Why Only 21% Of Marketers Can Measure Revenue Contribution


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The marketer’s place in today’s world can be overwhelming — there are more channels, more technologies, more data, and higher customer expectations than ever before. With greater scrutiny over marketing investments than ever before, marketers have a constant need to understand what is working, what is not, and how their actions are driving business impact.

Unfortunately, only 21% of companies are able to point all measurements to Marketing’s contribution to revenue, according to Allocadia’s 2017 Marketing Performance Maturity Benchmark Survey. This was a research initiative that involved in-depth interviews with many successful marketers from a variety of industries and company types, as well as a quantitative study in late 2016.

The report shines a spotlight on some of the reasons why these marketers are thriving, and why others fail to do so.

Where companies fall short

The study uncovered many reasons why only 21% of marketers in our study are able to point all measurements to Marketing’s contribution to revenue.

1. They’re using outdated technology

80% of organizations are still using Excel in some way to track their impact on the business. 47% of organizations are not using any purpose-built technology at all when it comes to planning or investment management (core activities of Marketing Performance Management).

In contrast, high-growth organizations leverage Marketing Performance Management software 3.5X more often than those with flat or negative growth.

2.Their measurements are not actionable
Only 6% of marketers feel that their measurements help determine the next best marketing action.

3. They’re not aligned with the business
Companies expecting more than 25% revenue growth are 2X as likely to have CMO-level reports showing marketing contribution to the business. Leaders in Marketing Performance Management are in lock-step with company objectives.

What’s more, these high-growth businesses are nearly 2.5X more likely than underperforming organizations to have marketing and sales data that is always or often consistent and aligned to the company’s overall objectives.

4. They haven’t made Finance their ally

Although leading marketing organizations in our study are 3X more likely to align Marketing and Finance, only 14% of marketing organizations overall see Finance as a trusted strategic partner, and 28% either have no relationship with finance or speak only when forced to.

A good relationship between Marketing and Finance is an important part of securing appropriate budgets, but more importantly it’s how marketers will earn a more significant role in the business as the role of a CFO grows increasingly more strategic.

Our study found that the majority of high-growth organizations expecting revenue growth of 25% or more report working with finance to track investments and measurements (57% compared to 20% of companies with flat/negative growth). They are also more apt to align with finance on the measurements of budgets and returns (61% compared to only 27% of companies experiencing flat or negative growth.)

5. Their data quality is holding them back

Data quality (related to investments, budgets, and planning) is a common challenge among organizations. this limits reporting and the ability to make better marketing decisions.

Only 8% of organizations have marketing, sales and finance data in one data warehouse that acts as a “single source of truth.” and only 28% feel marketing’s data is accounted for and well formatted (this includes that initial 8%).

6. They lack visibility into baseline metrics.

Only 50% of organizations report having full visibility, or better, into baseline marketing metrics. 13% of those reported that they don’t even know where all their data lives and can’t run any reports. Ouch.

7. They use marketing technology inconsistently

Especially in large and distributed marketing organizations across geographies or divisions, proper integration of marketing data across various technologies used is critical to driving growth.

We found that companies who consistently integrate technology across their entire marketing organization are 5X as likely to see 25%+ revenue growth than those with flat or negative growth (57% vs. 13%).

What’s more, consistent use of marketing technology (e.g. the same marketing automation platform rather than three different vendors across the organization) makes a difference. About 60% of companies who expect budget increases over 10% report their use of marketing technology across the organizations to be always or often consistent, compared to 36% of those with flat to negative growth.

Finally, 70% of companies that expect revenue increases have good or excellent clarity of their marketing technology roadmap, versus 27% of those with flat to negative growth expectations.

What good looks like

Overall, while the industry still has much work to do to improve the adoption and maturity of Marketing Performance Management, there are leading organizations who are setting a standard for their peers.

We found a number of shared success factors for these high-performing marketers:

1. They focus on core operational data; investments, returns, and strategic views of data like ROI.
2. They are integrating technologies globally
3. They meticulously clean data sources
4. They provide measurement that prove their value to the business and its goals.

In short, these successful marketing organizations are embracing Marketing Performance Management (MPM) and continue to mature and optimize their department’s marketing performance.

Why it matters

What’s at stake here is a “seat” at the executive table, meaning Marketing must now look at their organization more like a business and no longer a function. In short, they must make every dollar count to maximize their team’s performance and prove their impact.

Marketing leaders that succeed at this enjoy added power, confidence and the trust of the entire company. Those who fall short will be delegated to the second row: taking orders and executing, rather than strategizing and leading.

Download the full benchmark report here.


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