Learn the 7 marketing success metrics that help determine whether your marketing is effective. Start calculating marketing success now.
Deciding whether to keep doing a marketing tactic or to look to other options can feel confusing. Just how successful is the tactic and is it resulting in worthwhile impacts for your business?
By setting goals at the onset of testing a new tactic and following certain metrics, you’ll take all the guesswork out of knowing whether your marketing campaigns were successful or not.
Review these 7 marketing success metrics every business should put in place before starting a marketing campaign.
Get a clear idea of how your marketing campaigns are performing by following these performance metrics and tracking them compared to your marketing goals.
This metric is important because it tells you how much general awareness you’re getting for your products and services. It can also shed some light on your content marketing strategy as you see what content gets the most traffic and look for ways to help your customers find information related to your products and services and answer common questions.
Your website traffic can fluctuate for many reasons so you don’t want to just pay attention to total traffic. You should pay attention to where your traffic is coming from and how it compares to the same time the year before. Website traffic can have a seasonality to it, especially when you’re in certain industries.
The easiest way to start tracking your website traffic is to set up Google Analytics. The free tool offers granular data on where your traffic is coming from. Some traffic sources to pay attention to include:
You’ll know how well your marketing tactics are working and what prospects and customers are doing on your website once they get there.
Once you have Google Analytics set up on your website, you’re ready for a more advanced tactic. You should set up conversion information on your website that tells Google Analytics what a conversion is. For e-commerce websites, it’s completing a purchase. But on other websites, it might be a form fill or demo booking.
Website traffic only tells you a small part of the customer buying journey. You need to take it to the next step to learn whether that traffic is resulting in business impacts. Perhaps you’re driving plenty of website traffic, but for some reason, your visitors are not converting. This tells you that you need to update your user experience or strengthen your calls to action to get your customers to take the next step.
To determine your website’s conversion rate, you take the total number of conversions per month and divide it by the total number of visitors to your website (make sure you’re using total visitors and not total visits).
So if you got 10 conversions in a month and experienced 1,000 website visitors, you have a 1 percent conversion rate. The average website conversion rate is 2.35 percent, which means you have some work to do to improve your conversion rate.
For most industries, lead attribution comes in the form of good website metrics that tell you where converting traffic came from. But brick-and-mortar stores also face a challenge in knowing where traffic came from. Asking customers at checkout can help in attributing foot traffic to a physical store.
Another challenge some companies face in tracking lead attribution is determining where a lead came from when they come through a phone call. Thankfully many digital tools make this simpler, but if you can’t afford those tools just yet, you can also ask customers when they call with questions about where they first learned about your business.
When your website ranks well on search engines, it often results in strong website traffic from interested parties because they were actively looking for answers to questions your website could answer.
Tracking SEO comes in many parts. Here’s what you should be paying attention to.
All conversions are not equal, and understanding the cost of each conversion will help you determine where to put your time and money when planning marketing campaigns. This metric is extremely valuable when determining whether a tactic is successful or not.
If you run a Google Ad and get 10 conversions in a month and that’s what you tend to get organically from your website, it looks like a success because it doubled your total monthly conversions. But as you look deeper, you realize that 5 of your conversions came from a guest blog post you paid just $100 for more than a year ago that regularly results in monthly conversions. And your Google Ad campaign cost $1,000 to earn those 10 conversions.
Knowing that data tells you that it might be more worthwhile to invest in guest posts while trimming your Google Ad budget as you work toward lowering the customer acquisition cost on that platform.
To calculate your cost per acquisition, you can take the total cost of a tactic and divide it by the number of conversions you got from that tactic. Many companies also calculate their total customer acquisition cost, which takes your full marketing budget and divides it by the total conversions you received for that year. This is a good metric to track year over year to better understand your marketing as a whole.
Once you get a customer, how much do they spend with your business? This will tell you how much you can afford to spend on customer acquisition costs. Businesses with a higher CLV can generally afford to spend more on acquiring new customers. It also tells you how loyal your customers are and might point to opportunities to improve loyalty.
Measuring CLV is a little more complex than tracking many other metrics. Here’s how to calculate this metric.
Take your total revenue, and divide it by your total orders. This tells you the average revenue per customer. Then you’ll need to calculate how many orders you received in a year and divide it by how many customers placed those orders. You’ll also need to know the average customer lifespan, or for how long a customer buys from your business. Then you can take the average customer value and multiply it by the total customer lifespan to reach your customer lifetime value.
Customer attrition is normal and shouldn’t bother you too much. But when your customer churn rate is too high, it might be trying to tell you something about the quality of your products and services or how well you support your customers.
Knowing your church rate is important, but it’s also helpful to know why your customers are leaving you. Completing customer surveys and focus groups can offer these insights.
To calculate your churn rate, you’ll take the total number of customers at the start of a period and then subtract your total customers at the end of a period. You might do this quarterly or annually to calculate your churn rate. For example, you might find that at the start of the year, you have 1,000 unique customers. But by December 31 of that year, you only have 800, which puts your churn rate at 20 percent.
If setting up these metrics and determining success seems complicated, it might be time to bring in an expert. New Light Digital has vast experience in many industries across all digital marketing tactics. We know what equates to success and can help marketing teams adjust their strategy to ensure success. Schedule a free consultation now to learn more.
Further reading:
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