The B2B Marketing Funnel: Calculating Your Way to More Sales

A person is writing on a digital whiteboard with a stylus, outlining a marketing funnel with terms like "Awareness" and "Conversion" visible. The setting appears to be an office or seminar room.

Tired of marketing efforts that feel like a shot in the dark?

A common pain point we see with our B2B clients is that they don’t know where to start when it comes to goal setting and budgeting for their marketing and sales teams. After all, in the B2B space, the buyer journey isn’t a straight line – and you shouldn’t put all of your eggs (money) into one basket (tactic).

Additionally, the most effective B2B marketing strategy is multi-touch and full-funnel – meeting your buyers where they are along their journey.

The Bottom-Up Approach 

The most common way most B2B businesses establish their marketing budget is pretty straightforward: the leadership team identifies a number (sometimes this number is arbitrary, sometimes it’s what the founder/CEO feels is “reasonable,” and sometimes it’s all the business can afford), and then the marketing and sales teams break that number down into activations in alignment with an overarching strategy.

Don’t have an overarching strategy guiding your marketing team’s efforts on the day-to-day? Check out our article, How to Create Your Full-Funnel Marketing Strategy. 

This top-down process is common because it makes sense – you have limited resources (time and money) and you need to allocate those to activities designed to drive growth.

But is it the most effective? We don’t think so.

At OTM, we prefer to take a bottom-up approach whenever possible* by starting with company goals and working backwards through the marketing funnel. What you spend on marketing should be considered an investment, not an expense, and without a large enough audience at the top of the funnel, it’ll be immensely difficult to reach your conversion goals at the bottom of the funnel.

*This approach requires data. If you don’t have the right data, you won’t be able to calculate your conversion rates across the marketing funnel. The better your data, the better your goal setting and budgeting will align with your overall outcomes. Check out our article, How to Connect Your Sales and Marketing Efforts for Data-Driven Success to learn about our preferred tech stack. 

Calculate Your Way to Sales

So how do you calculate your way to sales using a bottom-up approach? 

First, you need to aggregate data that can be used to establish baseline conversion rates throughout your existing marketing funnel. We typically look at 3-6 months worth of data (taking into consideration external factors such as seasonality), and then plot the following:

  • How large was your overall audience size during this time? 
    • Consider the following: organic impressions across social media platforms, Google Search Console impressions, advertisement impressions. 
  • How many website visitors did you have?
    • What is the conversion rate from your overall audience to your website visitors? 
  • How many leads did you end up with?
    • What was the conversion rate from your website visitors to leads? 
  • How many new sales deals did you close/win?
    • What was the conversion rate from your leads to closed-won deals? 

Now you have a set of conversion rates to work with and you can start to establish goals working backwards. Let’s say:

  • Your first conversion rate, the conversion rate from your overall audience impressions to website visitors, is 3%
  • Your second conversion rate, the conversion rate from your website visitors to leads, is 2.25% (the industry average for B2B) 
  • Your third and final conversion rate, leads to closed-won deals, is 15% 

Now, let’s say your goal is to close 50 new deals this year. 

Working backwards, you would know that you need at least 333 website leads, 14,815 website visitors, and an overall audience of 493,827 if you make no improvements to your conversion rates. 

A funnel diagram displays the progression from "Overall Audience Size" at the top through three stages: "Total Website Visitors," "Total MQL & SQL Leads," and finally to "Total New Closed Deals" at the bottom. Conversion rates are shown between each stage.

Add Fuel or Removing Friction 

Now that you have data-based marketing goals, you can look at investing in either adding fuel or removing friction throughout your marketing funnel. 

Adding Fuel: if your audience is not large enough to meet your bottom-line goals, you need to invest in expanding your marketing funnel.

Removing Friction: look for specific points in your marketing funnel where conversion improvements can have a large impact. It’s not just about buying eyes, it’s also about converting those eyes into customers effectively and efficiently. 

Start with Strategy

Keep in mind that B2B marketing is not a vending machine. You can’t simply put quarters in and get leads out. You first have to establish product-market fit, and ensure that what you sell and how you sell it will align with your ideal customer. 

If you don’t already have a marketing strategy or plan, check out the OTM Path to Growth® our process that guides clients through a series of collaborative exercises to analyze your business and marketing strategy, understand your customer’s behaviors, and ultimately position your brand competitively within your industry.

Still unsure of what path you’d like to take?

Schedule a 20-minute meeting with our CEO, Miles, to learn more about how we can help you navigate growing your business.