Chart of B2B Marketing Effectiveness by Channel

B2B Marketing Benchmarks

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We recently completed a strategic analysis for one of our B2B clients, and wanted to share a few of the B2B marketing benchmarks that our research uncovered.

Most Effective B2B Lead Generation Sources

A recent survey by Chief Marketer asked heads of marketing at B2B firms to rank how well their various marketing channels performed in generating leads. The results are below:

Chart of B2B Marketing Effectiveness by Channel

What does this data tell us? That inbound marketing via content creation should be a cornerstone of any B2B marketing campaign, and that a well-structured email marketing campaign will help push those leads over the edge. As well, in-person events remain a very strong lead driver, so digital-only marketing strategies may not be as effective for these businesses.

And speaking of effectiveness, how do these B2B lead sources perform when it comes time to reviewing ROI?

Which B2B Lead Sources are Likeliest to Convert to Sales?

The data below comes from B2B sales benchmark research conducted by Implisit/Salesforce that compares contract close rate to original lead source.

Chart of B2B Contract Close Rates by Lead Source

The learning here? That referrals are golden and your marketing should work to generate customer referrals wherever possible. Additionally, email marketing scores low in this evaluation, but high in our previous example. The discrepancy here is likely explained by the fact that “email” is not really a lead source, since you’ll need to have had that email address in the first place. Most likely, this category is related to the purchased lists at the bottom of the close rate.

Now you might be thinking to yourself that this is good information, but what does it all cost? Which brings us to….

B2B Marketing Spend Benchmarks

The chart below presents a number of B2B marketing spend benchmarks compiled from different analysts. While your actual budget needs will likely vary, the data below can be a useful guide as you plan your budget.

 

B2B Marketing Spend Benchmarks by Percentage of Gross Revenue

We hope this post helps you benchmark your B2B marketing efforts. If you’d like to speak with Young Marketing Consulting about improving your B2B marketing, please contact us.

 

One Formula Tells You How Much Time to Budget for Marketing

As marketing consultants, one of the most common questions we receive is “how much time should I spend on marketing?” To help our clients answer that question, we need to do a little marketing math. And our formula for determining how much time you should spend on marketing centers around the old axiom that time is money.

So let’s work backward from the “money” part of the marketing equation and examine some marketing budget benchmarks:

Benchmarks for Marketing Spend as a Percentage of Revenue

The chart above shows marketing spend benchmarks from several sources:

  • The US Small Business Administration recommends that companies with revenues of less than $5 million allocate 7-8% of their budget on marketing
  • The CMO Council‘s benchmarking studies have found that the majority of companies spend less than 10% of their revenues on marketing
  • Deloitte and Duke University’s CMO Survey (depicted in orange above) shows the variation in marketing budgets between B2B and B2C companies

The next step is to convert this budget allocation into staff time. So lets use these benchmarks to make an easy formula:

[bctt tweet=”wkly time spent on #marketing should = (weekly staff hours) X (% of revenue budgeted for mktg)”]

If you’d like to get more, well, formulaic about how much time you should be spending on marketing, we can condense things to the formula below:

WMT = WSH x PRbM

  • WMT = Weekly marketing time
  • WSH = Weekly staff hours
  • PRbM = Percentage of revenue budgeted for marketing

Now, how does our marketing time allocation formula work in the real world? Let’s take a look.

To make the math easy for our example, let’s use a single staff member who works 40 hours a week and a marketing budget set at 10% of our revenue:

40 X .10 = 4 hours a week, or ~2 days a month

So there you have it – an easy calculation to help you determine how much time you should be spending on marketing.

Of course, every business handles its marketing budget differently. You may include your staff costs in your marketing budget, or you may not have a marketing budget at all. If you’d like any help with your marketing budget math, why not contact Young Marketing Consulting.