On this episode of Ground Up, Kieran Flanagan talks about the early days of freemium at HubSpot, instilling a growth discipline that expanded well beyond the marketing team, managing cross-functional teams, and more.
Ground Up Podcast | Oct 21
Kiera Abbamonte on May 30, 2019 • 13 minute read
The number of MQLs, cost metrics, maybe conversion rate, etc.
But tracking those metrics alone means you’re only scraping the top of the barrel. There are so many lead generation metrics that can offer deeper and more holistic insight into the true performance of your marketing and sales efforts.
To find out more about those KPIs, we asked 52 marketers what they consider the most important lead generation metrics to measure sales and marketing performance. Their answers highlighted the variety of options marketers and salespeople have at their disposal—and how each can help boost overall performance.
Here’s what they shared with us.
Editor’s note: Looking for a better way to view the cumulative results of your marketing and sales efforts? Download this free Marketing & Sales SLA dashboard to see cumulative results driven by your digital activities.
“Revenue generated is the only metric that should matter to a client,” said Steve Cross of iSynergy.
Revenue and return on investment were the most top-level responses we heard from marketers. At the end of the day, clients and marketers alike are looking to move the revenue and ROI needles—but those things happen a ways down the line from lead generation.
“ROI should be tracked by all marketers,” added Digital 22’s Natalie Simm. “Digital marketing strategies can take time to take effect,” Simm added, “and they can be a huge investment, so ROI is usually the key metric that’s most valuable to clients.”
“If your SEO is on point, people will find your website on their own. That means your cost per lead is lower because you aren’t paying per click from Google,” said Frink.
“If everything comes together to meet Google’s algorithmic requirements, your reward will come in the form of rankings,” added Frink, which ultimately generates more leads—if your website is well-optimized for lead generation. Not to mention, leads from organic traffic can lower your cost per lead and cost per acquisition numbers.
“If you aren’t seeing a lot of organic traffic, then you know you need to fix your SEO strategy,” added Ruditser.
“We’ve found there’s a strong correlation between how much time users spend on the page and the quality of the lead,” shared Monica Carol of Team Bonding NYC.
“For example,” Carol explained, “users that arrive on the page, do a quick skim, and then sign up are often price shoppers. Users that spend time reading the page and understanding our various offerings come to sales calls more prepared to talk about which activity will be best for their team.”
Casey Houser of VirtualPBX agreed, saying they track time on page to measure how engaging and effective their content really is.
“Consider a 5000-word article: it should take five minutes to scan and maybe 10-15 minutes to consider with some depth. If the time on page reveals that most readers are spending 10 seconds on the page, I know something’s wrong.”
“If you don’t have visibility into the ultimate ROAS from your captured leads,” said Zach Greenberger of adMixt, “you can’t protect the scalability of your campaign or business.” That’s why Greenberger recommends tracking return on ad spend, despite the fact that it can be more cumbersome and time consuming to measure.
“Customer acquisition cost matters for obvious reasons—like determining which channels to invest more money in—but also less obvious reasons, like judging the effectiveness over time of marketing budget capital,” said Quanstrom.
“The ability to structure any form of predictability from marketing and sales activities,” Quanstrom added, “hinges on monitoring of CAC.”
Masjedi echoed that sentiment, noting, “If the marketing team is able to drive qualified leads to the sales team well below CAC goals, maintaining a buffer for the sales team’s efforts, then the company can see an obvious ROI of the marketing team’s effort.”
One common thread woven through the responses we heard had to do with figuring out how valuable the leads you generate actually are. Whether they approached that by measuring lead value or lead quality, several marketers said it was a key part of their strategy. As Shrex Design’s Shreyash Mishra put it, “Generating leads isn’t as hard as vetting them.”
“Lead generation marketers should be focusing on tracking which leads are truly qualified and eventually result in revenue,” said Amy Bishop of Cultivative.
“You can have plenty of leads in the funnel,” explained Fidelitas Development’s Moises Parada, “but what are they costing you? Are they valuable?”
“Tracking lead value,” Parada added, “allows you to dig deeper into which leads are actually beneficial to your business.”
Edwin Plotts of Ladder explained that understanding how valuable a lead is to your business can help set reasonable cost benchmarks and accurately determine the value of your marketing campaigns.
“If 3% of ebook leads become customers, and customers are worth $10,000, those ebooks are worth about $300 on average. That means turning off a campaign because it’s CPA was $100 per lead might not be the right call—because the lead is worth much more.”
Gil Resnick said that looking at the quality of their MQLs over time helps Repsly identify their ideal fit leads—then work to generate more of them. Measuring MQL quality helps them answer key questions like
Nilesh Kadivar of Techuz put it bluntly, saying, “Without quality leads, there are no sales.”
“You need to be sure that your leads are profitable from the start of that business relationship,” added Natalie Lane of Roger West.
Working hand-in-hand with lead quality, cost-per metrics were another response we heard a lot from the marketers we spoke with.
“Cost per lead will tell you whether your investments are positively impacting the bottom line or not,” said Ahlem Mahroua of bHYP.
Venta Marketing’s Hannah Rubin put it simply, saying “if your marketing efforts aren’t producing leads at a profitable cost per acquisition, you could be spending more on your marketing than you’re bringing in.” That’s bad news bears. “These metrics will help you determine how much it makes sense to spend to get a new customer,” Rubin added.
Andrew McLoughlin of Colibri Digital Marketing explained, “If you can’t track how much you spent to generate that lead, you won’t be able to refine your process to be more cost-effective, and you won’t be able to accurately track the profitability of your enterprise.”
And Reggie Paquette of Chili Piper added, “When marketers track their success to this level in the funnel, it’s much easier to distribute resources to the best performing campaigns and better measure marketing’s contribution to the business.”
“If you understand what your average transaction value is,” said Chaz Van de Motter of Elite Marketing Studios, “then you can quantify if the cost per lead number is low enough that it makes sense to continue running an ad.”
The ultimate goal of most B2B marketing is to get leads through to the sales team—and let sales take it from there. To that end, Perry Nalevka of Penguin Strategies says the best way to measure the efficacy of marketing is to track new meetings booked for MQLs.
“We called it new meetings—some call it demos, SQLs, or discovery calls. The key is how much sales activity and revenue is marketing producing?”
“Conversion rate can be your first KPI flag that something bad is happening with your lead generation efforts,” said Ruthie Bowles of Defy The Status Quo. “It doesn’t appeal to your audience for some reason. Or they can’t access it. Or the wrong audience is landing on that page.”
Growth Hackers’ Jonathan Auffray recommends tracking conversion rates across marketing content, including:
Helen Freeman of Impression Digital explained why tracking conversions can shed more light on marketing performance than tracking leads generated alone: “If you only look at the number of leads you track, you won’t get the full picture. Say you’re receiving 20 leads per month, that might seem quite good until you realize 4,000 people visit your site every month.”
“With that KPI,” added Lance Beaudry of Avalanche Creative, “you can make all kinds of valuable assumptions that have an impact on what works, what doesn’t, and where you should be heading.”
As for what a “good” conversion rate looks like, there’s no one answer. Conversion rates vary widely from one industry to another and from one type of content to another. Still, we wanted to know what constitutes a realistic conversion rate for the marketers we talked to—so we asked.
Unsurprisingly, answers varied, but the largest chunk of marketers shared conversion rates between 2-5%.
“Customer lifetime value is, in my opinion, the #1 most important metric you can measure as a marketer,” said Stan Tan of Selby’s. “It will determine how much you can spend in your marketing budget, which marketing channels to allocate your budget to and which product or service to push.”
Car Loans Canada’s Jesse Perreault noted that measuring CLTV has only become more important with our reliance on digital ads. “It’s critical for modern bidding strategies on various ad networks like Google Ads & Facebook Ads. Considering many companies have customers with different lifetime values, this metric allows automated bidding to bid accordingly.”
“Most people fail to track the lifetime value of a customer,” said Lily Ugbaja of FindingBalance.Mom. “But knowing your average LTV can help you stop worrying about a high CPA and effectively decide your promotion budget.”
David Sanchez of Mammoth Web Solutions detailed a 3-step process for finding the net lifetime value of your average customer.
Andrew Schutt of Schutt Media said, “The most important lead generation KPI marketers should be tracking is the number of interested prospects.”
“It will help you understand if your messaging and targeting is effective, or if you need to go back to the drawing board to reposition your offering,” Schutt added.
Editor’s note: Want an easy way to see where leads are coming from? Download this free HubSpot (Leads by Source) dashboard to get insights on which sources of traffic generate the most leads for your business.
Taking it a step further, Jennifer Noto of Carolinas IT recommends tracking leads by the channel that generated them. “When someone inquires about our services via a contact form on our website, we ask them to share how they found us. This provides valuable insight about which of our marketing initiatives led them to contact us.”
Ampjar’s Quincy Smith echoed that advice, explaining, “Having a proven attribution model allows you to trace where leads come from, see which campaigns are working, and identify good opportunities to scale. You can go even deeper and set up multi-touch attribution to see how your channels work together.”
Curious, we asked respondents which marketing channels yielded the most leads, and the uniformity of their answers surprised us.
More than half (51.5% to be precise) listed content marketing as their primary channel for generating leads—and less than 6% said cold outreach.
John Holloway of NoExam.com told us his go-to sales and marketing metric, and it wasn’t one we hear a lot about. Holloway recommends tracking time to first contact because fluctuations in that time can really impact the perceived quality of your leads.
“If your sales team isn’t reaching leads quickly, they’re missing many opportunities—and marketers will have a hard time judging lead quality if sales isn’t acting quickly on new leads.”
Nili Zaharony of Penguin Strategies shared one of the lesser known KPIs we heard about: time to close. “It’s not a metric marketing usually focuses on,” said Zaharony, “but it can be a barometer of the quality of leads.”
Zaharony added that tracking time to close can help marketers and salespeople identify everything from training gaps to holes in their content to insufficient qualification for MQLs.
Capture rate measures the percentage of new traffic that provides some level of contact or other information on your website. Dean Cacioppo of One Click SEO says they track how that rate lines up with the ultimate conversion rate.
“The capture vs, conversion rate looks at the importance of incubating leads,” Cacioppo explained, “which is often highly overlooked.”
“This KPI helps marketers see the effectiveness and inefficiencies with landing pages,” said Eric Melillo of COFORGE. “If traffic is increasing but your traffic-to-lead ratio isn’t growing proportionally, there’s most likely a content, technical, or offer alignment problem.”
Daisy Campbell of CANZ Marketing added that measuring traffic-to-lead ration “helps explain the relevance of your traffic.”
“Higher relevance,” Campbell explained, “allows for better content ideas and can increase lead conversion rates as well. The more specific you are with your marketing, the better.”
Romy Fuchs of BEE Inbound AG says they rely on traffic-to-leads KPIs, too. “The most important rate for us is the conversion rate from visitors to leads. This rate shows us how effectively our entire website transforms visitors into leads.”
“To increase that conversion rate,” Fuchs added, “you can improve calls-to-action, landing pages, and lead gen forms.”
“Tracking the growth of the number of engaged prospects that meet your defined threshold is a great indicator of the success of demand gen and lead gen efforts,” said Nina Kuhlman of The Mx Group.
“A key indicator of whether you’ll grow valuable lead volume is if you’re creating a growing audience of highly engaged prospects who value your content enough to return over time and continue to engage throughout their B2B research and buying process,” Kulman explained.
Mike Catania of PromotionCode.org said their engagement KPIs center around bounce rates. “Not only does closely monitoring the bounce rate help determine where problems lie in the lead funnel, but improvements to the bounce rate directly affect other KPIs, like time-on-site and session length.”
Peare Media’s Kristen Hinman talked about the importance of tracking engagement for social media marketing initiatives in particular, saying “You need to know what type of content is resonating with people and which posts or pieces of content get the most organic likes, shares, and mentions.”
When you have that information, Hinman added, you can dissect vital questions that enable you to replicate and improve on successful campaigns.
One of the things that struck us about the responses we got from marketers was the sheer variety.
There’s no shortage of KPIs you can track to help measure lead generation and how it contributes to overall marketing and sales performance. The key is to find what works for your business and run with it.
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