Last week's blog was all about closing more leads and converting them into loyal paying customers. It's a great feeling to know that your marketing efforts are finally paying off, but do you know exactly which one of your tactics is giving you the best ROI and which ones need to be modified?
Wouldn't it be great to know exactly how much return on investment every single one of your marketing tactics generates? For most businesses, it's a far fetched dream. But in reality, it is actually possible, and easier than you might think. The key to success: closed-loop reporting.
What is Closed-Loop Reporting?
The basic purpose of closed-loop is in its name: it's a reporting structure that quite literally closes the loop on your marketing efforts. Rather than focusing on only relevant marketing efforts (such as reach and engagement on social media), this type of reporting considers key performance indicators that indicates not just initial, but long-term and revenue-generating business goals.
The result is a true evaluation of how much return on investment can actually bring. Closing the loop is mutually beneficial: it helps marketers make more informed decisions, pushing better leads with higher success chances to sales.
Closed-Loop Reporting KPIs that Matter
To succeed in closed-loop reporting, your first step is to understand exactly what metrics actually matter. Here is a sample:
- Customer conversion percentage, or how many leads actually convert to customers.
- Customer lifetime value, or the revenue that a customer brings to your company.
- Individualized lead evaluation, which is particularly helpful for account-based marketing.
Of course, the exact metrics may differ based on your business model and sales practices. In essence, though, it means making sure that sales metrics, which determine actual revenue, connect seamlessly to marketing metrics.
Considering Your Buyer's Journey Holistically
At its core, closed-loop reporting requires one thing above all: a holistic view of your buyer's cycle. It's tempting for marketing and sales departments to essentially consider themselves as separate entities. One is responsible for generating leads, while the other has to make sure these leads convert into longtime customers.
For your customers, of course, that distinction is entirely arbitrary. They simply want the best information possible from a company they can trust. Whether that information comes from marketing or sales matters little to them.
Inbound marketing, seeking to attract, convert, and delight customers, emphasizes this type of holistic approach. Once you shift your viewpoint from your own internal marketing and sales separation to your customer's point of view, the challenge of closed-loop reporting will become more natural.
Closed-Loop Reporting Steps You Can Implement Right Now
At this point, closed-loop reporting may seem like a mammoth tasks, especially for businesses with limited budgets. But in reality, it doesn't have to be. Consider these 3 tips that can get you started:
1. Change Your Target KPIs: The most important step is a change in mindset. Change your marketing KPIs from those isolated to promotions to those your sales department would track. Changing the emphasis alone might give you the motivation you need for a more closed-loop approach.
2. Build a Reliable Nurturing Workflow: Lead nurturing bridges the gap between marketing and sales. Of course, it also requires both departments/emphases to work together. A lead nurturing workflow allows you to not just stay in touch with your new contacts, but track them through from first contact to customer conversion.
3. Implement Tracking Pixels for Your Digital Advertising: If you use your website to generate leads or push sales, tracking pixels are a great way to take your advertising tracking beyond reach and clicks. They tell you exactly how many conversions your individual ads generated, allowing you to make better decisions for your marketing spend.
Ultimately, closed-loop reporting is a complex subject. Once you have implemented it, the benefits will become obvious. The above steps are quick to implement, and can help you get started on the road to more reliable ROI tracking.
Imagine the possibilities. With the data generated through this approach, you can make marketing decisions and emphasize tactics that are specifically generated to drive high-quality leads to your sales department.
Now, your chances of the final conversion (and for customers that stay on for multiple purchases) increase dramatically. Your revenue grows, as you attract more relevant leads and customers. All of that, thanks to the power of closed-loop reporting.
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