Most likely you would move that money to other marketing activities. To determine your sales revenue from inbound marketing you must first have a thorough understand of what you mean by inbound and outbound marketing.
You can calculate your sales revenue from inbound marketing by utilizing the following calculation.
(Total sales for the year) - (Total revenue from customers acquired through inbound marketing)
Not only do you want to calculate your customer acquisition costs for inbound marketing, but outbound marketing as well. How much is it costing you to acquire a customer through inbound marketing versus outbound marketing?
Calculating your customer acquisition costs requires the integration of your marketing automation and CRM platforms as well as accounting for all relevant costs associated with ERP integration.
Calculating CAC for inbound marketing, relevant costs include:
Manpower (creative and technical)
Technology and software
Calculating CAC for outbound marketing, relevant costs include:
Manpower (sales and marketing)
Once calculating the costs associated with your inbound and outbound marketing campaigns, you can directly account for new sales, as well as allocate particular budgets for each campaign.
If your company is utilizing mostly inbound marketing, you can break down that component further by campaign types then assess how successful and profitable each activity is. When you know that, you can start implementing activities to improve over time.
3. Customer Lifetime Value
With inbound marketing, there is no better way to measure customer value than reach out to your current customers. Not only can doing this help you keep in contact with leads, but it can also help reduce churn, keep your customers happy, and expand your customers lifetime value.
You can calculate the lifetime value of your customers by using the following calculation:
(Average sale per customer) x (Average number of times a customer buys per year) x (Average retention time in months or years for a typical customer)
A great way to increase the lifetime value of your customers is by developing lead nurturing campaigns that reach out to existing customers.
Providing you and your sales team the opportunity to inform existing customers about new services, products, and resources.
4. Inbound Marketing ROI
Every company wants to see their return on investment!
You don't want to continue adding money or increasing your budget for a marketing activity that is costing your company money. So, no matter what marketing activity your company is using, your return on investment will determine the future with that activity.
Use the formula below to calculate your inbound marketing ROI:
(Sales Growth – Marketing Investment) / Marketing Investment = ROI
5. Traffic-to-Lead Ratio (New Contact Rate)
Understanding your website traffic, especially knowing where your it is coming from, whether it's organic, direct, social media or referrals is extremely important.
If your traffic is steady or increasing, but your traffic-to-lead ratio is low or decreasing, that's a surefire sign that something is missing on-page.
In the spirit of conversion rate optimization, track this number to help you determine if and when a change in your website's text, design, form, etc. may be needed.
6. Lead-to-Customer Ratio
After all of your marketing efforts, it's important to know how many leads your sales team is able to close. You will want to calculate both your sales qualified lead conversion rate and sales accepted lead conversion rate.
What's the difference between the two?
Sales Qualified Leads are leads considered to be sales ready based on their lead score or specific activities/triggers they completed. Most companies would consider a lead who filled out a form, such as "contact a rep" a lead who is ready to buy your service or product. For example, a waste management company with a lead who filled out the form "rent a dumpster," would be considered a sales qualified lead.
Sales Accepted Leads are simply leads your sales team considers opportunities, and have either contacted the lead directly or a scheduled call.
Looking at these two ratios, ask yourself the following questions:
Is my campaign capturing leads?
Is our CRM successfully passing qualified leads to sales at the right time?
Do we have high close rate?
If the answer to any of these questions is no, meet with your sales team to determine what, if anything, is missing and how you can work together to improve your numbers. Here are a few questions to help encourage sales enablement and move the conversation along.
The goal of any business using inbound marketing is to have most of their traffic come from organic search.
High organic traffic means that people are finding your website on their own, minimizing not only your effort for your cost of attracting them to your site.
It should come as no surprise that organic traffic is directly correlated to your SEO strategy, so make sure to monitor this number (along with your keywords) and refine your SEO strategy accordingly.
9. Social Media Traffic (and Conversion Rates)
Many clients are often wary about the importance of social media in their inbound marketing, but over the years it has proven invaluable to every campaign's success.
Metrics you can utilize to show the importance and impact of social media on your marketing efforts include:
Number of lead conversions generated via each social media channel
Number of customer conversions generated through social media channel
Percentage of traffic associated with social media channels
With social media sites like Twitter, Facebook, LinkedIn, Google+, Pinterest, and Instagram you might not have all the time in the world to effectively utilize every platform, but breaking them down by the number of leads, customers, and percentage of traffic coming from each will help you determine where to focus your efforts.
10. Mobile Traffic, Leads and Conversion Rates
Is your website effectively optimized for mobile? With so many people browsing the web exclusively from their smartphones and devices and Google showing preference for sites optimized for mobile, you need to know how your visitors are using it.
Pay close attention to:
Number of lead conversions from mobile devices
Bounce rates from mobile devices
Conversion rates from mobile optimized landing pages
Popular mobile devices
Understanding how and what your visitors are doing on your website on mobile will help you improve the experience, and optimize it to increase mobile conversions.