marketo benchmark on revenue performance custom · pdf filedear justin gray, marketing and...

Benchmark Survey: Marketo Benchmark on Revenue PerformanceCustom Report For: Justin Gray

Dear Justin Gray,

Marketing and sales executives are constantly asking their organizations questions such as:

How much should we be investing in marketing as a percent of revenue?What percent of pipeline should Marketing drive for Sales?What conversion rates we should expect for marketing leads into revenueHow much time should Sales spend on revenue-driving activities versus administration?

Perhaps even more importantly, executives want to know the best practices of the companies with the highest growth and most productive revenueengines, aka the "Revenue Performance Management Leaders".

Get the answers now - here are your personalized benchmarks and recommendations based on LeadMD, Inc.'s performance maturity.

About this report The "Marketo Benchmark on Revenue Performance" combines an innovative revenue performance maturity model with rigorous research intothe sales and marketing practices of organizations across multiple industries.

The report examines revenue performance maturity and performance metrics across three categories:

Growing Number and Quality of Leads and OpportunitiesImproving Sales ProductivityOptimizing Sales and Marketing ROI

Based on responses in each category, companies are grouped into one of four levels of revenue performance maturity: Traditional Marketing,Demand Generation, Integrated Marketing and Revenue Performance Management (RPM). Then, the key performance metrics in eachcategory are benchmarked for each maturity level to quantify the impact of improving revenue marketing and sales practices. Benchmarks for eachindustry are also collected, as well as the difference between companies with or without marketing automation. The result is a customizedassessment of each organization's maturity and personalization recommendations for action.

Here's just a taste of some of the insights you'll find in this report:

RPM Leaders achieve 128% greater revenue versus their plan than average companies, and 178% more than the least mature companies.At RPM companies, sales reps spend 72% of time selling (versus administration, training, etc.), compared to 59% for average companies.Marketing generates 57% of pipeline for RPM companies, but only 40% of pipeline for average companies, and only 22% at companies withthe least mature processes.

The insights to drive more revenue with less work At Marketo, we thrive on sharing best practices, educating marketers, and helping companies of all sizes to improve revenue performance. That’swhy we’re uniquely qualified to help LeadMD, Inc. expand lead flow, improve sales effectiveness, and optimize marketing and sales investments.

Please encourage others to take the Benchmark Survey – the results get better and better each time someone fills it out.

Here's to your best,

Jon MillerVP of Marketing, [email protected]

mailto:[email protected]

Part I: Revenue Performance Management MaturityBased on your answers to Part I of the assessment, your Revenue Performance Maturity level is: Revenue PerformanceMangement (RPM)

Here's how the maturity levels break down by category and process.

© 2012 Marketo, Inc. | +1.877.260.MKTO (6586) | www.marketo.com | www.twitter.com/marketo | www.marketo.com/blog 1

Revenue Performance Management Maturity (shown as %)

Traditional Marketing Demand Generation Integrated Marketing Revenue PerformanceManagement (RPM)

0.0

12.5

25.0

37.5

50.0

Part II: Revenue Performance Management BenchmarksCompanies with higher revenue performance management maturity generate more pipeline from their marketing efforts, whichallows their sales teams to spend less time prospecting and more time selling. As a result, more mature companies achieve bettersales productivity, and higher revenue growth.

Marketing Pipeline, Sales Productivity, and Revenue GrowthMarketing generates 57% of pipeline at Revenue Performance Management (RPM) companies, but only 40% of pipeline foraverage companies, and only 22% at companies with the least mature processes.

When marketing takes a larger share of responsibility for pipeline generation and uses lead nurturing and lead scoring to help salesfocus on the hottest leads and opportunities, it frees the sales team to focus their time on productive activities such as selling. AtRPM companies, sales reps spend 72% of time selling, compared to 59% for average companies and 47% for the least maturecompanies.


Percentage of Pipeline Sourced by Marketing

TraditionalMarketing

DemandGeneration

IntegratedMarketing

RevenuePerformanceManagement

(RPM)

Average LeadMD, Inc.20

40

60

80

100

Percentage of Sales Reps Time Spent Directly on Selling


DemandGeneration

IntegratedMarketing


(RPM)


55

70

85

100

When companies become more mature at revenue performance management, they generate more revenue and achieve fasterrevenue growth. RPM Leaders achieve 96% of their target revenue plans, while average companies achieve only 75% and the leastmature companies achieve only 54%. This means that RPM Leaders achieve 128% greater revenue versus their plan than averagecompanies, and 178% more than the least mature companies.

Revenue performance management is about growth, so another way to look at the impact of improved maturity is to see how fastcompanies are growing versus the competition. (Though it is worth noting Lake Wobegon effect here, in which people overestimatetheir achievements in relation to others; on average, our responders are reporting above-average growth.)


Percentage of Target Revenue Plan Achieved Over the Last 12Months


DemandGeneration

IntegratedMarketing


(RPM)


55

70

85

100

Revenue Growth Rate Compared to Industry Average (% Above orBelow Average)


DemandGeneration

IntegratedMarketing


(RPM)


30

50

70

90

More mature companies invest more in marketing to achieve these results. On average, survey responders are investing 9% ofrevenue into marketing (aka Marketing Budget Ratio).


Marketing Budget Ratio (Total Marketing Budget as a % of Revenue)


DemandGeneration

IntegratedMarketing


(RPM)


10

20

30

40

Revenue Cycle Conversion RatesEvery company wants to know how many of the names they generate should turn into leads, and how those leads should turn intoopportunities, and how those opportunities should turn into closed won customers. Although benchmarks and averages areimportant, it’s critical to understand that there will always be a tradeoff between how strictly you define a lead, and the conversionrates you see as a result.

For example, some companies pass all leads directly to the Sales team. Since Sales time is scarce and expensive, it makes sensefor these companies to have a strict definition of an MQL (marketing qualified lead). These companies should expect a lowconversion of new names to MQL, but a high conversion of MQLs into sales qualified opportunities.

On the other hand, other companies may use relatively inexpensive lead qualification or sales development reps. This means it iscompetitively “cheap” to call an incremental lead, especially compared to the "cost" of missing out on a potential deal. Thesecompanies are looser in their Lead definition, and would expect to see higher conversion of name to MQL and lower conversion ofMQL to opportunity.

As a result, there is not a particularly strong correlation between revenue performance maturity and conversion rate from Name toLead to Opportunity. On average, 25% of new names convert into Marketing Qualified Leads (MQLs) each month, and 26% ofMQLs convert into opportunities.


New Name Conversion to Marketing Qualified Lead (MQL)


DemandGeneration

IntegratedMarketing


(RPM)


20

30

40

50

MQL Conversion to Sales Qualified Opportunity (SQL)


DemandGeneration

IntegratedMarketing


(RPM)


20

40

60

80

On the other hand, there is relationship between RPM maturity and opportunity win rates. On average, 22% of Sales QualifiedOpportunities (aka Sales Qualified Lead / SQL in the SiriusDecisions framework) convert into closed won customers, but RPMLeaders see an opportunity win rate of 35%.


Sales Qualified Opportunity (SQL) Conversion to Closed WonCustomer


DemandGeneration

IntegratedMarketing


(RPM)


20

40

60

80

Impact of Revenue Performance Management ProgramsThe more mature a company is at revenue performance, the more they are likely to say that RPM programs are driving morequalified leads, improving conversion of lead to opportunity, and raising win rates, and lowering customer acquisition costs.


Percent Saying the RPM Programs are Increasingly Driving MoreQualified Leads


DemandGeneration

IntegratedMarketing


(RPM)


30

50

70

90

Percent Saying that Conversion Rate of Leads to Opportunities isIncreasing Because of RPM Programs


DemandGeneration

IntegratedMarketing


(RPM)


30

50

70

90

On average, companies that are seeing more qualified leads say that qualified leads have increased by 49% as a result of theirrevenue performance management programs. Companies that are seeing improved conversion of leads to opportunities see anaverage improvement of 45% from their RPM initiatives. And companies that are raising their win rates report an average increaseof 33% from their RPM initiatives.

Finally, the survey also examined how customer acquisition costs are changing. Many companies are not reporting decreasingcustomer acquisition costs (likely an indication of the increasing complexity of the revenue process), but more mature companiesare more likely to report decreasing costs. On average, companies that are reporting lower costs indicating an average decrease of31%.


Percent Saying that Their Win Rate is Increasing Because of RPMPrograms


DemandGeneration

IntegratedMarketing


(RPM)


25

40

55

70

Percent Saying that Customer Acquisition Costs are Decreasing


DemandGeneration

IntegratedMarketing


(RPM)


20

30

40

50

SummaryIn summary, RPM Leaders have more productive revenue engines that:

Increase marketing-driven pipeline - Marketing generates 57% of pipeline for RPM companies, compared to 40% ofpipeline for average companies

Increase sales productivity - At RPM companies, sales reps spend 72% of time selling (versus administration, training,etc.), compared to 59% for average companies.

Improve opportunity to closed won customer rate – RPM companies see an opportunity win rate of 35%, compared to22% for average companies. Interestingly there are no key trends in the early stages of the funnel.

Make a larger investment in marketing - RPM companies invest 16% of revenue into marketing, compared to 9% foraverage companies.

Improve predictability – RPM companies achieve 96% of their target revenue plans, while average companies achieve only75%. This means that RPM Leaders achieve 128% greater revenue versus their plan than average companies, and 178%more than the least mature companies.


10 Tips to Improve Your Revenue PerformanceHere are personalized recommendations for LeadMD, Inc. based on your Maturity Level of Revenue Performance Mangement(RPM):

NO RESPONSE


Resources to Learn MoreWhat are you doing to explore new opportunities for optimizing your Revenue Performance Management? Do you set aside time tosit down and learn from others, or do you mostly go it alone on an ad hoc basis?

With these online resources, you can access best practices from multiple industries and develop action-oriented plans for emailcampaigns that deliver the results your business needs.

The Definitive Guide to Marketing Metrics and Marketing AnalyticsThe Definitive Guide to Lead ScoringThe Definitive Guide to Lead NurturingMarketing Automation Cheat SheetThe Marketing Measurement Cheat SheetCoordinating Marketing and Sales Across the Entire Revenue Cycle

View all these resources at www.marketo.com/rpm-resources

Marketo Revenue Performance Management SuiteWith Marketo's Revenue Performance Management Suite you can:

Visually define and map all the stages of your revenue cycle, and establish rules on how leads transition from one stage tothe next.Customize and automate triggered and multi-step marketing campaigns that incrementally deepen your prospectrelationships and convert customers over time.Score leads using demographics and BANT attributes, as well as prospect behaviors.Provide sales teams insights within their CRM that enables them to understand, prioritize, and interact with the hottest leadsand opportunities.A new class of out-of-the-box interactive data visualizations for the key metrics marketers and revenue teams should focuson.Fully customizable reports and dashboards with an intuitive drag and drop UI built for marketers — not for reportingspecialists or IT.


Visually define and map all the stages of your revenue cycleA Revenue Cycle Model is a visual representation of the marketing and sales business processes that define how a potentialcustomer proceeds through various qualification, opportunity and revenue stages to become an actual customer.

Define and map all the stages of your revenue cycleEstablish clear set of rules governing how leads transition from one stage to the nextAssign Service Level Agreements to send alerts when leads "get stuck"Map your stages to industry benchmarks such as Marketing Qualified Leads (MQL), Sales Accepted Lead (SAL), and SalesQualified Lead (SQL)


Don’t Just Email Prospects — Engage Them in a Dialogue and Score Leads as theyEngageThe days of batch email marketing campaigns with low response rates are over. It's time to use targeted email marketing with 1:1dialogue marketing capabilities. These include drip campaigns with automated lead nurturing and the ability to trigger follow-upactivities. For example, imagine being able to send a campaign and then automatically send a personal reminder a week later if theprospect did not open the first communication. By segmenting and targeting prospects based on specific behaviors, such aswhether the prospect opened a prior email or visited a specific webpage, marketers can increase open rates by more than 50%and increase conversion rates by more than 350% (Jupiter Research)'

With powerful yet easy B2B email marketing software from Marketo, B2B marketers can create, execute, and measuresophisticated email dialogue campaigns with a simple drag and drop user interface.


Enable sales to understand, prioritize and close the hottest sales leadsProvide sales teams synthesis or analysis of granular activity data to highlight what really matter to sales.

Best Bets and Watch List - Focus instantly on the hottest leads and opportunitiesInteresting Moments - Monitor the key moments that really matter to salesInsight to Action – Enable sales reps to use marketing template email and add leads to campaignsCustom Views - Roll-up or create custom views of best bets and interesting moments


Out-of-the-box interactive data visualizationsA new class of intuitive, interactive data visualizations built by marketers for marketers. These include the Opportunity Analyzer thathelps build credibility by proving how marketing programs drive conversion and accelerate leads and the Program EffectivenessAnalyzer that monitors program effectiveness and identifies which programs and events are yielding the highest return oninvestment.


Track the Metrics that Matter with Easy Dashboards and Powerful Ad-hoc ReportsMarketo Revenue Cycle Explorer makes it easy for marketers to measure, understand, and optimize revenue performance withcustomized dashboards and powerful, yet easy-to-use interactive reports powered by a robust analytics engine.

Create ad hoc reports, dashboards, and metrics with an intuitive drag-and-drop UI built for marketers – not for reportingspecialists or ITFocus on metrics that matter to marketing and sales executives including program cost, program ROI, and conversionsGain immediate access to trends and comparisons by revenue stage, program channel, and lead owners across timeperiodsCreate custom executive dashboards that provide at-a-glance views of the metrics that matter most


Marketo Client ServicesAt Marketo, we know that executing a successful marketing strategy takes more than just creativity and the right tools. MarketoClient Services inspire sustainable customer success throughout the entire revenue journey as a proven partner with real-worldexperience and best practices expertise.

Marketo University provides a learning path to gives you the skills, knowledge, and best practices to succeed.Marketo Customer Enablement gets you up and running quickly while Marketo Professional Services help you achievemaximize value out of your Marketo investment.Marketo Customer Support is there to help you along the way with over 95% service level agreement (SLA) achievement.

Here's how you can learn more or schedule your personalized demo of Marketo:

Visit www.marketo.comCall us at +1.877.260.MKTO (6586)Email us at [email protected]


marketo benchmark on revenue performance custom · pdf filedear justin gray, marketing and...

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