Find the right balance. Because a single metric tells you nothing.
Today's modern marketers have access to many individual pieces of data. Web visits, clicks, responses, leads, opportunities, pipe, wins, losses, people, spend… If you look at one KPI, it’s just a number. Look at it over time and you can see whether it’s going up or down. But it can’t really tell you about the health of your business all on its own.
You might have created $1M of pipe for the business. But what did you spend to get it? If you spent $100k that's probably great. If you spent $1M, then maybe not!
To really understand what's going on you need to compare multiple KPIs to see if they’re moving together in the right way for your business. Here are 9 of my favourite marketing ratios to understand the health of my marketing business.
spend:revenue
What is the revenue impact of my marketing spend?
The mother of all ROI metrics, the Return on Marketing Investment (ROMI). It seems simple enough, doesn't it? If I spend $100 on marketing, how much revenue will that bring the company?
As always, simple questions often have extremely complex answers. Going from marketing investment to revenue requires a lot of steps, each with their own complexities. Which of your promotional investments drove that spike in web traffic? Is our scoring model creating the best leads? Are inside sales doing a great job of engaging the customer? Are sales able to win consistently? Will the customer stay with us for a long time?
Trying to be 100% accurate on all those questions could make a modeller crazy, but by making simple rules at each step and applying them consistently, you can get to the point where you have strong baseline to work from. You can use this to understand whether changes are making things better or worse over time, delivering continuous performance gains across the extended team.
revenue:spend
Can my resources sufficiently influence business outcomes?
This is one of the most important questions any CMO can ask themselves. I've known CMOs for whom "what's the budget?" is the first question they ask when interviewing for a new role. A reasonable question, but the answer won't tell you if it's enough or too much.
The right amount of marketing investment will always vary by market and depend on how much your competition is investing.
By comparing the amount of spend to the amount of revenue (or bookings) being made by the company, you can understand quickly whether you can make an impact or whether you’ll just be noise to the rest of the business.
people:programmes
Is my team sized correctly to maximize ROI on our budget?
Too few people and you’ll really struggle to get a great ROI from your spend because they'll be running around trying to execute the budget. Too many and you’ve got people with not enough to do (so they spend their time asking for everyone else’s budget).
The classic ratios for people:programme are 40:60 for B2B and 30:70 for B2C but this will vary based on preferred tactics and use of external agencies. These ratios are the rule because they work, providing you with a team that's busy and has essential scalability and creativity provided by great agencies.
As a CMO, this ratio gives you a bit of a choice: do I hire lots of junior people or just a few senior people? Both can work and lead directly into the next ratio...
spend:people
What is the budget allocation per marketing team member?
It's great to have marketing budget, but without a team of talented marketers, how can you ever spend it effectively? But how can I figure out the optimal headcount for my team?
If I hire too many people, will they sit around twiddling their thumbs and making work? If I have too few people, will they just waste it to ensure they're not under-spent at the end of the year?
So how much money can my direct marketing person spend effectively? What about my strategic events person? And my advertising person?
While closely related to the people:programme ratio, this is where the rubber hits the road. You need to ensure that each member of your team has an appropriate budget for their experience and role. It’s harder to spend money in direct marketing running local events than it is writing big cheques for digital or out of home advertising. So set some targets, measure the spend:people ratios in each team, and then tune if you find people are under-spent or under-worked.
content:promotion
Can we afford to promote our content effectively?
Once, when joining a new team, I asked a senior marketer which piece of their many pieces content was the best performing. I was told that it wasn't really a fair comparison because they didn't have enough budget to promote all their content.
That was the saddest thing I'd heard in ages! I don’t think that anyone pours their heart and soul into original content just to hide it in the drawer. They create it to put in front of people - to get lots of eyeballs on it. To change hearts and minds and bring them round to our way of thinking!
So why do so many people create content without working out a promotion plan? In my world, the goal is all around reach and frequency, so to maximise the eyeballs you need to minimise the spend on content. Don't leave your fabulous content in the drawer.
click:response
How effective is my promotion in attracting engagement?
Welcome to the top of the funnel! You've got your great content and fabulous promotion assets. And you've built a well funded media plan to ensure that your target audience sees the ads and has an opportunity to click. Great!
The temptation is to focus on the clicks. You get those from the media agency and that's great, right? They clicked on your promo and got to your website. Job done!
Lots of people love to rave about the sheer number of views or clicks they get on their web page. They track their web visits and unique visitors as they go up and down week but week. But so what? If your clicks aren’t turning into registrations for events and webinars, form fills for gated content, and requests for information, you may as well not have the clicks.
The optimum click:response rate will vary by your target market and the nature of the campaign and ultimate offer. In B2B you can expect a 2-5% conversion rate, with strong offers delivering up to 10%. The key is not to try to reach an ideal rate all the time but to monitor constantly and adjust to try to maximize your campaign effectiveness.
response:lead
They came to the website, but are they a legitimate lead?
Next! Responses are great, but are they coming from the right people? Are they coming in the right volume? Is your scoring model turning them into leads?
If not, your targeting could be too fragmented, your sites might not be deep enough to deliver interest and value, or your scoring model might be letting you down.
In my view this is one of the most important ratios on in this list and one of the most challenging to fix. To create great leads you need to bring people to your website again and again. Targeting, retargeting, direct communication, and outbound calling all help. But if you don't have the right type and volume of content on your site, you'll give them no reasons to come back.
However, there's a risk that marketing and sales teams, eager for leads, might set too low a threshold, prematurely pushing interactions to inside sales. This wastes the time of potential customers who just don't know enough yet to engage properly, and of the inside sales team who are calling people who they can never convert.
lead:opportunity
How do I ensure leads are sales-ready?
Heading further down the funnel, do your leads turn into opportunities? How often? At what value?
Whose job is it to turn a lead into an opportunity? Why won’t they convert? Do they have the right training and resources to make them successful? If it’s not working, who are you talking with to find out what the problem is? Your sales team? SDRs? Or even your customers?
The information you find out here can inform the previous step of response:lead and the following step of opportunity:won. Because taking a lead, nurturing it over time, and creating a sales-ready opportunity is a people-centric activity, it's a huge opportunity to learn but also a place with opportunities for error.
If the teams picking up the leads don't have the information or skill to nurture leads, you'll find either that leads are being closed early or they're being pushed en masse to sales, breaking the win rate.
Expectation setting is key here and too many sales and marketing people think that the ideal rate for lead conversion is 100%. They say things like "why are you sending me leads that aren't ready to convert today?"
This is all about the quality lever: you can have more leads that are lower quality or fewer leads that are higher quality. It's a matter of how long and for how many interactions people should sit in the marketing funnel before they're passed across. In a properly staffed organisation, with capacity within inside sales to handle the volume of leads, a conversion rate of 75-85% is ideal as it allows inside sales to be spending their valuable time on the most likely conversions.
Keeping a close eye on lead-to-opportunity conversion will tell you a lot about your campaigns, inside sales, sales, and total pipeline efficiency.
opportunity:won
What role does marketing play in improving sales win rates?
Make or break time. If the opportunities you’re finding, nurturing, and passing to sales aren’t closing, what do you do? Saying “it’s not my fault, that’s their job” might make you feel better but won’t drive business success in the long term. And I promise you that, if sales aren't performing, marketing will be the first to pay the price.
Work with your sales colleagues to do deep dives, talk with prospects, and find out if you can be educating more deeply and targeting more accurately to give them a better chance of closing.
There are lots of reasons for losing good opportunities. Whether it's product, price, timing, or not having the right contacts, it's possible to build a solid feedback loop by collaborating across marketing, sales, and product to patch any holes with an appropriate remedy. New marketing materials, adjusted campaign targeting, sales enablement, and sales training can all be used to support better win rates and deliver more revenue for your business.
And finally...
Mastering these 9 golden ratios of marketing can transform your strategy from guesswork into precision. They offer a clearer view on where to allocate your resources for maximum impact and sustained growth. Let's use them to make smarter decisions, drive our marketing efforts forward, and achieve measurable success.
