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What Items Should You Include In Your Marketing Budget?

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Marketing budget items

What should you spend your marketing budget on?  In a previous post, “How much should I spend on Marketing?” I looked at how you can calculate your marketing budget based on industry averages and your own previous marketing expenditure and output. Once you have identified roughly how much you want to spend, the next question is what you should spend it on.

Here are some of the typical items you can include in a B2B marketing budget:

  • Website – updating it, redesigning and re-implementing it, adding new content or images
  • PPC ad expenditure – pay-per-click ads on Google or Bing
  • Search Engine Optimization – expenditure on tools and consulting
  • Content – Creation and design work on content by 3rd party (e.g. case studies, videos)
  • Graphics – web banners, infographics etc.
  • Events/ trade-show costs – e.g. pop-up banners, handouts, freebies, travel and accommodation
  • Company seminars e.g. hosting invite-only seminars at a city hotel
  • Display Ad and re-targeting ad expenditure
  • Video ads
  • Social Media tools and services
  • Social Media ads and paid promotion e.g. LinkedIn ads, promoted posts, Slideshare lead capture
  • Partner co-promotion e.g. seminars, other campaigns
  • PR costs
  • Distribution of white papers (e.g. TechTarget)
  • Analyst Relations e.g. subscription to Gartner, Forrester or similar
  • Telemarketing
  • Print advertising
  • Direct mail / direct marketing including print & postage costs
  • Marketing technologies – marketing automation, email marketing, SEO tools, web analytics etc.

Can you think of any other typical items of expenditure not included here?

Written by Michael White

Michael White is co-founder and Managing Director of Motarme, the Marketing Automation vendor. You can find him on LinkedIn and Twitter.

What is Lead Nurturing?

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Lead Nurturing refers to building regular, automated interactions with sales leads in order to develop a relationship and encourage a purchase. This guide explains what Lead Nurturing is, and the benefits you can obtain such as converting an extra 20% of leads to sales. We also describe step-by-step how to setup your first lead nurturing program.

Written by Michael White

Michael White is co-founder and Managing Director of Motarme, the Marketing Automation vendor. You can find him on LinkedIn and Twitter.

What Are Average B2B Website Conversion Rates?

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Pencil Line Chart

Most of us want to know how we compare with our peers or competitors, and that’s true in Business-to-Business (B2B) web marketing too.   A lot of our clients want to know if there is any benchmark data for B2B conversion rates and traffic volumes.   In this post I’ll outline some recent stats.

To start, we should be clear about what we mean by “conversion”.  It can potentially cover a broad range of visitor actions, from clicking on a button through to completing an online purchase.  In Business-to-Consumer (B2C) marketing conversions often equate to sales e.g. how many visitors to the website of a shoe retailer bought a pair of their shoes.  B2C conversion rates can be very high depending on the type of product and the purchase price (I quote some examples at the end of this post).

However, in Business-to-Business marketing conversions are generally not direct purchases but contact registrations of some form.  People usually don’t visit a website, take out their credit card and buy $80k of engineering components.  But a  proportion will visit and download a technical specification or submit a contact form as the first step in their evaluation and purchase process.  So when I talk about B2B conversion rates I mean someone completing a contact form, registering for a white paper or subscribing for a newsletter with their email address.

In our experience, conversion rates for these kind of B2B conversions (i.e. a web visitor signing up on a registration page) are typically in the 4% to 8% range.  That is, on average, for every 100 visitors to a website we should be able to persuade between 4 and 8 of them to register or provide their contact details.  The actual conversion rate for a company will depend on a lot of factors including your industry, your web page design, what you are selling, your typical sale price etc.

There are some published stats available too.  The first item comes from MarketingSherpa, a great research firm focused on B2B technology marketing.  In October 2012 they published a chart showing average website conversion rates per industry

MarketingSherpa Website Conversion Rates by Industry

The figures range from 2% for non-profits up to 10% for Professional services. However, the problem with these figures is that the definition of what survey respondents meant by ‘conversion’ may not have been consistent.

A second useful post,  What’s a Good Website Conversion Rate, comes from Blue Corona, a web marketing and conversion optimization agency.  They think visit-to-lead conversion rates for B2B service companies should be around 5-8%. In comparison, their estimate for B2C home services like heating, ventilation and air conditioning is around 15%. For higher ticket price or non-necessary home services (B2C) they expect the rate to be around 1 to 4.5%. BlueCorona also make the point that if businesses have less than 500 visitors per month then it will be difficult to determine what your visit-to-conversion rate is – they estimate about 1500 visitors or more per month as being a reasonable rate of traffic. I agree – if you are a B2B business generating less than 1,000 visitors per month then you need to focus on driving more traffic before you worry about conversion rates.

The third post I thought interesting comes from MarketingExperiments, a sister company of MarketingSherpa. In their post MarketingResearch: average conversion rates they have a chart showing the range of conversion rates reported by survey respondents for organic web traffic (i.e. visitors arriving from an ordinary search rather than a paid ad).  The conversion rates vary from just over 0% to 60%, with an average of 8% and (probably more useful) a median of 4%.  So again these rates seem similar to our own experience.  The conversion rates for visitors arriving from paid search traffic range from 1% to 60%, with an average of 8.4% and a median of 3.5%.

We came across a LinkedIn discussion on the topic of conversion rates in the “Smart Insights Digital Marketing” group and the rates quoted there are generally quite low – 1% to 3%, but contributors point out that optimization can push these rates up higher.

Optify published their “2012 B2B Marketing Benchmark Report” earlier in 2013, based on analysis of 600 small and medium-sized B2B firms.  They reported an overall conversion rate of 1.6% across email, paid and unpaid search. The rate for organic visitors was 1.65%. In this case conversion was defined as the percentage of visitors submitting a form during a single visit.  This conversion rate seems a little low, but it is based on actual recent data.  They also make the point that there is huge variability across companies.  Another interesting stat from that report was that average site traffic was 1,784 visitors per month among the 600 companies surveyed.

This leads to a related question – what volume of visitors should a B2B company expect to get?  There is a post from digital marketing consultancy NetworkIntellect  that provides a range of expected visitor volumes, which they say is based on data collected from almost 1500 websites.  According to Network Intellect, B2B companies with 11-25 employees should generate approximately 270 visitors per week (1080 per month), companies with 26-50 employees should generate about 510 visitors per week (2040 per month) and those with 51-200 employees should have about 710 per week (2840 per month).

So, we have some average figures for B2B web conversion and they range from 1% to about 10%.  This doesn’t mean you can relax if you’re obtaining a 4% or 5% conversion rate.  For particular industries and products you should be able to drive the conversion rates much higher.  And if you want to set yourself an ambitious target, look at what some of the top performing B2C retailers achieve.  In a 2009 analysis of stats from Nielsen Online and MegaView Retail, MarketingCharts reported that online food retailer Schwan’s had a conversion rate of 50.5%, while the other top retailers that year had rates ranging from 27.2% (FTD.com) to 18.5% (QVC)

Finally, if you’re a benchmarking junkie you should find this post interesting –  “The essential benchmarks for all B2B Marketers” . Figures include typical B2B marketing budget as percentage of revenue, email response rates and online display ad response rates.

I would be really interested in any other good statistics you can point out for B2B website conversion rates, website traffic rates and other metrics, so please get in touch if you have some interesting numbers.

 

Written by Michael White

Michael White is co-founder and Managing Director of Motarme, the Marketing Automation vendor. You can find him on , LinkedIn and Twitter.

 

How to Hire A Digital Marketer

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How to hire a Digital Marketer

How to hire a Digital Marketer

You want to hire a digital marketer. Should you choose them based on

  1. which school they went to;
  2. how much they can drink without falling over;
  3. their lack of a serious criminal conviction;
  4. their height, or
  5. the endorsement of your octogenarian aunt?

The correct answer is, of course, number 2. (Yes, that’s a joke).
We work with a lot of technology companies, and while many of them have pretty good processes for hiring engineers, they tend to be less structured when it comes to hiring non-engineering roles, including marketing. This is a problem because tech companies increasingly realise they need a strong digital marketing capability to support sales and drive new business. The question is, if you are not a marketer yourself, and you don’t have any experience hiring marketers, how do you hire the right person? Read More

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