When it comes to performance marketing, there’s a lot to keep track of. By monitoring these KPI’s, you can keep a pulse on how your campaigns are performing, and where there is room to improve.
Website Traffic
A basic measure to track your brand visibility is by monitoring the website traffic you receive, and learning more about who is visiting your site. This includes how they got there, their demographics, and what they did on your site. By using this information, you can help determine what they are looking for, and what you can do to better market to their needs.
Website traffic is a generic term, and encompasses a variety of other metrics and are highly measurable and heavily related to engagement. Such as:
-
Users
-
Page views
-
Page per Session
-
Average Session Duration
-
Bounce Rate
-
Traffic Sources
These metrics can be easily tracked using free tools such as Google Analytics. The easiest way to increase your traffic is to increase the advertising budget, but the opportunities for free and more efficient tactics are endless. Press coverage, blog posts, SEO strategy, a strong social media presence, and community engagement can all help improve your brand awareness and drive consumers to your website.
Read more: Optimize Your SMB Website for Better Traffic
Organic Traffic
The goal of any business using inbound marketing is to have most of their traffic come from organic search. This means that people are searching for your website on their own, rather than being directed from an ad or link. Higher organic traffic means less cost of attracting visitors to your site.
Organic traffic is directly related to the success of your SEO strategy. It makes sense that the higher you are ranked on a search engine, the more visibility you will receive when people are searching for your business. Make sure to optimize your ranking through the use of keywords on your website, posted content, and other SEO strategies.
Read more: SEO Essentials Guide
CTR
When it comes to reviewing your performance, views are just the beginning of tracking success. Click-through-rates (CTR) can help you determine if your call-to-action is engaging enough to warrant consumers to click. This metric can be used for ads, emails, landing pages, and even social media posts. If your CTR is low, it might be time to play around with different images, styles, headlines, and calls-to-action. While trusting your gut on how to create an ad may be a faster method, A/B testing different variations can help you determine what to feature in order to get a higher CTR.
Email Marketing Performance
Emails are a direct link to your consumers inbox, and have the potential to to greatly increase sales for your business. This only increasingly highlights the importance of monitoring your email performance.
When it comes to emails, there are numerous ways to track performance. Important factors to take into consideration are:
-
Delivery Rate
-
Open Rate
-
Click Through Rate
-
Conversion Rate (Sales, Downloads, etc.)
-
Unsubscribe Rate
By using these metrics in conjunction, you can determine what types of emails work best for your consumer base. The first step in a good email is the subject line, so make sure to test what works often to increase your open rates.
Read more: 5 Reasons Email Marketing Is NOT Dead
Cost Per Lead
Another important KPI is the cost to acquire a lead. This measures how cost-effective your marketing campaigns are when it comes to generating new leads. This metric provides a tangible dollar value for your marketing team to use so they can determine how much money is appropriate to spend on campaigns to acquire new leads. This usually comes into play when you’re paying for traffic and means you’ll need to know the exact cost to acquire each lead or risk losing a ton of money advertising.
You can discover how much each new lead costs by dividing the total marketing costs by the total amount of new lead during a specific time period.
Lead-to-Client Conversion Rate
You may be generating a lot of leads, but that doesn’t necessarily mean they will all turn into paying customers. To calculate the Lead-to-Conversion KPI, divide the number of monthly new leads with the number of monthly new customers.
The Lead-to-Conversion business metric reflects on your sales team’s performance. However, it can also mean that you may not be targeting the correct people or giving enough information about the value of your product. If a lead fails to convert, it might show that they are unimpressed with what you’re offering.
LTV
For businesses, customer sales are often not a one-time action. With brand loyalty and incentives, repeat customers can help save your business the cost of acquiring new customers. Sometimes it can be worth it to spend more on acquiring a customer than their initial spend, if you know that they are likely to purchase again. This is where the lifetime value (LTV) comes in handy.
The lifetime value (LTV) is a prediction of the net profit attributed to the entire future relationship with a customer. LTV = Contribution margin per customer action x frequency of actions x average lifespan of a customer (the duration of time that they stay a customer).
In order to be sustainable, you’ll want to make sure that LTV > Cost per Acquisition of a new customer. If this relationship does not hold, you’re paying more to get a customer than what they are worth to your business.
ROI
Return on investment is considered one of the most important measurement metrics in determining the success of a company’s marketing campaign. It overarchingly shows much much you are getting in return for how much money and effect you are putting out. Using this return, businesses can get an idea of how effective they are at structuring paid advertising campaigns, and find the best ways to get the most bang for their buck.
Paying a small amount of money for advertisements or keywords, and having them generate a lot of conversions or website traffic, means that they have a high return on investment. On the contrary, if you are paying high prices and seeing little for your efforts, the ROI is low. Though cost of campaigns is a huge factor for business success, high costs can also mean high returns. Return on investment can be an important measurement of success in order to determine if you should continue to move forward with a paid advertising campaign, or switch to alternative methods.
Ready, Set, Track!
While this may seem like a lot to track and monitor, using tools like Google Analytics and simple spreadsheets can help you determine the efficiency of your campaigns over time. This way you can see what works best for your business, and what can be improved. Once you nailed down these KPIs, go down to a more granular level to get a good look into your performance. By tracking key campaign metrics and conversions, you can optimize your campaigns for success. You can learn a lot from these small details over time.