Monday, August 08, 2011

Measuring the Impact of Lead Nurturing: 3 Methods You Can Use

One of the things that I love most about my role is when I'm able to visit customers and participate in a customer user group. This past week I was down in Atlanta for the Eloqua All About Revenue Success Tour and I led a breakout session on the different ways that companies measure the success of lead nurturing. Why is this so important? If nurturing is improving the number of overall leads that your marketing team is generating then everything is good, right? Wrong! Companies that are investing in marketing automation should be demonstrating to their managers, the sales team and company executives the role that technology, specifically nurturing, has played in helping the company achieve its business objectives. This of course goes well beyond technology and encompasses all of the time and effort put in to put these campaigns together. Here is a summary of three main ways that marketers are measuring the impact of their nurturing campaigns:

  1. Email Response. Most marketers who have been using lead nurturing were able to see improved open and click-through rates and lower hard bounces and unsubscribes as compared to regular batch and blast campaigns. Others broke this down even further by examining email response by region as an example. A few looked at which emails within the nurturing campaign had better response. This is definitely important to better understand which messages are resonating and which aren't and the optimal frequency to send these emails.

  2. Compare Against Benchmarks. Another approach that was discussed was to compare certain marketing metrics after nurturing was initiated to the same metrics before the nurturing campaigns begun. Companies can compare email response, conversions, leads, total revenue generated, pipeline growth, average deal size and the velocity of movement through the funnel from one period to another if they have the benchmarks to compare to.

  3. Measuring the True Influence of Nurturing. The more advanced marketing teams are able to understand specifically how many leads and qualified leads (MQLs), pipeline and closed deals were specifically influenced by lead nurturing. To do this, marketers are adding lead nurturing campaign responders to a Campaign object in the CRM. Reports can be generated that exhibit all of the campaigns that contributed to producing an opportunity and eventually a closed deal.

    To make this work, marketing needs to create a process that ensures that this campaign association is occurring and needs to create campaign influence reports. Depending on the complexity of your process and the type of technology that you have access to, these types of reports can be challenging to generate. However, if you're able to tell your boss, the CMO and head of sales that 50% of the qualified leads generated in the last 6 months had been through lead nurturing and that lead nurturing influenced 20% of the pipeline in the last quarter, you're able to better argue your case for investing time and resources in additional marketing automation and content creation initiatives. There is no question that lead nurturing takes some up front planning and time. You need to prove that it's worth it and third party reports have clearly demonstrated the success of lead nurturing. Eloqua just produced a simple chart showing that the best in class companies that are doing the most automation have the highest amount of leads produced.
My advice and a theme from the user group last week is to start slowly. Follow the concept of crawl, walk, run and don't mix up the order! In this case, focus on one aspect of lead nurturing and get moving with that. As an example, choose a certain segment to nurture to. This may be a specific vertical, region or job role your focusing on. That way you don't need all of the content at once and you can build out the campaign and still get your other work done. As you get more comfortable and start to demonstrate some results, focus on how you can optimize the process and improve how you measure the impact of your campaigns. 

Let me know if you have any other metrics you use to measure the impact of lead nurturing.

Chad H.

PS - here are two good resources that can help you today:
  • Webinar on lead nurturing: Automating the Buyer's Journey . This is a case study that is really a story about the evolution of marketing automation at NetApp. The story is told by Erin Rampey and there are some great tips that you can take away from this presentation
  • The Grande Guide To Lead Nurturing: All you ever wanted to know about lead nurturingGuide To Lead Nurturing



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