The Three Most Important Metrics When Outsourcing Digital Advertising
Is your organization either struggling to generate demand internally, or not even prioritizing your marketing to begin with? You certainly aren’t alone, as marketing can be incredibly difficult for organizations without a great deal of expertise. For this reason, outsourcing advertising has become an increasingly popular trend. How can you evaluate the success of an outsourced digital advertising program? In this blog, we discuss the three most important metrics you should be focused on when outsourcing digital advertising.
Cost Per SQL
The goal of an outsourced marketing program is to generate a high volume of qualified leads. Cost Per SQL, or in other words, the cost per qualified meeting, is a strong barometer of the health of the top of your advertising funnel. Without qualified meetings, the other metrics we are going to cover are going to be non-existent.
However, it’s one thing to have a perceived low Cost Per SQL, and a financially viable one. Cost Per SQL is inherently tied to metrics further down the funnel-like close rate, and average deal value. If these factors change, what constitutes a financially viable Cost Per SQL will change. If you are closing deals at a higher rate than expected, you can afford to spend more for a meeting, since that meeting is more likely to progress further down your funnel. You need to keep this in mind when determining the performance of your digital advertising campaigns, and if you can’t reach a viable CPSQL, consider if perhaps outsourcing marketing is for you.
Pipeline Over Ad Spend
Many marketing departments look at all the leads they have coming in and begin to pat themselves on the back, without taking lead quality into consideration. A lead is only meaningful if it has the potential to move forward as a business opportunity. Pipeline over ad spend is an incredibly valuable metric for determining whether a marketing program is producing quality leads. “Pipeline” refers to the value of any given potential deal. For example, if you meet with a lead and quote them for a $40,000 services package, that would add $40,000 to your “pipeline,” which in a healthy marketing program, tends to be near 15x your advertising spend.
If your lead volume is growing, but your pipeline is remaining stagnant, there’s a problem with your marketing program. When you are outsourcing marketing or digital advertising, it is critical that you do not settle for a partner that drives empty lead volume that is ultimately barren of any potential value.
Return On Investment
If your outsourced digital advertising partner checks the boxes of driving high-quality meetings at a financially viable rate, the last factor you need to consider when evaluating the success of your partner is your return on investment. Ultimately, the goal of a marketing program is to bring in new revenue for an organization. If your outsourced marketing program is generating tons of meetings and pipeline, but this is not resulting in any closed-won revenue, this could mean a couple of things. First, it could mean that your sales department, (or whoever is responsible for closing leads), is not performing up to par. It could also signal that your offering is misaligned with what the market is looking for, leading your potential deals to ultimately go elsewhere in the end.
However, if you are closing deals, but still not seeing a return on your investment, it could be that your deal value is too low. Digital advertising isn’t guaranteed to be a successful tool for demand generation for every organization. If your deal value is very low, and your cost to acquire a customer is high, it is possible that whatever channel you are using just isn’t a fit for your business.
Return on investment is going to be the end-all-be-all when it comes to evaluating a digital advertising campaign. Although there can be several reasons a company is not achieving a return on its investment on its marketing activities, it often does not make sense to continue spending money on a marketing program that is not generating commensurate returns.
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If your company is struggling to get its marketing program off the ground, FullFunnel can help. Our team of digital marketing experts follows a tried-and-true framework to successfully generate demand for organizations across every industry imaginable. Request a free consultation today to learn how FullFunnel can help your organization realize a return on its advertising investment with our comprehensive outsourced digital marketing services.