Assume you are a B2B marketing leader that delivers hundreds if not thousands of leads to the sales team during the year. If those leads result in $5 million of won opportunities with a 10% net profit margin, you helped generate $500,000 in profit.
What if you spent $500,000 to produce those leads? ROI would be break-even, or zero.
Let’s look a little deeper.
Assume that the $5 million in won opportunities represent a 20% win rate of proposed opportunities generated by your leads. In other words, you provided $25 million in opportunities from leads with a potential profit of $2.5 million, versus your $500,000 investment.
So why use proposed opportunities as an additional B2B metric, instead of just won opportunities? The rationale is that if salespeople think enough of marketing leads to invest time and resources to develop and present a proposal, marketing shouldn’t be held responsible for the loss or the win.
By measuring the value of proposals from marketing leads, your organization will understand what portion of proposed opportunities are generated or influenced by marketing versus sales.
Over time you will also be able to measure win rates for opportunities from marketing compared to those from sales.
I’m not suggesting that your organization ignores won opportunities when measuring marketing ROI.