How do we measure the performance of a modern B2B CMO ?
The dominant approach is to goal them on ‘source metrics’ - marketing sourced leads, pipeline, MQLS/MQAs or marketing sourced ARR
These metrics are great for budgeting and planning. Every function (Marketing, CS, Sales, Partner, PLG) is responsible for ‘sourcing’ a fraction of the revenue. Go figure !
Why is this a problem ?
You are treating each channel as a siloed source and customer journey as ‘linear’ and confined to one silo. Unfortunately, these silos just don’t exist. Most B2B customers read the content (marketing), talk to sales (Sales), get referred by a partner (Partner), try the product (PLG) before making the purchase
You are relying on some imperfect attribution model - whether you pick last touch, first touch, multi-touch. Most orgs are slaves to their attribution model
You are completely ignoring the impact of dark social. All the impact of word-of-mouth, third party reviews, substacks and communities just gets ignored, or wrongly attributed, in this siloed world of ‘channel sourced revenue’
So whats the answer ?
Modern B2B companies have to break silos and recognize the way customers purchase is not linear.
The right answer lies in a scorecard based approach.
A starting point could be this scorecard of 6 metrics
Total company ARR - Nothing to explain. Every CMO should feel the heat if the company is not doing well. This means they are collaborating with your other teams effectively
Marketing sourced ARR - Pick your favorite form of attribution model and run with it
Marketing influenced ARR - Measure what % of revenue is touched, not just sourced, by marketing. Simply track how many customers touch a marketing activity - attend an event, download an ebook, visit a webinar etc. At some companies, we saw 30% of all revenue was sourced by marketing but ~70% was touched by marketing - even if it wasn’t the first or last action that the customer took. Helps build truly cross-functional GTM motions
NRR/NDR - assuming marketing has some role in expansions/retention either directly through customer marketing, expansion plays, product launches, pricing /packaging work etc
Pipeline - This is the only leading indicator in the list. To ensure you are building for medium term while being focused on short term
Conversion rates - Pick your favorite. MQL—>Closed won, or Qualified opportunity —>Closed won. Or something else. Marketing plays a crucial role in enablement, in ABM, and in general storytelling. All of this impacts conversation rates
Similar scorecards should exist for Sales, CS and Product - with some shared and some unique metrics.