In the world of performance-oriented B2B organizations, marketing’s role goes beyond generating leads – it is expected to make a measurable contribution to revenue outcomes. CEOs now recognize marketing as a growth engine for their businesses, understanding that marketing teams facilitate prospects through a crucial portion of the buying journey.
To achieve success, B2B demand generation activities must be tightly connected to revenue outcomes. This means that prospects generated at the top of the funnel must smoothly progress through the middle as Marketing Qualified Leads (MQLs) and Sales Accepted Leads (SALs), eventually converting into Sales Qualified Leads (SQLs), opportunities, and loyal customers by the end of the sales cycle. All of this should happen in the most efficient and effective way possible.
Navigating the Challenges for B2B Marketers
B2B demand generation activities are not without their complexities. The buying journey has become increasingly intricate, with larger and more diverse buying collectives engaging through multiple channels and touchpoints. Furthermore, the buying cycle tends to be longer, lasting over weeks to months.
Connecting activities executed earlier in the funnel to revenues that occur much later poses a significant challenge for marketers. While they aspire to correlate their efforts with revenue outcomes, they often find themselves focusing on upper-funnel metrics like reach, website traffic, content downloads, and event attendees, as well as MQLs generated – often referred to as “vanity metrics.” This emphasis on upper-funnel metrics is driven by practicality; waiting for the entire sales cycle to unfold before assessing effectiveness is not feasible.
However, while upper-funnel metrics are important indicators of performance, they may not always closely correlate with actual revenue. Instead, lower-funnel metrics, such as MQL-to-conversion rates, time-to-conversion, cost-of-conversion, average deal size, churn rate, and customer lifetime value, hold stronger connections to revenue outcomes, especially for subscription-based solutions.
Five Tactics for Connecting Metrics Across the Funnel
- Adopt a Full-Funnel Marketing Approach
Embrace a full-funnel marketing strategy that recognizes evolving prospect needs at each stage. Tailor your marketing messages and activities to address those needs, ensuring a seamless and cohesive experience for buyers. By connecting activities throughout the funnel, you can better understand the impact of marketing efforts on revenue outcomes.
For instance, at the top of the funnel, focus on creating awareness and providing valuable content that educates and engages potential customers. As prospects move to the middle of the funnel, offer targeted content and personalized experiences to nurture their interest. At the bottom of the funnel, provide compelling offers, case studies, and testimonials that help drive purchasing decisions.
- Ensure Alignment Between Marketing and Sales
It’s crucial for marketing and sales to agree on funnel metric definitions. Misleading metrics can arise when both teams measure success differently or when marketing activities are disconnected from the funnel stages. Open communication and alignment enable optimization of conversion rates between each stage, allowing you to course-correct based on feedback from sales.
Regular meetings and shared dashboards that highlight both marketing and sales metrics can facilitate a better understanding of performance and help identify areas of improvement. Collaboration between the two teams is essential to ensure a smooth handoff of leads and to track how each lead progresses through the funnel.
- Invest in Attribution Capabilities
In a multi-channel buying landscape, attribution becomes vital. Invest in the right attribution models and solutions to identify the sources of conversions and revenue outcomes. This knowledge helps optimize marketing spend, ensuring the most efficient and effective channels receive proper credit.
Multi-touch attribution models consider the impact of various marketing touchpoints on a customer’s journey, providing insights into which interactions and marketing efforts contribute most to revenue generation. By understanding the customer’s path to purchase, you can allocate resources effectively and focus on the most influential marketing activities.
- Experiment and Adapt
A full-funnel marketing strategy and a solid attribution capability allow for more experimentation. Markets are dynamic, and what worked in the past might not work now. Regularly test and optimize marketing activities at each stage of the funnel to improve efficiency and effectiveness.
Experimentation can involve A/B testing different messaging, creative assets, and promotional offers. Analyze the results and use data-driven insights to refine your marketing approach. By continuously adapting to changing market dynamics and customer preferences, you can stay ahead of the competition and drive better revenue outcomes.
- Choose the Right Demand Generation Partner
Instead of settling for lead generation vendors that stop at the lead stage, seek partners that support your revenue-led performance goals. Find vendors who collaborate with you throughout the funnel, generating high-quality leads and MQLs that aid sales conversion. A customized approach aligned with your sales strategy is key.
Look for demand generation partners who understand your industry, target audience, and unique business goals. A good partner will help you create targeted campaigns that resonate with your prospects at each stage of the funnel. They should be willing to work closely with your team, providing valuable insights and data to optimize marketing efforts continuously.
By implementing these five practices, your B2B leads pipeline can flourish in terms of volume, velocity, and value. Ultimately, these metrics define the sustained revenue growth that every B2B organization aims to achieve. As marketing and revenue become more intertwined, the successful alignment of metrics throughout the funnel will prove essential for unlocking the full potential of your B2B marketing efforts.
