Measuring ROI is no easy task for accounting firms. On average, it takes 21 touchpoints for someone to become a client. Unfortunately, most public accounting firms aren’t selling online. Today, buyers do a significant amount of reading and research long before they ever reach out to or even meet with a firm.
Marketing has value, unfortunately, many marketers struggle to tie that value to actual sales.
At Inovautus Consulting, we practice and teach a methodology for attributing revenue to marketing activities. Here is how the model works: let’s assume that a firm tracks some basic information and has this information readily available. This includes:
- A new client report that shows new business for the firm
- A pipeline that shows closed new business with fees as agreed to in the engagement letter
- Basic analytics for most activities, including event attendee lists, google analytics for the website, social media analytics and press analytics.
Most accounting professionals aren’t going to grill a prospect about when and where they heard about their firm. Referrals might account for the most immediate interaction, but this doesn’t always take into account the other touchpoints that may have occurred with the prospect. Our ROI model works by attributing a percentage of a new client’s estimated revenue to various marketing channels based on the impact of those channels. The range generally falls between 1-50% of revenue. The theory is that the final lead source will be getting at least 50% of the sale, but that the other touchpoints for the firm deserve credit for their impact and role played. Below is an example of the ROI attribution model in practice.
An accounting firm holds an event and wants to evaluate ROI. To apply the ROI attribution model, the firm would take its list of attendees and segment the prospects between new and existing. New prospects are those whose first interaction with the firm is the event. An interaction is defined by having an interaction with an employee that indicated interest in a possible service; this prospect does not have to be qualified. An existing prospect is someone you have already engaged with and currently have contact information for in your CRM system, pipeline or newsletter.
The firm will also identify an attribution percentage. For example, new prospects that close from the event might receive 50% of the revenue while existing prospects might receive 25%.
On a periodic basis (usually monthly or quarterly) the firm will cross-reference the prospect list against their new business report and attribute the dollars according to the attribution percentage. The findings are then documented. At Inovautus Consulting, we call this our Event Scorecard (email us at Marketing@Inovautus.com to request a copy).
This same model applies to other marketing channels, including your website, social media and more. The key to applying this model in a more complex way is having:
1) Conversion goals – You need to be able to track conversion goals for standard activities to a lead firm. If you can track to a lead firm, you can then use your pipeline conversions to take it all the way to the sale. For example, if you are tracking LinkedIn, you need to know the percentage of traffic being driven to your website. You will then need the conversion rate for your website followers that turn into leads. If you are measuring a campaign, you may look at the conversion rate for the number of downloads.
2) Attribution percentage – Each channel needs to be assigned an attribution percentage to show impact. If possible, run these models by campaign rather than globally across the firm. When establishing these, use the marketing funnel as your guide. The closer to the top of the marketing funnel the activity is, the lower the percentage.
Whether used in its simplest form or in its most complex form, the ROI attribution model will help show and educate firms on the impact of various marketing efforts that aren’t always obvious.