Despite all the marketing technology that’s out there, attribution is a very relevant and current problem within product marketing. So, how do you measure the success of product marketing?
Whether you are a company investing in a new product marketing hire, or an employee making a case for more budget, this is an important question to answer. Of course, by rallying the whole company behind one solid narrative you have made all your marketing efforts more effective. By working on sales enablement you have helped improve revenue. By working with customer success on their customer understanding, you have improved upsell. But as you must be starting to see, the obvious metrics such as revenue growth, upsell and traffic are tricky when it comes to attribution, because tens of other initiatives have contributed to the higher ARR!
What are the more direct and measurable ways to know the impact that product marketing is making to businesses?
The role of a product marketer by itself is diverse. To top that, where a product marketer spends more time depends on what stage of growth a company is in. I have seen product marketing's focus change as a company moves from series A to B to C funding (not to mention things could be quite different at an established MNC). For simplicity, I am breaking the KPIs down by two stages: Pre and Post Product-Market Fit. You will notice that, for any metrics that matter, the timeframe is rarely immediate, which just reinstates that product marketing makes a sizeable and significant impact on business, in a relatively longer-term.
Pre product-market fit
At this stage, a company has had some wins but is still trying to find the sweet spot. You can imagine a company comprised of a few sales reps, a small out-bound focused marketing team, with initial investments in inbound marketing (content, social mostly).
No company operates in isolation, so it’s important to assume a fair bit of competition is out there. Here’s how you measure the success of product marketing in this case:
1. Sales effectiveness
One of the most underrated areas of contribution of a PMM is the hours spent in creating sales and product-domain assets that help move deals along the funnel. Every single time a sales-rep utilizes an asset such as a sales deck or a battlecard, they are not just saving precious time in creating something of their own, but are also benefiting from the most professional, targeted and unified messaging and knowledge that product marketing has put together. Sales enablement tools such as Highspot help you measure precisely how many times different assets have been used. However, for a better understanding, it’s best to gather quarterly feedback from your sales and SDRs and ask questions such as: which assets helped you the most, how many times the assets made a prospect consider us more favorably against a competitor, how can we improve these assets, which three areas do you need most help with, etc.
2. Win rates in target market
For a small company that’s still working on its positioning, it’s important to study how you compete against the biggest competitors. As product marketing works on a go-to-market strategy, companies should see their competitive win-rates improve. I’d like to highlight that it’s important to study the win-rates in your target market (buyer persona/industry/market segment etc.), as determined by your product marketing efforts. Improvement in win-rates is tangible and a testimony that you have been put on the right path by your product marketing team.
3. Reasons for winning
Go one step deeper than win-rates. Look for the reasons you are winning against competitors. Why? As the company starts to adopt the GTM strategy, they should see more consistency in why they are winning against their competitors (and in a target market, in most cases). If you see 10-15 different reasons for winning, it’s not a good sign. It’s impossible for any business to sustain 15 sources of competitive advantage. What you need are 3-5 consistent reasons for winning against the competition. And as a result of the target market identification, positioning, and competitive differentiation, your sales teams should be citing similar reasons for winning deals against a competitor. All CRMs allow for capturing this information. However, sales feedback will also be a good source for this information.
Post product-market fit
Once you understand your target market well, have clear positioning and are growing fast in your space, a PMM’s responsibilities start to shift. Also, you can now imagine a PMM team rather than an individual, with more specialized people within the role. In addition to the above KPIs, the ones mentioned below also start to become important.
Building brand awareness is always a goal for a business, but I’d say when you have a critical mass of customers (and have moved to a Series-C stage) it makes sense to make concerted efforts towards building awareness. Of course, a PMM team’s efforts will reflect in an increase in social media followers, PR impressions etc. but from a PMM standpoint, these could be considered vanity metrics. A better KPI for your PMM team is the good old brand personality assessment survey. Simple questions such as ‘If our company (ABC) was a person, how would you describe it?” can help you map how your customers and prospects perceive you. This can also layout which attributes are missing from your desired state. For instance, in the case of a B2B company, your typical desired attributes could be: innovative, cutting-edge, trustworthy.
Also, if you are doing well, growing fast and have vocally happy customers, chances are, analyst firms will sit-up and take notice. It doesn’t always have to be a Gartner or a Forrester, but even boutique firms that are on the look-out for hot technologies that are shaping-up the B2B tech space. PMMs have a strong role to play in building strong analyst relations and leveraging them to solidify their brand and improve GTM strategy.
2. Product adoption
PMMs should work with product management to track and improve product adoption. Once you determine what adoption means to you, it becomes a very measurable KPI for your product marketing teams. By way of in-app messages, new-features newsletters, customer-success training, etc., PMMs can make an impact on how excited customers are about your product and that excitement turns to utilization, upsell, referrals and renewals.
3. Conversion rates on inbound channels
This point is related to the one on awareness, however, rather than thinking about only revenue growth or traffic increase on various channels, pay attention to whether there is an increase in the percentage of leads from inbound channels. And don’t leave it at that, also monitor the conversions, deal-sizes and lifetime value of customers coming from these sources. Look at your website traffic and conversion content pieces that get leveraged in deals, and traffic and conversions from review sites such as G2 Crowd and Capetrra, and you should see the needle moving already. This is a longer-term metric but a very reliable way to measure how well your product marketing investments are paying off.
I am keen to know any new ideas on how your company measures a PMM team’s success. You are very welcome to share those in the comments below.