marketing back into sales.
You can spend more time in deal accounting and trying to make sure MCtR is accurate than actually marketing.
B2B sales cycles are complex. Trying to “credit” marketing to calculate MCtR just adds to the complexity without much benefit.
Top Six Reasons CMOs Should Be Cautious Using Marketing Contribution to Revenue
- #1: Marketing Does More than Lead Generation
- #2: B2B Sales Cycles have Many Touch Points
- #3: Closed Deal Forensics are Notoriously Difficult to Understand
- #4: Transformers
- #5: Using Revenue as a Measure Can Skew Marketing Program Results in Either Direction
- #6: Marketing is a Parts Supplier to Sales