What is a period cost?
Period cost is a Marketo term that refers to the amount spent on a program. This amount is defined by the Marketo user in the Setup tab of a specific program. Information on how to add the period cost can be found on the Marketo Community.
Why do we need period costs?
Period costs are important for reporting in Marketo for a couple of reasons:
What costs should be listed as a period cost?
We advise that you capture variable costs in Marketo as period costs. Fixed costs, such as headcount and capital resources, are complex to add in and do not provide a large amount of additional value, since the primary purpose of cost reporting in Marketo is to enable comparisons between programs. By excluding fixed costs from all programs, we can obtain a reasonably accurate comparison without unnecessary work that is better suited to a financial reporting tool.
Variable costs that should be included in Marketo as period costs include agency fees, event sponsorship costs, pay-per-click fees, and any other incremental expenses accrued specifically for the execution of one program.
How should costs be allocated across time?
For variable costs that are accrued at a specific point in time, there are arguments to be made for accumulating the cost in the month it occurred, in the month the marketing activity is launched, or dividing it across all of the months the marketing activity is live. Although it is not as realistic, we advise that you allocate the cost to the month in which it was launched, because there is no other way in which to see the month the program launched in RCA reporting in the three reports that utilize cost timeframe and do not offer membership status timeframes.
Although you can choose to enter multiple period costs within a single month in Marketo, there is no reporting benefit to doing so. The descriptions entered in Marketo are not visible in RCA reporting and you are not able to see the individual costs per month. All of the reports show sums of period costs across the given time period. For this reason, it is simpler for the Marketo user to enter the sum of the costs for that month in one single period cost entry in the Marketo program rather than breaking them
out into multiple entries, which has no effect on reporting.
How should we manage period cost for ongoing programs and/or programs with no variable costs?
For programs with no variable costs, such as most web form and email programs, we advise adding a period cost of $0 or $1. Whether you choose $0 or $1 only impacts what you see in the cost-related columns in reporting. If you select $0, you will see dashes or N/A messages. If you select $1, you will see very large, essentially meaningless numbers or $0 instead.
For ongoing programs, we recommend setting up multiple period costs when you do the initial setup of the program. For example, if I have a web form that will be live on the website for the entire year, when I build the program, I can add 12 period costs of $0 beginning with January. This will ensure that the program’s new names and successes are always available in your monthly and quarterly reports.
What if I do not want to enter period cost manually?
While you can enter period costs manually, it is also possible to populate period cost using the REST APIs for programs. The Update Program API call allows you to pass in cost information to an existing program. You can also create a program via the API using the Create Program API call, at which point you could choose to pass in the cost.
You must be a registered user to add a comment. If you've already registered, sign in. Otherwise, register and sign in.