Measuring Marketing ROI: Campaign Attribution and Campaign Influence

GUEST POST: this is  a guest post by Saad Hameed (@KaizenSaad), an experienced marketing operations manager and founder of the Marketing Automation Association LinkedIn Group.

The CEO/CFO of your organization may be asking you to measure Marketing Campaign ROI to determine marketing’s contribution to revenue. The question is straight forward, yet what you may have already discovered is that the answer on what to measure and how to measure is not simple.

In B2B, a prospect doesn’t convert into a customer in a single interaction as is often the case with e-Commerce. Usually, it takes several interactions in the prospect lifecycle that help conversion from prospect to customer. This complex lifecycle makes it difficult to track and report on ROI for the various campaigns that touch prospects, especially at the granular level. In addition to determining the ROI for campaigns, additional ROI related questions are asked such as the ROI by channel (Webinar, SEM, Content Syndication, etc.) and by vehicle (Email, Print Mail, SMS, Survey, etc.). Yet these questions are difficult to answer without costly manual analysis. What you need is a solution that will properly track the influence of marketing campaigns on the funnel and also the accurate attribution of revenue to marketing campaigns. The benefits of such a solution are:

  • Highly accurate measurement of marketing contribution to revenue generation
  • Significantly improved campaign management as a result of deeper visibility into performance
  • Time cost savings due to elimination of need to do painful manual analysis

In order to provide a better explanation of how these benefits would be accrued by your marketing organization, I would like to start by providing a more detailed definition of Campaign Attribution and Campaign Influence and why properly measuring these are critical to achieving success  for your marketing organization.

Campaign Attribution:

In order to report on Campaign ROI, the first key concept that we need to define is Campaign ROI Attribution i.e. what percentage of bookings from a deal should be attributed to any given campaign. Should the bookings be attributed to the first campaign that generated the first lead into a deal or maybe the last campaign that touched it or maybe it should be equally distributed across all campaigns that touched a deal? Determining an accurate method of revenue attribution is typically very difficult. Consider this scenario, you may be using the first and last campaign attribution model which splits the revenue between the first and last campaign that touched a deal. Now suppose for a new customer win, the first campaign was an awareness-based campaign utilizing SEM and the last campaign that touched this customer was a webinar. However, there was a tradeshow that highly influenced the prospect, yet utilizing your current attribution model the tradeshow campaign would not be attributed any revenue. In the end you would not be attributing credit where it’s truly due. At the end of the day, whichever campaign attribution model you choose is the one you would be held accountable to and this further intensifies the need to track all campaigns across the lifecycle for all deals.

Campaign Influence:

Regardless of what your campaign attribution model is, tracking all campaign responses will tell you which campaigns a given prospect was influenced by. So Campaign Influence measurement focuses on all campaigns that any prospect is responding to. It tells us what campaigns are helping the prospect move closer to making the purchase decision. This measurement is a holistic approach and it helps provide insights that typical Campaign Attribution models may not be able to give. So for example, it would show the influence of educational webinars that your prospects attend during the mid-point of the prospect lifecycle. Now if you were using a first and last touch campaign attribution model then these educational campaigns would not have revenue attributed to them, yet they are critical part of the prospect lifecycle. The Campaign Influence model would capture this data and provide the necessary insight to marketing and company leadership on the value of these campaigns. Otherwise these campaigns may be sidelined in favor of campaigns with a higher ROI based on the attribution model. Aggregating data on campaign influence will also tell you what campaigns are effective in nurturing a prospect and what campaigns are ineffective. So in a sense, it is as equally important to measure Campaign Influence as it is to measure Campaign ROI.

Summary

Given the complex nature of the B2B prospect lifecycle, building a solution that can properly track these metrics as they relate to your specific business situation is necessary. This solution will help provide a deeper understanding of the marketing campaign performance thereby helping in optimizing your marketing campaigns. This solution will also help you provide your CEO/CFO with the necessary reports that they can rely on to understand marketing’s contribution to revenue generation.

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8 thoughts on “Measuring Marketing ROI: Campaign Attribution and Campaign Influence

  1. Eric Goldman

    Saad;
    Thanks for your blog post! I liked the concept of Attribution and Influence – it seems logical and should be of use in grappling with the complexities of ROI.
    I’m a little hesitant to provide a link here to our site for fear of being labeled self-promotional, but the link is to a series of 3 posts which deal exclusively with ROI, and many people have found them useful in learning how to do this at a practical level. The posts are:

    1) How to measure the ROI of your website as a whole
    2) The 10 best free ROI calculators on the Web and
    3), How to build your own ROI calculator so that you can measure the ROI of your SMM.

    Here’s the link to the index containing all 3: http://bit.ly/cEc0ln

  2. Alan Green

    Always wondered how can you measure when the sales cycle is 18 to 36 months. It is too long to measure anything.
    Moreover such long sales cycles are complex.

    Imposing B2C systems (measurements) to B2B sales is not feasible.

  3. Meredith Smith

    Hi Saad,

    I enjoyed reading your posting, and we practice the same at LeadLife (http://www.leadlife.com). If you don’t have a lead management system to measure each step – each campaign the lead interacted with over its life, how the lead was nurtured to move it forward, and what revenue was generated from each campaign – you won’t be able to adequately supply your manager and company with needed information.

    Marketing itself has to become more metric-driven – it should not rely on sales or sales automation systems to deliver the final ROI. By implementing technologies for tracking the lead throughout the lead lifecycle, for evaluating interim metrics to predetermine campaign success, and for gaining insights on lead movement and sales readiness, marketers can begin to maximize their lead generation dollars and sales resources.

    Meredith Smith
    LeadLife Solutions

  4. Tewks

    Saad,

    Thought provoking piece. Couple of thoughts…

    1. You can’t measure what you can’t see. Any effective measurement strategy needs to start with effective tracking.

    2. I’m all for measurement and accountable marketing, however I think this type of campaign level ROI is flawed. It’s unfortunate how ubiquitous it is – you see it baked into SFDC, and then carried forth with Marketo, Manticore, et. al. following suit. It’s easy to produce is about all I can say for it. As a marketer it doesn’t help me make better decisions. Frankly, it may actually push me in the wrong way.

    The one useful purpose that I know it serves is providing a talking point when speaking to the head of sales to justify marketing’s existence. I will have to have a think on that and formulate a proposition.

    - Tewksbum
    themarketingmojo.com

  5. Alexandre Sagala

    Really good post. Explains the difficulties and challenges related to calculating marketing ROI. We at Alsamarketing (http://www.alsamarketing.com) provide a marketing automation platform that supports both methods of calculating ROI mentionned above as well as give a clear picture of campaign influence over individual leads.

    Getting accurate Marketing ROI data is the key to driving good marketing decisions. Without it you are driving blind.

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  8. Gaurav Mongia

    A very nice article on Attribution. Would be great if someone can help me answer the below query:

    Our CRM has the capability that auto-associates with the Opportunity for all such Contacts (within the Account) where an activity (related to the same product-We have multiple product Lines) was logged during the last 6 months. This will enable us to achieve the goal of associating all (100%) Opportunities with relevant Campaign (s) and then for all such contacts all the campaign associated with them will get mapped with the Opportunity.
    We create an Opportunity at Contact level.

    Now I am trying to figure out a Real time scenario where in a Contact attended a Product Seminar 12 months back(say Jan 2014) and then referred his/her colleague and then we started following up with the New Contact so sell the product for which the deal was closed after 7 months(July 2014). If we keep using the above suggested trigger then the ROI calculation wouldn’t be correct as the Original Campaign which is Product seminar campaign won’t get the credit for the Campaign as the Original member doesn’t get associated with the Opportunity and the Campaign doesn’t get the credit for the Deal.

    Do let me know on how you guys can help me on such a situation? What are the best industry practices that you will suggest to associate Contacts with a Campaign for ROI attribution?

    Thanks & Regards,
    Gaurav Mongia

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