Is Your B2B Marketing Working? These 10 Metrics May Hold the Answer
Many people view marketing as a creative endeavor, but it’s really a mix of art and science. When you invest time and budget on marketing, you need to know it will pay off through a strong ROI. That assurance comes from data. And therein lies the science of modern marketing.
Successful B2B marketing is rooted in data that allows you to determine what’s working well, what isn’t, and where you should fine-tune for better results. Yet, there’s no shortage of metrics to consider. Which are most critical to measuring, monitoring, and optimizing your marketing?
The following 10 metrics offer a great place to start.
They mostly focus on lead generation (a top objective for many B2B companies), but they’re also high-level indicators of how well your marketing is contributing to your business goals.
1. Website Traffic-to-Lead Ratio
This ratio provides a snapshot of your website’s appeal to your ideal buyer—the target audience your marketing is designed to draw to and through your revenue funnel.
Website traffic-to-lead ration is calculated as: (Number of Leads ÷ Total Website Traffic) x 100
High traffic alone doesn’t indicate whether visitors are genuinely interested in your product or service. If traffic is high but leads are low, it’s likely your content isn’t engaging or relevant enough to drive buyers to act. But if your website traffic-to-lead ratio is high, that means your marketing is doing what it should—moving ideal buyers to action.
2. Number of Marketing Qualified Leads (MQLs)
All marketing leads aren’t equal, so it’s important to target your efforts on the most qualified.
A Marketing Qualified Lead (MQL) is a prospect who’s shown deeper interest in your product or service but may not be ready to buy. They’ve engaged enough with your marketing and your content that it’s probably time for a touchpoint from your sales team or they’ve requested a demonstration of your product.
Tracking and measuring MQLs helps you focus finite resources on qualified prospects and avoiding wasting effort where it won’t likely bear fruit. The key is to establish the right criteria for an MQL. That works best when sales and marketing collaborate on the definition of an MQL for your specific product or service, ensuring they both have input and buy-in.
3. Number of Sales Qualified Lead (SQLs)
When a lead makes the transition from “I might be interested” to “Let’s talk business,” they’ve become a Sales Qualified Lead (SQL). An SQL is ready to meet with a sales rep to talk about your offering in more detail, including pricing and other specifics.
Focusing your sales team’s time on SQLs is critical for two reasons: It improves their efficiency and increases your rate of converting leads to new business (our next metric). And just as with MQLs, it’s critical for sales and marketing to collaborate and align on what makes a lead sales-qualified.
4. Conversion Rate
“Conversion rate” is marketing-speak for the percentage of site visitors that take a particular action, like downloading a guide, subscribing to your newsletter, or buying your product.
Conversion rate is calculated as: (Number of Conversions ÷ Total Visitors) x 100
A high conversion rate typically means your content is relevant and engaging, and your call to action is compelling. Your conversion rate is also a good indicator of whether your revenue funnel is effective at attracting buyers and nurturing them until they’re ready to purchase.
It’s helpful to segment your conversion rate measurement based on different traffic sources. For instance, organic traffic (which comes through search engines) might convert differently than traffic generated by paid ads. Using A/B testing is a great way to continually optimize conversions and keep that rate trending up.
5. Customer Acquisition Cost (CAC)
It’s not enough to attract new customers. You also want to attract them cost-efficiently. That’s why it’s essential to measure your Customer Acquisition Cost (CAC).
Customer Acquisition Cost is calculated as:
Total Sales and Marketing Cost (including salaries and overhead) ÷ Number of New Customers Acquired
The average cost to acquire a customer is a good indicator of whether you’re spending your marketing and sales budget wisely. It’s best to check CAC periodically, especially after launching a new campaign or adding a new marketing channel. While you might see a temporary spike in CAC, a continued upward trend means it’s time to reevaluate your marketing.
6. Customer Lifetime Value (CLV)
How much net profit can you expect to derive from a new customer over the life of the relationship? That’s a key question every B2B company wants to know, and the CLV metric provides the answer.
Customer Lifetime Value (CLV) is calculated as:
(Average Purchase Value x Purchase Frequency) x Average Customer Lifespan
Measuring CLV helps you assess if your investment in acquiring new customers is paying off in the long run. While it’s important to generate strong short-term marketing returns, it’s equally critical to nurture lasting relationships with loyal, satisfied customers that contribute to higher profitability. Higher CLV often signals that customer loyalty and satisfaction are on the rise.
7. Marketing-Originated Customer Percentage
This metric tells you which of your new customers are directly attributable to marketing.
Marketing-Originated Customer Percentage is calculated as:
(Number of Customers Originated from Marketing ÷ Total New Customers) x 100
A high percentage means marketing is playing an integral role in the growth of your revenue and customer base. For a more holistic view you’ll want to look at this metric in conjunction with CLV to ensure you’re attracting new customers with solid long-term value. It also helps to view this metric alongside your sales initiatives for a broader picture of where new business is coming from.
8. Churn Rate
Churn rate is a measure of how well you’re retaining customers. And since keeping a customer is often easier and less costly than acquiring a new one, it’s a critical metric to keep an eye on.
Churn rate is calculated as:
(Number of Customers Lost in a Given Period ÷ Number of Customers at the Start of the Period) x 100
If your churn rate is high or trending up, you’ll want to drill down into why. Are there quality issues with your product or service? Is your offering a poor fit for the audience you’re targeting? With feedback from departing customers, you can glean insights that help you improve your product, adjust your targeting, or fine-tune your marketing to attract the best-fit buyers.
9. Lead-to-Customer Conversion Rate
How many of the leads you attract turn into customers? That’s where the rubber meets the road, and it’s what the lead-to-customer conversion rate tells you.
Lead-to-customer conversion rate is calculated as:
(Number of New Customers ÷ Number of Leads) x 100
Think of the lead-to-customer rate as an overall health check on your sales processes. A lower rate might indicate bottlenecks that keep leads from converting or inefficiencies that slow the process. By observing this rate over time, you can spot trends and determine if your marketing optimization efforts are improving results.
10. Return on Investment (ROI)
Every dollar you spend on marketing should help boost revenue and drive growth. ROI tells you if you’re achieving that goal.
ROI is calculated as:
(Net Profit from Marketing Activities – Cost of Marketing Activities) ÷ Cost of Marketing Activities
By understanding whether your marketing investment is generating a profitable return, you can make the best decisions about how to adjust your budget and your focus. Since some marketing efforts take more time to generate returns than others, keep the long game in mind when tracking ROI.
These 10 metrics provide a great starting point for determining if your marketing is working, but there’s more to consider. Look at key performance indicators (KPIs) that are specific to the marketing channels you’re using; for example, share of voice is critical for social channels. Then read the story your data is telling you, beyond the numbers. By focusing on the marketing metrics that matter most to your business and evaluating them strategically, you’ll be in prime position to optimize your marketing spend and achieve your business goals.
Marketri is the strategic marketing partner that empowers B2B companies to achieve predictable growth through data-driven strategy and execution. We help identify the right marketing metrics for your business—then track your progress and optimize your execution for the best results.