In today’s data-driven B2B landscape, marketers are under constant pressure to get maximum returns from their investments and efforts. Hence, it’s critical to measure the success of your B2B campaigns.
Keeping an eye on a few marketing metrics can help you derive quantifiable insights on campaign performance. This exercise will report the success or failure of your marketing initiatives and show how they’re impacting your company’s growth.
Here are a few critical metrics every B2B marketer should keep track of to assess whether or not their efforts are paying off:
1. Website Traffic
The number of people visiting your website is a key indicator of whether or not your SEO strategies are effective. Website traffic is a metric that’s under your control, provided your marketing and SEO campaigns are leading the target audience to your website.
Google Analytics is a great tool you can use to measure traffic. It shows webmasters the traffic numbers, including the number of visitors and where they are coming from.
For instance, if you are running marketing campaigns on varying social channels, the tool will tell you which ones are driving traffic and which are failing.
Google Analytics can also measure user information like audience location, viewer time spent on a page, traffic sources and bounce rate.
2. Email List Growth Rate
In a global benchmarking survey, nearly half of the B2B marketers rated email marketing as the most effective channel. No wonder, a majority of marketers are leveraging email for distributing content.
List growth rate is a metric that monitors the rate at which your email list is growing. This can be calculated by subtracting the number of unsubscribes from the number of new subscribers. Divide the number derived by the total number of email addresses on your list, multiplied by 100.
List growth is often assessed along with churn as it’s important to understand whether or not your email send list is growing and at what rate. If the list growth rate is lower than your churn rate, it’s time to re-evaluate your email and lead generation strategies.
On the other hand, if it’s higher than your churn, you need to assess your engagement metrics and ensure that they stay high too. It is also important to track the unengaged subscribers who are on your list but do not respond or even open your emails. Having such subscribers can harm your engagement and delivery rate. Make sure you spot and remove these unengaged subscribers from your list.
Email monitoring tools like SalesHandy, Streak and MailChimp can help you track leads as they move through your pipeline. They also show you email opens, engagement rate and help track email marketing efforts and their ROI.
3. Social Media Metrics
Social media is a huge fertile ground for B2B marketers looking to attract leads and reinforce their relationship with existing customers. Hence, marketers need to track a few social metrics that can help them leverage this platform effectively.
- Social shares: If your content isn’t being shared by your followers, it’s not valuable enough. The number of social shares your posts enjoy is an indicator of how relevant and value-adding your content is
- Follower growth rate: A consistently growing follower base shows that your audience is finding your content and online engagement activities relevant
- Engagement: The engagement level of your social posts can be measured using the number of likes, comments and shares it receives
4. Customer Acquisition Cost (CAC)
Customer acquisition cost tells you the amount your firm has spent on successfully securing a customer. To calculate this metric, you need to divide the total sales and marketing costs by the number of new customers acquired within that period.
If your firm’s CAC is spiking month over month, you can assume that sales and marketing teams aren’t operating efficiently. For granular results, you can also calculate CAC for a specific campaign or an initiative.
5. Customer Lifetime Value (CLV)
Customer lifetime value predicts how much a customer will spend on your products or services throughout their lifetime. The number will help you understand how much you should invest in acquiring new customers and retaining the current ones.
CLV focuses on the exchange of value between your company and your customers over the length of time they are with you. For a high CLV, a firm should keep their acquisition cost low and retain and grow your customers.
Calculating the ratio of lifetime value to customer acquisition cost will help you see if you’re spending too much to acquire a customer. It will also show if you’re missing opportunities by not spending enough. A ratio of 3:1 or 4:1 is healthy.
Looking at CLV and CAC in relation to each other will also help you answer the following:
- How much is spent to acquire a new customer in a profitable relationship?
- Which products are profitable?
- What’s your most profitable buyer persona?
A great way to reduce CAC and boost CLV is to improve the adoption of your B2B product. You can do this by empowering customers to quickly learn and make the most of your product using a digital adoption platform (DAP) such as Apty or any of the top Apty alternatives.
With stronger customer onboarding and product adoption, you are bound to retain customers and thus, improve their lifetime value. A DAP like Whatfix also lets you collect and analyze usage data and user behavior, so you can improve your product to make it more intuitive and usable.
6. Cost per Lead
How much does it cost your business to acquire a lead? Cost per lead offers critical data for your return on investment calculations.
If your cost per lead is $100 and you need five leads to make one sale, your cost per sale will be calculated as $100 x 5 = $500. So, if the marketing team has generated five leads, you would expect to make one sale.
Now, let’s say you decide to count only the qualified leads. Your sales team reports only two qualified leads and close 50% of them. In this case, the cost per lead is $250. However, the cost per sale will remain $500.
Cost per lead can help you understand how an increase or decrease in the lead flow will affect sales. So, using the above example, if you desire to make two sales from your marketing campaigns, you will have to double your effort and marketing budget ($1000), that is generate five more leads of similar quality.
CPL also allows you to forecast the impact of increasing the advertising budget.
Consider that you spent $1,000 on your pay-per-click (PPC) campaign and acquired 10 leads, your cost per lead is $100. So, if this value is higher than the cost of your product, it’s a sign that you need to reduce your pay-per-click spend.
Google Analytics and Google Ads are the best tools to measure cost per lead. Alternatively, you can use lead calculators like Leadfeeder to monitor this metric and increase the number of qualified leads you get.
7. Marketing Qualified Leads (MQLs)
Marketing qualified leads are prospects who have shown the right level of buying intent to be passed along to the sales team. However, MQLs require more exposure to relevant promotional content for conversion.
It’s critical to track MQLs as it helps the sales and marketing teams to work in tandem — the marketing team generates a lead while the sales team converts them into customers.
MQLs hugely differ from SQL or sales qualified leads. An MQL is a lead that is more likely to convert compared to other leads based on lead intelligence. On the other hand, SQLs have been qualified as potential customers by the sales team. Knowing both these numbers is critical as they show the quality of the inbound inquiries and the efficiency of your lead qualification process.
8. Lead-To-Close Conversion Rate (CVR)
Just monitoring the number of leads generated isn’t enough; marketers need to determine whether or not these are quality leads. Lead-to-close conversion rate shows the average percentage of leads that finally end up becoming customers.
CVR offers insight into the lead quality your programs produce. For instance, if your lead-to-conversion ratio is high for a specific campaign, you know it’s working. On the other hand, if it’s low, you need to make certain changes to attract quality leads.
To arrive at this metric you need to divide the sales by the number of leads generated within a period. So, if your business made 15 sales in the first quarter and generated 100 leads, your CVR is 15%.
However, the average B2B sales cycle takes weeks or even months. In such a case, CVR can be calculated as follows:
- Look back to the same time the previous year and check how many leads were generated in a month
- Determine the portion of leads converted into customers throughout the year
- Now, divide the number of customers by the number of leads to get your conversion rate
9. Monthly Recurring Revenue (MRR)
A growing number of leads is great for business. But if these leads are not purchasing your products and contributing to your revenue, none of the other metrics matter. At some point in time, you need to assess the ROI of your marketing efforts.
B2B firms driving recurring revenue (like SaaS firms) should track the monthly recurring revenue (MRR) and the annual recurring revenue (ARR). That’s because SaaS B2B firms work on a monthly subscription model where the customer pays a fixed fee, each month for as long as they stay.
Measuring monthly recurring revenue can help B2B companies in the following ways:
- Improving Performance: MRR allows sales teams to determine the size of the accounts they pursue. So, if a sales personnel earns a commission on a deal they close based on high or low MRR customers, their salary will be impacted. This will encourage the team to close high-value MRR deals
- Sales Forecasting: By looking at the MRR, sales managers and business leaders can make more accurate sales forecasts and projections for the firm. This helps the team plan for business growth
- Budgeting: The amount of revenue a firm gets decides the future course of action. MRR tells business leaders how much income is coming in each month. This helps them plan their investments and business development strategies
The metrics discussed above will reveal whether your marketing strategies are making the desired impact on your company. Regardless of your business size, knowing your data will help you optimize your marketing spend and deliver positive results.
We recommend reviewing these nine metrics on a regular basis so that you can see how these numbers are changing over time. This will help you prioritize what’s most critical to work on.
Hazel Raoult is a freelance marketing writer and works with PRmention. She has 6+ years of experience in writing about business, entrepreneurship, marketing, and all things SaaS. Hazel loves to split her time between writing, editing, and hanging out with her family.