Evaluating marketing spend for a B2B SaaS company focused on enterprise sales, particularly one starting to verticalize its go-to-market (GTM) strategy, requires a clear understanding of growth drivers. SaaS companies grow through three primary levers: Acquisition, Renewals, and Expansion. For companies past $10M in ARR, renewals typically overtake acquisition as the main growth driver, and for those exceeding $100M in ARR, expansion becomes paramount. Marketing supports all three of these growth areas, with varying emphasis depending on the company’s stage and strategic focus. See appendix for a breakdown.
Discussions of marketing ROI often center on Acquisition. Below is a structured, 3-step framework to evaluate and measure the ROI of marketing investments for 6-figure ACV enterprise SaaS company:
Why: Early signals indicate whether campaigns are reaching and engaging the right audiences.
What to Measure:
Vertical-specific engagement: Content downloads, webinar attendance, and website visits.
Top-of-funnel metrics: Leads generated, target account engagement, and email open rates.
Sales enablement utilization: Use of vertical-specific materials (e.g., case studies, decks).
How It Helps: Ensures marketing efforts drive awareness and interaction within target verticals.
Why: Validates marketing’s role in revenue and pipeline growth.
What to Measure:
Marketing-sourced pipeline: New deals directly created by marketing campaigns.
Marketing-influenced revenue: Closed-won deals where marketing played a role.
ROI per vertical: Pipeline-to-spend ratio across verticals (e.g., banking, healthcare).
How It Helps: Links marketing activities to business outcomes.
Why: Identifies high-ROI investments for budget optimization.
What to Measure:
Cost per opportunity (CPO): Campaign spend divided by opportunities created.
Pipeline velocity: Time from lead to closed-won, broken down by vertical.
Campaign ROI benchmarks: Comparison of performance within verticals.
How It Helps: Guides budget allocation to efficient channels and campaigns.
Leading Indicators: A vertical-specific webinar generates 200 healthcare leads, with 15 converting to meetings.
Lagging Indicators: Of those meetings, 5 deals enter the pipeline, contributing $1.25M.
Efficiency Metrics: The webinar’s cost per opportunity is $2,000, and healthcare deals close 20% faster due to tailored messaging.
This framework ensures marketing’s contributions are measured holistically, balancing proactive assessment, impact validation, and optimization.
Accurate measurement also requires thoughtful attribution modeling to account for marketing’s role throughout the buyer journey. Here are key attribution models and their applications:
First Touch: Assigns all credit to the initial touchpoint.
Modified First Touch: Resets first-touch credit after a set period of inactivity.
Last Touch: Assigns credit to the final touchpoint before opportunity creation.
Influenced: Credits every touchpoint equally before opportunity creation.
Weighted: Assigns partial credit to touchpoints based on an engagement model.
It is correct to have a view of attribution that looks only up to the point of opportunity creation. This phase provides critical insights into how marketing drives initial engagement and conversion into opportunities. However, for a more complete picture, another model should be used to determine which activities and investments help accelerate deal velocity, improve win rates, and increase deal size.
Traditional models also often overlook the contributions of multiple stakeholders within enterprise deals, particularly in the context of Account-Based Marketing (ABM). ABM requires tracking progression at the account level rather than individual leads, including multithreading—engaging multiple stakeholders across an account. Standard CRM systems like Salesforce and HubSpot are not inherently designed to handle these complexities, so RevOps and data teams often need to build custom solutions. These might include mapping interactions to key decision-makers, tracking stakeholder engagement across the buying committee, and aligning activities with account-level goals to provide a more accurate view of ABM’s impact on pipeline and revenue.
To address additional limitations such as the reliance on correlation rather than causality and the challenges of measuring offline spend, consider:
Media Mix Modeling (MMM): Uses historical spend and outcomes to assess ROI and guide allocation decisions across channels.
Incrementality Testing: Employs experimental methods (e.g., heavy-ups, hold-backs) to isolate the causal impact of marketing spend on outcomes.
These techniques complement attribution models by providing a high-level view of channel effectiveness and enabling data-driven decisions for annual or quarterly planning.
Effective evaluation of marketing spend in a verticalizing B2B SaaS company requires balancing granular, campaign-level attribution with broader, strategic analysis. By using a mix of leading, lagging, and efficiency metrics alongside advanced techniques like MMM and incrementality testing, businesses can optimize their investments and ensure alignment with their GTM strategy. This holistic approach not only justifies marketing budgets but also positions the organization for sustained growth across acquisition, renewal, and expansion efforts.
While the discussion above focused on capturing and modeling attribution around acquisition, it's instructive to keep a big picture view of where marketing is contributing across not just acquisition, but also renewals and expansion as well. Different types of activities will require their own measurement framework.