KPIs

If you've taken the time to study your company's marketing plans and strategies, you probably have a pretty good idea of what's important. You know you need a website, blog, social media and great content. But you may have overlooked the most important part of online marketing: measuring results.

How do you know if your strategy is working? How can you compare the costs and performance of your campaigns? And how do you decide what to do next? The only way to answer these questions is to track a set of key performance indicators or marketing KPIs.

What is a marketing KPI?

Marketing key performance indicators, or KPIs, are metrics that determine whether a marketing strategy is helping you achieve your business goals. While there are thousands of numbers associated with your various campaigns to track, KPIs are the ones that matter most to you.

Depending on your industry and goals, there are many different metrics to focus on. For example, if you're working to improve your website, your KPIs might be server speed, load time, and bounce rate. If you work in customer service, you may want to track customer retention and agent response times.

Thanks to advances in Internet marketing, you now have the opportunity to gain insight into virtually every aspect of your marketing strategy.

This is great news if you already have specific goals in mind, but it can be extremely overwhelming if you don't know which logs to look at. For this reason, the choice of marketing KPIs is important. By focusing only on the most important metrics, you can determine the success of your strategies and keep improving.

Which marketing KPIs are most important?

While you can measure all types of marketing KPIs, it makes sense to focus on the KPIs that align with your goals. What do you want to achieve with your online marketing program? While the details depend on your industry, most marketing KPIs fall into three categories: financial, social, and website performance.

Finance

Ultimately, the goal of any marketing is to increase the sales of your business. That's why it can be helpful to think about how many financial benefits each part of your strategy will bring to you. So what types of financial KPIs should you track?

One of the most important indicators is total income. If you're improving month after month, you're doing something right. If not, then something has to change.

You also want to know the average customer value. By determining how much you can earn from each new lead, you can determine how much you are willing to spend to acquire them.

Likewise, you need to keep track of the cost per lead. How much does it cost you on average to recruit a potential customer? With methods like contextual advertising, it's easy to measure how much you pay for each visitor to your website.

Site Performance

Your website can be a good indicator of the overall success of your business and provides a lot of information about your demographics, consumer behavior and more.

One of the easiest things to measure is the number of unique visitors to your website. Tracking this number over time will help you see if new people are opening your business.

You also need to keep track of where your visitors come from. Traffic can come from organic search, links from other sites, and a host of other sources, and knowing where you perform best can help you determine where to focus your strategy.

In addition to the volume and origin of your visitors, you can still see what they are doing when they land on your site. Bounce rate and conversion rates can tell you if your site is driving people to leave or stay and take action to contact you.

Social networks

Social metrics allow you to measure the success of your social media marketing efforts. While it can be tempting to focus on the number or share of your followers, it's important to focus on the numbers that indicate engagement.

On platforms like Twitter, you should always be wary of your mentions. When your company is mentioned in a conversation, you can get a good idea of the general sentiment towards your brand.

On platforms like Facebook, you need to target comments and shares. While likes on pages and posts indicate exposure, people who engage with your content are more likely to become your customers.

Depending on your business, there are plenty of other KPIs worth keeping an eye on, but try to pick a few from each of these three categories. You may later decide to add more metrics based on your results, but unless you have a large marketing team doing it for you, you'll probably be overwhelmed with keeping track of everything at once.

5 key marketing KPIs

Now that you know the answer to what a marketing KPI is, why not take a look at some of the most valuable marketing KPIs? If you really want to track the performance of your online marketing campaigns, you need to follow these five KPIs.

1. Conversion rate

Your conversion rate highlights the effectiveness of your marketing and advertising efforts. This is because your conversion rate measures, for example, the percentage of users who achieve the desired goal. B. submit a contact form.

Here are some examples of conversion rates you can measure:

to sue
home pages
contact forms
Downloadable Resources
Social media continues
And more

Tracking conversion rates helps keep your business afloat. Instead of creating a new contact form with no data, you can do an A/B test beforehand. With this test, you can collect real data on how this new contact form design delivers an improved (or worse) conversion rate.

2. Cost per lead

Cost per lead measures the average cost of acquiring a new lead for your business. This is a must-have marketing KPI for lead generation businesses such as contractors, HVAC contractors, and landscapers.

Measure your company's cost per lead using the following formula:

Cost of a lead = cost / number of leads

Your expenses may include a number of expenses such as: B. the following:

advertising costs
Independent
software
And more

If you need the exact cost per lead, calculate the cost per lead per channel.

For example, if your business uses social media advertising and search engine optimization (SEO), calculate the cost per lead for each channel. For example, you may find that SEO is outpacing social media, which can impact your future marketing budgets.

3. Organic traffic

Your organic traffic tracks the amount of organic traffic that comes to your site. For example, your site may receive traffic from social media, paid advertising, and organic channels. Organic traffic is important because it's free.

In comparison, paid advertising requires a monthly advertising fee.

Organic traffic also provides insight into your SEO strategy. You can measure your organic traffic to gauge how your site ranks in search results. In addition, you can use these organic traffic numbers to see if your site is generating valuable organic traffic.

You can track your organic traffic in Google Analytics, it's free.

4. return on investment

Return on Investment (ROI) measures the financial results of your marketing and advertising efforts. Just like any other company, your company wants to get a return from its work. Your ROI can measure this and immediately show decision makers the value of marketing and advertising.

The following formula calculates the ROI:

ROI = Net Income / Total Investment * 100

As with cost per lead, you want to calculate total ROI and ROI per channel. For example, your company could calculate the ROI of its social media advertising and marketing strategy and then derive the total ROI based on those two strategies.

5. Lifetime customer value

Your Customer Lifetime Value (LTV) measures the long-term (or lifetime) value of the average customer. By calculating the average lifetime value of a customer, your company can optimize marketing budgets and determine a reasonable cost per lead.

Use the following formula to calculate LTV:

LTV = Customer Value * Average Customer Lifetime

You can determine the average life expectancy of your customers by calculating the average number of years that a customer remains a customer. For example, if you offer software as a service (SaaS), your target audience can remain a customer for several years. In comparison, in an online store, the customer lifecycle can be much shorter.

For the customer value you can use this formula:

Customer Value = Average Purchase Cost * Average Purchase Frequency

Based on LTV, you can make informed decisions about your marketing and advertising efforts.

For example, if you have a high LTV, you may want to pay a higher cost per lead to feel comfortable. If your LTV is low by comparison, you can shift your marketing and advertising efforts to lower your cost per lead.

With these marketing KPIs you can start to get the most out of your marketing strategies.

How can marketing KPIs be measured?

Once you've selected your key performance indicators, you need to develop a strategy to monitor and measure them. Effective measurement requires three steps:

Set specific goals for yourself

It's nice to know how your business is doing, but there has to be a reason to measure it. Do you want to increase sales? Get more customers? Are you reducing costs per lead?

Determine what your goals are, then set specific, measurable goals for your KPIs. Instead of just saying you want more web traffic, say you need 10,000 unique visitors in May.

Use analysis tools

There are many free and paid analytics tools for internet marketers. Before starting your marketing strategy, take the time to familiarize yourself with at least one of them.

If you don't know where to start, Google Analytics is a great tool. While you can upgrade to premium services later, the free version tells you everything you need to know if you're just getting started.

Track results

The final step is to benchmark your efforts against your chosen KPIs. You can measure as often as you like, but it probably depends on the size of your marketing team. If you're a business owner, you probably don't have the time to review every day. That's fine, but make a schedule so you don't get lost.

Be sure to note your results when viewing your KPIs. Whether you're using a spreadsheet, Word document, or other tool, this may be the most important part of developing your marketing strategy. Tracking your KPIs over time will help you see what's working and adjust your strategy accordingly.

Only you know what makes your business successful, so KPIs vary from company to company. The important thing is that you follow them and use them to your advantage.

KPIs