Tracking key metrics is crucial for any successful marketing campaign. There are countless KPI’s you could be tracking, but not all are essential. While it does vary from campaign to campaign, we’ve narrowed it down to 7 critical metrics that must be tracked to get a solid understanding of your campaign, to better identify where you should be spending your ad dollar.
1. Qualified Leads
Generating leads is one of the first and most difficult steps of a marketing campaign, but getting qualified leads is even more important. Qualified leads are leads that you’ve seen some level of engagement from, and have a high chance of making a purchase decision. You can calculate the rate of your qualified leads by using this formula: (Qualified leads / Total leads) x 100 = Qualified lead rate. That will help you get a better understanding of the effectiveness of your marketing initiatives. A few tips for gaining qualified leads include:
- Creating more personalized messages. Giving leads personal attention makes them feel more important and much more likely to continue down the sales funnel.
- Putting greater effort into finding them. Instead of cold-calling or sending out bulk email blasts, go through your lists to identify those that have a higher chance of converting.
2. Customer Acquisition Costs
Customer acquisition costs (CAC) looks at how much, on average, it takes to convert a lead into a customer. You can find it by calculating: Amount spent on lead generation / Number of new customers as a result of lead generation = Cost of customer acquisition. It’s a metric that can help you avoid wasting resources on programs and campaigns that aren’t delivering. It should not be relied on alone, though, as there are number caveats. A company’s CAC can be poor if they’re expanding into a new area, are in early stages of SEO work, the company is undergoing reorganization, etc. CAC should be viewed in comparison with the company’s overall strategy.
Referrals are something that often get overlooked by companies, but this is an important metric, especially in digital marketing. There are a lot of ways to track referrals. Traditionally, they can be tracked using referral or coupon cards. However, they’re often run and tracked online. The most commonly used program involves a customer signing up online, then inviting their friends via a unique code/link. To track this an excel or spreadsheet is easiest to use. You can calculate your rate of referrals with: Total number of customers / Number of referrals = Referral rate.
4. Customer Lifetime Value
Customer lifetime value refers to how much revenue the typical customer will bring into your business over the course of their lifetime. The simplest formula to measure CLV is the following: Customer revenue per year x Duration of the relationship in years – Total costs of acquiring and serving the customer = SLV. This shows how many customers you need to break even and make a profit.
5. Time Spent on Site and Bounce Rate
Time spent on site is a good indicator of whether or not people are interested in what you have to offer. If they’re spending a significant time on your site, as well as browsing to other pages, it’s likely they’ve found a good amount of value in your brand. Bounce rate is related to time spent on page, but refers to someone who made it to your homepage, but immediately leaves. If you have a high bounce rate, this is a big indication that either your home page is poorly designed or you are focusing your digital marketing on the wrong people and need a shift in strategy. Both of these metrics can be tracked with tools like Google Analytics or Clicky.
Return on investment is one of the most important metrics to track for a business overall. It allows you to identify which tactics are generating revenue and which are poorly performing. You can then adjust budgets and strategies as necessary. It’s important to note that you shouldn’t immediately quit a marketing strategy if it has a poor ROI right off the bat. You should take some time to think if there’s anything you can do to adjust to make it more successful.
7. Conversion Rate
Conversion rate tracks the percentage of people that make it to your landing page and turn into a real customer. A low conversion rate is bad for obvious reasons; your landing page isn’t working and you’re not making a profit. It’s important to A/B test multiple landing pages, because you never know what people are going to like best. Sometimes it can just be a small tweak to turn a poor performing landing page into a high performing one. Try different colors, fonts, images, etc. Other things that may cause a low conversion rate is if your ask is too large. It’s best to start with something small, such as a subscription or sign up, then move those customers to bigger purchase asks.
Like previously mentioned, all strategies and campaigns are different. But one thing all marketing programs have in common is their metrics need to be tracked and adjusted based on the data that’s found. If you need assistance in any area of digital marketing, our team at Onimod Global is here to help. We’re experts in SEM, SEO, analytics, social media marketing, and more. Learn more about what we do and contact us today.