The 10 Important B2B Marketing KPIs for Lead Generation
Boost your B2B lead generation success with these KPIs.
B2B lead generation is challenging because there’s tons of competition, and you might have to deal with multiple decision-makers, busy prospects, and a wide range of touchpoints. Plus, it’s only becoming more difficult, according to 73% of marketers, which means key performance indicators are more important than ever.
By measuring KPIs, you can adapt to competition and elevate your marketing approach to continue driving successful lead generation for revenue growth. The experts at Ideas Collide have a long track record of successful B2B lead generation campaigns, so we put together all the information you need to implement the 10 most important B2B marketing KPIs for lead generation.
Keep reading to learn how to boost your lead generation success with KPIs like lead volume, conversion rate, cost per lead, and more.
- KPI #1: Lead Volume
- KPI #2: Conversion Rate
- KPI #3: Cost Per Lead (CPL)
- KPI #4: Lead Scoring Accuracy
- KPI #5: Marketing Qualified Leads (MQLs)
- KPI #6: Sales Accepted Leads (SALs)
- KPI #7: Lead-to-Customer Ratio
- KPI #8: Time to Conversion
- KPI #9: Customer Lifetime Value (CLV)
- KPI #10: Return on Marketing Investment (ROMI)
B2B Marketing KPI #1: Lead Volume
To show you how to use lead volume and other B2B marketing KPIs for lead generation, we’ll demonstrate them using a fictional company, SmartTech.
This company sells smart home devices for businesses like smart thermostats, smart speakers, and smart light bulbs. SmartTech’s marketing team sets a goal to increase lead volume by 25% within the next quarter, so they’ll need to closely monitor and track lead volume metrics.
Lead volume refers to the number of prospects and potential customers who show interest in your product or service during a specific period. Lead volume is an important metric for B2B marketing campaigns because it determines how effective your strategy is. It can also be used to see if your marketing activities are qualifying new leads and determine new marketing activities.
Basically, the more leads you have, the more opportunities to convert them into paying customers. To track their lead volume, SmartTech uses a variety of methods including email marketing campaigns, social media advertising, and content marketing. All of these avenues drive traffic to their website, capture leads, and boost the number of leads during the designated period.
SmartTech started the first quarter of 2023 with a lead volume of 1,000 leads per month. Since their goal is to increase lead volume by 25%, they’ll need to generate an additional 250 leads this month. Each week they hold a meeting to monitor their progress and adjust marketing strategies as needed.
For example, if you notice that your PPC advertising campaigns and associated landing pages are generating significantly more leads than email marketing, you can adjust your email approach to better attract new leads. You can also use the messaging and SEO keywords from effective paid ads and landing pages to attract a higher number of customers.
B2B Marketing KPI #2: Conversion Rate
Conversion rate is a critical metric for any marketing or sales team because it refers to the percentage of leads that take the desired action. Conversion rate can focus on direct sales as well as the percentage of leads that sign up for a newsletter, fill out a form, request a consultation, or numerous other actions.
SmartTech uses conversion rate to measure the percentage of leads that buy their products. For instance, if SmartTech captures its normal 1,000 leads in a month and only 50 of those leads become paying customers, then its conversion rate is 5%. While not terrible in some industries, SmartTech believes they can do significantly better.
To increase its conversion rate, SmartTech focused its digital marketing efforts on improving its website’s user experience, clarifying product information and features, highlighting important benefits, and even offering incentives like discounts and free shipping to simplify the decision-making process.
Since SmartTech’s current lead conversion rate is 5%, their goal is to increase to 6% conversion by the 3rd quarter of 2023. They closely monitor conversion rates and use A/B testing to measure the impact of website design, messaging, personalization, targeting, call to action, and other optimization factors that influence marketing performance.
This helps them gradually improve until they hit their 6% conversion rate KPI. Like SmartTech, we recommend you track the results of all marketing channels and perform A/B testing to elevate your conversion rate. Without tracking metrics, you won’t know whether adjusting copywriting, design elements, or approach boosts conversions or lowers them.
B2B Marketing KPI #3: Cost Per Lead (CPL)
Cost per lead is the total amount your business spends to acquire each lead. This B2B marketing KPI is calculated by dividing total marketing spend by the number of leads generated. Additionally, customer acquisition cost (CAC) is the cost per lead that’s been successfully converted into a paying customer. While related, we are focusing on B2B lead generation metrics and cost per lead.
SmartTech understands the importance of CPL in B2B marketing because it ensures its marketing budget is allocated effectively. They currently have a CPL benchmark of $60 per lead, but they want to bring that down to $55 per lead.
To improve cost-effectiveness, they reduced spending on competitive keywords and focused on affordable channels like SEO content marketing and social media marketing that speaks to their B2B clientele. For example, by focusing marketing efforts on LinkedIn, they might reduce the number of total impressions, but they also boost click-through rate, reduce ad spending, and improve cost per lead metrics.
The result of better CPL is often a higher ROI as well because it means you’re spending less to drive just as many leads. Other strategies you may want to consider for this metric include better targeted, dropping low-performing keywords, optimization of ad creatives, and using high-performance, low-cost strategies like holding webinars or building a social media following.
B2B Marketing KPI #4: Lead Scoring Accuracy
Lead scoring systems help you identify and separate the highest quality leads that are more likely to convert. This can help you segment, target, and convert leads accordingly. You’ll be able to prioritize the best leads and allocate budget and resources to the most effective approaches.
You can use all types of data to implement lead scoring, including email click-through rate (CTR), social media engagement, demographics, user behavior, keyword and search engine activity, age of lead, and more. In addition, you can use conversion rate as your baseline for calculation. You can then build attributes and point systems for the customers that converted at the highest rates compared to other groups.
Let’s say SmartTech implemented a lead scoring system using base demographics, but they want to improve their system’s accuracy. Consequently, they refined their lead scoring criteria by adding negative points for inactive time, improving the precision of key demographics, and incorporating feedback from their sales teams.
Sales team feedback is an invaluable resource for B2B companies because they are communicating directly with leads and can speak to what drives conversions. Using this feedback helped SmartTech regroup leads and improve conversion rates for the highest quality leads.
You can also streamline the sales cycle, improve cost-effectiveness, and increase revenue simply by incorporating and regularly adjusting your lead scoring accuracy. With a precise lead scoring system in place, you can also learn more about your customers and prospects, which can help you redirect and optimize your lead-generation marketing efforts.
B2B Marketing KPI #5: Marketing Qualified Leads (MQLs)
Marketing qualified leads are potential customers who’ve engaged with your company’s marketing campaigns and are deemed more likely to convert than other leads. This is determined by the CTAs they clicked on, the pages they visited, interactions with blogs and social posts, offers redeemed or downloaded, and more.
This is not to be confused with a sales-qualified lead, which is a prospect who’s ready to talk to a sales team. An SQL is ready to buy, while an MQL needs to be nurtured further before closing the B2B sale. However, it’s a good idea to have them work together for an efficient and cooperative lead and sales process.
Going back to SmartTech, they noticed there was a disconnect between lead volume and sales conversion rates, even after they improved lead scoring accuracy. They decided leads weren’t properly nurtured and were too quickly sent to sales teams, which scared some leads away and produced poor results.
In turn, they implemented a clear marketing qualified lead system that was identified on behaviors and search intent. SmartTech used effective nurturing through targeted content, personalized email campaigns, and valuable social media posts.
This kept the MQLs in their pipeline, improved the bounce rate, and fostered better collaboration with sales efforts. Now they revisit lead definitions each quarter to continue optimizing their process and boosting lead generation and conversion rate success.
B2B Marketing KPI #6: Sales Accepted Leads (SALs)
After improving their process with MQLs, SmartTech started using another B2B marketing metric called SALs to streamline the customer journey. Sales accepted leads, or SALs, are MQLs that have been approved by the sales team as worthy of sales engagement. These SALs can become SQL through further qualification.
Working alongside the marketing team, SmartTech’s sales team mapped out the lead generation funnel to determine where low-quality leads were slipping through and where high-quality leads were incorrectly nurtured. Using this data, they could utilize specific qualification criteria that created SALs that naturally progressed from MQLs.
This not only boosted sales performance but also helped SmartTechmarketing efforts and save time and resources by creating a formulaic, data-driven methodology. The results were cost-effective marketing, a higher bottom line, and sales that drive revenue without losing qualified website visitors.
B2B Marketing KPI #7: Lead-to-Customer Ratio
The lead-to-customer ratio is one of the most important marketing KPIs for B2B businesses because it tracks the percentage of leads that eventually convert into paying customers. While lead volume and scoring are important, lead generation’s ultimate goal is to eventually convert, so it’s critical to track this metric to assess the sales funnel, identify weaknesses, and amplify strengths.
To boost the lead-to-customer ratio, don’t just focus solely on factors that boost the conversion rate. Rather, look at those that improve the overall customer experience through great lead nurturing and qualifying, as well as conversion.
For example, let’s say despite the increasing lead volume, SmartTech still converted a similar number of visitors. This brought down the lead-to-customer ratio. So they decided to refine the lead qualification process with effective sales collateral that thoroughly demonstrates their smart products and the benefits for businesses like cost savings with smart thermostat technology.
This improves qualifying ability while also enhancing the customer experience. In turn, SmartTech might reduce the number of MQLs, but convert at a significantly higher rate, thereby increasing the lead-to-customer ratio.
We suggest breaking down your lead-to-customer ratio using lead scoring as well to better focus your marketing initiatives and optimize your strategy. However, this KPI is critical because it influences everything from revenue and cost-effectiveness to customer satisfaction, number of referrals, positive reviews, and percentage of qualified website traffic.
B2B Marketing KPI #8: Time to Conversion
If you’re generating thousands of highly qualified leads, but it takes you several months or longer to convert each one into a B2B customer, that’s a problem for budget, return on investment, retention, simplicity, and more. Time to conversion is a crucial KPI defined by the average length of time it takes for a lead to convert into a new customer.
This KPI is based on the time from initial engagement to purchase but can also be broken down into time from initial engagement to MQL, MGL to SAL, SAL to SQL, and more. This can help you identify sections of the marketing process that might be lagging and contributing to a slower-than-normal time to conversion.
If SmartTech noticed a slow time to conversion, they’d try to identify bottlenecks in the sales process and agitate leads and keep things moving. For example, if they noticed that leads were slowing down as soon as they were designated as MQLs, then they would identify issues within that portion of their funnel.
They could address lead nurturing strategies that were too complex, not valuable to prospects, or didn’t properly communicate the benefits of their products. Additionally, they could evaluate the responsiveness of the sales team and ensure there wasn’t a disconnect between marketing and sales.
You can also accelerate the time to conversion KPI with automation. You can automate lead nurture email and social media campaigns, personalize your approach, and improve sales team effectiveness to accelerate the sales cycle. Continue to monitor time to conversion as well as lead volume to ensure that your pipeline continues to fill and contribute to a higher bottom line and marketing ROI.
B2B Marketing KPI #9: Customer Lifetime Value (CLV)
B2B success often relies on loyal customers who continue to purchase from your brand, which is why customer lifetime value (CLV) is so important. This KPI tracks the total revenue you can expect to generate from a single customer throughout the entire duration of the relationship.
It’s also closely related to churn, which is the percentage of customers that stop using your product or service during a set period. Since it’s easier to generate revenue from existing customers through upsells, referrals, retention, subscriptions, and other strategies, these KPIs are important for consistently maximizing revenue in the long term.
If SmartTech recognizes this, what should they do to improve the metrics? They’d focus on customer satisfaction and product quality. They might collect specific feedback from existing customers to find out what keeps them coming back and what drives them away. Using this data, they can enhance customer retention, improve relationships, assess inadequacies, and, in turn, improve CLV.
We recommend interviewing or asking customers for feedback often because it’s helpful not only for CLV, but for improving your entire marketing strategy. You can use it to address potential objections and missteps and adjust your approach to several B2B marketing metrics like lead scoring, lead-to-customer ratio, conversion rate, and more.
B2B Marketing KPI #10: Return on Marketing Investment (ROMI)
Return on marketing investment is the revenue generated from marketing activities divided by the cost of those activities. It’s expressed as a percentage and is similar to ROI.
However, ROI is a general term and may also include manufacturing costs, product loss, operating costs, and more. ROMI, on the other hand, only includes marketing costs and results. However, many marketers say ROI when they mean ROMI.
SmartTech would use ROMI to assess, adapt, and improve B2B marketing efforts. This metric would help them determine where to spend more and less money and improve decision-making using objective data.
For example, they might send sales data from their CRM to Google Analytics to measure the ROMI of each campaign as well as marketing in general. Then they can optimize or eliminate low-performing campaigns and focus more effort on campaigns that are cost-effectively contributing to revenue. They might even abandon a marketing channel altogether if ROMI demonstrates ineffectiveness.
Other factors that influence ROMI include targeting accuracy, competition, creative quality, messaging, and lead qualification. Try refining targeting to better intrigue prospects, optimize web page designs, enhance sales copy, and continuously perform A/B testing on all ad and marketing campaigns. Doing so will help you amplify ROMI by reducing costs and improving conversions.
By tracking the 10 most important B2B marketing KPIs for lead generation, you can generate more leads, qualify those leads, and convert them at a higher rate while wasting fewer resources. You can boost lead volume at a lower cost per lead by prioritizing certain prospects with lead-scoring accuracy. From there, you can increase your conversion rate.
By tracking these KPIs, you can get a better return on marketing investment, and ultimately drive growth and success for your B2B marketing strategy. If you need help tracking B2B KPIs and driving revenue with cost-effective marketing, the marketing specialists at Ideas Collide can help, starting with a free consultation.
Lead volume is an important metric for B2B marketing campaigns because it determines how effective your strategy is.
With a precise lead scoring system in place, you can also learn more about your customers and prospects, which can help you redirect and optimize your lead-generation marketing efforts.
Time to conversion is a crucial KPI defined by the average length of time it takes for a lead to convert into a new customer.