When you launch an advertising campaign, you want results. For B2C products, a digital ad with an incentive, such as a discount or limited-time sale, can lead ROI in short order. The sales cycle is short. Sales can also stop the minute you stop advertising.
For B2B businesses, the sales cycle is much longer. 74% of B2B sales to new customers take 4 months or great. Almost half (46.4%) take 7 months or longer. It’s unrealistic to expect fast results when targeting B2B customers.
- Measure ROI over the length of your sales cycle
- Don’t confuse Conversion Rates with ROI
So, when can you effectively measure the ROI?
LinkedIn surveyed 4,000 digital marketers worldwide and found the most are struggling to calculate the impact of their efforts.
“Seventy percent of global digital marketers claim to be measuring digital ROI today,” wrote Amy Trivedi, Product Marketing Manager at LinkedIn. “But we’ve found that they are measuring this impact long before a sales cycle has concluded. Meaning that many marketers are likely not measuring ROI at all.”
It’s one of the reasons businesses are turning to digital marketing agencies, such as iTonic, to do data analysis and offer recommendations for improving performance.
One of the key findings of the survey is about those that are measuring the ROI: they are doing it way too soon. If it takes 6 months to sell, how can your realistically measure the impact after a 1 month campaign?
More than three-quarters (77%) of digital marketers say they are measuring returns with the first month. However, 52% also say the sales cycle takes more than three months.
“Even more surprising, only 4% of digital marketers measure ROI over a six-month period or longer, which is the duration we know to be more in line with the length of a typical B2B sales cycle,” reported Trivedi in a blog post.
Why do they measure ROI before it’s realistic to see results? Marketers say it’s because they are being constantly asked to justify budget expenses for marketing.
Others are paying less attention to ROI and focusing more on awareness as a KPI. Chief Marketing Officers (CMOs) cited awareness as the most important goal in a Gartner survey. The majority of CMOs said awareness was more important than ROI or customer satisfaction scores (CSAT) when planning campaigns.
What Is A Good ROI for B2B Marketing?
When measured over the sales cycle, 44.3% of marketers say they still don’t know the ROI. Of those that do, the majority report an ROI of 1.1-1.5X.
Average B2B Conversion Rates
B2B conversions rates from digital marketing can vary greatly depending on industry, product, and offering. On average, Google Ads have a conversion rate of 3.04% for B2B, just below B2C average of 3.75%.
Don’t confuse conversions with ROI. While sales do get added into the number, conversion rates include much more than sales.
Conversions rate – The percentage of website visitors that completed a desired action / the number of visits.
Conversions can be filling out a form, signing up for an email newsletter, or reading a blog post depending on campaign KPIs.