From its inception, the concept of “marketing” (driving awareness to a product or service), has toed the line between art and business. Solid marketing utilizes creative expression to spark brand recognition and highlight product value to specific buyers. It’s as old as commerce itself, but its success criteria has remained the same: did we sell our offering, and if so, how much of it?
In 2020 this seems primitive, but we’ve only recently been able to quantify marketing’s impact on the bottom line. For most of marketing’s long history, reporting capabilities were nonexistent, but with rapid advancement in marketing attribution technology, marketing’s identity is evolving from “art and business” to “art and science”. An ad is no longer judged by its beauty, but by how much pipeline it creates. A thoughtfully crafted email nurture campaign is no longer “brilliant” unless it shortens deal cycles or increases the basket size.
Fear not, marketers; this is good news. Ensuring marketing is contributing to revenue generation is the only way to ensure marketing remains top-of-mind of executives and cements its rightful place as a revenue driver, not a cost center.
But how do we measure and quantify product marketing? As one of very few marketing (or sometime, product) departments that isn’t directly tied to a number, defining their KPIs is no easy task. Between sales enablement, competitive intelligence, analyst relations, release messaging, and overall go-to-market positioning, quantifying their performance is an uphill battle.
With that said, it’s a battle that needs to be fought. As Peter Drucker has preached, “what gets measured gets managed,” and without clear targets, product marketers can inadvertently lose focus on the projects and initiatives that matter most. Even worse, without having metrics to define your success, the rest of the organization may fail to recognize just how impactful your work is to downstream success. The Product Marketing Alliance’s State of Product Marketing Report for 2020 shows that only 5% of product marketers feel like their role is fully understood, meaning quantifiable metrics are desperately needed to maintain credibility and leadership buy-in.
So as you begin to determine how you could quantify product marketing at your organization, let’s first consider what’s possible from a metrics perspective. While evaluating the list below, remember that your PMM KPIs will vary depending on your company size, product sophistication, roadmap, release cadence, main stakeholders, and more.
Product marketing goals and associated metrics
At a high level, product marketing’s main areas of focus include go-to-market initiatives, sales enablement, marketing support, and product adoption. We’ll look at each of these in detail, as well as a few metrics that can help point to product marketing’s effectiveness. Before beginning to monitor any of the metrics below, be sure you collect baseline stats beforehand to better understand how large your delta is over time.
Establishing clear messaging to connect product to buyer is at the heart of any effective product marketing team. Between extensive buyer persona research, gaining product expertise, and understanding the competitive landscape inside and out, creating a go-to-market strategy is nuanced, time-intensive, and its success is often hard to gauge. With that said, a few metrics can be useful in determining how your positioning is landing.
- Win rates: though closing an opportunity takes a village, it’s dramatically harder to win a prospect’s favor without a strong messaging foundation for marketing and sales to effectively nurture them throughout an entire deal cycle. Increases in win rates after re-positioning exercises or large product updates can be reliable indicators that product marketing is delivering as expected.
- Conversion rates: If product marketing is fueling your demand generation engine (as it should be), there are several ways to identify the potency of your messaging. Identifying the right segments for your marketing team to target sets the stage for their success, and as such, should be considered a critical stat for any well-integrated product marketing team to monitor.
- Analyst reports: If analyst relations falls under product marketing at your organization, this is a tremendous way to understand how your messaging is differentiating you from competitors. By subjecting your product and messaging to scrutinization by industry experts, you’ll know just how potent your offering is. As analyst reports are incredibly popular in the market (and are significantly important in the researching buyer’s journey), this can be a risky undertaking for startups or unsophisticated products, but the learnings you can obtain year over year will undoubtedly help you identify where your messaging and strategy need improvement or, conversely, can drive immense demand should yours be received favorably.
Product marketing is often on the hook for ensuring sales teams and customer success managers have the information, resources, and confidence to comfortably handle relations with prospects and existing customers. There are several tasks that go into a strong sales enablement process, and the following metrics are likely to be strong indicators of its effectiveness.
- Asset utilization: When you make collateral to support your sales team in prospecting and progressing pipeline through the funnel, are they using it? If your intranet (Google Drive, Sharepoint, etc) captures usage data, this can be a tremendous indicator of the saliency of your internal-facing content. Depending on how targeted the asset is (job title, industry, sales stage), this can lend itself to further analysis around specific segments and product features.
- Deal cycles: How long, on average, does a sale take? From the discovery call to signing the contract, are there bottlenecks or points of contention that proper sales enablement could alleviate? The right preparatory material at the right time can help sales step on the gas and shorten deal cycles, a tremendous indicator of strong product marketing influence.
Win/Loss ratio: At its most basic level, sales enablement strives to increase success rates - the percentage of wins sales captures. Notice the nuance here versus the total number of wins; enablement doesn’t lead to a higher volume of opportunities, but should increase the rate of success in the opportunities they’re given.
This could span from messaging frameworks to be leveraged by demand generation and content marketing to product announcements to high-level brand identity. Depending on the size of your company, this will be nuanced, but one statistic almost always reveals the strength of product marketing’s impact on the greater marketing team’s success.
- Campaign performance: Is the messaging you’ve prescribed to your demand generation team landing? What about your paid/organic social teams? A/B testing of new vs. old content can certainly help identify the delta of a reimagined messaging framework, and is one of the most objective measures of product-market fit available. If you’re using a sophisticated ESP, use campaign data as a feedback loop, understanding which links and incentives generate higher levels of engagement to help fine-tune your go-to-market strategy.
- Site traffic: Increasing the volume of visitors to your website is certainly a cross-functional endeavor, but product marketing lays its foundation. Brand awareness, product specifications, and release updates are rooted in the go-to-market strategy that product marketing builds, and improvements to search performance (impressions, average position, clicks, etc) and an increase in site visitors are reliable indicators of the message’s potency.
- MQLs and SQLs: Once visitors reach your site or engage with your messaging across channels, are they raising their hands? Has product marketing positioned the product as something your visitors need to have? By identifying spikes or dips in MQLs and SQLs, we can get a sense of how receptive the market is to the story product marketing creates. SQLs provide an added layer: did we reach and compel the audience that’s actually a fit for our product, or does the conversation end at the discovery/MQL stage?
One of, if not the most direct indicator of a strong product marketing output is product adoption. If PMM’s high-level responsibility is to translate product features into customer value points, measuring the onboarding and usage rates of your products is a critical litmus test for any product marketer.
- Onboarding data: At the onset of a contract, are customers using the product as much as you think they should? Are they using all the features available to them? If they aren’t, is there collateral that can help them understand how to maximize the usage of their new platform? The first quarter of a customer’s engagement with a tool is a strong reflection of product marketing’s ability to showcase the product to those who are already bought-in (and likely more engaged with your marketing materials than prospects).
- Feature adoption: Similarly, when product marketing creates messaging around new features or cross-sell options, how quickly is that translating to adoption? Are customers signing up for beta programs at a high volume, and are their renewals increasing in price over time? Keeping an eye on how new offerings are performing can be indicative of appropriate messaging around them.
- Churn rates: While product marketing might not directly help a customer accomplish their goals, throughout the market there are competing product marketers that are making a compelling argument to leave your brand for theirs. If your messaging doesn’t instil trust in your customers, they’ll be more willing to evaluate other options. It’s the product marketers job to ensure that customers know you’re innovating and can solve their needs better than the rest of the market. Changes in churn rates signal a lack of trust in the product and, ultimately, the messaging supporting it.
Any of the metrics above can highlight product marketing’s performance, but it’s important to be patient before rushing to conclusions. It takes much longer for these metrics to paint a picture of PMM performance than it does for pipeline to paint one for demand generation. More often than not, product marketing is a marathon while the organization runs in sprints. Measure what matters, and don’t rush to conclusions.
“A part of the challenge in measuring product marketing is identifying what success looks like for a given initiative given the vast purview of the role and the many teams in which PMMs interact with. Oftentimes, organizational-wide education is required to ensure product marketing isn’t unnecessarily attached to quickly attainable metrics that a demand generation specialist or growth marketing manager might be accountable for. I advise leaders to take a step back and think through exactly what areas of the business they want to invest PMM efforts in. From there, work backward and focus on just a handful of key metrics that PMM can help improve in order to get to your desired business outcomes” - Devon O’Rourke, Founder and Managing Partner of Fluvio has stated,