Marketing ROI is an enigma for many professional services firms. Most executives find it easier to locate a unicorn than determine their firm’s marketing ROI. Many opt for dated “best practices” that may inadvertently sink their overall marketing efforts.
But here is the good news: It is getting easier to track marketing results thanks to new technology that far surpasses the limits of Google Analytics.
Don’t get me wrong. Google Analytics is a great tool, but it only captures the tip of the analytics iceberg. And most metrics, like Facebook Likes and Twitter Follows, are of limited value because they don’t tell the entire story.
High-Growth and Marketing ROI
It may surprise you that the most profitable high growth firms do not outspend firms with little or no growth in marketing. In our 2016 High Growth Study, we found that high growth firms actually spend less than their low-growth counterparts and are still 45% more profitable and generate an impressive 36.9% growth!
This highlights the fact that most firms are putting their money and efforts toward inefficient marketing methods that haven’t produced sizable results for years. But firms continue to pursue them because that is what they have always done.
Tracking the right data
One of the keys to measuring marketing ROI, especially for professional services firm, is to monitor progress along the entire B2B sales cycle. Maintaining that pipeline, with prospective clients at all stages, helps minimize the crazy ebbs and flows of work traditionally found in professional services industries.
Every firm will track different things. At Hinge we track the following metrics weekly, if not daily:
- Website sessions—Your website is the first touch point for many prospective clients searching for you services. Knowing how many visits you get is important because, not just to measure your SEO impact, but also it is the first traceable touch point for a referral checking out your firm.
- Conversions— Driving traffic to your website is only part of marketing’s role. Because a firm’s services are not transactional, most prospects will not convert to a lead on their first visit. When you ask your website visitor to give you their name, company, and email in exchange for valuable content like an executive guide, white paper or webinar you are converting them from a simple website visitor to a qualified prospect.
Many professional service firms don’t track this fundamental step of the content funnel. Asking them to download your content identifies the prospect and allows you to drip marketing messages to them over time. You want to track both the number of conversions and your conversion percentage, because a sway in your traffic may alter your view.
- Leads— A lead is anyone who “raises their hand” and wants to talk about potentially buying your services. Most professional services just start tracking here using a CRM, or customer relationship management, platform. But without insight into the previous steps, you cannot understand why the number of leads vary from week to week. You can further break this metric into qualified and unqualified
- Proposals—Separating leads from proposals is important because it shows how prospects are whittled down (not qualified, not ready, or just a poor fit for your firm). Noting the percentage of leads that get proposals shows the effectiveness of your marketing efforts in targeting the correct audience.
- Near close—At Hinge, we track and discuss the proposals that we believe have an 80% chance of closing within the month. It really has more to do with a capacity and cash flow measurement to help with forecasting. Since many proposals can sit for months (even years) before they close, it ensures potential clients remain on everyone’s radar.
- Closed deals—I hope every firm tracks this stage, but I know they don’t. You want to see the dollars generated by your marketing and business development efforts. After all, this data is required for the marketing ROI
Compare your numbers week-to-week and year over year. Develop a chart to make the metrics meaningful to everyone.
Understanding the data
Again, having the data is important. Understanding and using the data is mandatory. One of the easiest ways to use your data is to look for trends. Ideally, you want to see increases across all your metrics. You will find, that if the metrics from one stage of your pipeline decreases, eventually the other areas will drop as well. Knowing when to expect this drop is powerful, because you can fix potential issues at each stage by changing processes, adding personnel or using available tools more efficiently.
The challenge will be how you attribute a closed deal to your marketing and business development efforts. Most likely, a deal did not close because of one action. A prospect’s journey is quite diverse and may include web searches, reviewing social media, asking colleagues, attending webinars and presentations, meeting at association mixers, and reading your expert’s book.
Using technology to your advantage
As I mentioned before, marketing ROI has gotten much easier thanks to technology, otherwise known as “marketing tech.”
- Marketing attribution is the science of identifying what touch points contribute to a desired outcome like a prospect attending a webinar or, ultimately, becoming a client. Attribution helps you determine the mix of channels that lead to closed business, including which calls to actions and triggers work best.
- Lead scoring is the ranking of prospective clients by how likely they are to buy from you. Since prospects require multiple touch points to purchase your services, this technology scores each prospect based on their interactions with your firm and their behaviors. For example, a lead gets 2 points for opening an email, 5 points for clicking the link, and 10 points for attending a webinar. The more points a prospect has accumulated, the more likely that person is to buy from your firm. With this technology, you can prioritize your hot prospects over your cold leads
- Micro analytics, like lead scoring, are becoming more common and allow you to see what an individual does instead of just looking at everything as a whole (the macro view). Marketing automation and marketing attribution tools help you do this across multiple channels, and some tools also incorporate offline channels like speaking engagements and association memberships as well. Because these tools are web-based, they also report in real-time. You can see how a single touch point affects the lead scores in your CRM and measure both short-term and long-term successes.
Another way to maximize your marketing ROI is to do research on your target audience. Knowing what your clients and prospects want is always more efficient than following best practices because each market and industry respond uniquely. Knowing more about your audience helps you hit the target faster and more accurately than the fire-then-aim approach that many firms employ.
When determining your firm’s ROI on marketing, the key is having the data at hand. If you don’t have it now, start collecting it. I love this quote, “The best time to plant a tree is 20 years ago; the second best time is today.”
Once you have your data in place, you can start seeing trends to ensure you maintain a full pipeline at each stage and start to determine what efforts impact your pipeline the most. Take that a step further and utilize marketing attribution or marketing automation tools to pinpoint the marketing ROI of your investment in sponsorships, presentations, guides, and every other touch point.
- Discover what today’s most successful professional services firms are doing right in the research summary 2016 High Growth Study.
- Find out more on becoming a sought-after expert in your industry by downloading a free copy of The Visible Expert℠ book.
- For more hands-on help on becoming the next Visible Firm®, register for our Visible Firm® course through Hinge University.
How Hinge Can Help
Hinge is a global leader in helping professional services firms grow faster and become more profitable. Our research-based strategies are designed to be implemented. In fact, our groundbreaking Visible Firm® program combines strategy, implementation, training and more.