Having shared the 5 f’in’ fundamentals for creating marketing Objectives and Key Results (OKRs) on the podcast and his last article, Jeff Clark takes us through the next step to get us started on creating a marketing metrics dashboard…
In my recent acronym littered blog post, OKRs, KPIs, ROI … OMG, I staked out how CMOs can use the goal setting process to make marketing relevant, accountable and measurable. I outlined five f’in fundamentals of setting OKRs.
Those fundamentals still leave us with the question, “What do we measure to show our results?” It’s a loaded question, because there is an excess of things we can measure, from web stats to brand awareness to pipeline contribution. However, if we apply the following principles, we can hone down our measures to something meaningful.
Principle #1: Address Business Questions
When considering what you’re measuring, think of your measures in the context of addressing business questions. In other words, when you say, “Here’s our progress on supporting OKR numero uno?”, members of the executive team will be thinking, “What are you doing that’s important to me?”
If contributing to demand is important, the questions could be “How much in opportunity value have you sourced? Is it Net New? Is it current customers?” Or it could be “How is marketing influencing or accelerating opportunities in the pipeline?” Let’s put aside the debate of defining marketing attribution versus contribution, these are likely questions that are in their mind.
NOTE: Don’t Guess. Ask Your Audience What They’re Thinking. Before you start getting into selecting specific metrics or drafting a dashboard, survey the exec team to ask them what they’re questions are. Don’t expect detailed answers. You’re not asking them to define metrics for you. You want their concerns.
If you get detailed answers, don’t take them literally. They don’t know what sources of data you can access, or they may understand tactical metrics (e.g., leads) and you don’t want to go there, yet. With our demand example, this is where you confirm the expectation that marketing is to source, influence, engage or accelerate opportunities.
Principle #2: Prioritise Measures of Impact
For executive level reporting of OKRs, you want to avoid tactical or activity level metrics. In other words, event attendance and leads are tactical activity measures for demand, and you want to up-level to a revenue-oriented metric. Metrics with monetary value trump numbers of activities.
If reporting on leads is required, put them in context of the funnel as early-stage engagement. In the later stages, you must tie them to sales-accepted or marketing influenced pipeline. Showing how marketing is tracking a demand waterfall process gives you an opportunity to discuss a variety of process issues, such as conversion metrics, sales cycle velocity, or investment-to-pipeline ratios.
Principle #3: Address Readiness to Make Impact
At the executive level, marketing’s readiness to provide impact may be a valid concern. Is the demand creation and sales process working? Where are the issues? Is there a sales tool gap? Do you have a skills issue in digital, field, or enablement to address the issues?
These are all questions that, even though they are tactical in nature, show that you have identified a readiness issue, and are taking strides to address it. It may take quarters to fix an issue, but that’s important to raise to the exec team.
I worked at a company where the lack of customer stories and references was viewed as a key inhibitor to sales productivity. So, measuring the number, quality and sales satisfaction with customer stories and references is a legitimate, though tactical concern of readiness for the executive team.
Principle #4: Every Measure Needs a Target
If we’re telling a story of our progress toward business contribution, then what’s the goal we’re headed for? This relates back to our discussion of OKRs, because there must be an expectation of results. For example, if we’re sourcing or influencing opportunities or booked revenue, what’s the total or the percentage of total (sourced by sales, marketing, etc.) we signed up for? Is there a benchmark that we’re using to compare results, such as last year’s actuals, an industry benchmark, or a consulting recommendation?
Principle #5: Expect to Revisit All These Principles
Reporting on your contributions and progress is an evolution, not a destination. You may have thought you got the right business question input, and you may have defined a relevant impact and readiness metrics, but situations change. You may have data issues reporting on a perfectly valid metric or politics messes up a rational decision.
Going back to the drawing board on 1-2 metrics is not the end of the world. It demonstrates that you’re listening to your audience and your team is agile in response.
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