Thinking back to when my career in marketing first started, I recall a conversation with my Dad that was a bit unnerving at the time. I had always thought of myself as a creative writer and outgoing strategist, so imagine my surprise when he told me I would need to use math in a marketing career. MATH?! Seriously, I hate nothing more than math. Just ask Mrs. Daly at Northwood Middle School. As much as I hate to admit it, my Dad was right. Within a month of my new role as marketing specialist, I was asked to create a website report for the marketing director to share with other members of the management team. I had no idea where to start and immediately found myself asking, which marketing metrics matter most? What do they want to know? How can I provide the data they need in a way that makes sense?
Over ten years later and I’m still creating reports but I’m a lot better at it now – and the math is easier than it used to be! After creating that initial website metrics report, I discovered the importance of calculating return on investment as well as the ability to overcome unpredictability. I also found, over time, which metrics were most interesting to the c-suite and board of directors. So, here is a quick list of the metrics I’ve found to matter the most.
- Total website visits. I know, this is a no brainer but it’s so incredibly valuable! A website should be considered a storefront and it should be the primary target for customers and leads. Measuring the total number of visits gives a big picture idea of how well campaigns are running. This number should grow steadily over time. If there’s a dip in visits, it’s time to investigate individual marketing channels to determine what’s going on.
- New Sessions. This is a metric found in Google Analytics, which details the number of new site visitors vs. recurring. It can help marketers determine whether or not first time visitors are coming back for more information. With a Customer Lifecycle Marketing solution in place, marketers can see who those repeat visitors are and reach out with appropriate messages in an effort to build a relationship.
- Channel traffic. While total website visits is an awesome metric to compare month over month and year over year, it doesn’t provide the whole picture. That’s why it’s important to check out the Acquisition section of Google Analytics to determine how visitors are arriving to the site.
- The number of visitors who leave a website before exploring secondary pages, or the bounce rate, is a critical metric that provides potentially harsh feedback that is desperately needed by marketers. If bounces are high for a landing page it’s typically a good indication that the content or drivers to the page need some work. This number should be as low as possible.
- CPL or Cost Per Lead. This helps marketers determine which marketing channels are working most efficiently and effectively for the organization. To calculate, divide the average monthly cost of a campaign by the total number of leads generated from it during that month. For example, if a marketer spent $500 on a LinkedIn advertisement for one month and had 18 conversions during that same month, then the CPL would be roughly $28. Knowing the average CPL will help determine when campaigns are successful and when they fall short.
- Lead to close ratio. This metric measures sales success but is directly tied to marketing in order to discover the true return on investment for a campaign or tactic. Simply divide the number of sales by the number of leads to determine whether or not the close rate is high, moderate, or low and then take appropriate actions to realign the strategy for optimal results.
- Customer retention rate. This is a metric we take especially to heart at Right On Interactive. For some organization, this is often a difficult metric to measure because of long sales cycles – which is another reason to use a Customer Lifecycle Marketing platform (but I’ll save that pitch for another day). Essentially, this metric is determined by calculating the percentage of customers who buy from a business again or renew a contract.
- Customer lifetime value. If you’ve ever spent any time at all with ROI CEO Troy Burk, you know the importance of understanding customer value. This isn’t an “easy get out the calculator and you’re done with it” metric. To discover this, marketers must take into account all of the sales the average customer makes over the course of their lifecycle (i.e., number of transactions per year, average contract length and renewal rate, etc.).
Monthly reports that include these eight metrics can help provide management as well as other departments within an organization a snapshot of how marketing is performing vs. last month, last year, etc… These metrics also provide critical insights for marketers to consider when stopping or starting campaigns.
What other key marketing metrics would you add to this list?