When it comes to the marketing technology you use, you need to have standards and goals. It’s almost like you have a relationship with your Martech stack. You need to set Martech relationship goals. Those goals should be based on their return on investment (ROI). Unfortunately, ROI isn’t that easy. We agonize over reporting Martech ROI to justify our costs. Can we prove our ROI without sacrificing days and weeks to figuring it out? Yes. Yes we can.
This is the second in a series of blog posts on Martech stacks. If you haven’t checked out how your Martech stack is built like a house, you should. This post builds upon the 4 simple categories we used to slice up the Martech stack in the last post. To recap (for those of you who choose not to read my super awesome first blog post), here are the 4 categories:
- Relationship Management & Data
- ROI & Analysis
ROI not L.O.V.E
This blog post will help you tell if you’re in a bad or good relationship with your Martech stack. Spoiler: when it comes to your Martech stack, Nate King Cole (check out the tune if you are not familiar with it) is singing about ROI, not L.O.V.E. We’ll discuss the challenges we face in the marketing world for calculating ROI in general. Then we’ll introduce the simple solution for determining your Martech ROI.
What is ROI?
When creating or maintaining your Martech stack, you’ll see more and more tips for keeping your stack “tidy”. You’ll notice in all your research that ROI (return on investment) comes up every time.
Marketo suggests you “measure and keep track of the performance and return on investment” of any new goodies you add to your stack.
The truth is, ROI is a simple concept with a complex assumption.
- The concept: This tool/program/campaign/advertisement/thingy produced ROI would be $X revenue minus the total cost to execute the thingy…
- The complex assumption: There’s a direct, one-to-one relationship between the thingy and revenue.
Nope. Reality is not that simple
Usually, there’s not a one-to-one relationship.
Most of marketing involves many “touches” between leads and different marketing efforts. However, there’s still just one lead. If that lead produces revenue, which of the marketing efforts get revenue and how much?
“Aye, there’s the rub…” – Hamlet
There are dozens of ways marketers, Martech tools, and analysts have come up with to try and answer that question. Most of them are ways to only estimate the impact on revenue through different Key Performance Indicators (KPIs). Some are actual attribution rules that require you to link leads to sales opportunities. That’s just for general marketing efforts. Yet the same question exists for your Martech tools. How much revenue do you attribute to them?
Martech tools need to be measured. If a tool promises 10% more inbound leads a month, you better keep track of how many leads you’re getting a month.
If a Martech tool either
- doesn’t track its own ROI for you, or
- doesn’t offer you a method to track its ROI
Then you are working for your Martech, not the other way around. In other words, you’re in a bad relationship. Bail out now.
Saving time is also ROI
Of course, ROI is not easy. Some layers of the stack are harder to quantify than others. Let’s look at Marketing Automation Platforms like Eloqua or Marketo. These tools, and others like them, are arguably the cogs that make digital marketing work on the scale it does.
However, what’s their increase to revenue? With tools like these, it’s easy to think of the time they save you. Could you do all the same things they do with a team of marketing operation experts? Yes. All of that would take time to implement, maintain, and execute.
Time equals cost. People equal cost.
Therefore the impact on revenue from these tools is the reduction of cost they give you. Again, it’s harder to quantify, but the ROI is generally recognizable by the savings in time and people.
How to get your Martech ROI
Here’s where it gets good. How are we going to make Martech ROI easy?
The solutions is actually pretty simple:
Stop trying to do it by yourself.
Just like Marketing Automation Platforms make tracking, planning, and executing your marketing easier, ROI tools are designed to track your marketing and Martech ROI.
Yes, you could spend all your days and the days of your marketing team calculating and recalculating ROI. Yet, I don’t think any of us want to do that. That’s why ROI is still the top priority of marketing leaders for the 4th straight year.
We know it’s important, but our daily operations leave little time for figuring out how to continuously track ROI of our tools and marketing efforts.
But ORM is all about ROI….?
If throwing dollars at the dirt isn’t making your marketing money tree grow, you’ll eventually need to answer with ROI.
Yes, we make a Martech tool squarely in the ROI & Analysis layer of the stack. So I’ll make a deal with you. Subscribe to the blog, and in last post of this series, we’ll talk about how to do what it takes to track your Martech ROI the ORM Tech way.
After that, you can take that information and try to implement an ROI strategy. Or, if you’re a sane individual, you’ll let ORM Tech do it for you.
Here’s a teaser of the things we’ll cover in the next post:
- Automatic association of lead to sales opportunity
- Multi-touch revenue attribution model
- Account-based attribution
- Automated lead to source/program/campaign/vertical association
- Optimal marketing mix