What is Closed-Loop Marketing Reporting, Why is it Important and How to Get Started

Katie Holmes
25th January 2022

We take a closer look at how closed-loop marketing works and show you how to successfully connect data from your marketing tools and CRM platform.

The following process is how most businesses expect marketing and sales teams to function:

Marketing to generate as many leads as possible. Then, leads are passed onto sales to create opportunities that eventually turn into revenue.

As simple as this may seem, this practice is outdated and often leads to unwarranted friction between teams.

You’ll often find sales pointing the finger at marketing for sending mediocre leads that take up all their time.

Marketing, however, will question whether sales are working hard enough to convert leads into sales.

If this all sounds familiar, you’re not alone.

According to a study, only 17% of companies are believed to have completely aligned departments.

To make matters worse, misalignment of sales and marketing is costing companies an average of 10% of revenue per year.

So, that’s a whopping 83% of companies missing out on significant growth.

So, what’s the solution?

One of the most effective ways to align the sales and marketing teams is by tying the marketing pipeline to your revenue goals.

And this is where closed-loop marketing steps up to the plate.

For this article, we’ll discuss:

💡 Pro Tip

Ruler makes the process of closed-loop marketing much easier. It tracks data on a visitor level, allowing you to successfully attribute leads and marketing-generated revenue across multiple campaigns, ads, keywords and more.

Why you need Ruler’s closed loop attribution and how to get it


What is closed-loop marketing?

Put simply, closed-loop reporting allows you to pinpoint the lead generation techniques that drive the most (and the least) revenue.

Related: Why you need closed-loop attribution and how to get

It is the process that connects your conversion and revenue data to calculate the exact return on investment of your campaigns and channels.

Related: Complete guide on how to calculate your marketing ROI

“Closing the loop” refers to connecting marketing with sales so that revenue is definitively and automatically matched to marketing activity to measure and optimise for better results.

Why is closed-loop marketing important?

For this section, we’re going to use an example to demonstrate just how essential closed-loop marketing is.

This is Ella, Head of Marketing at Blue Inc. Ella and her marketing team use Google Analytics to track traffic, form completions and referrals.

closed loop marketing - ella head of marketing - www.ruleranalaytics.com

This is Jamal, Head of Sales at Blue Inc. Jamal and his teams use Salesforce to track leads, conversions, repeat purchases and reactivations.

closed loop marketing - jamal head of sales - www.ruleranalaytics.com

Ella knows which traffic sources and landing pages drive the most leads and conversions.

And Jamal can see which leads made it to the buying stage and have gone on to make repeat purchases.

But neither Ella nor Jamal have the data to connect the top-of-the-funnel activity with bottom-of-the-funnel data.

Traditionally, sales and marketing are considered two separate functions.

For most companies, the marketing funnel starts with the awareness stage and ends when visitors are converted into leads.

The sales funnel kicks in when the marketing funnel has done its job and ends when a prospect agrees to a deal or makes a sale.

Because these teams work in silos and focus on different stages of the funnel, data isn’t transferred between them.

As a result, sales teams don’t know what marketing activities generated their leads, and marketing doesn’t know what happens to leads once the sales team takes over.

closed loop marketing - funnel disconnected - www.ruleranalytics.com (1)

Since sales are only capable of tracking half of the customer journey, they lack insight into the quality and buying intent of leads that drop into the pipeline.

Related: Guide to customer journey stages and tips on how to track them

As a result, they end up wasting time and energy on opportunities that will never convert. In fact, when asked to list the main factors that affect the length of the sales cycle, our respondents ranked “having too many unqualified leads” the top challenge.

The best sales can offer marketing is feedback on the quality of leads, and depending on whether they’ve had a good or bad month, it’ll likely be either “these leads are rubbish” or “these leads are great, keep them coming”.

This information, however, doesn’t provide marketing with much detail on what’s working and what isn’t.

Different channels, ads and campaigns all drive different kinds of customers and revenue per lead values. Without data on the tactics that drive the most revenue, marketing teams will typically fall back on lead volume metrics to optimise campaigns and budgets.

However, optimising for lead volume often results in lower contact rates and decreased ROI.

This is where closed-loop marketing steps in.

Closed-loop marketing creates a cycle of data between all your teams.

Sales can track marketing activity and lead source data.

Related: What is lead source and tips on how to get started

Marketing, on the other hand, can attribute sales and optimise performance based on revenue instead of lead conversion metrics.

It’s a win-win situation.


How does closed-loop marketing work?

So far, we’ve highlighted the disconnect between the sales and marketing funnel and provided you with a solution in the form of closed-loop marketing.

But how do you approach it?

Closed-loop marketing can be achieved using the four steps below:

https://www.ruleranalytics.com/wp-content/uploads/closed-loop-marketing-stages-of-closed-loop-marketing-www.ruleranalytics.com_.png

Don’t forget, you can download our guide for a more in-depth look at closed-loop marketing.

What you need to know before you get started with closed-loop marketing

Closed-loop marketing does involve a lot of moving parts.

To implement closed-loop marketing yourself requires a lot of manual work, time, and not to mention buy-in from key stakeholders and co-workers.

Even after all that hard work, the data probably wouldn’t be very accurate, as you’ll likely miss out on key actions that occur offline.

Ecommerce sales, in particular, are a lot easier to follow if your Goals are set up correctly in Google Analytics. A little bit of code in your shopping cart and you can see which of your marketing channels are driving the most sales.

Offline interactions such as phone calls, however, are a lot more difficult and often impossible to track without the right processes in place.

Seeing how much work goes into setting up closed-loop marketing may have left you feeling a little apprehensive.

However, closed-loop marketing is absolutely necessary in order to demonstrate and improve your impact on bottom-line metrics.

In all honesty, the easiest way to guarantee a “closed-loop” is to let technology capture the information for you automatically.

And, this is where Ruler Analytics can help.

Ruler is a marketing attribution solution designed to close the loop between your sales and marketing data and provides a single source of truth on what’s working well and what isn’t.

Related: What is Ruler’s closed-loop attribution and how to get it

Ruler works by tracking each and every visitor over multiple sessions, traffic sources, keywords and more. 

When a visitor converts into a lead via form fill, live chat or phone call, Ruler updates the data it’s collected when the user was anonymous, creating a journey map for what is now a known as a lead.

Ruler takes advantage of a pre-built integration to pass all marketing data to the sales team’s CRM, allowing salespeople to see what specific products, services, and/or features each prospect was interested in while interacting with your campaigns.

Naturally, your leads will move through the pipeline over several days, weeks or even months.

Ruler will feed pipeline data into its dashboard, so your marketing team can keep track of leads and determine whether they’re or not they’re adding enough quality to the later stages of the funnel. 

Eventually, some of those leads convert into a deal.

When that happens, a pre-built integration passes real conversion and revenue data back to Ruler.

Related: How Ruler attribution revenue to your marketing

Now, marketing teams can see revenue and conversion data alongside all of their traditional metrics.

More importantly, a loop is formed between your sales and marketing teams, with minimal effort too.

💡 Pro Tip

Want more information on Ruler’s closed-loop attribution? We have a complete guide that covers all the features available in Ruler, plus advice on how to take your reporting to the next level.

Download the guide on how Ruler works

Now that’s covered, let’s take a closer look at each step and alternative methods to approach closed loop marketing.

1. Capture website visitors on an individual level

In order to set up closed-loop marketing, you’ll need to find a way to track and measure how individual visitors behave on your website.

Related: 11 website visitor tracking software and tools

Tracking visitors this way will allow you to monitor and measure the movements of specific users and track cross-channel journeys more cohesively.

Most web analytics tools let you track traffic sources such as PPC and referral, but the data is anonymised and aggregated.

In other words, it doesn’t allow you to focus on the specific steps of your unique website visitors.

To ensure the accurate deployment of closed-loop marketing and attribution of leads, you’ll need to go a step further.

One thing you can do is assign a tracking URL to any piece of content or marketing material that is directing traffic to your website.

Google Analytics 4 uses first-party data and considers individual users who interact with your business—from the first visit to the point of conversion.

Related: Tracking individual users in Google Analytics

To track every individual user in Google Analytics, you will need to implement a User_ID that consists of a set of alphanumeric characters. Again, this data is anonymised, so you can’t reveal the identity of a user behind the conversion.

A better option is to invest in a good customer journey analytics tool. Access to customer journey tracking will allow your sales and marketing people to map every touchpoint of a user across multiple channels and sessions before converting into a sale.

💡 Pro Tip

Learn how you can track each and every customer touchpoint to unlock valuable data across the entire buying cycle. You’ll gain access to key insight which will inform smarter budgetary decisions and provide more bang for your buck.

Download the guide on tracking customer touchpoints

For example, Ruler tracks each anonymous visitor over multiple sessions, traffic sources and keywords.

Once an anonymous visitor converts into a lead, Ruler Analytics matches the user’s details to their marketing touchpoints to create a journey.

Related: How to view full customer journeys with Ruler Analytics

Such connectivity “closes the loop” between all your departments.

There’s no more of marketing washing their hands at the handoff stage, and sales can no longer accuse the marketing team of sending second rate leads that don’t convert.

Instead, sales and marketing will unite as one, focused on driving the right type of leads that convert into customers quickly and effectively.

2. Store data from multiple sources in a single platform

Next, you’ll need to generate a centralised hub to store your leads and customer data along with the originating source.

That way, your sales, marketing and customer success teams can all collaborate and gain a holistic view of the customer journey.

Many organisations opt for a customer relationship management (CRM) system since most allow you to integrate seamlessly with different applications and are fully customisable to suit your specific business goals.

To successfully close the loop, you’ll need to assign a lead source to each one of your records.

Although seemingly straightforward, the process of tracking lead source in your CRM can be overwhelming and near impossible without the right systems in place.

Related: How to send lead source to your CRM with Ruler

That’s where tools like Ruler step up to the mark.

Ruler automatically sends lead source data to your CRM, along with 60 other variables. Such data equips your sales representatives with more intelligence about leads, and the loop between sales and marketing teams begins to close.

3. Share closed-loop data with the tools you use every day

Naturally, your leads will progress through the sales cycle, going from simple contact to a fully qualified sales opportunity.

For some businesses, the sales process can stretch over a number of weeks and usually involves more touchpoints along the path to purchase.

In fact, according to a survey, we recently found that 52.3% of companies endure sales cycles lasting between one to three months, while 18.8% have sales cycles greater than four months.

Related: What is a sales cycle and tips on how to close deals faster

closed loop marketing - sales cycle length - www.ruleranalytics.com

With that in mind, it’s helpful to know where your leads are at the various stages of the sales cycle so that you can plan and optimise your marketing well in advance.

Such intelligence will help you pinpoint the channels that have the highest lead to opportunity rates.

You can allocate budgets more wisely to accelerate customer acquisition and retention.

Here is a screenshot of Ruler, providing us with key information at different stages of the sales pipeline. As you can see in the example, Google Ads is responsible for driving £28,295 to the proposal stage, whereas Google Organic has only added £7,695.

closed loop marketing - opportunity report - www.ruleranalytics.com

Based on this data, you could potentially allocate more spend to Google Ads and ensure that there are enough leads entering the pipeline for sales to close into revenue.

4. Lead closes into a deal, revenue is attributed to the original source…

…and the loop is finally closed.

When an opportunity eventually converts into a sale, the revenue data is passed back to the marketing team. This brings a couple of benefits.

First, it allows marketing teams to build reports showing exact values for marketing-generated revenue. 

Second, this data helps marketers identify which campaigns and channels are the most effective at generating revenue and driving growth.

This lets marketers optimise their efforts by focusing their time and budget on the channels that deliver the highest ROI.

At Ruler, we use our platform and ChartMogul to track and report on monthly and annual recurring revenue driven by our marketing activities.

In ChartMogul, we’ve set up custom fields, and marketing source data is passed from our closed-loop platform and CRM.

This seamless integration allows us to visualise and analyse our monthly and annual recurring revenue segmented by lead source. We can measure:

Benefits of closed-loop marketing reporting

By switching from traditional marketing measurement to closed-loop reporting, you can enjoy the following key benefits:

Better decision making power

Let’s say you log into Google Analytics, go to your acquisition report and see that Facebook has sent the most “conversions”.

You look over at organic search and notice that the conversion rate is lower.

If your CEO handed you more budget to increase revenue by XYZ%, where would you invest it?

Likely, Facebook. What if we told you that Facebook was driving low-quality leads that dropped out at the prospecting stage, and organic search delivered a higher return on investment and lifetime value.

Where would you invest your budget now? When it comes to decision making, closed-loop marketing can help you make the right choices.

Proof of marketing’s impact on business growth

Growing awareness is still a good thing.

But it’s a game-changer when you can supply detailed and accurate revenue metrics to your company’s leaders.

Reporting that “we grew traffic 20%” is much less impactful than reporting that “marketing generated £100,000 this month at a 5:1 ROI.”

Ability to identify your best-performing campaigns

Relying on awareness metrics doesn’t provide a full picture of which campaigns and channels generate business growth and which don’t.

It’s possible for a campaign to drive a lot of traffic but little revenue, and vice versa. Closed-loop attribution lets you identify top performers.

Data to improve marketing performance

Once you know which channels and campaigns drive the most revenue, you can double-down on those initiatives to grow marketing-generated revenue even more.

Additionally, you can cut down on waste by pausing or ending underperforming campaigns and initiatives.

Need help getting started with closed-loop marketing?

Closed-loop marketing allows you to focus on the channels and campaigns that matter most to your business. When you know what lead sources drive the most revenue, you can stop wasting efforts on those that don’t perform as well.

Keeping your cost per lead as low as possible while boosting your bottom line.

Using tools like Ruler, closed-loop marketing is something that modern-day companies can take full advantage of to help solve the disconnect between sales and marketing, improve customer acquisition and prove marketing’s impact on revenue growth.

If you want to see the closed-loop marketing attribution model in action, then book a demo today.

Our experts will run you through how the platform works, and how you can use it to prove your marketing ROI and optimise your marketing efforts.

This article was originally published July 2021 and last updated on 25th April 2022 for freshness.