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When we talk about marketing in the digital age, we no longer mean the vague sense of wellbeing and light branding that we used to think of as effective marketing. The digital age has made it necessary to use highly scientific methods based on very sharp insights from measuring specific marketing metrics in order to track and predict business trends and patterns.

Marketing campaign metrics, also known as KPIs (key performance indicators), are critical to monitoring and planning marketing initiatives and how we can optimize them for the best results. They form a solid knowledge base that B2B business owners marketers can use to formulate and execute all of their business decisions.

Current technology makes it possible to automate many of these marketing functions. Even so, it is helpful to understand the different types of digital marketing metrics and how they might be relevant to your business, which we will be covering in this article.

1. Return on Marketing Investment (ROI)

This is one of the most important marketing metrics today, and it relates to calculating how much value your marketing efforts are generating. You can find your ROI by subtracting your marketing budget (social media, email, digital, print marketing, etc.) from your increased sales or profit growth. Determining this metric is important in helping executives decide how much to spend on ongoing or potential future marketing campaigns.

A campaign with a negative ROI must be redesigned or completely discontinued, while campaigns with a positive ROI should be extended or even expanded.

Any campaign with an ROI of at least 5: 1 is considered particularly powerful for most industries. Marketing departments will find this a powerful tool to justify their expenses and compare their activities to competing companies or brands.

2. Customer Lifetime Value (CLV)

The digital marketing and e-commerce landscape offers tight profit margins in these competitive times, which is why companies need to find ways to maximize their market share and revenue streams.

One of the key indicators for the effectiveness of marketing is the key indicator Customer Lifestyle Value. This is to determine what value the purchases represent for the company over the entire service life as a customer.

For example, if a customer makes total purchases of $ 5,000 throughout their relationship with you, and you’ve spent about $ 1,000 in advertising and service costs, the customer’s CLV is $ 4,000.

The idea or usefulness of this marketing measurement is that it can give you some insight into which customers to focus on as you are trying to maximize value, drive growth, and maximize profit. Instead of finding new customers in difficult-to-penetrate markets, it makes more sense to build your existing customer base.

3. Customer Acquisition Costs (CAC)

Here a company tries to estimate what it will cost to win a new customer or customer for its goods or services. This KPI marketing metric is determined by calculating the total cost of your advertising, sales, and marketing department costs and all related costs divided by the number of new customers you have won.

It is a valuable measure for a business because the low cost of generating leads and subscribers means that it will cost you little to attract new customers and thus generate more significant revenues and profits.

This metric has emerged in recent years with the advent of the Internet age, which makes it more efficient to track consumer behavior, which enables businesses to find the tools to help them determine where to invest their money.

4. Click rate (CTR)

This is one of the most valuable metrics for determining the effectiveness of an advertising campaign in the digital landscape. They measure click through rate by taking into account the number of people who clicked a link in your email or website after seeing it on their screen. For example, if 100 people see your ad but only ten people click on it, your click-through rate is 10% (Ad Clicks / Ad Impressions * 100).

When you have a high click-through rate, your advertising or marketing strategy can be considered a success because a good chunk of the people exposed to your advertising will be interested enough to click on it and potentially become customers.

By analyzing this metric, you will determine which ads need to be changed and which are effective in attracting leads and prospects. While this is a general phrase, it still gives a positive picture of your target market’s behavior and is high on the list of examples of marketing metrics.

5. Funnel Conversion Rate

Any helpful list of marketing metrics includes the Funnel conversion Rate. Before a potential lead is converted into a customer, it goes through certain phases. These stages can be thought of as a funnel, and that’s because the number of people in each stage is much larger initially than they will be when they eventually become your customers.

You can calculate your conversion rate by taking total sales / number of leads * 100. If you had 100 clicks, inquiries / leads, but only bought 30 people, your conversion rate will end up being 30%. In the ecommerce world, this is a very healthy conversion rate, with most companies reporting conversion rates of 2-3%.

This may seem like an enormous waste, but the world of digital marketing is adapting to this reality by maximizing the spread of its advertising reach at the lowest possible cost, so that even such conversion rates result in significant customer numbers. For example, even at a 2% conversion rate, a company with 10 million leads in a month has 200,000 customers, which could be more than enough to generate healthy profits.

6. Cost per Action (CPA)

This refers to an affiliate marketing model where the payment is triggered when a targeted user takes a certain action. Such promotions vary widely and can include a purchase, a click, a subscription, signing up for a trial, completing a survey, downloading, and more.

This model is often referred to as Pay-Per-Action (PPA) or performance-based advertising because an advertiser does not have to pay until their desired action is complete. In most cases, such models require significant conversion rates to be financially viable.

For this reason, most small and medium-sized businesses use cost-per-click (CPC) or cost-per-impression (CPM) models, where low conversions don’t hurt profitability too much. This metric directly monitors how much a company is investing in taking any particular action that it wants. It is usually reported at monthly intervals.

7. Bounce rate

In the simplest terms that Google itself uses, website bounce rate refers to the percentage of single page or single interaction sessions your website experiences. This is where visitors land on a page but leave without clicking anything or interacting with it in any way. It is for this reason that it is known as a “bounce”.

Email marketing metrics include bounce rates, which relate to the percentage of emails on a marketing campaign list that the intended recipient doesn’t see because their server has rejected them.

Although email campaigns can be considered a high ROI advertising method because of their low cost, high bounce rates can still render them completely ineffective. Analyzing the bounce rates of your website or email landing pages gives you a good idea of ​​how engaging those pages are and gives you an idea of ​​where you might need to improve.

Fixing high bounce rate issues for optimal performance in marketing takes a lot of analysis and attention to determine what is putting people off. You need to consider your presentation, pricing, site structure, email copy quality, website design, etc. when looking for practical solutions to the matter.

This is a very widely used marketing metric to refer to what customers think of your product or service and whether they would be willing to recommend it to their family, colleagues and friends. Most of the time, looking for this information will use a single question survey that is offered to customers.

The survey asks customers to choose a number between -100 and 100, with negative numbers indicating negative attitudes towards the company, while positive numbers indicate positive opinion.

A 100 answer shows that the customer has the best possible view of the company and vice versa. A Net Promoter Score is now determined from the average of these individual survey responses in order to obtain a reliable picture of how customers see the company in general and how willing it is to recommend its services and products to others.

This marketing measurement comes in handy as it can alert companies when their customers are no longer happy with changes made before they lose their customers entirely.

Final thoughts

There are many important marketing metrics that can be used to analyze and monitor business initiatives and marketing performance. With the advances in data collection technologies and statistical methods, their numbers are constantly increasing.

To stay ahead of the curve, you need to have a deep understanding of marketing metrics and stay abreast of what’s happening in the field. This is especially true if your work is in any way related to, or relies on, digital marketing.

By keeping an eye on your marketing metrics on social networks, consumption, sales and lead generation, you can keep your company’s health on the cutting edge.

The post was originally published here.