Event marketing is a critical element of today’s brands. Whether it is thru a tradeshow, direct to consumer, social engagement, or internal it has a major impact on your brand and activating actions you want from your targeted audience, but all to often companies engage in event marketing without a specific goal or activation plan in mind. Any event begins by first understanding the action you wish to have take place and then developing plans to make sure that action does occur. Matthew does a good job of pointing out the basics of building a good event strategy in the following article, but just remember it needs to connect with the needs of your targeted audience, and you should have a measurable result that you hope to achieve and build the program around that strategy.
5 Metrics To Evaluate Event Effectiveness
by Matthew Wainwright
Director Of Marketing
Whether to improve customer engagement, generate new leads, or simply network, marketers have long leaned on events to help their brands stand out and their businesses thrive.
The problem comes when marketers are asked to prove the return on those event investments. In an increasingly digital age, your events can get the side eye without concrete, revenue-based key performance indicators to back them up.
So how can you justify your event spend? By accessing data that integrates with your other systems–your customer relationship management (CRM) systems, in particular. Integrated systems offer robust analyses, quick comparisons among disparate metrics, and a track record from which you can pull historical data that demonstrates the value of event marketing investments.
The following sample scenario helps demonstrate how you can uncover event KPIs and explain the impact of event marketing to your boss through analytics:
1. Cost per lead (CPL): Let’s say your marketing team spends $100,000 in a given month sourcing 6,100 new leads. Meanwhile, you spend $15,000 on an event and source 530 new leads. Regular marketing efforts source leads at a CPL of $16.39, while your event sources leads at a CPL of $28.30. Your regular marketing efforts should have a positive ROI, but given that your event leads already cost 73 percent more to generate, there is a chance here that your event ROI may not exactly be positive.
2. Conversion rate: Despite the higher CPL, your sales reps tell you that the conference leads they spoke with are much more interested in buying your product or service than the leads they typically talk to, so working these leads is a better use of their time than a typical day of cold calling. (Given the fact that these leads were willing to leave their offices to talk to your company, this may not be too surprising.) While one in 20 of the leads that marketing normally generates (a 5 percent conversion rate) turns into a customer, you learn that the leads who attended your event are 60 percent more likely to become customers (an 8 percent conversion rate) than a typical lead.
3. Cost of customer acquisition (CoCA): When you look at the regular sales funnel and your event sales funnel, you calculate that 5 percent of 6,100 leads is 305 customers. Meanwhile, 8 percent of 530 leads is 42 customers. Your organization’s marketing CoCA is $327.87, while your event CoCA is $353.77. The numbers are getting closer in comparison, but your event-generated customers are still 8 percent more expensive than your typically generated customers, and your event may still be in the red from an ROI perspective.
4. Average sales price (ASP): Next, you start hearing that the leads who attended your event were more interested in a more expensive product than the leads that marketing normally generate. This could be for many reasons, including in-person demos, the in-person experience, or simply because the motivated leads were the ones who showed up.
Regardless, the result is that you end up with more sales-ready leads than those worked exclusively over the phone. Typically, your organization has an average sales price of $525 (or $160,125 in revenue in this scenario). However, for one reason or another, your attendees-turned-leads-turned-customers spent a total of $25,440 for an ASP of $600. Now things are starting to look very good in terms of your event ROI.
5. Event ROI: If you were only using the rough, back-of-the-envelope calculations mentioned in the first step, your event ROI would be 70 percent–very much in the red. But if you’re looking at your event ROI in terms of revenue–the KPIs that really matter to your business’ bottom line–your event is a revenue-generation machine with a 60 percent ROI. In other words, your event generated nearly 10 cents more per dollar invested in it than in your regular marketing efforts.
A similar logic can be carried through in comparing the customers who came to your event versus those who didn’t. When deriving event ROI through customer metrics, it’s helpful to compare customer attendees to nonattendees in terms of retention or resell rates. What percentage of customers renew or buy from you again? You should also look at average upsell value. How much above and beyond the original contract or sales price do customers spend?
These metrics will vary from organization to organization, but the basic elements remain the same. In anticipation of these latent considerations, you may also want to post event survey data to present the intangible, or not-so readily monetized, value of your event. Demonstrating that the event has improved brand recognition, brand loyalty, or likelihood to refer your company can also help make the case that your event was a good investment.