How To Measure The Marketing Funnel

Lead Nurturing ‌• May 6, 2010

Our team here at OppSource has been doing a lot of thinking lately about the Marketing Funnel. Specifically, the valuation of the marketing funnel. It dawned on me the other day that most CEOs know in detail how to size and measure key value points of their business value chain. Things like inventory, sales pipeline, cash flow, employee productivity, etc. Why don’t they know how to value their marketing funnel?

There are probably lots of reasons, not the least of which is the mystical shroud that hovers over marketing.  For most businesses, the marketing funnel is the lifeblood of business two quarters from now.  Marketing activity today or the lack there of will show up in the business results downstream.  It is clearly a part of the value chain in each and every business no matter how large or small.

Most CEOs think about valuation of anything in 3 ways; volume, value, and velocity. Tracking the volume is important because it speaks to capacity and scale. Tracking value is important because it speaks to the relative investment involved. Tracking velocity is important because it speaks to the timing of business results.

We’ll have more on this concept in coming posts.  For now, I simply urge you to start thinking about the MFV within your organization.  Below are some simple ideas for establishing a valuation of your marketing funnel.

Volume = the number of leads x the lead score
Value = the lead volume x average order value
Velocity =  leads converted to sales pipeline / new leads added to marketing funnel

To learn more, click here to download the White Paper: “Why The Marketing Funnel Needs Your Attention

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