What if a single campaign type could lead to higher-quality leads, increased revenue, boosted customer engagement, improved marketing, amongst a whole list of other benefits?

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Initially, it might sound too good to be true - yet there’s a reason why B2B marketing leaders are spending 38% more on demand generation campaigns than last year.

In order for demand gen campaigns to be successful, it’s vital to have the right demand generation metrics in place. By doing so, marketers can actively gauge the performance of their funnel strategies, and turn key data into actionable business opportunities.

Here, we’ll take an in-depth look at the 10 demand generation metrics and KPIs you need to measure. They’re a great starting point when it comes to optimizing your demand gen funnel and powering business growth. 

We’ll go over what they are, explain why they’re a must-track, and discuss the methods and formulas used to accurately track them.

In a rush? Take a look at our demand generation metrics cheat sheet below:

MetricDefinitionHow to MeasureMQLsSomeone likely to convert after nurturingTrack prospect clicks on key web pages, visits to site, gated content downloads, newsletter signups, social media follows, etc.SQLsSomeone who's on the precipice of convertingTrack whether a prospect contacts sales, frequently visits pricing pages, undertakes a free trial of your product or service, etc.Cost Per LeadHow much you're paying for each leadExtract stats from each marketing channelCost per AcquisitionHow much you're paying for each conversion1. Define acquisition window, 2. Identify acquisition costs, 3. Track customer acquisition, 4. Calculate CPA (Details below!) Customer Lifetime ValueA customer's revenue value across predicted customer lifespan(Average customer value) x (Average customer lifespan)Close Rate per ChannelThe ultimate conversion rate for each individual marketing channel(Customers acquired per channel) / (Leads generated per channel)Marketing Sourced PipelineTotal leads generated across all marketing effortsLead attribution systems, sales reps recording source of leads, or add together close rate per channel metricsAverage Deal SizeThe average revenue generated per customer(Total revenue from channel-sourced deals) / (Number of channel-sourced closed deals)Content EngagementHow content resonates with target audienceContent pageviews, content downloads, SaaS toolsBrand SentimentHow your target audience feels about your brandSaaS brand sentiment tools, online mentions & comments

You've had the overview - now let's take a more detailed look at each metric.

Demand gen basics: Measuring your leads

1. Marketing Qualified Leads (MQLs)

Meaning: Someone likely to convert, but will require more marketing/nurturing in order to do so.

You’ve undoubtedly heard of the first two essential KPIs on this list - MQLs and SQLs. If you’re not tracking these yet, we highly recommend starting straight away. 

Why you need to track it: Imagine MQLs as enthusiastic tourists who've stumbled upon your beautiful island (your website). They've downloaded a white paper, attended a webinar - meaning they're intrigued, but perhaps not ready to commit to your services just yet. MQLs are a good first step, but they’ll require nurturing to convert. 

With proper nurturing throughout the sales funnel, the more MQLs going into your funnel, the more conversions coming out. 

How to track it: Unfortunately, potential customers won’t suddenly announce “I am interested, but not ready to buy! However, if you nurture me well enough, I just might!” - although life would be so much easier if they did. 

Instead, you’ll need to use lead intelligence factors to determine your MQLs. Lead intelligence factors are certain first-party metrics used to determine prospect behaviors and intentions, including: 

• Clicks on key web pages
• How many times they’ve visited your site within a certain time period
• Gated content downloads, including whitepapers, webinars, guides, etc.
• Actively looking to hear more from your company - through newsletter sign ups, social media follows, etc.

These actions typically indicate someone is happy to engage with your business, or is interested in the products/solutions you’re offering. However, they’re currently in early stages - meaning you’ll need to give them more reasons to convert. 

2. Sales Qualified Leads (SQLs)

Meaning: Someone who’s been qualified as a good fit for your product/service, and is on the precipice of converting. 

SQLs (often referred to as ‘hot leads’) have been vetted by the marketing team and deemed ready for sales outreach. They've engaged with your sales team and are showing buying intent. 

Why you need to track it: MQLs and SQLs are the best demand generation metrics available when it comes to measuring product demand. The more MQLs & SQLs in your pipeline, the more conversions you’ll get. 

In short, SQLs are where the magic happens.

How to track it: Similar to MQLs, SQLs typically display a few key behaviors: 

• Contacting sales
• Frequently visiting your pricing page
• Undertaking a free trial of your product or service

Counting your pennies (and Customers)

3. Cost Per Lead (CPL)

Meaning: How much you’re paying for each lead. 

Why you need to track it: This crucial demand generation metric tells you how much you're shelling out to attract each new lead. Think of it like your travel expenses – you want to reach your destination (MQLs & SQLs) without breaking the bank. 

How to track it: Track your CPL across different marketing channels (social media, email campaigns, etc) to see where you're getting the most bang for your buck. Then, refine your high-performing channels by doubling-down on what works to reach your entire audience base. 

4. Cost Per Acquisition (CPA)

Meaning: How much you’re paying for each conversion.

Why you need to track it: This one takes CPL a step further. It factors in all your marketing and sales expenses to land a paying customer. A low CPA indicates efficient lead generation, ensuring you're acquiring customers at a sustainable cost.

How to track it: In order to track your CPA, you’ll need to: 

1. Define your acquisition window - consider all marketing and sales expenses incurred within a specific period (typically a quarter) that ultimately led to conversions during that period. 
2. Identify acquisition costs - gather your marketing costs (PPC, paid social, content creation, event setup fees, etc.) and your sales costs (commissions, sales training costs, enablement tools, etc.)
3. Track customer acquisition - keep track of the total number of new paying customers acquired within your chosen time period. This data can be gathered from CRM systems or sales pipeline reports. 
4. Calculate your CPA - as an example, if your total acquisition cost for a month is $20,000 and you acquire 40 new paying customers, your CPA would be $500 ($20,000 / 40)

5. Customer Lifetime Value (CLTV)

Meaning: A customer’s revenue value compared to predicted customer lifespan.

Why you need to track it: This golden demand gen metric reveals the total revenue a customer brings in over their entire relationship with your company. A high CLTV is an indicator of a healthy and loyal customer base. 

By measuring CLTV, you can identify issues with your product, optimize customer success teams or systems, and boost overall customer loyalty and retention. Therefore, tracking and improving CLTV directly results in more revenue. 

How to track it: Analyze historical data from your CRM and financial systems to multiply average customer value (annual revenue per customer) by average customer lifespan. 

Use this information to identify high-value customers, prioritize resources, and optimize customer success roles to create long-lasting client relationships. 

Optimizing your channels

6. Close rate per channel

Meaning: The conversion rate (leads to customers) for each marketing channel

Why you need to track it: Not all marketing channels are created equal. Some might be generating a high volume of leads (think social media), while others might be bringing in fewer, but higher qualified leads (think targeted webinars). By tracking close rate per channel, you can tell which marketing channels are ultimately performing the best. 

By analyzing close rates for each channel, you can double-down on the channels which are flying, and refine the underperforming ones. 

How to track it: The formula for measuring close rate per channel is: 

(Customers acquired per channel) / (leads generated per channel) 

Customer data can be gathered from your marketing platforms and website analytics, whereas lead data can be found in your CRM system. 

7. Marketing Sourced Pipeline (MSP)

Meaning: Overall leads generated from ALL your marketing efforts.

Why you need to track it: If you want to track the overall effectiveness of your marketing efforts, tracking MSP is the way to do it. 

It showcases the direct contribution of marketing activities to the sales pipeline, and allows you to demonstrate the tangible impact of your marketing efforts on revenue generation. 

How to track it: Using lead attribution systems that track the source of each lead is the easiest way to track MSP. Additionally, during the sales qualification process, sales reps should record the source of the lead, ensuring alignment with marketing attribution data. 

Note: You should never focus on marketing lead gen at the detriment of the business as a whole. Use it to measure overall marketing effectiveness - not to put marketing and sales teams at odds with each other, or create an internal arms race!

8. Average Deal Size (ADS)

Meaning: The average amount of revenue generated per customer.

(As demand generation metrics go, this one's pretty straightforward.)

Why you need to track it: Knowing how many leads you’re generating from each channel is all well and good. But if 100 leads generated from social media are worth $100 each, whereas 5 leads generated from gated webinar content are worth $9000 each… You get the picture. 

When you can attribute a channel to the largest, most profitable deals - rather than simply counting the number of deals - you can start evaluating each channel in more depth, and making more informed decisions about where to invest your time and money.  

How to track it: In order to track average deal size, you’ll need historical sales data from your CRM system - including total revenue generated from each closed deal, and the lead source channel.

Then, track the number of closed deals generated through each marketing channel. This can be gathered from marketing automation platforms or website analytics. 

The formula to calculate average deal size per channel is:

(Total revenue from channel-sourced deals) / (number of channel-sourced closed deals)

Demand generation metrics: Engagement and sentiment

9. Content engagement

Meaning: How the content you create resonates with your audience.

Why you need to track it: Not all metrics are about cold, hard cash. Tracking content engagement (downloads, shares, views, comments) shows you what kind of content your audience gains value from. 

The more value your audience is gaining from your content, the higher the regard they’ll hold for your brand. The higher they regard your brand, the more likely they are to convert. 

A diverse range of content helps connect you to your audience, and therefore your potential customers. Whitepapers, webinars, blogs, infographics, podcasts, or otherwise - content is a necessary step in most buyer’s journeys. 

By refining your content and doubling-down on what works, you’ll directly provide more value to your audience. 

How to track it: Simply tracking blog pageviews, webinar registrations, whitepaper downloads, and so on is a great place to start. But in order to really take your content to the next level, find SaaS tools that help you gather deeper feedback on the efficacy of your content. 

10. Brand sentiment

Meaning: The overall feeling that underlies each mention of your company - AKA, how people feel about your brand. 

Why you need to track it: Tracking brand sentiment lets you know if your marketing is striking a chord with your audience. Hopefully, that chord is major - not minor. Either way, tracking brand sentiment helps you find out, and modify your content accordingly. 

If you have good brand sentiment, it generally means your top-of-the-funnel content delivery resonates with your audience. 

How to track it: Similar to content engagement tracking, SaaS services can be your best friend here. Tools such as Brandwatch or Pulsar Platform can help you measure brand sentiment within your target audience. 

Demand generation metrics overview

There’s a whole bunch of demand generation metrics out there, however this guide provides a good starting point in providing the key metrics that every B2B brand should be measuring. 

By incorporating these metrics into your demand generation marketing campaigns, you’ll be able to closely monitor the health of your pipeline, and optimize for greater success at every stage. 

Remember, don't get bogged down by every single metric. Focus on the ones that align with your overall B2B marketing goals and use them to make data-driven decisions. After all, B2B marketing is a marathon, not a sprint.

Optimizing analytics with Lunio

When it comes to demand gen strategy, performance marketers rely on accurate analytics to make informed decisions about their overall business goals. 

Unfortunately, data can be heavily skewed by invalid traffic. Bad data can lead to incorrect metrics, which can ultimately result in making the wrong business decisions. 

According to our Wasted Ad Spend Report, over 42% of performance marketers are concerned about the impact of invalid traffic on their ad spend and analytics data.  

Lunio works to exclude invalid traffic and stop your analytics from being invaded with bad data. That means more ad spend is actually being spent on real leads - not fake bots that’ll never convert - and your analytics data won’t be corrupted by invalid sources. 

With a Lunio 14-day free trial, you can see exactly how invalid traffic is impacting your business - and learn what you can do to prevent it.