If you’re wondering what key performance indicators (KPIs) and performance reporting have to do with digital marketing success, you’re not alone. The truth is, most business owners and sales reps keep busy with running their companies and don’t have the time to figure them out. And in essence, that makes perfect “cent$!”
However, in this particular case, what you don’t know about using key performance indicators and understanding analytics CAN hurt.
Although it’s normal for us to fail at business from time to time, success only comes if we keep getting back up! And unlike John Wanamaker’s experience of wasting money on business advertising 100 years ago1, no 21st-century business has to waste resources or time! Instead, we can learn from every mistake and make the necessary adjustments to ensure progression.
Thankfully, these days we have modern digital marketing with its various metric tools, like key performance indicators. KPIs serve as benchmarks to help us measure campaign success in multiple ways. However, the most essential thing any marketing VP, CEO, or business owner should know is KPIs mean nothing if their marketing efforts and strategies aren’t producing quality leads.
Before moving on, view Jason’s clip on “Marketing Performance Reporting!”
In this article you’ll gain insights on the following:
To put first things first, let’s understand the best ways to measure our digital marketing success – using KPIs.
Since every business is different, the metrics and measurement tools we put in place shouldn’t be the same for each company, not even those in the same industry. Also, to fully benefit from your marketing investment dollars, it is vital that you first understand what KPIs are and how they work.
We like to think of key performance indicators as “benchmarks” that provide us with highly useful insights on how we’re progressing. And though they show typical metric values, they also indicate how our business is performing compared to the goals we set and industry averages.
For instance, before your company sets its benchmarks for an email marketing campaign, you’ll need to know the average industry click-through rate, so you’ll have something to compare with your actual open rate. In other words, KPI numbers tell the story of our progress and whether we’re passing or failing in our campaign efforts.
Top Three Characteristics of Key Performance Indicators
- Offer comparative and comprehensive digital insights to help guide future actions.
- Can incorporate objectives and company goals
- Allow you to evaluate and adjust settings with SMARTER methodology over time – (SMARTER goals are goals that are: Specific, Measurable, Attainable, Realistic, Timely, Evaluated, and Reviewed)
Our Seven Key KPI Benchmark Measurements
There are many key performance indicators companies use to measure and determine the marketing success of various campaigns. But BUILDINGBLOCKS focuses on KPI measurements that are associated with digital marketing lead generation.
Our choice indicators help tell a story to our clients who choose our services, like email marketing automation and digital ads.
- Conversion Rates (CR) – the measured percentage of leads that actually converted/completed a CTA
- Cost Per Lead (CPL) – the established pre-paid price or cost for each generated lead
- Click-Through Rates (CTR) – simple formula of # of clicks/impressions; it’s the quantity of clicks an ad receives divided by the times that ad is shown
- Cost Per Click (CPC) – a pre-established price for the number of times an online display is clicked
- Cost per Action (CPA) – the cost associated with the action taken by a potential customer
- Customer Acquisition Costs (CAC) – the cost of a campaign’s capacity to attract new leads and potential customers based on sum total sales
- Return on Marketing Investment (ROMI) – your regular ROI is based on your ad spend, but marketing ROI is based on the overall effectiveness of a marketing campaign
With lead generation and performance reporting, we aim to educate and empower businesses through their digital marketing ventures.
We’re about ensuring that your company investment puts the correct KPIs in place to measure progress for success. In the world of online marketing, there are two main categories of data that business marketers must track. The first tracking category is analytics, and the second is the number of leads generated within a specific time period.
Analytics is extremely vital as it helps us develop performance reporting and indicate if your campaigns are delivering the results you expect. Through analytics, you can determine:
- Whether or not you’re on the right track with your campaigns
- If you’re using the proper marketing tactics
But even more important than analytics are the leads that your campaigns generate. Hence, the beauty of incorporating the proper performance indicators is that they help you understand if what you’re using is actually generating revenue returns. So, our primary purpose for key performance reporting is to confirm whether or not your online advertising is generating leads that fit the persona of your ideal customer.
So, why are KPIs so vital to digital marketing success?
When we look back 100 years and consider marketing in the 1920s, lead generation was very different. We immediately think of radio advertising, word of mouth, door-to-door salespeople, and print media. Print media included store signs2, newspaper ads, posters, and those good-old-fashioned flyers that you’d see people passing out to strangers on the streets. And like Mr. Wanamaker, measuring marketing success and lead generation was very difficult to determine. Why? Well, because back then, outbound marketing was the order of the day.
However, modern digital marketing can always determine where our investment dollars are going if we use KPIs. In truth, you really won’t know how well your campaigns are performing unless you check the numbers. And since the numbers and values you receive from using the correct performance indicators don’t lie, correct calculations mean accurate analytical results.
We recommend that you start with Google Analytics to initiate the gathering and processing of your marketing data. Use it as a template to create your own customized report. And once you’ve gathered enough pertinent data, you can begin checking actual campaign results compared to industry benchmarks.
Fortunately, with KPIs, you can make necessary adjustments to your settings and focus on the tools that bring in the most qualified leads. Hence, that’s how you confirm where your investment dollars and going and which tools are working to yield an ROI.
There’s one sure-fire way to stop wasting your “Inve$tment Dollar$” — consider seeking help from a trusted marketing partner!
Look, we’ve been in advertising and marketing for over 18 years. And in all those years, our top mission is to help businesses protect their bottom line. Unfortunately, over the years, we’ve seen agencies place significant emphasis on campaign performances from the perspective of analytics. Meaning they focused on getting more traffic to their websites, putting more clicks on ads, and offering more form fills. Well, none of those tactics mean anything if your business isn’t growing from your online marketing efforts.
When visitors experience your brand online via company website, landing page, email, or ad, you must engage them to act upon arrival. Connecting with and engaging them dramatically increases the chances of conversion.
Remember, KPIs provide data in helping you understand which marketing channels are generating revenues and which ones are not. And if the leads you generate through your marketing campaign efforts are not converting, allow us to assist you.
At BUILDINGBLOCKS, we define performance monitoring by meeting with you on a bi-weekly basis to:
- Provide you with a list of names, emails, and/or phone numbers of the leads we’ve generated through our advertising efforts
- Determine which of those leads converted into customers –
- Whether they were ideal prospects,
- or didn’t fit your ideal customer profile
- Then, calculate the revenues those new customers represent for your business
This discipline of ongoing performance monitoring is critical to optimizing the conversion rates of your ideal customers. Furthermore, it’s a core foundation for our success in managing your campaigns.
- Image: Wiki Commons – Retrieved February 18, 2022. https://upload.wikimedia.org/wikipedia/commons/thumb/2/28/CanalStreetNOLA1920s.jpg/640px-CanalStreetNOLA1920s.jpg
- Image: Wiki Commons – Retrieved February 21, 2022. https://commons.wikimedia.org/wiki/File:Greenwood_Avenue_south_of_Easton_Street,_Tulsa,_OK.jpg