Back in the day, life was easier, technology was simpler and outbound was less confusing. Although selling was never effortless, the ‘spray & pray’ marketing reliably brought results. The more money businesses spent on ads, the higher their conversion rate. The more persistent their calls were, the more deals they closed.
Nowadays, there is no common rule that works with all the channels. As sophisticated systems often get mistaken for confusingly complex, orchestrated outbound sounds hard to execute and difficult to track. While multi-channel outbound is a choreography of well-timed prospecting activities, it is also the only marketing channel in which revenue generated is 100% attributable.
Beyond the appointments set, however, KPIs (key performance indicators) tell the story about how your messaging and strategy did, or did not, lead to good outcomes and strong ROIs.
There’s precise targeting, high-quality outreach, and timely prospecting can be, when understood and used the right way, they can become an important source of generating both new and repetitive customers. The only question is: how to understand what exactly is that ‘right’ way for your business?
That’s where KPIs come along. Or metrics. Or performance stats. After all, the only thing that matters is tracking the right ones and knowing how to use the results to improve, iterate, and achieve predictable high performance from your next outbound campaign.
Why track Outbound KPIs?
Among a long list of all the responsibilities marketers have, the real pain point is planning the budget. Let’s say you have a certain marketing goal. To achieve it, you need to invest money in certain channels. To make these channels work right, you have to know precisely where, when, and how much money you should spend to ‘stay in the green zone.’
Understanding and modeling the right KPIs can produce predictable, repeatable results as lead generation activities scale in scope and budget.
Without knowing your KPIs, going down this road is like walking through a wild forest at night – really easy to get off track and get eaten by wolves (read: spend budget and goodwill without getting any results)!
Outbound KPIs matter because they help to bypass this trap, to define the weak spots on your track, and to map out the best ways to deliver and attribute real results.
So, if you still don’t know what these three letters mean in general and for your business, keep reading.
The Basics – General Outbound KPIs
Before we get to the specific outbound metrics for each channel, there are a few KPIs that are essential to track, regardless of the outbound channels you’re going to market with. Each of these marketing performance stats deserve a separate explanatory article with detailed instructions on how to measure them, why they are important for your business, and how to improve them gradually with every new marketing campaign you have. But for now, let’s just have a quick review of each of the essential outbound KPIs
Return On Investment (ROI)
The essential metric, ROI reveals how efficient your marketing strategy is, and how many dollars you should expect in return for investment.
ROI equals the ratio between the overall revenue gained from a marketing campaign and the general costs spent on this campaign. To calculate your ROI, use the formula:
As a rule, your expenses should never outweigh your profit. A ratio of 5:1 between profit and expenses is an excellent ROI coefficient.
Conversion rate is a key metric in defining how effective your sales pipeline is. It shows the percentage of leads who were converted into qualified appointments. This can come via landing page form fill, on-page chat conversion, appointment set via email, LinkedIn outreach, or by phone call. By measuring conversion rates for each outbound channel you can define which channel is most effective, then optimize using this information. By knowing where your highest rate of conversions is, you have a clearer path to solving pipeline challenges and increasing the efficiency of your top of funnel conversions.
Conversion Rate can be calculated this way:
The median conversion rate for a B2B company is about 2%. Top performing sales organizations are hitting as high as 11%. If your company’s conversion rate is somewhere in this range, you’re doing something very right.
Customer Acquisition Cost (CAC)
CAC is another stalwart metric that shows how much it costs to convert a potential lead into a new customer. CAC represents the ratio between how much a company spends on acquiring a new customer and the total number of new customers acquired within a certain time. The formula looks like this:
Sales and Marketing costs take into account the salaries needed to pay to get the client, plus overhead like rent, equipment, marketing tools, sales engagement platforms, and any other expenditures related to closing costs.
To calculate how efficient your CAC is, you’ll need to compare it to another KPI…
Customer Lifetime Value (CLV)
CLV is a metric that predicts how much profit a single customer is expected to bring to your company. CLV is a complementary metric to help understand CAC.
Tracking CAC and CLV matters because these KPIs define the profitability of your business model. If these numbers drop too low, it’s a serious red flag.
To calculate your customer’s CLV, use the formula:
Ideally, the value each customer brings to your business should be 3 times higher than what is spent on acquiring them. Here’s an easy to remember ratio to keep in mind when modeling out outbound marketing efficiency using CLV and CAC:
Next Level Metrics – Orchestrated Outbound KPIs
If any of those vital metrics discussed above are underperforming, some of the outreach channels you’re using (maybe all of them) may not be as effective as they could be. To find the weak spots in your marketing strategy, we’ve isolated several secondary, yet essential, orchestrated outbound KPIs to track.
We’ll start from the most popular outbound channel – emails. The main metrics to track here include:
- Total emails delivered: The number of emails sent by your sales development reps.
- Prospects contacted: The total number of potential customers contacted within a certain period.
- Bounced emails: The number of emails failed to be delivered to your prospect’s inboxes. To calculate: Emails sent divided by emails delivered.
- Open rate: The percentage of emails opened. To calculate: Emails delivered (minus emails bounced) divided by emails opened.
- Response rate: The total number of emails responded to, regardless of negative, neutral, or negative responses. To calculate: Emails opened divided by prospect responses.
- Appointment rate: The rate of appointments scheduled per contacts touched. To calculate: (Prospects contacted divided by appointments scheduled) times 100.
- Domain health: The rate of emails that are delivered to inboxes versus the number of emails delivered to tabs or spam. To calculate: typically requires a subject matter expert who has the tools and deliverability know how to track emails delivered across all email services (Gmail, Outlook, etc.)
Whenever you have an in-house sales development team, or you use the services of outsourced SDRs, tracking outbound call performance is critical to building a predictable top of funnel pipeline. Here you should track:
- Calls made: The total number of phone calls made by SDRs within a certain period of time.
- No answer: The number of unanswered calls.
- Unreachable: The number of calls failed to reach a certain phone number.
- Voicemail: The total number of voicemails left to the prospects.
- Types of Responses: The total number of responses received, depending on the outcome of the conversation. The number of calls, which lead to a follow-up, referral, positive conversation, or appointment. The number of calls that reached out to a gatekeeper, not the right person or the right prospect, but within not the right time.
- Connect rate: The ratio between a number of calls made and a number of answers received (including voicemails) within a certain time frame. To calculate: (calls answered divided by calls made) multiplied 100%.
Social Media Outreach (LinkedIn)
There are a number of very helpful tools for tracking different social media, but we mostly pay attention to LinkedIn as it is the most convenient social platform for interacting with potential B2B clients. Outbound metrics to be tracked here are:
- Invitations sent: The number of invitations sent to potential prospects during a certain period of time.
- Accepted: The number of accepted invitations.
- Types of responses: The number of positive, negative, and neutral interactions, and the number of appointments set.
- Connection rate: The number of accepted invitations out of the total number of invitations sent. To calculate: accepted invitations divided by invitations sent.
- Response rate: The total number of answers received (regardless of the types of responses) to a number of prospects, who accepted the invitations. To calculate: responses received divided by accepted invitations.
Pretargeting Digital Advertising
The most important metric to track here is total impressions per named account list. The purpose of pretargeting ads is to create brand awareness and familiarity before a lead ever receives an email or phone call. This way, cold emails, and cold calls will feel a little warmer when the prospect engages. To track the efficiency of this outbound channel, keep an eye on these stats:
- Impressions: The total number of times your ad was displayed to the users while viewing the web page. If the same person have seen the ad a few times, it counts as another impression.
- Click-Through Rate: The rate between how often people click on your ad compared with the number of total impressions. To calculate: total ad clicks divided by the number of impressions.
However, you should always analyze the efficiency of these outbound channel metrics by looking at how it influences the main KPIs like ROI and conversion rate. If after receiving a certain number of impressions, your ROI gets to the point you want it to be, consider investments done into this channel as successful.
- Unique Visitors: The number of first-time visitors to the web-page. (this shows the effectiveness of the whole orchestrated outbound campaign: the higher is the number of unique visitors – the better other outbound channels work)
- Appointments (Target Actions): The number of appointments set up through the landing page.
- Chat Started: The number of chats conveyed on a landing page.
- Conversion Rate: The number of visitors converted into leads via landing page interaction. To calculate: leads converted divided by the total number of page visitors.
Obviously, there are many other outbound KPIs worth tracking, which we haven’t mentioned. On that note, be on the lookout for a future article where we dive into even more granular outbound metrics to fine tune even the best performing campaigns.
As the old saying goes, you can only change what you measure. So, if you want to know how you can get better, keep an eye on those KPIs stated above for a good start. And then, you’ll figure out what other outbound metrics to include to make your business even more efficient.