In today’s digital marketing age, metrics play a key role in the success of an online business. These metrics are not only a measure of the success of a website, but when combined with other analytical information, they allow marketers to refine their strategies for improved results as well. In a rapidly changing online business arena, the need for measuring marketing success is as important as having a foolproof marketing plan. In this article, we take a look at some of the most important metrics that you need to keep an eye out for in this data-driven era.
The importance of Metrics in Digital Marketing
Before we proceed forward, let us understand the importance of measuring metrics for marketing in this data-driven age. Nowadays, users are highly dependent on handheld gadgets, such as smartphones for staying connected. This means that there is a vast amount of data available pertaining to how users interact with your website. Marketing today is driven solely by data-backed research that is based on the information that is captured at each stage of the customer’s buying process.
With so much data available, marketing needs to be data-driven in order to be effective. But what exactly does it mean to be “data-driven”? Well, it is quite simple. You need to know the goals, behavior, challenges, pain points, and requirements of your target audience so that you can develop a marketing campaign that caters to the specific needs of these users. Monitoring metrics such as online purchase behavior, browsing patterns, and social media activity allow you to understand your customers in an entirely different way — through statistics and numbers. This eventually allows you to focus your marketing efforts and investment into what works for your company.
10 metrics that you need to look out for:
Click Through Rate
A viable source of directing targeted traffic to your website is through Pay-Per-Click (abbreviated as PPC) campaigns. The Click-Through-Rate (CTR) can be measured by simply working out how many clicks an ad receives compared to the total number of views that it receives. The CTR measures how many of the people that view your PPC ad actually click on it! The higher the click through rate of your website, the better the quality score of your website will be, which will eventually allow you to reduce the PPC costs for your business and hence, increase profits.
Cost Per Click
This is another metric that is related to PPC campaigns. This describes how much will you have to pay a search engine (or marketing platform) each time a visitor clicks on one of your ads. This metric is mainly based on the keywords that you use in the PPC ad. For a successful PPC campaign, your aim should be to lower the Cost Per Click (CPC) as much as possible.
It is important to understand that not all traffic that comes to your website will convert into leads, nor will every visitor on your site spend considerable time on your web pages. On some occasions, the visitors on your website will immediately leave your website as soon as they visit it — an action that is referred to as “bounce”. This can happen when the visitors find the content on your website to be inappropriate to their needs. Measuring the bounce rate is important since it provides you with insights how the content on your website can be optimized for converting potential customers to leads.
Average Page Views
Driving high-quality traffic to a website is considered to be a core component of a successful digital marketing strategy. The aim should be to entice your visitors to stay for longer on your site and digest as much of the content as possible. The higher the page views generated per visit, the higher the chances of engagement and conversion. A successful digital marketing plan will look towards increasing the average page views per visit.
Average Cost Per View
You need to keep a check and balance between the investment that you pour into your digital marketing campaign. You can control your marketing campaign by knowing two important metrics: The revenue generated from a single pageview and average cost per view on that page. The logic here is pretty straightforward — the cost per web page view needs to be much less than the revenue that you generate from that web page so that you generate a profit from the marketing campaign. If it is the other way around, then it is time to reconsider your marketing plan.
Average Time Spent On Site
This metric determines how well your targeted website visitors are interacting with your website by measuring the average time spent on your website (per visit).This is essential for determining which contenton your website is relevant and would lead to results from the visitors on your website. This metric is important for gaining the valuable trust of your customers and alluring them to convert eventually leading to improved revenues for your business.
Return On Investment (ROI)
This is a simple but highly important metric that allows you to identify the areas of your marketing campaign that are driving revenue and sales. This metric can be easily measured by analyzing the website traffic that is being converted into new paying customers. The Return On Investment (ROI) allows you to assess the parts of your campaign that are not carrying their own weight and will hence, enable you to improve these areas for benefitting your business financially.
Customer Acquisition Cost (CAC)
The customer acquisition cost (CAC) is an estimated cost of gaining a new customer on your website. For example, if you spend $2000 on your marketing campaign which results in 20 new customers for your business, the CAC will be simply $100 per customer. Understanding how much it costs you to acquire a new customer is key for scaling a business’ profits. You can also gain a holistic picture of your business’ marketing channels by segmenting the CAC by the source of the channel (social, paid, email, organic).
Organic Traffic VS. Paid Traffic
There is two type of traffic that can come to your website: organic trafficis the number of people that find your site through an unpaid, unadvertised source while paid traffic is the number of people visit your website from a paid source such as an advertisement. Measuring traffic from both paid and organic channels is important in understanding how and where your business is growing. It allows you to make better decisions about which marketing campaigns are most precise for your business.
Nowadays, customers expect a 24/7 hour service across all channels — they are not afraid of voicing their opinions on the social media and they will switch to a competing business if they are not satisfied with what you have to offer. The growth in consumer power has forced organizations to make use of customer experience as a differentiator. In 2014, a study by Gartner found that digital marketers spent 45% of their marketing budget to retain customers while 55% of the remaining was spent for gaining new customers. Metrics that define the customer experience are satisfaction scores and sentiment measures such as the percentage of a business’ customers who plan to repurchase (an attribute that we know as customer loyalty). Your aim should be to design a marketing plan that prioritizes the visitors and ensures a satisfactory customer experience.
As a final word, it is essential that you reiterate each of the metrics that are described in this article to consistently assess how successful your online marketing campaign actually is. Each of the metrics above focuses on a specific area of your online marketing effort and it will be best practice to make use of these metrics as a whole.
What you need to do is to make use of the information that you can extract out of these metrics to identify components of your digital marketing campaign which are working and which are not.
This will allow you to refine the digital marketing strategy of your business for a more profitable experience.
Originally posted on Mentionlytics: http://www.mentionlytics.com/blog/marketing-in-data-driven-era-10-metrics-for-your-business-success/