Marketing Metrics For Beginners: Understanding Key Performance Indicators – Disclosure: We sometimes use affiliate links, which means we may receive a commission if you purchase something through our links.
Before we get into the full list, let’s take a look at the two main types of marketing metrics.
Marketing Metrics For Beginners: Understanding Key Performance Indicators
There are many marketing metrics your company can track across dimensions, but they can be broadly divided into two categories:
The Key Marketing Metric Definitions And Reference Guide
Channel metrics are specific to the platform or site you’re targeting and can be broken down with varying degrees of detail. To give a general idea, here are some examples of general marketing channels with examples of specific channels:
If you ask 10 different marketers how they organize different marketing channels, you will get 10 different answers.
Consider PPC search traffic. It’s a certain sub-channel of website traffic, isn’t it? Or does it apply to social media and banner ads in the larger category of paid ads?
Both answers are correct. The way you think about your marketing channels is different for your business, and PPC search shouldn’t be the same.
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Performance indicators show the results achieved. Common types of performance indicators include the following, with a few examples of each:
Each of these metrics is important to understanding the success of your marketing efforts, but when used alone, it’s not an empty metric.
Just reading these stats I’m not sure whether to fire you or promote you. Because they want specific content.
You don’t track marketing metrics just to create busy, colorful whiteboards to impress your peers. You monitor them because you want to use that data to grow your business.
What Is A Key Performance Indicator (kpi)? Explanation And Examples
Marketers who invest in performance measurement and management create more value, achieving a 5% better return on marketing investment and a 7% higher growth rate.
Performance measurement is the main focus of this app, but if you can’t control performance, the measurement itself is pointless.
You have lunch with a colleague who works at a company that sells dog hats. It seems to be the latest fad and a small football hat business is booming.
A co-worker is responsible for designing and improving his company’s landing page. When you ask how things are going, he says, “Yeah, it’s 2.5% conversion on the landing page.”
Social Media Kpis You Should Be Tracking
Now you have a better understanding of how to do it, but it’s still not clear because you don’t have the other two pieces of content.
Businesses do not exist in silos. Your company probably has competitors, and those competitors are trying to beat you. That’s why it’s so important to benchmark your work against your competitors.
Unfortunately, it can be difficult to find out how your competitors are doing. Some metrics are readily available (Facebook page likes), others can be estimated using online tools and databases (organic search traffic), and disappointingly, many are secret (conversion rates).
But even if you don’t know how your competitors are doing, sometimes you can test them to get more content.
Key Metrics For Understanding Product Performance Annual Product Performance Report
In your partner’s example, you can predict your competitors’ conversion rate by understanding the correlation between existing page performance data, such as conversion rate and bounce rate.
His brilliant answer: “Our landing page is up 2.5% this year compared to last year. Our main competitor has a high bounce rate on their landing page, so I think their conversion rate is around 2.2%.
Benchmarking courses and reports to measure your performance. If your company sells a product or service in a certain geographic area, you can compare yourself to companies in the same industry in other areas.
Let’s improve your partner’s answer with the last topic: “Our landing page is converting 2.5% this year compared to last year. A big competitor has a high bounce rate on their landing page, so I think their conversion rate is around 2.2%. The conversion rate in the industry is 3.0%, so I still have work to do.”
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If you choose any sales metric from this list, you can easily search for S, M, A, and T. Let’s use a common marketing metric: social media tracking.
Do you want to increase likes on your Facebook page? How does this relate to your business marketing strategy? Why is a Facebook page important?
One of the most common pitfalls marketers fall into is focusing on descriptive metrics that aren’t tied to real business goals (the results you’re trying to achieve).
A 20% increase in Facebook likes over the next three months is great, but you still need to explain why it will help you grow your business by aligning it with a stated business goal.
The Basics About Key Performance Indicators
Let’s bring back your friend’s company that makes dog hats. One of their business goals is to increase sales by 50% in the next year. Their products are sold through their landing page and one of their tactics to increase traffic to that landing page is to reach out to their Facebook followers. By increasing the number of likes on their Facebook page, they can reach a larger audience that they can drive to that landing page to convert to ads.
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The specific marketing metrics you track will depend on your company’s product, business model, industry, and many other factors. Whether you’re a well-known brand with a few established metrics or a startup with a clean slate, you’ll find something useful in this list of 51 important marketing metrics.
The main goal of most businesses is to increase sales and profits. These are the top quality metrics you need to track your productivity.
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Incremental marketing measures the effectiveness of your marketing efforts by tracking the net change in sales volume over a period of time. You need to know two things:
You want to test the impact of changing the design of the holiday marketing email you send to your subscribers each year.
Last year you sent your email to 5,000 subscribers and generated 50 sales. This year your list is still at 5000. You send out your annual customized email, generate 75% of sales and get “more email subscribers”. The net change is 25 additional sales (75 – 50) made by the same 5,000 emails sent. Are you sure your design changes worked?
In addition to measuring the success of a specific campaign, you can use upsells to measure the success of all sales activities in general. Let’s use the same store from use case 1.
Types Of Key Performance Metrics To Track (with Examples)
Your business sold 1,000 units of products in the fourth quarter of last year. Your goal is to increase sales by 25% annually by implementing several strategies, including your customized holiday email and creating your first social media account. This 25% increase equates to 250 additional sales (1,000 x 25%) in the fourth quarter of the previous year, which is your base period.
We know that your customized holiday email generated 25 additional sales. You also notice that your social media efforts have resulted in 275 sales, all of which are up, since your base period (Q4 of last year) was zero.
By combining these two campaigns, you generated 300 additional sales (25 + 275), which is more than your goal of 250. Great job, Marketing Guru.
Just like additional advertising, you can measure additional income. This method is similar, but the profit margin is lower because it focuses on real dollars.
How To Use Kpis For Digital Marketing
Using the example above, let’s say your company sells its product for $100. Your holiday email proposal generated 50 additional sales at $100 per sale, generating $5,000 in additional revenue. You hired a designer for $1,000 to make your email look engaging, and that $1,000 investment resulted in $5,000 in additional revenue.
But what if you didn’t change the email design and instead raised the price from $100 to $125? You email those 5,000 people and generate 45 sales, which is $5,625 in total revenue and $625 in additional revenue last year, although -4 additional sales.
But “value” is an intentionally vague term because you can measure CLTV by gross profit or net profit after expenses (excluding sales). Adding costs gives you a better idea of the value and performance of the business, but it is very difficult.
Cost, then multiply the annual cost by the number of years you keep your average customer.
Digital Marketing Metrics Cheat Sheet
Potential customers drive your business. They can be found through any channel, and methods of measuring lead generation vary by channel. However, these are the most important metrics that lead to high-quality paid marketing efforts.
CTR tells you the rate at which users click on links, buttons or other elements on a page. It is measured as (number of clicks) / (number of impressions) and is a common metric used almost everywhere in marketing to measure different variables:
Although CTR is covered in many other places in this guide, it has its place in the Lead Generation section because you will use it to measure and grow your numbers.
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