If you own or operate a business you know that effective marketing is the number one way to grow. But how do you know if the marketing campaign you ran was successful? You won't be able to determine how successful your marketing campaigns are unless you know how to measure them. This is where key performance indicators (KPIs) come in, and there are many types to help you measure results based on your marketing goals. Depending on the campaigns you have in place and the ideals driving them, you will want to choose the appropriate KPIs to track your progress.
Key performance indicators let you know how well or poorly your campaigns are performing, which can help you determine what's not working and address those issues. You will need to have at least one KPI when developing your campaigns, but it often helps to track multiple KPIs to give you clear insight.
When measuring marketing ROI, the following are some top KPIs to track during your campaigns to ensure they are worth producing results.
1. Return on Ad Spend (ROAS)
Return on ad spend (ROAS) is a metric used to measure the amount of money you've made per dollar spent on advertising your business. It's essentially the same as return on investment (ROI). However, ROAS applies explicitly to the ROI from ad spend. You can calculate the return on ad spend by taking the conversion value and dividing it by your ads’ cost, which will give you insight into how successful your ad was.
By tracking ROAS, you can gauge the effectiveness of your advertising. Low ROAS could indicate that you need to change certain aspects of your ads. Consider it's relevance, updating the messaging, or other creative to increase clicks and conversions.
2. Sales Qualified Leads (SQLs)
Sales qualified leads (SQLs) are prospects who have been deemed as qualifying for closing a sale, meaning that they are an ideal client who would benefit from your business. While marketing qualified leads (MQLs) are newer leads ready to be marketed to, SQLs are closer to the end of the sales funnel and ready to make a purchase. At this point, sales teams would contact SQLs to close a deal and officially convert them into customers. Tracking SQLs can indicate how effectively your marketing efforts lead people to the end of the buyer's journey.
3. Website Visitors
You should also be tracking visitors to determine how people are engaging with your website. It's essential to keep track of unique visitors since they indicate who's viewing your website for the first time and where they come from. You can also track those who are returning, including people who are researching your business and offerings, along with others looking at contact forms or other pages to indicate that they're ready to make a purchase.
4. Organic Traffic
The amount of organic traffic your website is receiving will indicate the performance of your SEO campaigns. Organic traffic is the amount of views you get from people utilizing a search engine, and then eventually landing on your website. If your organic traffic is high, this indicates high rankings for keywords along with well-optimized title tags and meta descriptions that appear in search results. Non-organic traffic will come from your paid ads, meaning that your website is placed in front of consumers directly.
Low organic traffic or a decrease from high traffic could indicate low rankings or low-quality metadata. In some cases, low traffic could also indicate that the ranking page is irrelevant to what people enter in search engines.
5. Social Media Followers
It's essential to keep track of social media followers so you can measure the success of your campaigns along with brand awareness efforts. On platforms like Facebook, Twitter, and Instagram, you can measure how many people you may have gained or lost. You can also compare the number of followers you have to those of competitors to see where you stand.
6. Social Media Engagement
In addition to social media followers, you need to track how those followers and other social media users interact with your business. Some social media engagement metrics to look at include shares, likes, comments, and follows. All of these metrics can help measure the popularity of individual posts to see which performs the best. Based on the content that attracts the most engagement, you can create posts using similar elements to help drive sales.
7. Customer Lifetime Value
Customer lifetime value (CLV), tracks the total amount of money that a person spends from when they initially become customers to the time they end their relationship with your business. You can calculate the CLV by multiplying the average order total by the average number of annual purchases, then multiplying by average retention time in total years. You can then use this data to improve retention and promotions to keep consumers coming back to you.
8. Client Retention
The client retention rate indicates the number of clients or customers who do business with you over a particular time. You can calculate your client retention rate by taking the number of customers at the end of a given time, subtracting the number of new customers you've added within that time, and dividing the total by the number of customers at the beginning of the campaign. Take that final number and multiply it by 100 so that the number is a percentage, which will give you your client retention rate.
9. Event Attendance
Having people sign up for an event isn't enough. Suppose a financial advisor is hosting a webinar with a topic of giving tips for what to do with your tax return. Your event might attract many signups for an event, but the number of attendees could be low. In that case, this could indicate that you need to market your future financial webinars better or provide incentives to ensure people actually show up. If you can highlight the value that your events will bring, this could go a long way in increasing attendance.
10. Conversion Rates
If you want people to complete a specific goal or perform a desired action, conversion rates will be the metric to watch. Depending on the platform and your campaigns, conversion rates could account for the number of people who perform a certain action throughout the buyer's journey or convert to customers when making a purchase. Whether you want people to download an ebook or brochure, sign up for a newsletter, complete a contact form, or buy your products or services, conversion rates will be based on the goals you have in place and the platforms you use. Low conversion rates could indicate ineffective calls-to-action, messaging, or other issues that keep people from performing a certain act.
Work with a Media Partner to Help Identify and Track Important KPIs
The key to measuring marketing ROI is to know which KPIs to track based on your objectives and campaigns. If you want to determine which KPIs to analyze and use that data to optimize your campaigns' performance and adjust your marketing budget, consider working with a media partner. An experienced partner will help you figure out which KPIs to look at and use them to assist with future planning.
