Before we dig in, what is closed loop marketing?
Simply put, closed loop marketing is marketing that ensures collaboration between sales and marketing. It “closes the loop” between the sales that came in as a result of the marketing activities implemented. In business to business sales, it ensures that the Sales team reports back to the Marketing team about deals closed from the leads which Marketing gave them. In consumer marketing, closed loop marketing relates to attribution.
This technique allows marketers to learn how effective their strategies are and helps determine the return on investment. It's also used to define important data points, such as how many website leads convert into customers and which ads are clicked the most by potential leads.
Many marketers don’t incorporate closed loop marketing because they find it too difficult. Big mistake – it puts them at a serious disadvantage. It's important to know whether your marketing investment is working for your brand, and you can do so by tracking every lead and dollar earned through your business’s marketing strategy.
If you’re still not convinced, below are some great reasons you should consider implementing closed loop marketing!
It helps identify the best channels for conversion
One major aspect of closed loop marketing is determining which sources contribute the most leads. By collecting this data, you can hone in on those specific channels, engage with potential clients in those spaces and start the process of converting them into sales. Whether these channels are online or offline, it's wherever your core customers hang out.
Print marketing has always been an effective tool for selling a brand to mass audiences; research shows that more consumers will react immediately to direct mail than they will to email. Keep in mind that your print marketing can be enhanced with promotional items (like key chains, shirts and pens), which also connects physically with your customers. Print marketing can play a big part in closed loop marketing. An example is a direct mail piece that drives recipients to a branded web page and converts on the site. Once that recipient becomes a customer, that sale can be attributed back to that individual direct mail piece. You can also test different creative, headlines, demographics or any criteria to see if one yields a better result.
It accurately forecasts marketing campaign success
Another highlight of closed loop marketing is how it takes the guesswork out of marketing campaigns. Marketers often create campaigns based on what they think the audience will like, but closed loop marketers use statistics and data to create campaigns that are more likely to produce audience engagement.
Ask your sales team to discuss current campaigns with their leads and find out what they liked or didn’t like. Your sales staff may even have this information already, based on previous interactions with their customers. Use this knowledge in combination with tools like Google Analytics to determine how effective your campaigns have been in the past, in terms of converting potential leads into customers and the sales that result from it.
This data will enable you to move forward with confidence, creating the right campaign strategies based on what you already know. It also allows the marketing department to predict future sales by analyzing past conversion rates and analyzing patterns prospects take. Together, this information will help come up with more effective campaigns.
It lowers the time & cost of the lead conversion process
Once you’re able to point your marketing in the right direction – emphasizing the right conversion channels and using effective campaigns – you’ll start to see the length of your sales cycle decrease. It makes sense; once you know where your ideal buyers are and what they like, it will take less time and effort to convince them to become customers.
The best way to track this is with a CRM (Customer Relationship Management) system. A CRM system will help you automatically track lead conversion and sources, in addition to storing your leads’ contact information. It will also provide data on how many people saw your ads, what percent clicked through to your website and what actions they took once they got there. With both sales and marketing teams updating and reviewing this information regularly, both teams have the opportunity to work together and continuously improve the marketing-sales cycle.
Closed loop marketing is an effective tool that provides invaluable insight into the effectiveness of marketing processes and campaigns. Both the sales and marketing departments stand to gain from the increased communication and feedback. With direction from the sales team, marketers are able to direct funds to the right places at the right time to help the sales team close more deals.
If you need help getting started, contact us here at Ironmark! Whether you're starting from the ground-up, or you have a basic procedure already in place, our talented team can assist you in getting your own closed loop marketing system up and running. Or, if you’re interested in getting more updates from us, subscribe to our blog to keep up-to-date on the latest industry news.