You have your own mission and purpose, of course. Not to mention your own set of goals and expectations, your own distinct culture, ideas and expertise. So why would your benchmarking be viewed largely through a summary of data points shared by large buckets of other very unique businesses? Shouldn’t you take a more internal view of success?
Wielding broad terms like B2B, B2C and SaaS, marketers often seek out general measures and apply them to very specific business cases.
A few weeks ago, I was asked what a SaaS organization should be spending on marketing as a ratio to revenue. Hint: there is no answer to that question without asking at least ten more of my own, and the question itself only begins to allow me to benchmark an organization. And yet, this is a very common inquiry.
Far too many companies fall into the trap of comparing themselves to other companies without taking into account key differentiators. Then, they go a step further by emulating their practices. Soon, it’s hard to decipher what made a given company unique to begin with. But get into the corner offices, and the leadership likely believes they are staying competitive, when in fact they’re erasing the very distinction that attracts customers and blows competitors out of the water.
This mode of thinking is especially true when it comes to setting benchmarks, a concept much in vogue right now. It’s more important than ever for companies to stay competitive in their field and be able to match comparable offerings from other firms. Take a moment to Google "marketing automation benchmarks" and behold the flood of metrics. Bear in mind that while benchmarking can be a game changer for your business, it can also be a total waste of time and effort if not executed properly. Or worse, it can lead to a false sense of security.
With the rise of marketing automation, benchmarking has become essential and is an increasingly hot topic in business circles. But, you don’t hear much about the fact that many marketers use these benchmarks to figure out how they compare with other companies, without accompanying that natural curiosity with segmentation around core concepts like maturity, buyer behavior, sales-cycle and ARR.
This is a dangerous path to tread. While benchmarks have some value as summary data, they have much more impact when you compare true apples-to-apples.
What’s the Solution? Start Looking Inside
Let’s be clear: Using outside benchmarks is not inherently bad. You can learn a lot from your peers and competitors. It’s just that an over-reliance on general external factors often comes at the expense of truly aligned comparisons. This can make all of the difference in guiding your business. If you’re new to marketing automation, setting internal benchmarks first is a more useful marker for measuring the success of a variety of factors, from campaign strategies to the roles that staff can play.
This kind of internal view creates a clear definition of success. Keep in mind, too, that this definition should encompass more than simply tallying leads or sales figures. You’ve likely invested in marketing automation because of the scalable benefits it brings. While lead volume may be one of the desired results, your team probably has other goals too, such as streamlining your funnel, passing higher quality leads to sales, using data for more targeted campaigns, or creating a more efficient and high-performing team in general. These goals can only be reached by using one strategy: setting internal benchmarks. Obsessing over the performance of other companies without an accurate internal reference point will do nothing to boost your results.
So, Create Your Own Benchmarks
It helps to think of marketing automation as a living, breathing entity. For optimal results, you’ll be constantly to changing, tweaking, updating and evaluating. Even creating your own benchmarks will be an ongoing process. But here’s a good place to start:
- Identify what exactly should be benchmarked (this will take some “soul searching” with company leadership)
- Define the metrics for measurement
- Analyze and evaluate performance
- Create and implement an improvement plan
- Monitor the results
In step one, your “soul searching” should include the following:
- What technology is being used and how efficient is your team at using them?
- How are leads being captured? Are we collecting enough, and gathering the right information about each?
- Can we attribute campaign effectiveness and if so, what are our most effective channels?
- How quickly do leads move through our funnel and at what volumes?
- How does sales feel about the leads we provide?
- Do we create happy buyers?
These critical questions can only be answered with a thorough amount of the above-mentioned soul searching. But don't do it alone. The power of getting everyone in a room can not be overstated. The answers you arrive at at will point to necessary improvements, and provide initial benchmarks that will later help review achievements and earmark processes for improvement.
The Question of Maturity
At this point, we've seen over 2500 Marketo customer implementations. I can tell you squarely that the most important factor in success is maturity. I can also tell an organization exactly where they fall on that maturity curve based on the responses to the internal benchmarking exercise mentioned above. Sometimes, it's evident just by the words they use to answer the questions and their tone while doing so.
Marketing maturity is both a result and a goal. Based on your benchmarks, you have to focus on the strategies and tactics that will lift you to where you want to be. There's no better way to streamline that process than to find organizations that have a similar buying cycle, product delivery mechanism and were able to graduate to the next maturity level.
Form Your Own Focus Group
Research, white papers, surveys and case studies always offer some value, which is why they are so popular. Yet, in the end their findings and recommendations can be several degrees removed from your specific circumstances.
One valuable alternative is to form your own peer group to share ideas, strategies, successes and failures. This could be a circle of leaders in your local area, a user group or an analyst roundtable. The critical element is to ensure that there are others present who share similar stories to that reflected by your internal benchmark. Meet with your unofficial “focus group” for monthly or quarterly roundtable discussions. You’ll be surprised what you learn.
Like the proverbial greener grass on the other side, external benchmarking will always look attractive. But if approached in a general manner, it will never be a valid assessment of your company’s skill and intelligence in wielding marketing automation.
Use external benchmarking measures as inspiration, sure, but understand those measures can only provide the most basic guidance. Instead, turn your focus first to internal performance and benchmarks. By identifying both your strongest weapons and areas for improvement, you’ll have all you need for continued success. You can take advantage of LeadMD's free online benchmark for Marketo users here to get started on your own internal evaluation.