Incremental Profit From Generating New Leads

Evidence and data. Decision-makers interviewed for this study shared that their organizations saw an increase in number and quality of leads, which led to an increase in incremental profit. This was one of the interviewees’ main objectives in purchasing the TEI study as the analysis provided the insight needed into both the quantitative and qualitative benefits of their solutions.

Because Forrester is an objective, third-party organization, the interviewees indicated that both prospects and customers were more inclined to believe the results and therefore more inclined to buy. All eight interviewees said that they were able to gain the credibility that they previously sought. A director of product marketing for a SaaS company told Forrester, “It certainly gives us credibility and it’s a great resource to reference as prospects are considering what the short- and long-term ROI from our solution will be.”

The interviewees used their studies’ findings in a variety of ways to engage prospective buyers. Several reported conducting a public-facing webinar, creating landing pages, and using other bite-sized assets that discussed the TEI study to generate even more leads.

A global director of product marketing for a legal technology firm shared these results: “We had 113 people attend the webinar, we had 369 form fills from the main page of our website, we had 815 form fills from advertising and content syndication, we had over 70 open opportunities where it contributed to a multi-touch campaign, and we had about 16 opportunities where it was actually our first touch.  And of those first touch opportunities, two of them are currently closed, one with a value of over $400,000.”

Interviewees shared that in addition to an uptick in new leads thanks to the TEI study, they also had stronger renewal conversations with their current customers. A marketing research and strategist at an operations management software company shared this story with Forrester: “Our sales team has had a lot of success in using the TEI in expansion conversations. When it’s time for clients to renew, they will be able to point to this and be like ‘These are some of the benefits that our other customers have seen or potential customers will see if you continue to use the product.’ It has been very beneficial in getting the deals across the line or being able to enrich the conversations that they have upon renewal or upon extension to drive more revenue.”

Many interviewees compared their internal assets’ performance against that of the TEI study and found that the TEI drove more leads and conversions. A director of product marketing for a telecommunications company shared these results: “Since the TEI has gone live, we’ve been able to generate over 3,785 leads from the report itself. It is one of the best performing assets that we have in our portfolio. Our number two white paper asset has only 1,500 to 1,600 leads. The TEI is double that.”

Modeling and assumptions. For the composite organization, Forrester assumes:

• The average number of leads per campaign for a non-TEI asset is 625.

• The organization experiences a 60% increase in leads from to the TEI report in the first six months. As the data becomes older and the study is in the market for some time, the percentage increase of leads flattens over time to an increase of 40% after 12 months and an increase of 20% after 18 months.

• The average conversion rate for the composite is 1%; however, campaigns based on the Forrester TEI study yield a 2.5% conversion rate.

• The average deal size is $50,000.

• The operating margin is 10%.

Risks. The following risks can impact the incremental profit generated from new leads attributed to the TEI study:

• The TEI study cannot generate leads without proper go-to-market activation from the marketing team. A lack of strategy and effort to deploy and use the TEI assets effects the number of new leads and thereby the potential profit. The interviewees who saw the best results were the ones who created landing pages, highlighted the benefits via social media, set up email campaigns, reviewed the findings via webinar, and other common marketing practices.

Results. To account for these risks, Forrester adjusted this benefit downward by 10%, yielding an 18-month, risk-adjusted total present-value (PV) (discounted at 10%) of $177,000.

Business Case Development Time Savings

Evidence and data. Decision-makers described the environment before a TEI study, saying that their teams needed a lot of support to create custom business value case studies for prospective clients. With a business case laid out in the TEI study, salespeople could more efficiently build a customer business case for those customers who needed one.

A VP of marketing at a cybersecurity, SaaS company told Forrester, “Our salespeople would have either spun their wheels; gotten stuck; or spent 5 hours, 6 hours, 8 hours on a custom ROI exercise.” However, once they had the TEI in place, he said that sales teams spent “an hour figuring out the Forrester analysis.”

Furthermore, because the TEI study was available, it alleviated questions that this VP of marketing’s team would have received, giving valuable time back to his employees. He shared this story with Forrester: “It was almost like we were a ‘deal helpdesk’ where sales would come when they had questions. Now, we don’t get the ‘Hey, help me do an ROI’ or ‘Where is the ROI spreadsheet?’ Everyone knows to self-help themselves, and to go get the TEI.”

Not only did the TEI study provide a clear business value case study for sales to use, it also was a differentiation from competitors as it was a third-party validation of their solution. Interviewees said that this too helped their sales teams be more efficient as customers were not asking for additional proof points.

A senior director of research and innovation for software development told Forrester, “Among our commercial competitors in our space, we’re the only ones that have third-party validation of the business impact. The Forrester name adds weight and credibility to our business case, which can help with the win rate, and displays a level of professionalism in terms of our communication and selling ability. It gives the buyer confidence that it’s a safe bet for them to go with our company.”

Modeling and assumptions. For the composite organization, Forrester assumes:

• The composite organization has 200 salespeople on their staff. Since this is an 18-month analysis and with the rate of turnover, we assumed this number to stay flat.

• The number of opportunities per salesperson per cycle is 13.

• Fifty percent of all opportunities require a business case justification.

• Prior to the TEI study, salespeople needed 5.5 hours to develop a business case.

• The reduction in time needed to build custom business case content due to a TEI study is 33%. This remains the same for the first year, and, as the data becomes less current, reduces to 25% by 18-months.

• The average fully burdened hourly salary of a sales and marketing employee is $58.

Risks. The following risks can impact the business case development time savings attributed to the TEI study:

• The number of salespeople.

• The average number of hours to develop a business value case study.

• Different amounts of time to create simple business cases versus those that are more complex.

Results. To account for these risks, Forrester adjusted this benefit downward by 15%, yielding an 18-month, risk-adjusted total present-value (PV) of $133,000.

Content Marketing Creation Time Savings

Evidence and data. Decision-makers interviewed for this study shared that, if they had not chosen to invest in a TEI, they would have needed to dedicate internal resources to develop an asset with ROI analysis based on substantial data from several customers. Because of this, they saw significant time savings throughout the content process, including savings around roadmapping, scoping, and actual content development (writing, editing, etc.).

A director of product marketing at a cybersecurity company explained how much longer it would take for his internal team to try to create a similar asset. He said: “We had three people working as part of our business value team and it took twice as long as Forrester was able to deliver the full report. That’s three people, 40 hours a week for over a year, and they couldn’t produce what Forrester was able to produce. Perhaps they could’ve produced a one-pager that provided some valuable metrics, but it wouldn’t nearly be as complete as like a 20-page report that we can display externally.”

Interviewees also commented that the Forrester consulting team produced a quality product that truly reflected their respective businesses. A marketing and research strategist at an operations management software company explained: “Forrester did their due diligence at the start to understand the products, [and] do the internal stakeholder interviews prior to like speaking to our customers, and the output was definitely something that I personally found really well-written and articulated in terms of our value proposition and our benefits.”

By having the Forrester team write the study, interviewees said that it helped to solve internal bandwidth issues their organizations faced. A director of product marketing for a SaaS company told Forrester: “If we were to have our content marketing team and our product marketing team collaborate with our value engineering team, that is three teams and several people that would be involved to create something like this. I imagine that would have taken us upward of six months to work with all the internal stakeholders, which would mean that they’re not working on other projects. I don’t even know if we could have executed this alone without Forrester.”

Modeling and assumptions. For the composite organization, Forrester assumes:

• There will be five decision-makers (VPs, heads of strategy, etc.) involved in roadmapping cornerstone pieces of content each quarter.

• The number of hours required to develop the road map for cornerstone pieces of content each quarter is 80.

• The average fully burdened hourly salary of an executive is $128.

• The composite organization dedicates two employees to developing marketing content and it takes them 500 hours to develop a cornerstone piece.

• The average fully burdened hourly salary of a marketing employee is $48.

Risks. The following risks can impact the content marketing creation time savings attributed to the TEI study:

• The number of marketers employed to create content for the organization.

• The ability for the internal team to have an accurate portrayal of the value proposition they seek with each piece of content they road map. If stakeholders aren’t aligned with concept, it will take longer for the marketers to write the piece and tweak accordingly to the feedback they receive.

Results. To account for these risks, Forrester adjusted this benefit downward by 15%, yielding an eighteen-month, risk-adjusted total present-value (PV) of $58,000.

Incremental Profit From Generating New Leads With Calculator

Evidence and data. Some of the decision-makers interviewed for this study also purchased a derivative of the TEI study known as the TEI calculator. This asset allows for individuals to get a personalized expectation of the benefits and ROI their organization would see if they invested in a solution.

While Forrester’s composite organization provides an estimated ROI and benefits, it’s sometimes difficult for companies who don’t match the composition of the composite organization to see themselves in the results. For example, if the composite organization is a larger corporation and the prospect reading the study is a small business, some of the assumptions would not align.

As a result, Forrester created a TEI calculator where a prospect can input their company’s characteristics to get a more personalized estimate. Because not all customers interviewed for this study purchased the calculator, Forrester did not include this benefit into the financial model. However, to demonstrate the impact for this benefit category, Forrester calculated an example that readers can use to further estimate positive impact and ROI (see Table D).

Interviewees said that their sales teams appreciated the credibility of the real-world data that the calculator provides. The TEI calculator is hosted on an independent, third-party site and not on the company’s website. To the customers, this provided increased credibility as prospective customers would see the Forrester logo and have more trust in the results. Two interviewees spoke to this.

A VP of marketing for a cybersecurity SaaS company said, “The calculator pairs really well with our risk assessment because instead of estimating numbers and making things up, we take the output of a client’s real risk assessment and then we plug that data into the Forrester calculator, and it gives them the ROI.”

A solution marketing leader for value at a service cloud company said: “We had a call with about 500 salespeople on a webcast a couple of quarters ago. I asked them during a poll to say, ‘Is it important to you to have third-party certification of our value models on the calculator?’ And 95% said yes – that absolutely, credibility, was the number one thing.”

Another feature of the calculator that interviewees appreciated was the ability to track leads. Decision-makers provided intake forms to their CRM tools to the Forrester team to embed in the calculator so they could see who was engaging with it.

Modeling and assumptions. For the composite organization, Forrester assumes:

• The average number of leads per campaign for a non-TEI asset is 625.

• There will be a 40% increase in leads due to the TEI calculator in the first six months. This will stay steady as more people are exposed to the calculator and remain at 40% for 12 months. After that, at 18-months, the composite organization will see only a 30% increase. 

• The average conversions per campaign with the TEI report and calculator is 5%.

• The average deal size is $50,000.

• The operating margin is 10%.

Risks. The following risks can impact the incremental profit from generating new leads attributed to the TEI calculator:

• A shorter PDF report is generated when a prospect uses the calculator; however, it doesn’t come with the richness of the study itself. A director of product marketing at a telecommunications services company said their team felt that you needed the study (along with the calculator) to capture the details and stories. Some organizations do not use the calculator as a lead gen tool; rather, they may use a version of the TEI calculator for sales enablement, which would affect the impact and results.

• Companies are responsible for promoting the calculator, and the number of leads will be affected by marketing’s strategy and support of the asset.

Results. To account for these risks, Forrester adjusted this benefit downward by 10%, yielding an 18-month, risk-adjusted total PV of $129,000.

Unquantified Benefits

Additional benefits that customers experienced but were not able to quantify include:

• Engaged decision-makers that were otherwise uncertain or reluctant with purchase support. Buyers now exercise greater scrutiny over vendor solutions than ever before, with more people involved in the process.⁵ Furthermore, many technology purchases inherently affect a broader swath of functions, departments, and business areas, bringing more stakeholders to the mix.⁶ Interviewees shared with Forrester that the TEI was able to deliver personalized messaging for many members of the buying group—here are some of their reflections.

  • The senior director of research and innovation at a software development company said: “It’s a tough job selling and convincing people of the value of a relatively expensive B2B product. We’re selling a technical product to a very technical buyer. The buyer of our product – engineers and software developers — doesn’t normally think in economic terms. It is very important for us to help them see a bigger picture. Introducing financial value into conversations of what otherwise would be a very technical discussion is quite important.  The Forrester TEI report shows the impact for their team in the economic terms they need.”
  • The director of product marketing at a SaaS firm shared: “One of our sales reps said that the TEI study helped him to re-engage and get some stalled deals unstuck. The deal that was likely not going anywhere and the customer was thinking about going to the status quo of not doing anything. They then saw this ROI, and the value and re-engaged with us. So, a deal that otherwise just would have gone away has reinvested themselves in our product.”
  • The VP of marketing for a cybersecurity SaaS company noted: “The top benefit is definitely the ability to help our champions justify the purchase in our solution. That’s the main reason we bought the TEI as it gets us past that hurdle in the deal cycle. Whether it’s giving it to the procurement people or giving it to our champion to articulate to their CFO, that’s what it’s used for that’s the main benefit that we see.”

• Elevated brand awareness across the customer lifecycle. Interviewees said that because the TEI study can speak to different stages of the buyer’s journey, marketing teams could be creative in how they utilized the study. Many called out the benefits on social media to drive downloads of the TEI study. Others said their sales teams were able to have better conversations with existing customers because the study helped remind existing customers needed of the value, they had in working with their organizations.

• Created consistency and alignment around companies’ value propositions. Interviewees said that creating consistent messaging around their value propositions was a key benefit of commissioning a Forrester TEI study.

  • A senior director of research and innovation at a software development firm said, “The Forrester TEI report is a cornerstone to our corporate strategy of organizing around value-selling.” He went on to explain how the study has allowed his team to focus on their strategy: “We have been trying to organize our product strategy, marketing strategy, company strategy, and so forth around value-selling. We wanted to tell a fuller story around how our product could benefit people, using an economic lens. That’s quite critical to us from a strategic point of view, just in terms of our internal organization and external communications. We see [the TEI study] as a really strategic aspect.”
  • A director of product marketing for a telecommunications services company shared how the TEI study helped her organization drive consistency: “What we do is pretty complex, and I think in the past we tried to boil the ocean and tell you everything. Now we’re more consistent with what we say we do and how we help our clients. We really anchor around what you get and the benefits of working with us. With the TEI, we start with the benefits and we lead with the benefits.”

• Supplied primary research and actual voice of the customer data and feedback. Having customer insights allows organizations to better meet their customers’ needs and deliver more rewarding experiences.

  • Interviewees shared that by including customer perspective and quotes in the TEI study, it highlighted peer successes to prospects. A global director of product marketing for legal technology firm said, “I had a legal operations executive at one of the top financial institutions in the world tell me that the report was invaluable for communicating the importance of our product to their legal team.”

Flexibility

The value of flexibility is unique to each customer. There are multiple scenarios in which a customer might implement TEI Study and later realize additional uses and business opportunities, including:

• Providing sales with self-service business case studies and tools. With the ongoing trends around the employee attrition, companies will continue to experience more turnover.⁷ That, combined with an anywhere-work model, means that sales enablement teams need to provide resources so newer sales representatives can learn and train autonomously learn and train. Interviewees said that by having the TEI study, their sales representatives have an easy-to-use, pre-vetted business value case study, meaning newer team members can influence pipeline faster.

  • A VP of marketing for a cybersecurity SaaS company said, “My sales team knows they can go into our library, search for ROI, and two things appear: the TEI PDF and a link to a calculator. They can go and learn it themselves, and they have a tool in their toolbox to fight pricing objections.”

• Using the Forrester TEI analysis to validate internal ROI models. More and more companies are hiring business value engineers to create ROI analyses internally; however, it’s hard to get these claims verified. A solution marketing leader for value at a service cloud company reached out to Forrester and asked if the TEI team could validate their internal models. He said, “We were pushing the boundaries and you guys were amenable to that. It was similar to a typical TEI project except there was no actual TEI study at the end. Instead, we have a PDF on Forrester paper that shows the Forrester team verified our claims, which allows us to have more credibility in the marketplace.”

Flexibility would also be quantified when evaluated as part of a specific project (described in more detail in Appendix A).