Marketing Attribution – Worth the Effort?

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Challenge: Considering the Challenges of Marketing Attribution, How Deep Should You Go?

Marketing attribution is a hot topic. You need to know which programs are worth the effort and expense and marketing must demonstrate its contribution to revenue. In fact, both marketing and sales must both carefully plan and measure their unique contributions to more accurately predict revenue.

However, Sergio Maldonado’s recent guest post on Scott Brinker’s Chief Martec blog raised some very important questions about the veracity of marketing attribution. The article challenging various aspects of marketing attribution is timely and worth a careful read. It also caused me to re-evaluate my ongoing efforts to focus on attribution.

The journey starts with developing a standardized way to tag Leads, Contacts and Opportunities to marketing campaigns, followed by a methodology to differentiate sales from marketing contribution (as well as sourced versus influenced). Adding various program costs and labor investment to the formula provides a more complete picture. However, this tells just part of the story as it analyzes attribution from first ‘form conversion’ to closed deal, without consideration for pre-conversion activities.

Tracking and attributing the activity of all stakeholders before form conversion is more difficult. Furthermore, attribution-to-revenue calculations only provide results for Contacts associated with a closed-won Opportunity, whereas other Leads and Contacts not associated often influence the deal. Therefore, this methodology ignores Leads and Contacts that influence but are not associated with the opportunity as well as all awareness phase marketing touchpoints that positively affected the opportunity.

By focusing only on campaigns with direct attribution, marketing may erroneously optimize for those programs only – at the expense of awareness and early stage funnel activities where attribution is much more difficult. The resulting focus on ‘directly attributable campaigns’ that occur at or after the first form conversion can easily result in a decreased ‘share of voice’ and ignore important early stage touch points. Often, sales prospects are unaware they have a problem or they’re unfamiliar with solutions better suited to their challenge. Awareness programs focusing on the earliest stages of the sales cycle are key to growing sales in the long run.

So if strict adherence to attribution metrics will lead to sub-optimal marketing resource allocation, should marketing invest time and resources in it? Unequivocally yes. At the highest level, Lord Kelvin was right when he said, “When you can measure what you are speaking about, and express it in numbers, you know something about it.” The attribution process is not at fault here (though it can and will certainly improve), rather the issue is how this data is used to make marketing investment decisions. Even though early stage program investments are not measurable in the same way that later stage programs are, they remain an important part of the marketing mix. Therefore, it is incumbent upon the marketing team to explain and defend these ‘awareness’ investments for the long-term health of the organization. The marketing team should also look for important correlations to justify these programs (correlations of direct/organic traffic with various programs, for instance).

In my opinion, marketing must continue to pursue attribution while keeping in mind the limitations of the current systems. Marketing investments should be made recognizing that the team cannot measure all aspects of the marketing mix, and more importantly, additional attribution effort investments should be made with an eye on overall effectiveness. While imperfect, I am reminded of the saying, ‘Even one candle sheds a lot of light in a dark room.’ Without attribution, marketing has no guidance about future investments.  But at the same time, marketing programs with impacts that are difficult to measure must not be ignored.

[Important note: Management should also look at the costs and benefits of the attribution process itself to ensure it is worth the effort. Tracking every last ounce of attribution adds significantly in terms of labor and cost, and at some point, these programs reach diminishing marginal returns. How a marketing team should optimize its spend on marketing attribution is a discussion for another time.]

Lesson: Spending time and resources on marketing attribution is critical, but it is just as crucial to realize program and system limitations to make truly optimized investment decisions.

 

If You Don’t Know Where you’re Going, Any Road Will Take You There

Challenge: How do you build and maintain long term motivation from your team?

Start with the end in mind. That’s a really simple statement but it can be challenging to put into practice. How often do you leave the office and say ‘What did I do today?’ or ‘Did I really accomplish what was most important?’ In today’s multitasking work environment, we’re pulled in so many directions and by so many means: Phone calls, emails, meetings, travel – and all in an environment of change. Yesterday’s plans are put aside for new action plans.

Fortunately, a few simple steps can bring clarity, sanity and most importantly, increased motivation for your team members. This starts with a process of developing organizational objectives from the executive staff and then translating them for everyone in the organization. Organizations just need to translate CEO objectives into those that fall onto the VP Marketing and so on to all in marketing. Simple, right? What if your organization does not have this in place? Good news – you can still put this into action, all on your own.

In outbound marketing and lead generation, you are responsible for sales targets. You can take the quarterly sales objectives and drive these into executable programs. These might impact new opportunities, increase awareness, target verticals or geographies, support sales enablement and more.

So you can ask – do these new requests I just received via email or on a call support my target objectives? Are these tasks somehow more important than the ones already on your plate? Our time is a zero sum game. We only get one chance to complete the day ahead of us and spend our time most effectively. If we get new incoming requests, we need to compare these to the current tasks in plan. Put your plans into place and take these to your manager, Director or VP. This will start a conversation regarding which programs will best support the target objectives. You may even develop a set of quarterly objectives for the team (positive steps!). Once agreed, as plans change, you can raise these up to ensure that the new plans better support your objectives.

The result? Not only will you have better alignment and coordination in your team, but also better motivation by feeling more connected with the organization. You will feel more engaged knowing that your activities directly contribute to the advancement of the organization. Being a part of a successful organization and knowing the role you play is a great source of ongoing motivation.

Lesson: Aligning objectives throughout the organization drives increased motivation

It’s Not Such a Small World After All

Challenge: Small companies want to expand to global market but face limited resources to invest

OK, so you have small company that’s growing well in the US. The product value fits well with international markets, which are inviting local exploration. International expansion frequently starts with hiring a local, in-country team in English-speaking markets (UK, Ireland, Australia and/or New Zealand). The thought is that hiring local resources will help translate what’s worked well in the US and assist in guiding localization efforts. These resources also bring to the table channel relationships and past customer experiences which help propel the process forward. Sound familiar?

The plan is not unreasonable. The learning curve will be steep and frequently initial sales will prove to be positive. The typical issues don’t arise until the next phase, where business growth doesn’t take off as expected, due to expectations of increasing revenue without continued investment.

This is where further investment is required. Certainly the local team may need additional personnel to ramp up channel partners, produce local events, develop local case studies and/or provide collateral localization. However, there may be further investments required stateside in the form of additional development, product management or product marketing to support this fledgling international team.  The further investment doesn’t stop there. Driving internationalization as a priority with the executive staff is required as well. Every quarter an executive should make a location visit to  see progress and challenges firsthand and bring this experience back to HQ in order to make a plan and implement necessary changes. The executive team needs to make the commitment to drive international agenda, communicate feedback and plans, and drive initiatives to support the remote team.

The fundamental mistake most companies make in their internationalization programs is lack of secondary investment, which won’t likely be justified with short-term revenues. The meagre initial revenues’ true payoff is in the learning necessary for next steps on the investments required for success. Likely investments will have to be made in advance of revenues – often significantly in advance of increased revenues.

Lesson: Only make initial investment in international markets if you are willing to double down with further investments ahead of increasing revenue.