When companies make large evaluations that have a lot of risk involved, it’s natural for them to evaluate the vendors in every way possible. This is why it’s important to have great content available that supports every stage of the buying process in a complex sale.
A recent client evaluation of their data revealed that, when content marketing was used in tandem with sales, the closing rates went up, the deal sizes were larger, and the cycle times were shorter.
Here’s how we conducted our research:
In a seven-month period, we were able to generate just under 2000 Marketing Qualified Leads (MQLs, defined as the demonstration of digital behavior, i.e. link clicks, white paper downloads, infographic views, etc.) based on marketing to over 117,000 lead records.
That translates into a 1.6% conversion rate. Of those 1,900 MQLs, 443 total sales cycles had been initiated, meaning that 23% of the MQLs converted to Sales Qualified Leads—or opportunities where the company was competing for a deal. The company was able to win 149 of those 443, for a 33.6% win rate. All of these conversion rates are pretty good, which tells us that the marketing is going in the right direction, they have a fair number of qualified suspects in their database, and their sales process is sound.
To find the value of MQLs to the company, we first take the total number of MQLs and divide it by the total marketing program cost, which shows that each MQL generated has a cost to the company of approximately $52. But even more interesting, when calculating the average selling price of closed business, the MQL has a value to the company of $224.
Digging a little deeper into the data, we found that of the 422 opportunities that were closed out, 273 of them were lost and 149 were won.
We broke the 149 deals down even further into:
1. Marketing sourced opportunities: MQLs that precede the opportunity create date. So first there’s the MQL, followed by sales pursuit, and then the opportunity is created.
2. Marketing influenced opportunities: this occurs when there’s an existing deal, followed by marketing engagement. Many times we see a bigger influence on close rates when combined with marketing engagement.
3. Sales sourced opportunities: this means that the opportunity was created entirely by sales, with no marketing influence. There may have been marketing pursuits, but no marketing qualified response.
In this case, of the 149 wins, 70 were marketing sourced, 16 were sales sourced but also had marketing engagement, and 63 sales sourced and ran the process without marketing support.
The first interesting statistic was that approximately half of all opportunities in the pipeline came from marketing first and were marketing supported. For the company, this translated to $1.9 million in new revenue from marketing sourced and marketing influenced.
We also found that the marketing sourced opportunities were almost 17% more likely to win over sales sourced alone. (If sales started the cycle, whether there was marketing engagement or not, there was a 29% win rate.)
But when they became engaged with the vendor from marketing and then sales nurtured the deal through to closing, the win rate was 46.6%—which was a significantly higher close rate.
It is also interesting to note that the marketing sourced opportunities tended to be smaller deals. But it’s reasonable to expect that when a prospect finds the company, closing rates tend to be higher and overall deal sizes are smaller—more transactional in nature. In other words, people that are already looking for something and finding what they need on your website are going to have a higher chance of closing.
That’s not surprising. But what is interesting is that even though the average deal size was larger when sales went at it alone, it’s not even close to what happens in terms of close rates and deal sizes when sales works in tandem with marketing.
What does that look like?
When prospects become engaged with a brand and start evaluating vendors, they usually talk to sales reps, read white papers, subscribe to newsletters, open emails, and more. They’re engaging with the content.
These are usually longer evaluations that are much larger and they take longer to close. Compared to when sales runs it alone, the close rate is about the same but the deal sizes are significantly smaller.
You should always approach your content marketing from the perspective of the buyer. For example, if you’re a buyer of payroll services and you have 10 employees, you’re probably not going to need to read a lot of white papers on the subject.
But if you’re an employer of hundreds, in multiple locations around the world, it’s a much more complex problem and therefore the price is going to be much higher. Therefore you’re going to do a lot more due diligence in your search, looking not only at one vendor, but several.
The point is that you need to develop content that supports all of these buyer types with materials that supports them through every stage of the buyer’s journey.