Every brand that has an online presence and works with actions of relationship and sales on the internet needs the metrics of paid digital marketing. These indicators represent the analytical part of the campaigns, that is, they point to what is working, what deserves to be revised and what should be left aside in the strategies.
As digital marketing teams use innumerable resources to promote their services and products, managing results is often difficult and costly. But with some metrics and specific KPIs it is easier to determine goals and objectives and measure performance based on those values. Digital marketing metrics are especially relevant to justify investments in the field and present to your client a state of how your initiatives go.
However, the importance of them is something you should be familiar with, even if you are a beginner in the field. The hard part is to understand what the key metrics are to follow for great results in your day-to-day lives. That is why we have prepared this list. Metrics help narrow down the margin of error for decision makers – after all, with a good amount and quality of information, the choices are often the right ones. For example, an e-commerce with a high cart abandonment rate can identify some failures to check out purchases such as forms and pages in excess.
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The Paid Marketing Metrics
As digital marketing involves a number of tactics and methodologies, it is to be expected that the number of metrics would also be large. Below you will find a list of the 10 most strategic indicators. But, in practice, will all of them have to be followed religiously? It would be nice, then, the more information you collect, the more your decisions will be based. However, to avoid wasting too much time, focus only on those that are relevant to each campaign or specific marketing action.
1. Conversion rate
This rate measures the percentage of visitors who visited a particular page and performed a desired action. This action can be a sale, an e-book downloads or a newsletter subscription, for example. So, depending on what the conversion is about, the result can vary. For example, if 5,000 visitors made it to a landing page and 3,000 accessed the webinar that was being offered, then the conversion rate was 60%. No greater difficulties, is it?
Return on investment measures the financial efficiency of your campaigns. The focus of this metric is to measure how much each actual expense has returned in the form of profit (or loss) to your company. The ROI formula is as follows:
ROI (%) = Investment profit – Total investment cost / Total investment cost
3. Customer Acquisition Cost
Also known as CAC, this metric measure how much you spend to acquire a new customer. It is not possible to define an ideal acquisition cost for buyers, since this varies according to the average ticket of the product and the expenses to promote the offer. The CAC formula is also simple:
CAC = Total marketing spend in one period / Number of unique customers in one period
4. Average Ticket
This indicator calculates how much your customers usually spend, on average, for each purchase made in your company on the internet. More interesting than calculating the whole, is to segment this calculation according to the differences between your buyers, such as location, gender, age group, etc.
5. Lifetime Value
LTV projects how much a consumer should spend on your business while he or she is an active customer. It is not a simple calculation, since it depends on other variables, such as the average ticket, the recurring purchase rates and the percentage of customers that usually leave the base after a time.
6. Net Promoter Score
The NPS measures the satisfaction and loyalty of its customers from two simple questions:
On a scale of 0 to 10, how much would you indicate our company / product / service to your friends and family? Why did you assign this note? With these two issues, you can detect how much a customer is happy with your business and the reasons that led to it.
The goal when measuring the NPS is to have as many customers as possible who have scored 9 and 10, who are the category of consumers who speak well of your company to close people, generate leads and repurchases.
7. Cart Abandonment Rate
This indicator measures the percentage of people who almost bought an offer, that is, visitors who were performing the steps required to finalize a purchase, but who gave up. The reasons for this? There are several such as expensive freight, lack of inventory, limitation of payment options, lack of security certificates, slow loading pages, among others.
8. Clickthrough Rate
Click-through rate measures how much of an ad or content was compelling enough to get people to click on your Call-to-Action (CTA). This metric is tracked in sponsored link campaigns (number of clicks per impressions) and email marketing (number of clicks per open emails).
9. Keyword Ranking
For those who bet on SEO strategies, measuring this indicator is critical. It points out the organic positioning of your website or blog by keywords in search engines such as Google and Bing.
10. Bounce Rate
This rate measures the number of visitors who came to your site and left without visiting any other page. She/he is good because it gives an idea of how much the public is interested in getting more involved with their content. In addition to the metrics cited here, there are others that at least deserve to be remembered, such as total visitors, unique visitors, open e-mail rate, rate of oscillation in the mailing list, video views, comments, and many other indicators.
With this information in hand, it can simplify the process of completing purchases and thereby improve your conversion rate. If you understand some of the importance of these indicators for digital marketing strategies has already been important, better still be to check what these metrics are and the tools that can help in tracking them.
The key to an effective strategy lies in looking at paid marketing metrics. Knowing which ones represent real good performance and pointing the way forward is essential to making decisions that keep your campaign on the road to success. One of the biggest advantages of digital marketing is the large number of indicators that can be analyzed to attest to the success or failure of a strategy. However, this can also become a problem: not knowing which numbers to look at, this process gets pretty confusing. To make this whole process even more efficient, you must rely on the help of a digital marketing agency that is able to determine the best actions to take from your numbers!
Sarah Feldman is an experienced Digital Marketer and currently working as a Marketing Manager in Digital Express, a leading Dubai-based Digital Marketing Agency.