Marketing and maths are often thought of as like oil and water.
Happily divorced from the harsh realities of business, revenue and profits, many marketers run campaigns, decide positioning and develop compelling brand messaging whilst the sales team raise their eyebrows and huff and puff about how marketing live in cloud cuckoo land, not the real world of monthly targets. CEOs and CFOs allocate the marketing budget as a cost centre and chuckle quietly to themselves when the head of marketing tries to get a seat at the boardroom table.
The good news is that marketers can inhabit a different world where they can demonstrate a clear relationship to revenue and a rock solid ROI on the market budget...or at least the smart ones can.
So what is it about smart marketers that differentiate them from their peers?
They know their marketing maths!
Smart marketers are in control of their marketing maths. They understand their go to market funnel. They know that buyers pass through different stages on their buying journey and that not everyone moves from stage to stage. The funnel leaks!
Additionally, not everyone moves along their buying journey at the same time, buyers take time to buy. Often there are multiple stakeholders that need to be on board before a buying decision is made. Complex B2B products rarely take less than 6 months to sell, often much longer, 9 -12 month is more like the average. There is a lag from first contact to the closed sale.
Smart marketers know their leakage rates from stage to stage of their funnel and they know the lag time from first engagement with their prospect to the time they become a loyal customer. Armed with these two pieces of data, plus the businesses revenue goals and an average selling price they can model their funnel. They know the amount of visitors and contacts they need at the top of the funnel in order to drive revenue at the bottom of the funnel.
With this information, marketing and sales can apply the right marketing effort, in the right quantity and the right time to deliver against the organisations revenue goals.
How can marketers have a clue about the volume of marketing activity that needs to occur otherwise? They are simply performing "random acts of marketing" in the hope that something sticks.
Many marketers run their campaigns on a quarterly cycle. This is most typical, but in the world of business to business sales this is also most peculiar.
Why on earth would you run a marketing campaign that is shorter than the typical buying cycle. Are they really happy to leave the prospect to be influenced by their competitors?
By limiting themselves to market only to a certain stage of the funnel marketers end up running price driven, "knee jerk" marketing such as end of quarter promotions and discounts.
Successful B2B marketing is about creating a lead engine that contributes to the momentum of the business. Without knowing your marketing maths you have no sense of the volume of marketing that is required to generate leads to feed the sales team.
If you want to be a successful B2B marketer take some time to get to know your marketing maths.
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