Revenue Performance Management Demystified for UK ... - Oracle

June 2012

Revenue Performance Management Demystified for UK Companies What is Revenue Performance Management (RPM)? The term has gained considerable traction over the last few years, but still remains a concept shrouded in mystery for many marketers. Based on responses from over 200 companies (37 of which hail from the U.K.) to Aberdeen’s marketing lead management study collected in April and May 2012, this Research Brief aims to demystify RPM and provide practical recommendations for incremental adoption. At its core, RPM is the byproduct of marketing process automation. It’s both an initiative aimed at better quantifying the performance of marketing, and at optimizing the activities of marketing across the funnel, from marketing response to the close of an opportunity. RPM provides marketing with a set of baselines and tools it can use to evaluate everything it does related to demand generation. As reported in The Marketing Executive’s Agenda for 2012 (October 2011), increasing top-line revenue is the leading goal among marketing executives, with 66% of companies identifying it as a focus. In fact, and not surprising, revenue-oriented metrics top the list of methods organisations use to evaluate marketing effectiveness, with company revenue growth, revenue from net-new customers and percent of marketing-generated leads closed by sales topping the list.

Research Brief Aberdeen’s Research Briefs provide a detailed exploration of a key finding from a primary research study, including key performance indicators, Bestin-Class insight, and vendor insight.

Marketing process automation, sometimes called marketing automation, is enabling greater instrumentation of the marketing (and sales) funnel, from response-to-close. As with previous process automation revolutions in industry, this instrumentation generates vast quantities of data that can be used to optimize the underlying processes – begetting a virtuous cycle. This is the promise of RPM.

Marketing Automation Driving Data Volumes U.K. companies cite two conflicting macro-pressures more frequently than any others: managing growth, and budgetary strain, i.e. the need to produce more with the same or even fewer resources. No doubt this is tightly related to a third-most cited pressure: the ability to validate or quantify the value of marketing to the business as companies look to scale efficiently and effectively. These pressures jointly are contributing to the need to both accurately measure Return on Marketing Investment (ROMI) across a range of metrics, as well as to then optimise the application of that investment in both large and small ways.

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Adoption of marketing and sales force automation technology over the last few years has allowed many firms to automate key marketing processes, This document is the result of primary research performed by Aberdeen Group. Aberdeen Group's methodologies provide for objective fact-based research and represent the best analysis available at the time of publication. Unless otherwise noted, the entire contents of this publication are copyrighted by Aberdeen Group, Inc. and may not be reproduced, distributed, archived, or transmitted in any form or by any means without prior written consent by Aberdeen Group, Inc.

Revenue Performance Management Demystified for UK Companies Page 2

from lead generation to close. These systems also generate significant quantities of data about the processes themselves coming “off the side” of the process. Like business process automation and management evolutions that have taken place in industry over the last 30 years, from ERP and supply-chain management in manufacturing, to Straight-Through Processing (STP) in financial services, efficiencies gained from automating the actual processes represent a small percentage of the value of these systems. Significant value is actually unlocked by capturing and analysing this metadata. Figure 1: The New Normal - Managing Growth in a Time of Constraint Managing growth

32%

Budgetary pressures (i.e. do more with fewer / same resources)

30%

Ability to validate / quantify value of marketing to the business

22%

Market share

22% 10%

20%

30%

40%

Percentage of U.K. Respondents, n = 37

Source: Aberdeen Group, May 2012

The stock market provides an extreme but useful illustration of the value of process data. At its most basic, a stock price is nothing but metadata produced as a result of a trading transaction. Over the last 20 years, trades representing complex financial transactions have become increasingly automated, from the trade to back-end settlement. While this StraightThrough Processing (STP) has produced enormous benefits in terms of efficiency and accuracy vs. traditionally brokered trades, some of the biggest benefits have come from analyzing the trade process using data such as trade size, trade volumes, in addition to the stock tick itself. Using technologies like event stream processing and complex trading algorithms, traders use the data being produced by many thousands of automated trading processes to generate intelligence, and make split-second trading decisions.

Revenue Performance Management Emerges Revenue performance management is an approach to optimising marketing processes. It is the equivalent of process optimization in the language of business process management, and in this light it’s nothing new. In fact, many marketers are implementing RPM today, albeit incrementally and / or piecemeal. RPM is a way of looking at marketing operations through a data © 2012 Aberdeen Group. www.aberdeen.com

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lens and operationalising that data to make better decisions about where to invest those precious marketing resources. In so doing, organizations using RPM can optimise the interactions with potential buyers across the entire revenue cycle, and deliver more accurate forecasting of marketing outcomes in the process. RPM is not a new product category (as 98% of respondents agreed), nor should it be dismissed as just another TLA (three letter acronym). Companies identified as Best-in-Class (see sidebar for definition) are more likely than others to adopt revenue performance management today. As seen in Figure 2, 20% of Best-in-Class firms have an explicit RPM initiative in place, compared with 5.5% of all others (Industry Average and Laggard firms), and a further 30% of Best-in-Class are planning to implement one, compared with 19% of all others. Perhaps more telling, Laggard companies are much more likely to be ignoring RPM (Laggards are nearly three times more likely than the Best-in-Class to have no RPM initiative in place and no plans to implement one). This difference reflects the significant deltas we see in both the reported value and use of marketing metrics between maturity classes, as we’ll discuss below. Interest in revenue performance management appears to be strong in the UK. Fifty-one percent (51%) of UK firms have heard of or are very familiar with RPM (compared with 49% of all firms); they’re more than twice as likely as Industry Average firms to have an RPM initiative in place and nearly as likely as Best-in-Class companies to have one in the planning. Figure 2: Best-in-Class Companies More Likely to Have Revenue Performance Management Initiative in Place

Percentage of Respondents

Best in Class

Industry Average

Laggards

UK Companies 57%

60% 50% 35%

40%

30%

30%

21%

20% 20% 10%

28% 17%

28% 20%

12% 5%

7%

Defining the Marketing Lead Management Best-in-Class Aberdeen used three key performance criteria to distinguish the Best-in-Class (top 20% of aggregate performers) from the Industry Average (middle 50%) and Laggard (bottom 30%) organisations. The top 20% of companies in the forthcoming marketing lead management report achieved the following performance metrics: √ 85% of marketing leads passed to sales are “actioned” vs. 27% for Industry Average and 5% for Laggard firms √ 22% year-over-year increase in marketing’s contribution to salesforecasted pipeline, compared with a 7% and 1% increase for Industry Average Laggard firms respectively √ 18% year-over-year rise in marketing’s contribution to company revenue, vs. 6% increase for Industry Average companies and no increase for Laggards

0% Revenue performance management initiative currently in place

Planning to implement

No RPM initiative in place / no plans to implement one n = 163, n = 37


Of course, before a process can be optimised, it first must exist and it must be instrumented in such a way that it can be analyzed in a meaningful way. Thus, the foundations of revenue performance management are twofold: 1) clearly defined, standardised marketing lead management processes, and 2) consistent use of marketing metrics (i.e. process instrumentation), © 2012 Aberdeen Group. www.aberdeen.com

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particularly metrics that span the process from lead (or response) to close (or revenue). As seen in Figure 3, Best-in-Class companies are significantly more likely than other companies to have the fundamentals of RPM in place, as are UK firms. Using a 5-level framework like the Capability Maturity Model Integration (CMMI)1 created for benchmarking software development processes provides a useful model in defining marketing process maturity, they are: 1. Initial / ad hoc. Emergence of a marketing function. 2. Repeatable. Established marketing lead processes and tribal knowledge of processes. Initial use of marketing technology. 3. Defined. Marketing processes are documented, often using marketing technology to capture and automate key steps. 4. Managed. Use of measurement and metrics help marketing deploy processes more effectively. 5. Optimised. Cross-functional metrics used to apply continuous improvement to marketing processes based on revenue outcomes. Explicit in this framework is the notion that achievement of each level is cumulative, i.e. organisations must gain the experience of level 1 as a foundation to achieve the level 2 and so forth. Figure 3: Marketing Process Management is the Foundation of RPM Best-in-Class 70%

65%


70%

All Others

UK Companies 69%

67%

65%

60% 50%

45%

45%

40%

42%

35%

41%

30%

32%

Dedicated resource responsible for optimising lead management

Ability to measure close rate of marketinggenerated leads via integration with CRM

30% 20% 10% Process to establish / Defined, standardised, refine lead qualification and documented criteria between lead management sales and marketing processes in place

n = 163, 37


1

See http://www.sei.cmu.edu/cmmi/ for more information about the Software Engineering Institute and an overview of CMMI. © 2012 Aberdeen Group. www.aberdeen.com

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The Road to Revenue Performance Management at Colt Colt, a leading information delivery platform serving Europe, enables its customers to deliver, share, and process and store their vital business information. An established leader in delivering integrated computing and network services to major organisations, midsized businesses, and wholesale customers, Colt operates a 21-country, 35,000km network that includes metropolitan area networks in 39 major European cities with direct fibre connections to 18,000 buildings and 19 Colt data centres. In 2010, the Colt Data Centre Services business was launched to deliver innovative, high-quality modular data centres which are rapid to deploy and power efficient. After completing a pilot marketing automation project in 2008, Colt rolled out an initial, organization-wide implementation in 2009, with a second phase that incorporated full Customer Relationship Management (CRM) integration in early 2011. With this foundation in place, Colt has embarked on a revenue performance management initiative aimed to connect all of its marketing activities with revenue. With marketing operations across Europe, Colt faces both organizational and technical challenges in reaching this goal. “We’re a very sales-driven company so it’s important that we’re speaking the same language, which is a language of metrics and hard numbers,” said Sebastian Zentgraf, digital marketing manager at Colt. Colt’s marketing teams are focused on three key performance indicators (KPIs): •

Marketing influenced pipeline

•

Marketing sourced pipeline

•

Return on Marketing Investment

Colt tracks a number of funnel metrics to determine KPI values, including the number of leads in each stage of the funnel, the percentage of leads converting through the different stages, and the number of sales-qualified leads (opportunities) resulting from marketing activity. One key focus for Colt is on marketing qualified to sales qualified conversion as an indicator of sales and marketing alignment. Finally, Colt tracks the percentage of closed won opportunities to achieve closed loop reporting. Colt focused on several key elements in rolling out its RPM strategy: 1) developing standard, consistent lead management processes from response to close; 2) capturing and ongoing tracking of funnel metrics; and 3) change management around the behaviour of field marketing.

Continued… © 2012 Aberdeen Group. www.aberdeen.com

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The Road to Revenue Performance Management at Colt “Putting a marketing automation system in place is to some extent the easy part,” Zentgraf explains. “The biggest challenge is changing the culture and practices across the organisation so campaigns are set up in a consistent manner.” To support Colt’s distributed, global marketing team, the company implemented a digital marketing team and central demand centre which are responsible for setting up all campaigns and reporting back campaign performance, along with recommendations for improvement. “The road to revenue performance management is really a journey,” said Zentgraf. “In some ways you never actually arrive, you just want to keep improving it and the more you understand the more you want to track and measure.”

Use of Metrics as Measure of Best-in-Class Maturity With standardised processes in place, use of marketing metrics—measured instrumentation of discreet process steps, as well as derived metrics based on the relationship between processes—is another key foundation for revenue performance management. In Figure 4 and Figure 5 we look at the comparative value of various marketing metrics and the rate at which those metrics are adopted by Best-in-Class, All Other, and UK-based companies respectively. Looking at the two figures together provides a gap analysis between marketing’s wish list and what marketing is actually doing today. Figure 4 shows the percent of companies indicating that a particular metric is a 4 or 5 on a 1-5 scale from 1: Not Valuable to 5: Very Valuable. There is no requirement to actually be using the particular metric, but it’s reasonable to assume that companies will tend to place a higher value on metrics with which they’re familiar. Top-performing companies are more likely to view just two metrics more favorably: marketing’s contribution to sales-forecasted pipeline and the value of the marketing funnel. Both of these have a distinct flavour of marketing and sales alignment. Sales-forecasted pipeline attributed to marketing is an interesting metric, as it’s not related directly to the marketing funnel, but rather to the outcome of both funnel performance and the relationship between sales and marketing (see Aberdeen’s December 2011 report, Sales and Marketing Alignment: The New Power Couple for a detailed discussion of this issue). This data reminds us that marketing lead management often requires more than managing the interactions with buyers; marketing leaders must manage internal expectations as well. Surprisingly, companies in the UK don’t rate marketing’s contribution to sales-forecasted pipeline very highly, as their adoption of other capabilities associated with strong marketing-sales alignment, such as processes to define the lead qualification and lead scoring criteria, is higher than average. Instead, companies in the

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UK prioritise lead conversion, reach, and lifetime customer value as the most valuable marketing metrics. Best-in-Class companies also track the value of the marketing funnel at a higher rate than all other companies, a capability that we consider in more detail below.

Figure 4: Comparative Value of Marketing Metrics (percent of companies indicating metric as valuable or very valuable) 89%

Sales-forecasted pipeline attributed to marketing

71% 58%

86% Lead conversion

87% 83%

78% Rate of marketing programme return

80% 63%

77% Marketing funnel value

65% 62%

59% Lifetime customer value

65%

Best-in-Class

63%

56% Audience reach

All Others 61% 70% UK Companies

52%

Lead velocity (time in marketing / sales funnel stages)

56% 42% 20%

30%

40%

50%

60%

70%

80%

90%

Percentage of Respondents, n = 163, n = 37


Several trends emerge when we look at the actual use of marketing metrics in Figure 5. The first is an execution gap between Best-in-Class and other companies. For example, while 84% of all companies indicate lead conversion is valuable or very valuable, Best-in-Class companies are over 40% more likely than all others to currently track it (74% vs. 52% adoption). This execution gap is consistent across marketing metrics: Best-in-Class companies are simply more likely to measure marketing outcomes. © 2012 Aberdeen Group. www.aberdeen.com

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Figure 5: Use of Marketing Metrics the Measure of Best-in-Class Maturity 78%

Sales-forecasted pipeline attributed to marketing

42% 43%

74% Lead conversion

52% 63%

63% Marketing funnel value

32% 38%

56% Rate of marketing programme return

35% 31%

52% Audience reach

35% 31% Best-in-Class

50%

Lead velocity (time in marketing / sales funnel stages)

29% 41%

All Others

35% Lifetime customer value

UK Companies

28% 37% 10%

20%

30%

40%

50%

60%

70%

80%

Percentage of Respondents, n = 163, n = 37


The second interesting trend comes from looking at the way in which the metrics are ranked. The overall ranking of the metrics is consistent between the comparative value and use metrics, except for rate of marketing programme return and lifetime customer value (net present value of future revenue associated with a customer). The difference here represents again an execution gap, suggesting that these metrics are more challenging or difficult to obtain. For example, to understand the rate of return from marketing programmes requires closed loop reporting on the close rate and transaction value. In more complex, multi-touch, multi-channel selling environments an attribution model will also be needed to appropriately “weight” the rate of return. Furthermore, given the sophistication required to determine lifetime customer value, it’s not surprising that use is the lowest among the metrics we tracked. This isn’t the case for companies in the UK, however, which both value and track lifetime customer value more than even Best-in-Class companies. This is consistent with the fact that UK firms are likely to identify most and / or least profitable customers (55% of UK respondents have this capability, just 5% shy of the Best-in-Class adoption rate of 58%). As we’ll discuss below, this shows that almost all © 2012 Aberdeen Group. www.aberdeen.com

Tweet This Best-in-Class companies are 40% more likely than other companies to track lead conversion (74% vs. 52%) #RPM

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firms have some revenue performance management processes in place, even if they’re not pervasive, or identified as such. What marketing leaders ultimately want to know is where to invest that next dollar of marketing budget for the greatest impact. Closely related to the lifetime value of a customer is the profitability of specific customer segments. We consider this among a number of RPM capabilities.

Revenue Performance Management (RPM) Capabilities In the following section we look at RPM capabilities being used by companies today, including general marketing performance capabilities, profit-oriented marketing performance capabilities (i.e. cost-adjusted performance), and predictive-oriented marketing performance capabilities.

General Marketing Performance Capabilities Beyond the ability to actually capture the metrics considered above, Best-inClass companies are more likely to adopt several general marketing performance capabilities seen in Figure 6. UK firms are strong in this area as well, and even are more likely than the Best-in-Class companies to have a process in place to determine the number of marketing-qualified leads needed to reach their goals. Consistent with what we see in other domains, Best-in-Class companies are 116% more likely than all others to have a dedicated resource responsible for tracking and reporting on marketing performance, while UK firms are 84% more likely to have the same. This is particularly important, as key metrics often reside in multiple systems and take multi-channel communications into account, making it more challenging for individual marketing programmes managers to deliver a comprehensive view or normalize the metrics across systems. In many companies, this function is served by a marketing operations role (either individual or team, depending on the size of the organisation).


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Figure 6: Marketing Performance Capabilities Best in Class

All Others

UK Companies

70%

62% 58%


60%

54%

52%

50%

46%

46%

39%

40%

36%

34%

30%

32% 25%

21% 20%

10% Process to calculate average total cost of customer acquisition

Ability to apply marketing metrics to specific campaigns, channels, or segments

Dedicated resource responsible for tracking and reporting on marketing performance

Process to determine number of marketingqualified leads needed to reach revenue targets

n = 163, n = 37


Another trend we see among Best-in-Class firms is the greater granularity and comprehensiveness at which they track marketing metrics. Best-in-Class companies are 71% more likely than all others and 49% more likely than UK firms to apply marketing metrics to specific campaigns, channels and segments. In other words, they can determine the revenue performance of marketing activities across a range of attributes, allowing them to make more informed decisions about future investment, and the likely return for any given programme. Best-in-Class companies also significantly outpace both all other companies and UK-based companies in their ability to calculate the average total cost of customer acquisition. While cost-per-lead and cost-per-customer metrics are less optimal than return- and / or profit-based metrics, as a costly lead source may actually deliver better results from a revenue perspective, it is a necessary component for determining such composite, revenue performance metrics.

Profiting from Profit-Oriented Metrics By definition, profit-oriented metrics are those that take cost considerations into account, especially when we refer to campaign metrics. For example, marketing might look at the response rate of a campaign in perspective of the relative acquisition cost – essentially the cost-per-lead or response to a given campaign or lead source, as noted above. Profit can also apply to the return on those leads in real, revenue terms. In this scenario, a campaign’s © 2012 Aberdeen Group. www.aberdeen.com

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performance will be evaluated based on how well those responses or leads ultimately convert into closed sales deals, and the relative value of those deals vs. the average, etc. This weighted calculation allows marketing to make smarter choices going forward about whether a given programme or lead source is “worth it.” Marketers, especially those working with long sales cycles, should keep in mind that such metrics are historical, have a long lead time and require multiple data points to yield statistically viable information. Given that buyer response patterns shift over time, their value is in providing clues to guide future decisions based on correlations of marketing activity and customer value. The same is largely true for other profit-oriented metrics that take deal value into consideration. The value of such metrics goes beyond just marketing campaign optimisation, however; they may have a profound impact on the business’ strategy. For example, the ability to calculate the profitability of specific customer segments may provide a foundation for product choices designed to appeal to a specific segment (e.g. vertical industry). As seen in Figure 7, Best-in-Class companies are more likely to utilise many of these profit-oriented metrics. As a result, they’re also more likely to have a solid decisioning framework for marketing investments in place, and to be more strategic within the business.

Tweet This Best-in-Class companies more than twice as likely as other companies to track the profitability of marketing campaigns (58% vs. 25%) #RPM

Figure 7: Best-in-Class Companies Profiting from Profit-Oriented RPM Capabilities


Best in Class

60%

All Others

UK Companies

58% 50%

50%

46%

50% 40% 30%

41%

39%

36%

32% 25%

36%

21%

21%

Ability to calculate return on marketing investment (ROMI)

Ability to track profitability of specific marketing channels

20% 10% 0% Ability to track profitability of specific marketing campaigns

Ability to calculate profitability of specific customer segments

n = 163, n = 37


Better Results Predicted Best-in-Class companies are 70% more likely than all other companies to be satisfied with their ability to predict or forecast marketing campaign results (34% of Best-in-Class vs. 20% of all other and 29% of UK-based companies). The difference is no doubt attributed to their overall propensity to track marketing and marketing campaign metrics, but the adoption of specific © 2012 Aberdeen Group. www.aberdeen.com

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predictive competencies have an impact as well. Figure 8 shows the predictive capabilities that are adopted at higher rates by Best-in-Class companies compared with all other companies. One key metric here is the ability to predict or forecast the future value of opportunities in the marketing funnel. Forecasting has long been standard operating procedure for sales; however the challenges are unique for marketing. Sales forecasting is often made based on direct interaction with the buyer, whereas marketing isn’t touching each and every lead upstream. Thus, accurately forecasting the value of the marketing funnel not only requires historical understanding of the revenue value of leads at various stages of the funnel, but also rigorous application of standardised lead qualification stages. Once well-defined qualification stages are determined, marketers can work backwards to assign a weighted revenue value to leads at each stage. Figure 8: The Future’s so Bright - Best-in-Class Adopt Predictive Marketing Capabilities Best in Class

40%

38%

36%

All Others

UK Companies

38%

37%

36%

35%


32%

31%

30%

27%

20% 14%

14%

Process to determine lifetime customer value

Process to determine weighted average cost / benefit of specific lead sources

16%

10%

0% Ability to track marketing spend to budget within 15-days accuracy

Process to determine future value of opportunities in marketing funnel n = 163, n = 37


As mentioned above, marketing’s contribution to sales-forecasted pipeline also plays a major role, as the forecasted value of the funnel is ultimately dependent on the percentage of leads that are being accepted, qualified and closed by sales. Paying attention to these metrics then is not only essential to understanding marketing funnel value, but can also provide a focus for optimization, as small percentage changes can have a significant impact on this value (i.e. if a larger percentage of marketing qualified leads are © 2012 Aberdeen Group. www.aberdeen.com

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converted to sales qualified, the value of the marketing funnel will necessarily increase, all else being equal). Returning to lifetime customer value, we see that despite modest adoption, Best-in-Class firms are more than twice as likely as Laggards to have a process in place to determine the lifetime value of a customer. While frequently associated with consumer marketing, the use among the predominantly B2B respondents of the survey is interesting, and points to the growing sophistication with which B2B marketers are leveraging the data available to them. Beyond its inherent value, this metric can reveal important trends in the value of discreet customer segments, as well as trends in terms of the marketing programmes to which they’ve been exposed. UK firms are more likely that Industry Average companies to determine lifetime customer value—statistically even with Best-in-Class adoption. They’re also strong in a number of other predictive capabilities discussed above, indicating a fairly mature level of marketing process management.

Technology and Processes Marketing automation software suites are the prevailing means through which companies are defining and standardising marketing processes today. In fact, a marketing system implementation can often serve as a catalyst for organizations to document the processes they have in place, often for the first time. Sixty-three percent (63%) of Best-in-Class companies in our study use marketing automation software, compared with 38% of all others, a difference of over 65%. An even higher 69% of the UK-based companies surveyed currently use a marketing automation software suite. When we look at adoption of specific functions within marketing automation software suites, such as email marketing, landing pages, lead scoring and nurturing, and reporting and analytics however, Best-in-Class differentiation is readily apparent. Eighty-nine percent (89%) of Best-in-Class companies use reporting and analytics functionality, compared with 66% of all other companies, and 68% of UK firms, as seen in Figure 9.


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Figure 9: Best-in-Class Lead in Use of Marketing Analytics Tools


Best-in-Class 100%

All Others

UK Companies

95%

90%

Tweet This

80% 70%

65%

68%

60% 50%

89% of Best-in-Class use reporting and analytics within marketing automation vs. 66% of other companies #RPM

40% Actively use reporting & analytics as part of marketing automation deployment n = 163, 37


Recommended Actions Companies should stop thinking of revenue performance management as the sole, exclusive, and exotic domain of only the most advanced and deeppocketed marketing organisations. RPM is a process, an approach and a discipline. While technologies can support an RPM initiative, it’s not something you buy. RPM depends upon solid underlying marketing processes, some level of process automation and instrumentation, and a degree of standardisation or normalisation of the data. As noted above, Best-in-Class companies are more likely to have well-defined lead management processes in place, and to utilize the reporting and analytics functionality within a marketing automation software suite. But organisations that don’t have end-to-end marketing processes defined, implemented, and instrumented can begin the RPM journey by developing islands of excellence using metrics that are currently available. Firms in the UK demonstrate this in their use of lifetime customer value and other predictive marketing analytics. But there are opportunities for improvement. While companies in the UK are 34% more likely than Laggards to measure the close rate of marketing leads through CRM integration (41% vs. 32%), they’re 58% less likely to do so than Best-in-Class companies (65%). The use and preference of specific marketing metrics also provides a model for adoption. Once processes are established and measurement is in place, start by tracking lead conversion. Be sure to develop a clear and agreed-upon definition and criteria across the funnel, else the corresponding metrics for each stage of the funnel become less and less meaningful. This is especially so for the “hand off” of leads from marketing to sales, where marketing typically has less visibility and almost certainly less control over the process (at least in firms where © 2012 Aberdeen Group. www.aberdeen.com

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marketing and sales are separate departments). Companies in the UK should consider focusing on marketing’s contribution to sales-forecasted pipeline, a metric that not only serves as a proxy for how effectively marketing is driving revenue, but provides an indication of marketing-sales alignment. Firms with established process and metrics have the opportunity to extend their RPM initiative to consider the weighted cost and revenue return of the marketing activities. By doing so, they can gain valuable insight about the shape of the business to guide strategic decision making.

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Related Research B2B Social Media Marketing: Are We There Yet?; March 2012 Sales and Marketing Alignment: The New Power Couple; December 2011

The Marketing Executive's Agenda for 2012: Uncovering the Hidden Sales Cycle; October 2011 The Marketing Executive's Agenda for 2012, Part 2: Channel Conflicts and Resolutions; October 2011 Author: Trip Kucera, Sr. Research Analyst, Marketing Effectiveness ([email protected]) LinkedIn @TripKucera For more than two decades, Aberdeen's research has been helping corporations worldwide become Best-in-Class. Having benchmarked the performance of more than 644,000 companies, Aberdeen is uniquely positioned to provide organizations with the facts that matter — the facts that enable companies to get ahead and drive results. That's why our research is relied on by more than 2.5 million readers in over 40 countries, 90% of the Fortune 1,000, and 93% of the Technology 500. As a Harte-Hanks Company, Aberdeen’s research provides insight and analysis to the Harte-Hanks community of local, regional, national and international marketing executives. Combined, we help our customers leverage the power of insight to deliver innovative multichannel marketing programs that drive business-changing results. For additional information, visit Aberdeen http://www.aberdeen.com or call (617) 854-5200, or to learn more about Harte-Hanks, call (800) 456-9748 or go to http://www.harte-hanks.com. This document is the result of primary research performed by Aberdeen Group. Aberdeen Group's methodologies provide for objective fact-based research and represent the best analysis available at the time of publication. Unless otherwise noted, the entire contents of this publication are copyrighted by Aberdeen Group, Inc. and may not be reproduced, distributed, archived, or transmitted in any form or by any means without prior written consent by Aberdeen Group, Inc. (2011a)


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