What Marketing Metrics Matter (And What They Mean)
Since your business has limited time and resources, you must track the right marketing KPIs to ensure you allocate time and resources efficiently and maximize ROI.
Running a business is tough, and marketing teams have been using marketing metrics to determine targets, goals, and budgets based on performance and business goals.
Image Source: https://blog.marketo.com/2016/06/if-marketing-metrics-are-driving-you-crazy-read-this.html
Instead of guessing where to spend your marketing resources, you can use Marketing KPIs to tell a story about how your customers engage with online content.
Here are 12 marketing metrics that you need to know and how to apply them to your business!
1. Website Traffic
Website traffic is a basic (but essential) marketing KPI that you can look at to evaluate the overall health of your online marketing strategy. This metric is simply the number of people who visit your website in a given time period.
You can use tools like Google Analytics, Tag Manager, and Google Search Console to understand what people want from your website. Use that data to optimize your site, improve the customer journey, and guide your content strategy moving forward.
2. Conversion Rate
Conversion rate is a central metric for any marketing campaign because it tells you how practical your marketing activities are throughout the customer journey. You can use the conversion rate of a marketing campaign to understand how effective your targeting, message, and landing pages are performing.
The ultimate goal of any marketing strategy is to get the right message to the right people at the right time. Conversion rates help you measure how well your online content resonates with potential leads throughout the customer journey.
3. Cost Per Lead
Cost per lead tells you how much time and money it takes your team to acquire new leads. This metric is important when deciding how to allocate marketing budgets, and it can also help identify opportunities to optimize various marketing channels.
Typically, you will want to invest in marketing campaigns that have a low cost per lead, but this strategy will change based on your products, industry, and business goals.
4. Lifetime Customer Value (LTV)
Do you know how much different customers are worth to your business? Lifetime Customer Value (LTV) is a great way to identify new business opportunities, and if you properly allocate time and resources to the right customers.
You can determine LTV by estimating all sales on a per-customer basis, and you will want to use this number to identify your most valuable customers and guide your future business decisions.
5. Sales Growth
Sales growth is a metric that shows how effective your sales team is over a given period of time. This KPI is vital because it directly impacts the revenue and profitability of your business, so you should track this metric to help business strategy decisions.
You’ll need to take steps to cut costs if sales growth is on the decline, but if you have a high percentage of sales growth then you can take action to expand your market share.
Do you know how effective your content marketing strategy is, or which channels are most valuable to your business? Sales revenue is an important metric to track because it tells you how much money you are making from different marketing activities.
You will be able to put more time and effort into the types of marketing activities that are most valuable to your business. At the same time, Sales revenue can also help you identify opportunities for future marketing campaigns.
7. Customer Acquisition Cost (CAC)
Do you know how much it costs you to acquire new customers? Customer Acquisition Cost (CAC) can help you understand how effective your marketing budget is performing across all marketing activities.
You can use this metric to guide future marketing strategies based on your budget and business goals. It would help if you also used this KPI to find opportunities to improve your content and engage with more qualified leads throughout the sales process.
8. Website Lead To Marketing Qualified Lead Ratio (MQL)
Do you know the effectiveness of your website to generate leads? Website Lead To Marketing Qualified Lead Ratio (MQL) is a metric that helps you determine the quality of your website traffic.
If you are driving lots of traffic to your site but not generating leads, you will have a low MQL ratio. In this case, you should look at the type of content you produce because your website is not engaging with customers ready to engage with you.
9. MQL to SQL ratio
Image Source: https://www.leadfeeder.com/blog/sales-pipeline-metrics/
Marketing Qualified Leads (MQL), and Sales Qualified Leads (SQL) sound similar, but they have different meanings for your business. On the one hand, MQL represents potential customers who engage with your content, whereas SQL shows those customers who are qualified for a sales pitch.
Look at how many customers click on ebooks and other downloads compared to how many are closed by your sales team. If your MQL to SQL ratio is low, you likely need to adjust your content marketing strategy and how your sales team close leads.
10. SQL to Quote Ratio
This KPI tells the story about how effective your sales team is when they receive a qualified lead. The sales process is dynamic, and there are many reasons why people don’t convert.
You can use this metric to isolate the different variables that could block potential conversions through the sales process.
11. Quoted to Closed Customer Ratio
Quote to Close is a KPI that tells you what percentage of your customers purchase from you after initial contact within a given time period. Different industries have different baseline Quote to Close.
A higher ratio shows that your content is reaching the right people and your sales process is aligned with your customers’ needs.
12. Churn Rate
Churn rate is a KPI that shows the number of customers who end services with your company in a given timeframe. This metric is essential to help you understand if there are missing features in your products or service or improve how you engage with customer satisfaction.
Even with lots of leads and sales, your business can struggle with profitability if you have a high churn rate. You spend a lot of time and resources to attract and close the right leads, and those marketing dollars will go to waste if you cannot retain customers.
If you have a high church rate you should look at how to make your products or service more sticky and more valuable for your customers.
Tie KPIs To Your Business Goals
Marketing KPIs are just snapshots of your marketing activities, but you can combine different metrics with painting a bigger picture of your overall business operations.
Use metrics to understand the quality of your marketing strategy, learn what channels are performing the best, and review conversions throughout the customer journey to identify areas of improvement.
Marketing metrics are essential to get the right message in front of the right people while also blending the customer experience between your marketing and sales teams!