In the age of big-data driven businesses, LinkedIn’s Sean Callahan notes that it’s really “small data” that should be the focus of marketing departments.
Callahan, who is the Director of Content Marketing for LinkedIn, co-wrote the book The Big Data-Driven Business with Russell Glass back in 2014. It highlights the emerging trend of big data and its impact on the marketing department.
“The book is now five years old, but its message is more important than ever,” Callahan said.
The message is simple: To be a customer-driven marketer, you have to be a data-driven marketer.
Simple to understand, but complex to execute, especially for marketing’s right-brain creative types. And despite all the amazing tools and technological advancements, marketers are still struggling with how to do it right — particularly leaders of small marketing teams.
The answer may not be to go big or go home, according to Callahan. It’s to focus on a smaller number of key performance indicators (KPIs), and understand how they relate to your program’s overall return on investment (ROI).
Big data can feel like too much data
The Big Data-Driven Business provides a complete overview of big data and how it can help shape an organization. Especially for marketers, it distills high-level concepts into practical techniques you can use to transition into a data-driven business.
It also addresses the #1 concern of many business owners, expressed years ago by John Wannamaker: “I know 50% of my marketing is working. I just can’t tell you which half.”
The book points out to Mr. Wannamaker that those answers have been available for a long time. From 800 phone numbers on ads to brochure-order inserts in magazines, there have always been ways to track your marketing.
“There always was data,” Callahan said. “It just moved a bit slower.”
Today with the Internet, email and social media, the metrics are instantaneous and often overwhelming. Big data can feel like too much data. Even worse, it leads to drawing conclusions too soon in a marketing campaign, particularly with ROI.
Your measurement of ROI shouldn’t outpace your sales cycle
Take a B2B company with a sales cycle of 18 months. Callahan explains that management teams place too much emphasis on evaluating ROI before the first sales cycle is even completed.
“If you follow those first leads for 18 months, you can see if the ad or program worked,” he said.
Instead of focusing on ROI in the short term, organizations should monitor the KPIs that will eventually help determine the ROI. This is particularly applicable to manufacturing and industrial marketers in companies with long sales cycles. Check out LinkedIn’s recent report on ROI.
The relevant KPIs: Let’s get small
To avoid getting overwhelmed by the amount of big data available, Sean believes focusing on a smaller number of KPIs will be more productive. (We’ve thrown one in for good measure, no pun intended.)
KPI #1: Top-of-funnel traffic to website
We’re not just talking about traffic counts, which far too often are considered a measure of success. We want the right traffic, which for most B2B marketers includes visits from decision-makers in a director role.
You can get that kind of occupation-specific data with a LinkedIn tool called Website Demographics. This is a game-changer for B2B marketers.
Simply install the pixel on your website, and LinkedIn will provide you with a breakdown of the types of visitors coming to your site (job title, company demographics).
It won’t give you the individual profiles, but the aggregate data can help you determine if you’re producing the right content for the right people.
KPI #2: Mid-funnel lead magnet sign-ups
You want to start building a list of the people you’ve attracted with the content. Your metric here would include conversions such as sign-ups for white papers and downloadable tools.
You can also measure email drip campaigns that you run to these lists to gauge success in moving prospects to KPI #3.
KPI #3: Marketing qualified leads
Once you have a prospect that either calls in or submits a form to speak to someone at your company, your marketing department can qualify the lead.
Is the prospect coming from the right company, with the right job title? Is the marketing producing the types of leads you can pass along to your sales team for follow-up?
KPI #4: Sales-accepted opportunities
You’ve passed along the marketing-qualified lead to the sales team. Now you’re going to track how many of those leads the sales team follows up with a discovery call and then actually enters into their pipeline.
This is a bit subjective. You may want to just make this about deals closed by the sales team, assuming that if it’s a marketing-qualified lead, the sales team will follow up.
KPI #5: Branding
Huh? What? Isn’t branding a smoke-and-mirrors tactic of the bygone Mad Men days?
Actually, no, and there’s data to prove it. Market research conducted by Binet and Field found that when companies spend more on branding campaigns than they do on lead generation, they actually have better results.
“Let’s say you go to a search engine, and you do your search,” Callahan explained. “Out of the first 10 results, you’ll likely pick the company you’ve heard of — even over the top result. That’s branding.”
For B2B spending, the spending split is becoming almost 50-50 lead gen and branding.
Measuring brand has always been a challenge for organizations. You can use brand research surveys, which have proven effective in the past. One simple metric which might provide some insight is your “branded search” traffic volume. (Here’s more on branded search.)
KPI #6: Business value
This one is a bit fuzzy, but it’s relevant when considering the cross-functional impact marketing can have.
For example, a client of ours asked us to produce content that would help streamline their customer education process. Instead of their then-current hour-long, one-on-one meetings, they wanted video and written content that the customer could absorb at their own pace.
It’s an example of how marketing can both improve the customer experience and make an organization more efficient.
Work with the client to determine the metrics for this type of business value. Let them brainstorm the right numbers to track. They will then have ownership and understand the business value you provide.
A business book that you will read from cover-to-cover
Consider these KPI metrics to be a bonus from Sean Callahan. The big prize is the book itself, and I’ll tell you why.
I read a lot of business books. And my biggest beef with many of them is they’re centered around a single premise, which is revealed in the first third of the book. The rest is all needless minutiae or rehashes the premise over and over.
In The Big Data-Driven Business, Callahan and Glass interweave their firsthand experience at Bizo (which Glass sold to LinkedIn) with a number of relevant examples from a wide range of industries.
The result is truly a cover-to-cover read with valuable nuggets and insights for every small marketing department.
Including the gems Sean shared with us here: You want to get big? Then start small.