Demand Creation: Five Metrics That Matter
For every marketing leader, there comes a moment of truth. This moment – whether it is in front of your chief executive officer, product management, your board of directors or your senior sales counterpart – will be defined by the answer to one simple question. What benefit has your function brought to the organization? And while the systematic building of reputation is certainly important, the answer that all of these audiences are truly looking for has to do with how your strategic plan and tactical mix has helped contribute to topline revenue; they want to know how effectively marketing is helping to create demand. Here are five metrics that you simply must be armed with the next time you find yourself on the firing line.
Inquiries. This first metric is the fuel that at a baseline makes your demand creation engine run. When all campaigns have been accounted for and all sources totaled, how many raw responses - hand-raisers, if you will – did the marketing function generate?
Marketing Qualified Leads (MQLs). With a group of raw inquiries in hand, it is now marketing’s job to nurture those leads to a level that has been mutually agreed upon by sales. Marketing leaders must track and report on the conversion rate of inquiry to MQL; they can then demonstrate how improvements in target marketing and messaging have improved this rate from quarter to quarter.
Sales Acceptance. With a definition (or definitions) of an MQL that have been agreed to by marketing and sales, an organization is now ready to create a formal process for acceptance of these leads by inside, field or channel sales.
Sales Qualified Lead (SQL). By initially accepting a lead, a salesperson is not committing to anything beyond the basic tenets of the MQL. Marketers are looking at two metrics at this stage of the funnel, including the conversion rate of sales accepted leads to SQLs, as well as the cumulative size of the opportunities now in the pipeline.
Closed Business. Although much happens to leads once they leave the control of marketing, understanding the ratio of SQL to closed business is still critical for marketers.
It’s hard to believe that five fairly straightforward metrics have so much power, but they do. With these metrics in hand, marketers can make a strong argument for additional program dollars; identify gaps in communications with sales; understand their impact to the organization’s pipeline and revenue; and build a series of processes that makes the entire set of activities around demand creation much more systematic.
