Before the internet age, it used to be nearly impossible for small-to-medium business (SMB) owners to accurately measure the return on their marketing efforts. SMB leaders allocated significant sums to the marketing budget to be spent on advertising, events, sales collateral, and even company-branded swag, but it was usually a challenge to determine whether any of the individual marketing activities (and marketing budget dollars) directly led to revenue, and if so, to what extent.
Marketing budgets were often viewed as fiscal black holes — business owners knew they had a lot of money going to marketing, but they had no idea if it was working or not. Many marketing teams and executives were viewed with similar suspicion. At best, corporate leadership misunderstood marketing’s impact and value. At worst, they viewed marketing as a waste of time and money.
What was missing back then was a way of measuring marketing’s impact, showing the relative effectiveness of both the strategies deployed and the dollars spent. Without that measurement, the marketing department had no way to show its value — the return on the marketing investment.
But around the turn of this century, the internet came along, the marketing technology (MarTech) marketplace exploded, and both contributed to a business environment that put measurement front and center. As the marketing function itself transitioned from a primarily offline environment to a digital one over the last two decades, it’s now easier than ever to see how well your marketing is working and to calculate a fairly accurate return on your marketing investment.
As marketing technology continues to evolve, it’s now clear that if you’re not measuring your marketing, then you’re doing it wrong.
The Internet and MarTech Made Measurement Easier
The internet fundamentally changed so many aspects of our personal and professional lives that it’s sometimes hard to imagine how we ever did anything before it existed. The same can also be said of the many different technological innovations that we use every day, both at home and at the office. When was the last time you found a vendor for your business in the yellow pages? When was the last time you made a major purchase without doing some online research? When was the last time you used an actual paper map on a road trip? You get the picture — everything today is faster, easier, digital.
While this transition to digital has certainly made our home lives easier and our work lives more productive, working digitally has also made a fundamental change when it comes to data. In short, every single thing we do online generates data, and smart companies leverage this data to sell more stuff, make their customers happier, and of course, make more money.
Read on for a brief discussion of how SMBs are now measuring their marketing efforts in three digital realms — on the web, over email, and on social media.
Measuring Your Marketing on the Web
It’s still possible to be a successful company without a robust presence on the internet, but these old-school companies become increasingly harder to find with each passing year, especially after the COVID-19 pandemic forced almost all business interactions into the virtual realm almost overnight.
According to the marketing research firm Forrester, 90% of B2B customers start their buying process with an online search, often visiting several different websites to gather information relevant to their impending purchase. In order for an SMB to take advantage of this overwhelming customer behavior pattern, it has to be “findable” on the internet. And the best way to do that is by publishing compelling, SEO-optimized content that is easily found by someone during an internet search.
An SMB can spend a lot of money on its website, and even more on content marketing — creating web content and other digital assets designed to attract potential customers. But how do you measure the effectiveness of your investment in your website and related digital content?
By using a tool such as Google Analytics (GA), modern-day marketers have access to a wealth of information about their digital audience — data that is vital to measuring the return on your digital marketing investment. The data readily available in GA will tell you how your audience found you on the web (for example, via organic search or from digital advertising), where your audience is in the world, what type of device they use (mobile phone vs tablet vs computer), and even which browser they use to access the internet.
You can see which of your web pages your audience lands on, how long they stay, and which pages they exit your site from. You can even tell if they “bounce” from your site. (A “bounce” in GA is when someone visits a single page on your website but does nothing else — if land on the page and don’t click on anything or do anything else and then leave, that’s a bounce.)
Suffice to say, you can see a lot of data in GA; the examples above barely scratch the surface of what’s available. But don’t let the vastness overwhelm you — it’s all about trying to get a read on the performance of your website content and your web traffic in 3 main areas:
- What are your web visitors doing on your site? What pages are they navigating to, how long are they staying, what are they clicking on, and more.
- Is your web traffic growing? How many people are coming to your site? Is that number growing over time? Where are the users coming from? Are new visitors coming to your site?
- Are your visitors converting? There are many different ways to define what a conversion is for your company — it might be downloading a gated piece of content, scheduling a meeting using an online assistant, or another type of goal. You can easily set up goal tracking in GA and measure how many times your web audience completes your goals.`
If you’re still feeling unsure about Google Analytics, there are a number of excellent courses available online, including Google’s Analytics Academy which is completely free.
Measuring Your Email Marketing
Over the last 20 years or so, a number of marketing technology companies offering increasingly sophisticated platforms that manage and automate email marketing efforts have come into existence. Some of these companies have become tremendously successful and include names that many business professionals are now familiar with, including Constant Contact, Mailchimp, and many others.
Most of the leading email platforms provide robust data and analytics on the emails you send, including, the number of emails sent (with many categorization options), how many reached their intended targets, who opened the email (and how many times), if they shared it, and so on. It’s also easy to see which links the email recipients clicked on within the email — this is an easy way for a marketer to track interest the interest in certain types of content or specific offers. Many email providers also offer A/B testing, giving savvy marketers a way to test their messaging effectiveness.
Since email is basically “free” (though the email marketing platforms don’t come cheaply), a well-managed email marketing effort will often end up as one of the most effective, cost-efficient marketing channels in a company’s overall marketing mix.
But one word of caution: effective email marketing requires a solid email database with accurate contact information. But bad data such as a few incorrect email addresses isn’t the only concern here — because of federal SPAM laws (and state spam laws), companies with careless email marketing practices risk getting themselves into legal hot water, too. In short, you don’t want to get caught sending unwanted emails to people that have opted out of receiving them. Nor do you want to add people to your email database without their knowledge or consent. Just because you’ve emailed someone in the past or have their email address for some reason, that doesn’t mean you’re allowed to send them marketing emails. The law is very clear on this and you don’t want to get caught — mistakes in this area (even honest ones!) can be disastrous and costly.
Measuring Your Social Media Marketing
There’s a famous saying about the business of social media: “If you’re not paying anything, then the product is you.”
And while most people may think of Facebook, Twitter, and the many other social media channels in terms of the unique user experience offered by each, in reality, these companies are nothing more than digital marketing channels — a platform to connect advertisers and audiences (and increasingly, to connect buyers and sellers).
Not every social media channel is relevant to a given business or industry. For example, an industrial engineering firm may not have as much use for a TikTok account, while a juice bar or a yoga studio probably would benefit. But at the same time, that engineering firm should prioritize its LinkedIn account where its efforts can move the needle on a number of different corporate objectives, from recruiting new employees to generating new business.
While every social media channel is unique, all of them are set up to achieve the same goal for their users — interactions or engagement. Clicks, views, comments, reactions — the more interactions your social media content gets, the more people see it. Companies can attempt to publish compelling content that garners interactions organically, and they can also pay for interactions by sponsoring posts. Each social media channel also has its own form of advertising available that’s native to the platform.
Social media metrics include measuring your number of followers, how often they engage with your posts, how often they share or amplify your posts, and many others. Social media can also be the source of new leads, conversions, and even revenue (for companies that sell their products or services directly to consumers over social media).
For an industry that barely existed just a decade ago, it’s amazing how significant social media has become to many companies’ marketing efforts.
Tying It Together With MarTech — CRM, and Automation
Business professionals of a certain age will remember a time when you used to run an entire company off of a few different spreadsheets. From the early 1980s on, this off-label use of Excel was a common practice at companies both large and small. But today’s data-rich environment is making it harder and harder for Excel to keep up. The tremendous amount of data available is simply overwhelming for both the spreadsheet technology and the hapless users who are left desperately trying to keep all of the information organized, accurate, and up to date.
Customer Relationship Management (CRM) tools have been around for at least as long as Excel has, originally as installed software (ala Goldmine in the 1980s) and now mostly as cloud-based, feature-rich platforms (including Salesforce, the biggest of them all, along with many others).
Through the use of Application Programming Interfaces (APIs), today’s powerful marketing platforms can synthesize data from most or all of the marketing technology your company used. So, if you look at a certain contact in the CRM platform, you can see such data from such disparate sources like your website (what pages the contact viewed, what they clicked on, what they downloaded) via an API with Google Analytics, to email (email subscriptions along with opens, clicks, and forwards) via an API with your email marketing platform, to the history of their phone calls (both incoming and outgoing calls, call notes, follow up tasks, and more) via an API with your cloud-based phone system. Trying to keep track of all that in a spreadsheet would overwhelm even the most diligent worker.
Another big technology innovation that’s had a big impact on corporate marketing is automation. Consider this very basic scenario: pre-internet, a B2B customer doing research prior to a big purchase might have to call a potential vendor and request a catalog. Today, that same customer might fill out a quick form in order to immediately access and/or download the catalog. And in the process, the vendor has captured the potential customer’s contact information as well as an indication that they are probably interested in the vendor’s products or services. The latter scenario is a textbook example of basic marketing automation. However, there is so much more you can do with automation technology these days, utilizing both human and artificial intelligence (AI).
SMB owners may feel like they don’t need all the bells and whistles, but ignore the benefits of even the most basic marketing automation at your own peril. The lightning-fast user experience this technology provides is quickly becoming the norm rather than the exception. Plus, with all of that data organized and in one place, SMBs can more easily keep tabs on how each aspect of their overall marketing efforts is performing. Marketing managers can perform analytical deep dives by running multi-dimensional reports, and many measures of critical marketing data can even be shown in real-time via dashboards. Soon, companies lagging behind their competitors in the technology department will stand out like a sore thumb in the marketplace as they watch their competitors leverage technology to do things better, faster, and more easily.
The Pitfalls of Measurement for Your Company
So, the more measurement the better, right? Just measure everything you can at your company and you’ll be successful? Not quite.
Way back in 1954, long before the advent of the internet and digital marketing, the brilliant business management guru, Peter Drucker, famously said, “what gets measured gets managed.” Drucker was right of course, but just because measurement in business is a good thing, that doesn’t mean that business managers and executives sometimes get caught up measuring the wrong things.
Measuring Effort at the Expense of Effectiveness
Hard work, as in, the amount of effort someone puts forth to get the job done, has long been a prized trait in the work world. No one wants a company staffed by a lazy workforce! But sometimes, companies focus too much on using measurement as a way to keep their employees active and working hard, measuring the wrong activities that don’t actually translate to the bottom line. Because effort is so easily measured (and results less so), it’s easy for SMBs to fall into the trap of focusing on effort metrics instead of results.
An example of this is counting “dials” for inside salespeople. Companies that require their salespeople to make 50, 60, or more cold calls a day might be missing the point. Shouldn’t the real goal be getting a certain number of qualified opportunities in a set amount of time? Who cares how many calls a person is making if the numbers that really matter — opportunities, deals, new customers, and revenue — are there?
Now we’re not saying that effort isn’t important — clearly, hard work is an integral part of success. All we’re saying is that when it comes to workplace metrics, try to focus on activities that directly impact the bottom line.
Leads vs. Qualified Leads
Digital marketing technology and tactics completely changed the way company’s sourced and managed their sales leads. In the old days, companies had to go out and “get” their leads. But thanks to digital marketing, these days many leads come to a company on their own, by opting into a company’s email newsletter, downloading a gated piece of content (giving the company their contact information in the process), or simply filling out a form on the company’s website. However, not all leads are created equal, and some leads are more qualified than others.
So what’s a qualified lead? While there is no universal definition that fits all companies and industries, in short, a qualified lead is a potential customer of your business that meets or exceeds a set of pre-defined criteria that you have specified. For example, a nursery school administrator is probably not a qualified lead for a company that sells education technology to colleges and universities. That doesn’t mean that the nursery school administrator has no value to the college tech vendor — they could recommend the technology to their college administrator friends after all. It just means that the nursery school administrator is not a potential customer themselves.
When Measurement Breaks Down Across Departments
Sometimes it’s striking to hear how different departments in the same company define a “good customer.” For the accounting department, a good customer might be someone that pays their bills in full and on time (or better yet, pays early). The customer service department may value customers that don’t have a lot of returns or require a lot of hand-holding. Both sales and marketing have a tendency to value top-line revenue at the expense of profit.
The point is, with the multitude of cross-departmental data available at the average company (in addition to the head-spinning amount of data that is coming out of the marketing and sales departments), sometimes the actual value of a customer can be obscured by how the different corporate departments perceive it. This is true both for existing customers and potential customers.
Smart companies tend to take all of the relevant data from each department, weigh it appropriately, and use that fully weighted “score” to value their leads and customers. Without that in-depth analysis, the marketing department may find itself focuses efforts and resources on leads and prospects that don’t help the bottom line.
The Importance of Calling Your Shot
We want to touch on an element of marketing measurement that may get overlooked. We’re talking about the importance of setting specific goals for your marketing efforts — defining what success looks like in concrete numerical terms — before you embark on a new marketing initiative or plan. This can be a challenge for some who may be uncomfortable with the idea of making projections on the front end of a new project or initiative. “How am I supposed to know how this idea will do — we haven’t tried it before!” is an objection frequently heard when a company instills a comprehensive goal-setting and measurement structure into the marketing efforts.
The thing is, defining what “success” looks like is the key to fully benefiting from any business measurement. Even though some inaccuracy is to be expected (especially on a new endeavor), as you gather more data, you’re measurements (and your projections) will get more accurate over time.
Pay Attention to Trends
In closing, it’s important to keep in mind that data is rarely 100% accurate (even the data from Google Analytics can be off from time to time). It’s not really important if your web page views count is off by a few hundred views this month, or if that spike in traffic wasn’t actually relevant. What is important is the trend over time — specifically, are the views going up or down over the last weeks and months. Are your overall results growing, slipping, or staying flat? Keeping a close eye on the trends is key, especially the trends that most impact your bottom line.