In the 2014 NFL season, Dallas Cowboy’s running back DeMarco Murray had an unquestionably good season. He ran for nearly 2,000 yards behind a terrific offensive line. At the end of the season when his contract was up, the challenge for general managers around the league was to separate Murray’s individual contribution from his offensive line’s contribution to the team’s running success (among other things) in order to determine how valuable he is (read: how many millions of dollars to offer him). This, essentially is the same problem B2B marketers face when it comes to channel attribution and ultimately, budget allocation. In a typical B2B sale, prospective customers are exposed to multiple marketing campaigns often over many months and there’s a tremendous amount of teamwork going on, but at the same time, it’s clear that some efforts have more impact than others. Additionally, there is a sales team involved, who is critical in closing the sale. With so many elements contributing to a single result, how do you evaluate which channels worked and which didn’t? Which deserve more of the budget?
If your marketing team is anything like ours, you’re constantly juggling a number of marketing programs on various channels, always trying to experiment with and optimize the budget allocated to each. It’s one thing to go based off of intuition or the old “this is how we’ve always done it” way, but data-driven marketers crave one of two things: proof that you’re doing it right or proof that there’s a better way.
Here’s how to determine, with your data, which channels deserve more of the marketing budget and which channels deserve to be turned down.
In a word: attribution.
Attribution, at its finest, is about giving appropriate revenue credit to the marketing efforts that played a role in creating that revenue. When it comes to marketing channels, it shows you what channels are playing key roles in customer development and what channels are wasting money.
Common stumbling blocks
It seems pretty simple, but marketers are often led astray because their data -- their feedback -- doesn’t capture the nuances of the full B2B marketing funnel.
For example, if you’re only reporting on how people get to your website, you’re only going to value marketing channels that are targeted at the top of the funnel. Your data might tell you to scale up search and social, and scale down the rest. But when you do that, your middle and bottom of the funnel will suffer because what’s really happening is those other channels (email, content, webinars, etc.) are taking those visitors and turning them into warm leads for the sales team to convert. With that reallocation of the marketing budget, you may get more leads, but fewer will be qualified.
Additionally, if you rely on native analytics (AdWords + Google Analytics, Facebook Insights, etc.) to track the success of each of your respective marketing channels, it’s likely you’ll double count conversion credit. For example, if a prospect clicks on both a Facebook ad and then an AdWords ad, and then later converts, both Google Analytics and Facebook Insights will show a full conversion each, when really they should only be getting partial credit. Obviously, double counting isn’t good for your data accuracy and leads to poor allocation decisions.
Essentially, the fatal error here is judging the channels based on unfair conditions.
To truly optimize your channel budget allocation, what you need is better data. More advanced data that connects downstream, to be more specific.
The most effective data-driven marketers determine which channels to scale up or down using multi-touch attribution that connects to their CRM, so that they are on the same page as the sales team. “But the sales team and the marketing team are different -- they use their own set of tools and metrics,” you say. That’s like saying the running back and the offensive line should be running different plays at the same time. Of course they have different roles and techniques, but if they’re not on the same page and if they don’t have the same goals each and every play, the team is not going to be successful. The most successful running backs are in sync with their offensive lines. Similarly, the most successful marketers coordinate their efforts based on the entire funnel and are in sync with their sales teams. All this to say, marketing channels that more closely support sales goals (MOFU and BOFU) need to also receive their appropriate credit when assessing the value and success of all marketing channels.
So what is multi-touch attribution and how does connecting it to the sales team (CRM) help?
Multi-touch attribution is the method of assigning credit to multiple marketing efforts in a consumer’s buying journey. This is especially important in B2B marketing because the deal rarely happens on the first contact -- there are many steps in the funnel. For most B2B marketers, there are three main steps: the first website visit, when the visitor becomes a lead, and when the lead qualifies to be handed over to the sales team. Multi-touch attribution should divide credit to at least these three touches. You’ll notice that these three touches conveniently represent the top of the funnel, the middle of the funnel, and the bottom of the funnel. By dividing credit among these three touches, marketers do not over- or undervalue the impact of any marketing channel just because it primarily targets one specific part of the funnel.
Connecting your marketing attribution to the sales team allows marketers to understand and assess the channels based on their true value -- how much revenue they drive. Unlike in B2C, the sales team’s system (the CRM) holds the revenue information for B2B marketers. So when marketing efforts are plugged into the sales system, marketers can see the downstream effects of their work and trace the revenue numbers back. By connecting to the CRM, marketers are no longer guessing how much value each channel is driving, they’re using the most important business metric.
Is this channel working?
In the NFL, it’s really difficult to get the right data to properly attribute a single person’s contribution to the team, and most teams end up with different valuations. In the end, the Philadelphia Eagles valued DeMarco Murray higher than the Cowboys and signed him for a little over $8 million/year. Truthfully, nobody knows for sure how he’ll do this season. He hasn’t started off well, but we’ll just have to wait and see how it all plays out.
Fortunately, when it comes to marketing, it is absolutely possible to get the right data. And with the right data, channel budget allocation is not rocket science.
With an attribution solution that values at least those three key touches (first visit, lead creation, qualifying as a sales opportunity) and connects to the downstream revenue numbers via CRM integration, you can see (with dollar values) what channels are truly contributing to the entire marketing process. Are search ads being attributed a ton of revenue credit? Scale it up! (Here’s how.) Are Facebook ads not contributing as much? Scale it down and maybe try again another time with a new experiment. Pretty simple.
Don’t you wish that your NFL team’s GM had access to this kind of data?