October 10, 2022
Consider this your ultimate guide to B2B marketing ROI. From tips on how to measure and improve your B2B marketing efforts to benchmarks and ROI calculations.
Online marketing offers many benefits to businesses of all kinds, including business-to-business (B2B) companies. However, a unique challenge B2B businesses face is being able to effectively track the return on investment (ROI) their efforts generate.
In this guide, you’ll learn how to measure your ROI on B2B marketing no matter what digital marketing channels you’re advertising on. You’ll get access to data on industry benchmarks along with tips on how to measure and improve your internet marketing ROI.
Plus, you’ll also get all your questions about B2B, and account-based marketing ROI answered too!
So, let’s dig in.
B2B marketing ROI is a measurement of the ‘Return On Investment’ your marketing strategies are delivering. By measuring your ROI on B2B marketing, you will be able to understand how much revenue your marketing strategy is producing for each channel you advertise on.
For a long time, measuring B2B marketing ROI has been somewhat elusive. However, with modern analytics and intelligence tools, every B2B marketing team has ample opportunities to track and improve the performance of their strategies like they never could before.
If you’re a B2B marketer or business owner, the good news is that it’s now easier than ever to measure and track B2B ROI. You just have to do a little bit of preparation to get there.
A good ROI for B2B marketing depends on your product yield, profit margins, advertising channels and the strategies you implement. For many B2B marketers, a positive ROI is enough to measure success. However, at EngineRoom, we’re known for delivering over 10x returns for our B2B clients.
In other words, for every dollar you invest in your marketing, if you get that dollar back and extra, that is a positive return on your investment and most people consider this good enough. Ambitious business owners often strive to earn $5 or even $10 back as a return and that’s what we aim to deliver too.
The ROI value each business is satisfied with depends on so many different factors so it’s difficult to give you a definitive number of what’s going to be a good ROI in your business. However, if you’re seeking to maximise your return on investment across multiple digital channels, here’s an idea of some industry benchmarks.
You can also read our case study showing you exactly how we delivered 10x ROI for an industrial B2B business.
We bought a company to show exactly what EngineRoom’s methodology could do. Five years later, we had grown revenue by 1266% and increased the equity value of the business 10x.
The average return on investment for search ads is from 200% upwards. This means that for every dollar B2B businesses spend on Google Ads, they receive $2 or more in revenue.
Email marketing can offer very high returns as there are lower overheads than with paid advertising. However the challenge B2B businesses face is that building a targeted audience can be quite challenging. As such, the average return on B2B email marketing is around 122%. In other industries where businesses use email to market to active and ready buyers, HubSpot suggest returns can be as high as $38 to every dollar spent.
Measuring ROI on your blogging and content marketing efforts can be challenging. However, on average, B2B businesses that publish around 3 articles a week will experience 300% more traffic than those that only publish once or twice a month. They also see 375% more leads.
Well-executed account-based marketing (ABM) initiatives deliver over 200% ROI, on average. Paired with personalised email campaigns, you can boost your ROI on account-based marketing quite significantly. For the right industries with high-ticket products or services, ABM can often be the most lucrative marketing channel in the long-term.
The above data was sourced from a variety of pulications including HubSpot - Measure content marekting and Step Change - Marketing ROI benchmarks.
Now that you know what to aim for, let’s walk through how to measure your ROI from B2B marketing, one step at a time.
You can calculate your return on investment by using the formula (Revenue - Investment) / Investment * 100. For instance, let’s say you spend $100,000 on a content marketing campaign, and it generates $600,000 of revenue over a year. You can report your content marketing ROI as 500% for that year.
If you would like to calculate the profit generated from your ROI, it’s a good idea to exclude all your costs. So your ROI formula could look like this instead: (Revenue - Investment - Incremental Expenses) / Investment * 100
There are also other methods to calculate ROI, and these change from business to business. Returns can be tracked using so many different metrics, including net profit, gross profit, total revenue or customer lifetime value. It doesn’t matter which formula you use so long as it’s consistent throughout your organisation.
A B2B ROI calculator can help you get quick calculations for ROI without doing any math. However, you will need to already know the revenue each campaign has generated before it can be effective. If you know how much you spent on a marketing campaign and how much revenue it generated, take our ROI calculator for a spin.
If you don’t know what revenue was generated, then you’ll need to follow the steps in the next section to start collecting the right data.
We can help you measure accurate ROI by connecting your business objectives with your business intelligence and marketing performance.
[feature_link]Reach out to one of our Digital Advisors for a strategy session. [/feature_link]
The reason ROI is so difficult for most B2B companies and marketing teams to measure is because they can’t track their digital marketing revenue precisely enough.
It’s not enough to simply track the total revenue generated from all your marketing efforts. Doing so will mean you miss out on opportunities to refine your marketing strategy. You won’t know which channels are the most effective, let alone which marketing campaigns are worth pouring more budget into.
Here are some tips and considerations to help you track B2B ROI more accurately regardless of your business type.
The only way you can gather the data you need to measure your marketing ROI is by using analytics tools.
Depending on what channels you’re advertising on, you will need a combination of different analytics tools. The good news is that you can usually send the data into one interface, like Google Analytics.
However, ignorance is not bliss! Without taking the time to set up the right tools, you cannot track ROI.
If you’re looking for free software to start with, Google Analytics is one of the best to choose. It is widely adopted and can integrate with your website and many other third-party software.
If you want the most accurate ROI tracking across all your channels, it might be worth chatting with one of our digital advisors. We specialise in bridging the gap between marketing and business intelligence by using custom APIs to integrate into any tools you already use in your business. We can measure:
By connecting your sales data or your accounting software with your lead data, you can see exactly which activities generate the most ROI for your business.
EngineRoom is customisable to your business. We can track the metrics that matter to you and report ROI across all your digital marketing campaigns.
One of the biggest issues with tracking B2B marketing comes from lengthy, multi-step sales cycles. It’s common for many of our B2B clients to experience sales cycles that can take months to convert someone to a lead. But, of course, it depends on the nature of the products or services you’re selling.
However, if you are experiencing lengthy sales cycles in your business, you may also find that the marketing attributions given to prospects are inaccurate. Or that you’re measuring ROI too early, which means, in reality, you’re likely measuring the impact of marketing on some key performance indicators (KPI) instead of ROI.
KPIs highlight what happens during the sales cycle, whereas ROI measures what happens at the end of the sales cycle. And while both can be great to consider to define the value of marketing on key business outcomes, measuring ROI is the most critical metric for measuring impact on the bottom line.
Most marketing attribution cookies have a shorter life cycle than B2B sales cycles, and, unless managed properly, this can lead to mistakes in reporting ROI accurately.
For instance, it may be that the first time a prospect came into contact with your brand was through a Facebook ad. However, the largest attribution window for Facebook ads is 28 days. This means that if a prospect takes longer than 28 days to take action from that ad, you may not be able to accurately attribute your Facebook ad strategy to the outcome of that prospect’s journey through your sales cycle.
Not to mention the fact that the average number of touch points before someone engages with your brand is between 11 and 13. If you cannot track those touchpoints effectively, you won’t know which areas of your marketing strategy are working and which aren’t.
At EngineRoom, we tackle this issue for our B2B clients by tracking the entire journey across their digital channels.
The image above shows multiple instances of how people engage with one of our B2B clients. Notice how there aren’t many times where a lead converted on the first marketing message they came into contact with?
It’s likely the same situation for your business. Most of your prospects are probably touching multiple campaigns you’re running before they become a lead. So unless you pay attention to marketing attribution and the complete sales cycle from start to finish, you’re missing out on crucial insights!
Once you’ve set up your analytics tool and you’ve also configured your marketing channel attribution data, the next step is what defines how well you can track ROI.
You need to ensure you’re looking at the right data in the right way.
As we’ve covered, there are so many different ways people can find your business, especially online. When it comes to digital marketing, understanding the nuances of how your visitors interact with your marketing campaigns offers a goldmine of insights.
If you’re using Google Analytics, it’s a matter of connecting the attribution of each channel to a custom audience segment you can view data for.
Default audience segments include:
To better view your ROI on a campaign level, you will need to customise your reports further so your data can become more granular.
It’s also worth considering refinements to these segments based on the factors that matter most for your B2B marketing campaigns. For instance:
You can add exclusion parameters to your analytics tool to filter out traffic related to a branded search. This can help you see the data related to people who are unfamiliar with your brand.
If you are running multiple campaigns on social media networks, it could also be worth segmenting your data for each one individually. Otherwise, you may be unable to see which network is delivering the best ROI.
You can also do the same with specific websites. For example, for eCommerce stores using various payment vendors, analytics tools often track AfterPay and other payment portals as a referral source which is not accurate.
In your customer’s journey, they would have used the payment portal at the very end of their sales journey, whereas when tracking your ROI, you want to ensure you’re following the data from the start of their journey.
Knowing what your analytics tool tracks and what stage of the buying journey it connects to are important for recording accurate return on investment. This leads to the next point.
At EngineRoom, we look at the holistic picture of ROI for our clients. So we also track ROI across the entire buyer’s journey along with customer lifetime value.
Doing so isn’t easy to achieve in a tool like Google Analytics. Sure, it can be done, but it’ll take a little more legwork, especially if you would like to customise the default report to better reflect the business outcomes you care about the most.
Many of our B2B clients love how we can take care of all of this for them so they can get straight to analysing ROI across the entire customer journey. Not only does this mean you can better analyse ROI based on the campaigns that lead to more effective initial interactions, but it also means you can track ROI across the lifetime of a customer’s journey.
Depending on how precise you want to get, it’s also worth considering tracking data at a campaign level.
Being able to see how effective each campaign is at returning your investment is worth its weight in gold. It means you’ll be able to minimise wasting your budget and only focus on campaigns that work.
The next step in the journey of tracking ROI is to track conversions on your website and in marketing campaigns. Typically, you can do this by tracking clicks on buttons, or when a visitor on your website takes the action you want them to take.
Google Analytics has the functionality to allow you to track any type of click-based conversion. But first, you need to figure out what counts as a conversion for your company. If you’re running a B2B eCommerce business, a conversion is the sale of a product. For an advisory or consulting firm, you might consider a conversion to be any of the following instead:
Once you know what you wish to track, there are a few ways you can go about tracking conversions for each.
What you count as a goal is unique to your business. No matter what that is, however, it’s important that you take the time to set up your conversion tracking correctly. This is how you can measure ROI for specific marketing campaigns.
If you do not run an eCommerce store, there is one final step you’ll need to take.
For most businesses, Google Analytics is not enough to show you an accurate picture of your ROI from your marketing campaigns. For instance, any of the following types of B2B businesses often cannot connect their sales data directly to Google Analytics, leaving a gaping hole in their ability to track ROI:
In essence, unless a transaction happens directly on your website and not through a third-party app, you cannot easily measure ROI in Google Analytics. There are some instances where you may be able to bridge the gap between your sales and analytics data, but for most B2B businesses, you’ll need the help of someone with analytics experience.
That’s where we come in. At EngineRoom, we’re known for bridging that gap seamlessly, regardless of the internal tools you use to track your sales pipeline. From your CRM tool to your invoicing software, we can connect it directly to your marketing data so you can track your ROI.
So now that you know how to measure your ROI, here are our top tips for improving it.
You can also read our whitepaper on the approach we take to generate over 10x ROI for our B2B clients.
The biggest secret to improving your B2B ROI is using data to understand which of your marketing campaigns are the most effective.
By leveraging the right data, you can avoid wasted ad budgets while also lowering your cost per acquisition. Over time, you will also be able to use historical data to learn which channels and campaigns are the most effective for generating repeat customers with a high customer lifetime value.
Despina is a Senior SEO Consultant with 8+ years of experience growing B2B, e-commerce, SaaS, and national brands.