confusedEek! Did you read that title? Um...there's something wrong with this picture. To put it bluntly, if you're a marketer and you're not reporting your return on investment to your company's executives, then you have a problem.

In new research reported by eMarketer, a B2B marketing survey conducted by Sagefrog Marketing Group revealed that 68% of B2B companies in the U.S. allocate just 5% or less of their company revenue on marketing. For small businesses, this means marketing budgets are pretty darn tight.

However, while it's evident that small business marketers have pretty tightened purse strings, they also don't seem to be making the case for bigger budgets.

Consider this: Recent research conducted by Lenskold and the Pedowitz Group showed that just 1 in 3 B2B marketers worldwide report financial-contribution metrics to senior management. While a third of B2B marketers are actually tracking revenue metrics associated with marketing-generated opportunities, closed deals, and percent of total sales, they're simply not communicating that to upper management. And although 58% are reporting on marketing performance metrics like leads and 48% are reporting opportunities created, they're failing to report metrics that reflect the bottom of the funnel like leads closed to sales, which is what really matters to upper management.

In fact, 33% of B2B marketers indicated they don't measure marketing ROI (financial metrics)... at all.

emarketer metrics

This means there are a ton of marketers out there who aren't measuring how their marketing efforts are contributing to the bottom line. And even when they are measuring their performance, they're not even telling their bosses how they're doing. No wonder executives aren't allocating more money to marketing budgets. If they're not getting shown their marketers are generating results with the money they're already getting, why hand out more?

Marketing Takeaway

Marketing analytics are an important part of inbound marketing. Measuring the performance and ROI of your marketing initiatives can not only help you understand which channels are effective, what's working, and what's not, but it can also help you prove to your business' executive team that the money they're investing in your marketing budget is actually generating results.

Don't undermine your marketing efforts by putting the work into measuring your results but failing to report them. Or worse -- limiting your analytics to just performance-based metrics or failing to measure ROI efforts altogether. The beauty of inbound marketing is that you won't need as big a budget as you would if you were focusing on outbound marketing strategies. But that said, it's always nice to have a little extra padding in your purse.

Photo Credit: Alex Bellink


Originally published Aug 30, 2011 11:30:00 AM, updated October 20 2016