Let’s continue our discussion of ways to measure the value of marketing programs with a look at somewhat more complex metrics, starting with allocation across multiple programs and people. This method acknowledges the importance of each marketing or sales contribution (touch) needed to close a deal, and tries to gauge the value of each touch. In this technique, you work backwards from the last touch (the immediately preceding event to a sale), such as a direct mailing in which the lead clicked to the website and made a purchase. Next, identify each significant preceding contact that contributed to the closing of the deal.
Now that you have a list of contributing touches, you need to apply an allocation methodology by weighting the importance of each touch point. There are three main allocation methodologies:
- Allocate by Time — Touches that occur immediately before the final one tend to have more value than much older contact events. A recent webinar attendance will be given more weight than downloading a white paper a year earlier.
- Allocate by Role – You allocate more weight to programs that touched that primary decision maker, as opposed to contacts that dealt with other influencers. Just be sure you correctly identify the key decision maker, who is not necessarily the most senior executive in the deal.
- Allocate by Program Type – Weighting is allocated by the amount of engagement with influencers. In this allocation methodology, you would assign more value to attending a two-hour webinar than to a quick website visit. But don’t necessarily assume that more expensive events deserve higher weightings, lest your assumptions be questioned by other executives in your firm.
As a concrete example, let’s assume that we close a $200,000 deal that involved three influencers from the buyer’s company, as follows:
1) Influencer X attended a trade show and a seminar
2) Influencer Y went to the trade show only
3) Influencer Z received direct mail and clicked through to the website
You might divvy up the $200,000 credit by assigning half of it to the trade show and a quarter each to the seminar and the direct mail. Although somewhat more complex, this measuring method acknowledges all nurturing touches and lead generations. Its especially useful when the sales cycle is long and involves a number of touches, each of which deserves some recognition. You want to make sure that your value assumptions are not overly biased, that they don’t overlook less obvious contributors, and that you realize that you’re not getting an insight into the ways the different touches correlate or connect with each other to provide synergies.
Next time, we’ll examine a more precise, and more costly, method of program measurement: test and control groups.
