As a revenue marketer, you know it's important to track your progress. After all, if you don't know where you're going, how will you know when you get there?
By tracking KPIs, you'll be able to see whether your revenue marketing efforts are successful. If you're not seeing the results you want, you can adjust your strategy accordingly. By continually improving your marketing, you can increase your sales and grow your business.
In this article, we'll discuss some key performance indicators (KPIs) for revenue marketing. By tracking these metrics, you'll be able to tell whether your efforts are successful and continue to improve your marketing strategy.
- Predicted revenue
- Deals acquired
- Closed deals
- Marketing attributed revenue
- Marketing ROI
- Customer lifetime value
- Sales cycle length
Predicted revenue is an estimated amount of revenue your business will make over a certain period of time, like a year. The forecast takes into account data from both present and past sales to make a prediction of future revenue.
It’s an important metric to track as it can help you plan for future investments and costs if predictions look good, or to put contingency plans in place for any predicted drops in revenue.
Predicting revenue takes into account both sales and marketing efforts. By having predictive revenue as a KPI, you can measure actual revenue against your predictions to discover how accurate you were, and make adjustments if your estimates were off.
A crucial way to keep an eye on how your revenue marketing efforts are progressing is to measure the number of deals you’re acquiring in the marketing funnel. Keeping track of your deals as a metric lets you know how effective your marketing efforts have been.
Similar to how many deals you acquire, tracking how many you manage to close will further help to highlight what you’re doing well, and where improvements can be made. When you have a goal in mind for the number of closed deals, you’ll be better able to understand the product-market fit, the pricing structure, and if the sales team's approach to their leads needs to be adjusted, or even if they’re receiving the right leads in the first place.
You can also track just how much revenue those deals bring the company over time in the form of customer lifetime value.
Measuring closed deals is also a great KPI to share between marketing and sales to help with alignment.
Marketing attributed revenue
When you measure all the different marketing metrics, it becomes easy to discover just how much revenue you can attribute to specific marketing touchpoints.
In this way, you can find out the overall contribution of marketing to revenue growth. You can look at individual marketing activities and deep dive into the data to discover exactly how many sales can be attributed to each channel, asset, or campaign. Not only does this help you better track your marketing efforts, but it gives you insights into which marketing channels to stick with, and which to put less energy into.
Setting KPIs for marketing attributed revenue gives your marketing team something to work towards. So often the marketing department is oblivious to how their efforts are directly impacting revenue, so by focusing on this KPI for your team, they’ll have a greater awareness of how their work impacts the company’s success.
The cost-efficiency of marketing has a big impact on the bottom line. By looking at marketing ROI, you can see how much revenue has been generated at the cost of the marketing efforts to generate said revenue.
To get an accurate picture of your marketing ROI, you need the ratio of attributed revenue to marketing spend. This KPI can really highlight just how much revenue your marketing team is generating, and can help you highlight your successes to the higher-ups at your company.
Customer lifetime value
Customer lifetime value (CLV) is an important metric to understand as it can inform decisions like how much to pay to acquire new customers, the effect of losing customers, and the total revenue you can expect to bring in from a single customer.
It’s ideal as a KPI for revenue marketing, as it gives you a complete picture. A growing CLV indicates a company is doing well, as customers are happy and prolonging the life of their relationship. But a declining CLV means that a company is generating less revenue from each customer, and changes are needed to remedy this.
CLV as a metric can give you a robust picture of where your organization stands and the revenue you can expect to generate over the course of a customer's lifespan.
Sales cycle length
Another metric you can use for a KPI is the sales cycle. By measuring the lead to win time, you can keep track of just how quickly you’re generating revenue. This metric takes into account how quickly leads move through the sales pipeline, starting with the initial contact with a lead, up to when the deal is closed.
This KPI can track the overall performance of your sales strategy. It can also boost the sales cycle by highlighting where leads are growing cold, and identify the steps sales reps can take to close deals more quickly. The shorter the sales cycle, the less costly it is for your business.
There are a number of revenue marketing KPIs that you can track, from the leads interested in your products or service, to your conversion rate which measures how many prospects have become paying customers. Analyzing your team’s contribution to overall revenue is a new way of looking at existing processes and pulling back the curtain of your department’s overall effectiveness and how you’re impacting the bottom line.