How does Time affect Marketing Accountability?
While top marketers understand that proving marketing’s impact on revenue is essential to transforming marketing into a revenue driver and an accountable part of the revenue team, only 20% of companies say they excel at measuring the business performance of marketing initiatives. Where is the disconnect? Surveys of CMOs and other executives have repeatedly proven that marketers need to measure and demonstrate marketing ROI and the impact marketing programs have on revenue. Consider these studies:
- Over half of CMOs say that their top challenge is quantifying and measuring the value of marketing programs and investments. (CMO Council: Marketing Outlook 2008.)
- Two‐thirds (65%) of marketers say that CEOs and CFOs are making greater demands than last year for marketing to show a potential return on investment (ROI) as part of securing budget. In addition, 8 in 10 marketers (79%) indicate that the need to measure, analyze and report marketing effectiveness was greater in 2009. (Lenskold Group/MarketSphere Marketing ROI and Measurements Study.)
- Three quarters (76%) of B2B marketing professionals agree, or strongly agree, that their “ability to track marketing ROI gives marketing more respect.” (Forrester’s Q1 2007 B2B Marketing Measurement Online Survey.)
The research above clearly indicates how the ability to measure and forecast the impact marketing has on business metrics, such as revenue, plays a vital role to help marketing earn a seat at the revenue table.
I must admit, while the concept of marketing accountability is nothing new, until now, no marketing analytics solution has effectively understood the deep role that time must play in an accurate marketing analytics. “Time” influences marketing analytics in many ways. At the most basic level, today’s marketing investments may not have a payoff for a long time, and past marketing investments affect current period results. Approaches to measuring marketing ROI that do not properly incorporate time can lead to decisions that are biased towards short-term gains versus building true long-term value. The more marketing wants to measure true business outcomes like revenue, the harder the problem of time becomes. This problem is true across all industries, but it is especially acute in businesses with considered-purchase products and a long revenue cycle.
In 2010, Marketers can finally take control of their metrics, as solutions that address this issue are now available. Enter Revenue Cycle Analytics, a new approach that combines technology with methodology and services to make it easy to measure and optimize the revenue cycle and accelerate predictable revenue. While this is our solution to the problem, we’re curious about yours. How are you dealing with the issue of time in understanding your marketing campaigns?
To learn more about how we use revenue cycle analytics to deliver more accurate and more actionable marketing analytics in Marketo’s latest white paper, Revenue Cycle Analytics: Measuring and Forecasting Marketing’s Impact on the Revenue Cycle over Time.