Measuring marketing value for manufacturing companies
Are you a Marketing Manager in the manufacturing sector, and struggling to measure the value of your marketing effort? The answer might lie in your marketing systems. Click here to find out.
Published: 16 Mar 2023
5 minutes read
The introduction of Industry 4.0 has seen digital transformation across the manufacturing industry advancing at breakneck speed. This digital acceleration is revolutionising the way companies manufacture, improve and distribute their products to customers.
But digital technologies are also providing the industry with a means to revolutionise their marketing effort, collect and analyse data to deliver real-time decision-making, extend reach and improve the customer’s purchasing experience.
Until recently, many manufacturers relied only on traditional marketing and lead-generation approaches such as trade shows, networking events, telemarketing, advertising, and PR. But, customers now buy differently. Especially since the pandemic, industrial buyers have increasingly taken to the web to research and select potential suppliers.
This is challenging because it means that older ways of marketing now produce less good results, but it also gives manufacturers many new opportunities to promote their businesses online. Even better, it is now possible to accurately measure the effectiveness of digital marketing and sales channels to focus resources where they offer the best results.
However, while the idea of measuring return on marketing investment, and being able to clearly attribute results to marketing activity ("attribution"), may seem simple - it is not easy in the Manufacturing sector. This article explains the main reasons why and what to do about it.
THE CHALLENGE OF Disconnected data in manufacturing companies ...
“Organisations that leverage customer behaviour data to generate behavioural insights outperform their peers by 85% in sales growth and more than 25% in gross margin.”
Despite many sectors implementing digital tools to stay competitive, the manufacturing industry is one sector where digital transformation can be notoriously difficult.
The main challenge lies in the fact that, for many UK manufacturing companies, data is commonly held internally across disparate systems and siloed teams, and externally across multiple organisations.
According to new research from The Manufacturer, almost three quarters (74%) of manufacturers are held back by disconnected data, still relying on legacy systems and spreadsheets to get tasks done.
Sales and marketing teams have a tradition of working in silos, but this is resulting in an inability to gain visibility over the whole customer journey. Without visibility on this data, it’s impossible to measure how well your manufacturing business activities are performing. It also prevents manufacturing leaders from making data-driven, revenue-generating business decisions.
MADE WORSE BY A LACK OF VISIBILITY THROUGH THE SUPPLY CHAIN...
The problem of internal data fragmentation is exacerbated by many companies' inability to trace product and sales through the value chain.
Most manufacturers sell through a supply chain involving an array of distributors, retainers, stockists, installers, influencers and/or specifiers before reaching the end customer. Manufacturers understand the volume of product solution into distribution but quickly lose visibility thereafter.
This makes it difficult to measure the value of any "Pull-focused" Marketing effort that extends beyond the distributor. Branding and advertising efforts targeting end customers can only be measured through awareness tracking and other KPIs, which might then be linked to sales, but not in clearly attributable way. As Lord Leverhulme of Unilever said, "Half the money I spend on advertising is wasted, and the trouble is I don't know which half”.
"Push-focused" Marketing efforts directed towards distributors are perhaps more measurable eg. we attend a trade show and are able to measure the new distributor contacts arising from that event and hence the new sales that result. However, even this is not tracked with any great accuracy.
Does this mean that Marketing budget should be targeted towards Push tactics, rather than Pull tactics, because they are more measurable?
A single source of truth for UK manufacturing companies
So what do you do about it? Start by by building a single source of truth in-house.
From initial interaction through to purchase and post-sales engagement, having visibility over every customer touchpoint is critical to enabling manufacturing leaders to accurately report on which areas of the business are generating revenue (enabling them to focus their efforts on doing more of the same). It also creates efficiencies as UK manufacturing companies are able to identify gaps in their marketing activities, and make strategic plans to improve.
Ready to connect your data? Learn everything you need to know about revolutionising your sales process by taking a look at our 'Front Office Digital Transformation: A Guide For Manufacturers' now.
“You can’t manage what you don’t measure.”
With modern digital tools, however, sales and marketing teams are now in a strong position to capitalise on technologies to truly measure what matters. The ability to identify whether revenue has been generated through advertising, selling products or services or generating leads will strengthen your manufacturing business. Every manufacturer needs to know exactly which activities are boosting the bottom line.
The most effective tool that forward-thinking businesses are turning to drive revenue is Customer Relationship Management (CRM). A CRM is a platform that businesses use to manage, analyse and maintain interactions with customers. Used by 91% of companies with more than 11 members of staff, the CRM is among the top three tools and technologies implemented to centralise customer data, connecting and driving marketing and sales activities.
Align sales and marketing across your manufacturing business
Organisations with tightly aligned sales and marketing teams
are 6% more likely to exceed revenue goals.
The Ultimate Guide to Sales and Marketing, HubSpot, 2021
Sales and marketing are your two most important customer-facing divisions. They both drive and support customers on their purchasing journey. The better you can bring these two teams together, the more you’re likely to glean insights from your shared data to drive a better customer experience, moving each individual customer from initial engagement through to purchase.
HubSpot’s CRM, for example, connects sales and marketing in a single platform. Sales and marketing teams across the manufacturing sector can work from one centralised system, allowing leaders to extract revenue-generating data on every touchpoint of the customer journey. Only by combining customer, marketing, and sales data can manufacturing companies measure how the sales and marketing activities are contributing to overall business goals.
Marketing teams generate leads which are logged into the HubSpot CRM, including their source. Sales teams can then take the opportunity to drive those leads forward to purchase. The value of each customer conversion can directly and easily be attributed to the source, enabling clear attribution reporting. Every lead that marketing activities generate are all captured within the system with a clear link to the source. Sales teams can also access the system and drive the customer experience further through to purchase.
Ready to align your sales and marketing departments? Learn everything you need to know by getting your free copy of 'Front Office Digital Transformation: A Guide For Manufacturers'.
Capturing customer data for your manufacturing CRM
If UK manufacturing companies are to be successful, implementing a Customer Relationship Management (CRM) should be the first point of call.
With a connected CRM platform, you can collect actionable first-party data to meet the needs of your team to gain a 360 degrees view of the customer. With this connected data, your customer experience with you can be joined up and made seamless across every touchpoint.
This means your manufacturing teams across sales and marketing can view customer interactions such as page views, email opens, ad engagement etc - all creating a more holistic view of your customer’s activities. Once you gain insight into your customer interactions, you can identify which tactics are working hard for you and which you can afford to cut back on (or remove altogether!) The goal is to focus on the activities creating revenue and, with your single source of truth, your data will provide you with the entire story of your customer - from beginning, to middle and end.
As manufacturers exist in a challenging business climate, dealing with the fallout from economic chaos, supply chain volatility and shrinking margins, every manufacturer can begin to foster long-term growth with a renewed focus on the customer, using their granular view of data to find new ways to improve sales, buy products and create operational efficiencies.
Merging sales and marketing data in a CRM is a sure fire way to measure the value of your manufacturing marketing activities. HubSpot’s platform provides manufacturing businesses with a single source of truth that will create more efficiencies by enabling real-time reporting on how to reduce costs and identify opportunities to optimise sales and marketing strategies, increasing the profitability of your manufacturing business.