Unlike traditional media, digital media makes it easier for aspiring marketers to drive on lead generation and lead conversion activities through direct interaction with consumers. Aspiring marketers can further customize marketing strategies and curtail marketing expenditure by interacting with customers through a wide range of digital marketing channels – websites, mobile apps, organic search, paid search, social media, emails, and online display ads.
But no aspiring marketer can generate qualified leads and drive conversion rate simply by launching multiple digital marketing campaigns. In addition to interacting with consumers through multiple channels, aspiring marketers must measure and track the performance of every digital marketing campaign based on quantifiable goals set in advance. Also, they must use the appropriate digital marketing KPIs or metrics to measure the performance of marketing campaigns accurately.
According to Amazon Advertising,
“Marketing metrics are a quantifiable way to track performance and are an important marketing measurement tool for gauging a campaign’s effectiveness. The most appropriate marketing metrics vary greatly from one campaign to the next, but in general, they measure the effects of your campaign on audience actions. The right marketing metrics to measure will be the ones that ultimately have the most impact on your business goals, which may be sales generated for one campaign but incremental reach for another.”
In addition to measuring the success or performance of campaigns, marketing key performance indicators (KPIs) or metrics help aspiring marketers to optimize the ongoing digital marketing campaigns by taking the required action. Also, they make it easier for digital marketers to make informed decisions while implementing digital marketing strategies in the future. But both experience and aspiring marketers must choose and combine the appropriate digital marketing KPIs according to the type and nature of the digital marketing campaign.
The aspiring marketers must use monthly website traffic as a fundamental digital marketing KPI. As its name suggests, this metric depicts the number of people who visited the website over a particular month. The marketers can identify a surge or decline in monthly website traffic by comparing the metric with traffic volume for previous months. The widely used web analytics services enable marketers to divide website visitors into multiple categories using parameters like pages, landing pages, blogs, and product categories.
Inbound marketing campaigns divert traffic to a website through various channels or from various sources. The aspiring marketers must compare various channels or sources based on website visitors. For instance, they can use visits per channel to compare the number of website visitors across popular marketing channels like organic search, paid search, social media, and referrals. Also, they can increase monthly website traffic by targeting the channels or sources that do not meet preset goals.
A visitor spends more time on a website only when the pages keep her engaged. Marketers can convey the desired marketing message to visitors only by identifying the pages that keep them engaged and finetuning the pages that do not meet visitors’ expectations. Aspiring marketers can use average time on a page as an important KPI to measure the effectiveness of individual web pages in keeping visitors engaged. They can use web analytics services to compare the different categories of web pages – home page, landing pages, blog pages, and product categories.
A business can increase revenue and profits only by generating and converting more leads. But marketers convert the leads generated over a period into two broad categories – marketing qualified leads (MQL) and sales qualified leads (SQL). The sales team can close transactions by initiating direct sales follow-up with SQL. But marketers must nurture the MQL by sending targeted and personalized convert to create sales opportunities. That is why; marketers consider both MQL and SQL to measure lead to close ratio accurately.
Most enterprises these days run multiple digital marketing campaigns to generate more leads. They can predict and digital marketing expenditure accurately only by knowing the money spent to generate or acquire a new lead. Aspiring marketers must consider the number of leads generated over a specific period while calculating this digital marketing metric. Also, they must consider the lead nurturing and conversion process to justify the cost per lead.
A business cannot increase revenue and drive growth simply by generating more leads. The marketers can achieve preset goals only when most of the leads become customers. They use this digital marketing KPI to know what percentage of leads become paying customers. The simple metric is calculated by dividing the number of leads converted into customers by the total number of leads. However, many marketers consider the revenue contributed by converted leads to make informed decisions.
Businesses these days run digital marketing campaigns to drive both lead generation and lead conversion activities. The KPI helps marketers to measure the average cost incurred to convert a lead into a customer. The marketers can use a customer relationship management (CRM) system to know the amount of lead generated during a specific period. Also, they should consider the conversion rate for a specific period.
The primary goal of every digital marketing campaign is to increase sales revenue consistently. Most enterprises these days measure the performance and success of various digital marketing campaigns based on the sales growth or increase in sales revenue. Many entrepreneurs these days share sales figures with digital marketers honestly to make them assess the contribution of individual campaigns towards sales growth. While calculating this crucial metric, digital marketers can compare the performance of various campaigns based on sales revenue.
Most digital marketing campaigns these days divert leads and customers to landing pages. Hence, the look, feel, and structure of the landing page impacts conversion rate directly. This digital marketing KPI helps aspiring marketers to assess the performance or effectiveness of landing pages based on the percentage of visitors becoming customers after visiting the landing page. If the landing page conversion rate is low, the marketers must revamp the page design and make the call-to-action (CTA) more impactful.
This important digital marketing KPI helps marketers to determine the worth of a customer based base the sales initiated by her throughout the relationship with a business. A digital marketer can measure the lifetime value of a customer only by considering the total revenue as well as gross margin.
Total revenue refers to the combined prices of products or services sold during a particular financial year. On the other hand, gross margin refers to the percentage of sales revenue the business earns as gross profit. Customer lifetime value is calculated by multiplying total revenue, gross margin, and the number of repeat purchases.
Businesses can drive sales without increasing customer acquisition cost only by retaining existing customers. Also, businesses have to spend more on lead conversion than customer retention. That is why; marketers need to use customer retention or reverse customer churn as a metric to know if customers are returning and placing orders repeatedly. This digital marketing KPI helps marketers to assess both customer experience and customer service. They have to implement strategies to increase customer retention rates by improving customer experience and service simultaneously.
Digital marketers can run campaigns successfully only when the targeted audience responds to the information shared or messages sent through various digital marketing channels. They use customer response rate as a key metric to what percentage of customers respond to the communication efforts. Digital marketers calculate customer response rate as a percentage of the number of customers responding to communication efforts to the number of customers who are contacted.
Digital marketing campaigns divert visitors to a website regularly. But a business cannot generate more leads or increase conversion rate if the visitors leave the website without taking the desired actions -place an order, click on a link, access other web pages, or fill in forms. Bounce rate helps digital marketers to know if the web page or landing page is effective in keeping visitors engaged and persuading them to take the desired action. Marketers calculate this KPI as a percentage of the visitors who access only a single page to the total number of website visitors.
Most organizations these days run search engine optimization (SEO) campaigns to divert traffic to their website organically from search engines. Popular web analytics services make it easier for aspiring marketers to track and measure organic search traffic to a website. Hence, marketers can easily assess the performance of SEO campaigns based on an increase or decrease in the number of website visitors from organic search.
Web analytics services help marketers to measure the amount of traffic a website gets from popular social networking platforms. The marketers can further know the number of unique visitors from individual social networks. But they can assess the performance of social media marketing campaigns only by tracking the growth of followers, and the number of likes, shares, and comments. Also, they must assess the performance of individual social media marketing campaigns based on social media conversions.
This important digital marketing KPI helps marketers to measure the performance of email marketing campaigns. The metric indicates the percentage of recipients who respond to the marketing and promotional emails sent by a business by clicking on any link included in the emails. Marketers can easily calculate this metric by dividing the number of clicks generated by the total number of emails sent after individual campaigns. They have to focus on sending targeted and personalized emails to achieve a higher click-through rate.
Unlike organic digital marketing campaigns, pay-per-click (PPC) campaigns require a business to pay publishers only when an advertisement link is clicked on. That is why; marketers use click-through rate as the primary KPI to measure the performance of paid advertising campaigns. A higher click-through rate helps them to increase website traffic and reduce customer acquisition cost simultaneously. But aspiring metrics must use the quality score as a crucial metric to relevance and appeal of the paid ads based on quality scores.
Customers access cloud-based software and services based on various subscription models. Hence, marketers have to track the percentage of customers who discontinue their subscriptions over a specific period. Marketers measure the percentage of customers who have discontinued subscriptions using customer churn rate as a KPI. But they measure the impact of customer churn on the monthly recurring revenue accurately using a different metric – revenue churn rate.
Businesses have to incur upfront and recurring expenditures to generate, nurture, and convert leads. They calculate the overall customer acquisition cost based on the total amount spent to convince customers to buy products or services by adding marketing campaign cost, marketing software cost, and marketing team salary. Marketers calculate time to pay back customer acquisition cost as a key digital marketing metric to estimate the time required to earn back the marketing cost incurred to acquire a customer.
A large percentage of customers these days share positive brand experiences with their friends on social networking platforms. Hence, digital marketers measure a customer’s brand experience by checking if she will refer or promote the product or brand to others. This KPI helps digital marketers to check the percentage of customers who will refer the brand to others. The marketers have to divide the customers into three categories based on how likely they will recommend the brand – promoters (9-10), passives (7-8), and distractors (0-6).
The aspiring business can measure, analyze, and track the performance of a digital marketing campaign accurately using the right metrics or KPIs. But they must not measure the performance of multiple marketing campaigns using the same set of digital marketing KPIs. They can make informed decisions only by picking and combining the right digital marketing KPIs for individual marketing campaigns.