This article is based on a panel discussion at our CMO Summit New York in March 2023.
Delving into the intricacies of revenue attribution feels akin to navigating an ever-shifting labyrinth. It’s not just about crunching numbers; it's about forging a pathway that directly links marketing efforts to the bottom line.
I’m Ron Fisher, CEO and Co-Founder of Mesh Analytics. I’ve had the pleasure of diving deep into the world of B2B attribution, a crucial but often convoluted aspect of marketing. It was my honor to moderate a panel discussion at the CMO Summit on this very topic, where I was joined by two experts in the field:
Drew Smith, the CEO and founder of Attributa, a company dedicated to resolving marketing attribution challenges.
Julia Hartwig, VP of Marketing at Nimble (Julia was VP of Marketing at Capchase at the time of the original discussion.
Julia emphasizes that attribution isn't just a buzzword - it's the heartbeat of a marketing team’s success. With Capchase's impressive growth and substantial financial support offered to startups worldwide, she underlined that understanding where each dollar goes and how it performs is pivotal.
Drew notes that Attributa doesn’t create software, but instead focuses on ensuring that the existing software is used effectively. He spoke about the importance of establishing compatible processes that complement attribution software and assist in accurately reporting the data it generates.
From my vantage point at Mesh Analytics, I see daily how the complexity of B2B attribution can be daunting. Our platform aims to simplify this by providing a clear picture of what’s effective in your marketing efforts and what’s not. The discussion with Julia and Drew highlighted that whether you view B2B attribution as a treasure hunt or a wild goose chase, one thing is clear: it’s a journey worth embarking on if you want to chart a successful marketing course.
Stay tuned for more insights as we delve further into the conversation, unearthing the strategies and mindsets that make B2B attribution not just manageable, but a cornerstone of informed decision-making in marketing.
Will Whitham
The cornerstone of CMO-CFO relationships: Revenue attribution
As we delved into the essentials of revenue attribution, the importance of this concept was immediately apparent. Why is it so critical, and how do we define it? Julia was quick to point out that the relationship between a Chief Financial Officer (CFO) and a Chief Marketing Officer (CMO) can hinge on successful attribution. She emphasized that a solid attribution framework can mean the difference between a trusting partnership or one where the marketing team is constantly under scrutiny for their spending decisions.
Julia shared that the ability to demonstrate the revenue driven by the marketing team can mend or break this crucial relationship within a company. A lack of trust arises when there is an inability to show the return on investment for marketing expenditures.
"The more you have attribution, the better you are able to make decisions as a team and inform the company of what you're doing and why you're doing it," Julia stated. She warned against the dangers of analysis paralysis, where teams are inundated with data but unable to act on it. A clean and effective attribution model can be the guiding star that helps a company invest in the right areas, enabling growth by spending wisely.
Adding to Julia’s insights, Drew highlighted that having actionable, clean attribution data is not just a practice but a competitive edge. "There are so many organizations that just can't do this," he said, suggesting that the ability to execute attribution well is a rare and valuable trait.
Drew pointed out that in uncertain economic times, the ability to use attribution data to defend marketing budgets becomes even more crucial. Good attribution enables marketing leaders to make informed decisions about where budget cuts can be made with the least impact on the sales pipeline, should the need arise.
The consensus was clear: attribution is not just about tracking revenue - it’s about strategic decision-making, maintaining crucial interdepartmental relationships, and securing a company’s competitive standing in the marketplace. As we navigate potential economic downturns, the role of attribution only grows in importance, serving as a lifeline for marketing departments to demonstrate their value and safeguard their budgets.
The evolution of marketing: Lead generation to revenue marketing
The conversation shifted to a term that’s rapidly gaining traction in the marketing world: revenue marketing. I posed a question to the panel about the significance of this trend and how it sets itself apart from traditional demand generation and lead generation strategies.
Julia was enthusiastic to address this, revealing that she’s long branded herself as a revenue-based marketer, a concept that has only recently caught on industry-wide. Revenue marketing, in her view, is all about tracking the customer journey all the way to the sale and tying every marketing action to the lifetime value it generates.
Julia noted the challenges that come with attribution models - they can be cumbersome and inaccurate if not managed by someone who deeply understands the tools that tie everything together. She stressed the importance of accuracy in attribution, recounting a career-shaping experience where she was forced to prove the value of every marketing dollar spent.
This challenge led her to develop her own systems for tracking marketing impact on revenue, an approach that aligns closely with the solutions my company, Mesh Analytics, aims to provide. Julia highlighted the complexity of educating teams on effective revenue attribution and the necessity of having an aligned tech stack between sales and marketing to avoid data silos.
Drew weighed in, reinforcing Julia’s point by distinguishing revenue marketing from demand and lead generation through the metrics used to measure success. While traditional methods focus on top-of-the-funnel metrics like leads and engagement, revenue marketing holds marketers accountable for their contribution to the sales pipeline and final bookings.
Drew emphasized this approach as an up-leveling of the marketer’s role, asserting that revenue marketing is about demonstrating direct impact on an organization’s bottom line and valuing the work accordingly.
As the discussion progressed, it became clear that revenue marketing is more than just a trend - it's a strategic shift in the marketing paradigm. It challenges marketing teams to look beyond the surface metrics and to intertwine their efforts seamlessly with the revenue goals of the company. This shift is not just about accountability; it’s about transformation and empowerment within the marketing function, positioning it as a central driver of business growth.
Will Whitham
The transformative power of revenue attribution
In our discourse on revenue attribution, I steered us towards the tangible impacts of this practice. I asked my fellow panelists to share specific instances where implementing revenue attribution made a discernible difference in their companies.
Julia provided a compelling case study from her experience. She recounted joining a company overly fixated on Marketing Qualified Leads (MQLs) with little regard for what happened beyond that point. Her approach to implementing a comprehensive attribution system led to a drastic reduction in the cost per MQL - from a staggering $32,000 to a mere $900 - within a mere two weeks.
This was achieved by ceasing ineffective spending and focusing on tactics that showed real return. Julia’s strategic redirection of ad traffic straight to sales, coupled with her decision to cut off non-performing avenues, yielded immediate efficiency gains. The result was not just cost savings but also an empowered Business Development Representative (BDR) team, which grew significantly under her guidance. This narrative perfectly encapsulates how refined attribution can sharpen a marketing team's focus and amplify its impact.
Drew Smith shared a story with echoes of Julia's experience, describing a client who had been practicing marketing attribution for several years. They launched an AdWords campaign that, on the surface, seemed to perform brilliantly due to its excellent conversion rates and low cost per lead.
However, a deeper look, facilitated by a robust attribution system, revealed that none of these leads had progressed to opportunities - a crucial metric for actual business impact. Within minutes, they identified that the ad's broad language and imagery were attracting the wrong audience, leading to an immediate disqualification by the BDRs.
With the insights provided by their attribution model, they could pause and refine the campaign, resulting in fewer but higher-quality MQLs that began converting into genuine opportunities. Drew's example underscored the value of attribution not just in tracking but in enabling rapid, informed decision-making that saves resources and drives real business results.
These stories from Julia and Drew highlight a critical aspect of revenue attribution: it’s not just about assigning credit, it’s about strategic insight. By understanding which activities drive real value, companies can optimize their marketing spend, focus on the most productive areas, and ultimately fuel their growth.
This capability to pivot quickly and efficiently is particularly invaluable in an environment where every dollar must be justified, and the pressure to perform is ever-increasing. Revenue attribution, when executed correctly, becomes not just a tool for justification but a compass for strategic marketing investment.
Why companies struggle with revenue attribution
During our panel, a critical question surfaced: If the benefits of revenue attribution are so evident, why do companies falter in its implementation? Drew Smith responded by shedding light on a common misconception that deters many organizations - the belief that their data must be perfect to start with attribution.
He clarified that the role of attribution, ironically, is to aid in cleansing, normalizing, and standardizing data. Drew explained that during the implementation of an attribution platform, issues like improper UTM usage or campaign tracking in CRM systems get rectified as part of the process. His perspective is one of encouragement, urging companies to take the leap, as waiting for perfect data is essentially a Catch-22 situation where nothing improves because no action is taken.
I added to this by noting the presence of organizational inertia, a resistance to change that can pervade companies, stalling progress and innovation.
Julia further expanded on the topic, pointing out the intricacy of budget allocation in marketing departments. She described how budgets are often historically based, creating a risk-averse culture that fears losing funds with any deviation from the norm.
Yet, Julia argued that a robust attribution system can mitigate these fears by building trust within the organization. With better attribution, marketing leaders can protect and potentially grow their teams, demonstrating that the value of marketing extends far beyond the superficial layers of advertising spend.
She also touched on the strategic benefits of sophisticated attribution practices, such as their ability to integrate marketing efforts more deeply into the sales cycle. By leveraging precise data, marketing can influence sales cycle velocity, improving metrics like customer acquisition cost (CAC) and lifetime value (LTV). For Julia, adept attribution is the line between feeling constrained as a marketing leader and being empowered to direct the future of your department.
Throughout the discussion, it was clear that the journey to effective revenue attribution is often hindered not by a lack of tools or technology, but by psychological and procedural barriers within organizations. However, as Drew and Julia highlighted, these barriers are surmountable. With the right approach, attribution can transform a marketing department from a cost center to a powerhouse of strategic business growth, capable of driving revenue and proving its value with hard data.
Navigating data integrity and organizational trust in marketing
In our exploration of revenue attribution, a significant concern arose: the potential for marketing teams to manipulate data in their favor. I questioned the panel on how they mitigate such concerns within their leadership teams.
Julia candidly shared her approach, emphasizing transparency and highlighting the cost savings resulting from her strategic decisions. She spoke about the importance of showing leadership what she opted not to do, as much as what she did, using attribution data as her evidence.
Julia also discussed the temptation to invest in the latest marketing technologies, often spurred by industry buzz and the fear of falling behind. She stressed that solid attribution practices allow for a clearer assessment of such investments, recalling her own experience with an early adoption of a marketing tool that ultimately did not deliver the promised value.
For Julia, the lesson was clear: robust attribution not only builds trust within the organization but also enables smarter, more strategic investment decisions.
Drew emphasized the need for impartial analysis, stating that if the creators of campaigns are left to evaluate their own work, there's an inherent bias toward self-advantageous interpretations. Drew advocated for the role of an unbiased analyst within the organization, someone who is removed from the campaign creation process and can provide an objective assessment of performance. This unbiased perspective ensures that campaigns are evaluated on their actual merit, not on the internal narratives or ambitions of those who designed them.
The conversation underscored a fundamental truth in marketing analytics: while data can empower, it can also mislead if not managed with integrity. Building a culture of trust around data usage means establishing clear roles for creation and analysis, encouraging transparency, and fostering an environment where accountability is valued over self-preservation.
As leaders in marketing, it’s our responsibility to maintain the balance between advocating for our teams and ensuring that the data guiding our decisions is interpreted without bias. This balance is essential not just for internal credibility, but also for the sustained growth and health of the organization.
The art of communicating marketing success
At the heart of our recent panel discussion was the fundamental question of how marketing leaders effectively convey their successes and learnings to executive leadership. Communication, it seems, is both an art and a science, especially when it involves complex data like that from revenue attribution systems.
Julia conveyed her passion for Monthly Business Reviews (MBRs), highlighting them as a critical opportunity to showcase marketing's triumphs and setbacks. Julia's approach is meticulous, with preparation spanning weeks to ensure her data tells a compelling story.
She notes the ripple effect of trust that good data storytelling can create across an organization, beyond the CFO to include other departments like sales. When marketing's narrative is robust and transparent, it shifts from being a department of cost to one of strategic importance.
At Capchase, where they've implemented Mesh Analytics, Julia has witnessed firsthand the transformative power of having immediate, actionable data. It’s enabled her to make rapid, informed decisions that have positioned the marketing team at the heart of the company's strategic initiatives.
Drew touched on the importance of storytelling through data. He explained that an attribution platform serves as a neutral storyteller, which can mitigate the often adversarial nature of departmental interactions. By presenting an unbiased account of how opportunities and deals develop, marketing leaders can navigate away from credit battles and toward a narrative that builds credibility and trust.
The ability to tell a clear, data-backed story is a powerful tool for any marketing leader. It not only demonstrates the value of the marketing department but also enhances collaboration across the entire organization. As marketers, we hold the unique advantage of being natural storytellers, and when combined with precise attribution data, we have the capability to not only tell the story but also to shape the future narrative of our companies.
Dr. Peter Cain
Envisioning the future of revenue attribution
The conversation then pivoted to the future of revenue attribution technology, a topic that resonates deeply with those in the trenches of marketing analytics.
Drew Smith shared his enthusiasm for the potential of AI and machine learning in attribution. His vision is one where the labor-intensive process of sifting through data to uncover insights is transformed by technology. He sees a future where anomaly detection can proactively alert marketers to discrepancies in their data, such as a disconnect between a low cost per lead and the number of opportunities created.
AI-based recommendations could also revolutionize budget allocation, offering predictions and guidance on where to invest marketing dollars for the best return, especially in situations like the reallocation of budgets from canceled in-person events to other channels, as was common in 2020.
Julia expressed a desire for a future where the complexities of UTMs and data analysis are streamlined. She dreams of a tool that allows her to enter any organization, regardless of its past software decisions, and clearly outline where to allocate spending for optimal results.
Currently, the process of data analysis is cumbersome, involving the evaluation of numerous tools and their integration with CRMs, data fields, and overall data handling. In her ideal future, the role of sales and revenue operations would be far less about managing painful data intricacies and more about strategic decision-making.
Both perspectives underscore a shared aspiration in the attribution industry: to simplify and enhance the marketer's ability to make data-driven decisions quickly and with confidence. As the conversation around attribution technology continues to evolve, the focus remains on developing tools that not only gather data but also interpret it in meaningful ways, ultimately empowering marketers to excel in their strategic roles.
Getting your attribution model is more important than ever for CMOs. Don't miss the opportunity to compare notes with the brightest marketing minds at the CMO Summit: New York 2024 on March 19th.
