So you don’t have a clue what marketing metrics are, let alone which ones are important? Panic not! Just read on to discover my top six metrics for effective marketing, and why – no matter the size of your business – you need them.
Marketing metrics – what are they?
Quite simply, metrics are ways of measuring just how successful (or not!) your marketing efforts are. From tracking how many people open your email newsletter (versus unsubscribe from it) to knowing where your website traffic originates from, nowadays there’s a metric that can tell you whether you’re hitting the marketing mark or missing by miles.
Metrics – why I love them!
I’ve always focused on metrics. When I ran my media agency, clients would give me a budget and target metrics. If we didn’t meet those targets, that was it! With staff to pay and an office to run, I couldn’t afford disappointed clients that disappeared… I needed blissfully happy clients that kept coming back! And so we’d measure everything we possibly could: not just the marketing channels, but also the effectiveness of the creative, messaging, promotions/ offers, landing pages and calls to action.
Nowadays, an astonishing array of tools and systems exist to make marketing analysis much easier, but back then, digital marketing was nowhere near as tech-savvy. But we still managed to monitor really significant metrics to help us optimize each campaign. And so our happy clients kept coming back, month after month.
Marketing that measures up.
Virtually every marketing tactic you can think of can be measured nowadays – and, if it can’t, you can bet some Boffin is busy developing an app that can!
Here are just a few to get you started:
- Brand awareness
- Social media engagement
- Social media following
- Event/webinar attendees
- PR coverage and PR value
- Client satisfaction
- 5* reviews
- Site bounce rates
- The success of lead generation campaigns
- The success of content marketing campaigns.
And that’s just a fraction; the ever-lengthening list is constantly evolving and somewhat mind-boggling.
For me, though, there are six absolute must-have metrics. Essential for getting the most out of any marketing budget, these are the metrics I always monitor and analyze when running campaigns for clients and I couldn’t survive without them.
1. Website visitors
A brilliant way of measuring if/how people are engaging with your business, this is my go-to, number one metric. (So, if you’re not already reviewing your website’s visitor stats via Google Analytics, get to it!)
Understanding how people interact with your site can reveal a huge amount about your business. Think of your website as your shop-window. Ask yourself: do visitors barely spare a glance before moving on; or are they coming in and committing? Are visitor numbers up or down on a monthly basis… and where are they coming from? How long are visitors spending on site, and where do they hang out most? What content is most popular? (Whatever works, write more of it!). I remember when I wrote my wedding blog (when I was learning to blog over 10 years ago) I had over 3000 readers a month to one blog post, ‘100 wedding table name ideas’. So once you know that is popular, you know to write more content like that. You know that lists work. You know what people are searching for and what content is popular.
2. Cost per lead (CPL)
A lead is a positive action by a potential consumer before they take that final leap and buy your product or service. For instance, it could be someone signing up to an email newsletter, requesting a brochure, or asking for a callback or a meeting. Basically, it’s someone saying, “Yes, I’m interested. Can I get more information?”. Measuring what it costs you to get a lead is a great metric. If you know how many leads convert to customers (conversion rate) then you can work out what you can pay to acquire a customer, and make some estimations.
3. Cost per Acquisition (CPA)
In plain English, CPA is the cost of getting a new customer (typically a paying customer, versus a freebie). If you know what it costs you to acquire that customer, you can easily work out if a campaign is providing value for money. So if it is, spend more. If it isn’t, rewind and rethinks. Ask yourself, why are you running the campaign? Is it worth continuing? Does it bring in an additional benefit – fabulous PR, say – that justifies its worth? Most of the time if the campaign is not hitting the CPA targets to generate profitable customers then it should be tweaked.
4. Conversion rates
Do you know what percentage of your leads turn into actual paying customers? Working out your CPL/CPA conversion rate gives you a quantifiable benchmark to aim for and build on. The same applies to the conversion rate of visitors to leads. Conversion rates are vital as, without them, you’ll never know if anything you’re doing to improve them is working!
5. Return on Investment (ROI)
A key metric, ROI, refers to the return you get on your investment; so the revenue and profit generated from the cost of your marketing campaign. Obviously, you want a positive ROI… if your marketing costs more than it makes you, you need to stop spending and rethink strategy! Conversely, if a particular campaign delivers a higher ROI than other channels, then spending more on those channels will usually make sense (unless you hit a plateau)
6. Customer Lifetime Value (CLV)
I’m always a tad surprised when (larger) companies I have consulted for don’t know what their customers are worth to them over the lifetime of the relationship. Unless you’re selling a product/service that a consumer only ever needs to buy once, then the ideal scenario is, surely, that they’ll come back and buy from you, again and again?
Repeat business relationships rely on two things: that your customer not only likes what you’re selling but also likes how you market to them after that all-important first purchase. Retaining a customer is generally much easier and cheaper than finding a new one, so retention marketing is key. If you want your customer to stay true, do all you can to make them feel special; you’ll increase your CLV, so everyone wins!
Dig deeper into the CLV metrics and you’ll also discover which marketing channels your profitable customers are coming from. Then, assuming the other metrics add up, allocate more of your budget to those channels. The upshot? A higher number of repeat, profitable customers and an ever-higher CLV.
Think about the CLV and the CPA. You want there to be a nice margin between what a customer is worth to you (profit) and what it costs you to acquire them.
How can I help you?
Marketing can be a major cost for a business, so getting real results for your money is key. I’m working with lots of local businesses to perfect their marketing efforts and, for me, these six key metrics are indispensable for evaluating campaigns. By staying on top of marketing metrics, you can budget wisely and ensure you’re only spending on the most effective channels, with promotions, calls to action and creative that work.
To find out more about the marketing services I offer, and how they’ll benefit you and your company, you can contact me. Even better, let’s talk! If you need help with marketing metrics or just general marketing or media advice, then please get in touch for a free, no-obligation chat.