Why Investing in Marketing Analytics is the Best Salesforce Marketing Investment for 2013
- AUTHOR Bonnie Crater
- December 5, 2012
- No Comments
Most Salesforce marketing people are familiar with John Wanamaker, early 20th century US department store merchant and pioneer of the money-back guarantee, who famously said, “Half the money I spend on advertising is wasted; the trouble is I don’t know which half.” Sadly many marketing people still find this funny. But today it’s much easier to track marketing metrics than in 1869 when Mr. Wanamaker opened John Wanamaker & Co. in Philadelphia. With 67% percent of a B2B buyer’s journey being digital, there’s many more activities that can be measured, tracked and attributed to revenue. While John Wanamaker didn’t ask the question this way, what we can surmise is that he really wanted to know marketing ROI and individual campaign influence.
We built Full Circle Insights to solve the problem that John Wanamaker proposes — to uncover the 50% wasted with the aim to allow marketers to invest in programs that contribute to the customer journey and ultimately drive revenue.
Utilizing marketing analytics software is the best investment that a marketing department can make in 2013. If a good marketing program in your company drives $6 in revenue for every dollar spent, a poor marketing program may drive 10 cents for for every $1 invested. Whether you have a $500K marketing program budget or a $500M marketing budget, smart marketing managers always want to reinvest the marketing budget from low performing marketing campaigns to high performing marketing campaigns.
Say you’re a small company with a marketing programs budget of $500K and $6M in revenue. Assume also that as best as you can tell that marketing influences about ⅓ of the revenue or about $2M. So for every dollar spent on marketing, your programs on average return 4 dollars in revenue, some higher and some lower. Say you also think you have about 10% of your programs that return 0 revenue. Some of these programs can be the insidious ones where prospects may respond to the campaigns but they never turn into customers. In our example, the “zero return” programs are valued at 50K. Even if you reinvest that 50K in average programs, your revenue return is 200K. If you paid 25K for a marketing analytics solution, your return on investment is 700%. (($200K – 25K)/25K = 7)
That is a good deal!