With the influx of big data, marketing is all about the numbers these days. It’s difficult to run a successful campaign without knowing the answer to the question “what are metrics?” In short, metrics are numeric data that tell you how well your campaigns are performing. These numbers are plotted against your agency’s original goals. To understand your data to make smart marketing choices, you must have a high-level understanding of how to pick your marketing metrics. Additionally, you must understand which metrics are best for marketing agencies.
How to pick a marketing metric?
A recent HBR article made an interesting point, “you can’t pick your data, but you can pick your metrics.” It’s true. Data will truthfully tell you exactly what you need to know about how your campaigns are performing, but you must make sure you are setting the right metrics in order for that data (whatever it may be) to speak to you. When looking to select a metric, or key performance indicator (KPI), make sure they are:
- Understandable – metrics are only good so far as the people on your team know what they mean and know how to use them. When selecting a metric for measurement, make sure it is something that is understandable to your key players and clients.
- Replicable – If you can’t measure a metric on a monthly basis, then it’s probably not a great standard of measurement. Make sure your metrics can be measured and reported daily, weekly, monthly, etc.
- Actionable – The sole purpose of measuring a certain data set is to gather information to make actionable changes to your campaigns. Make sure you select metrics that tell you how you can improve your campaigns. Otherwise, you are just wasting time and brain space on useless numbers.
If a metric isn’t understandable, replicable, and actionable, then it really doesn’t matter and shouldn’t be included in your reports.
What are the top marketing metrics?
The metrics you use will depend on your job function and your campaign goals. The metrics the email marketing team uses will be different than the metrics the social media marketing team uses.
However, there are some marketing metrics that every member of your agency will want to pay attention to. The reason? It affects the bottom line of the company.
- Customer Acquisition Cost (CAC) – This metric will tell you your total marketing and sales costs in relation to the new customers you acquire and the revenue they bring in. This will give you a great idea on how much new customers costs. This includes things like employee labor, advertising, overhead, etc. to get a new customer.
- Life Time Value of Customer – Not only do you want to measure how much it cost to initially get a new customer, but you also want to determine the lifetime value of a customer. This will give you insight on how much spend to put into acquiring new customers versus nurturing existing customers.
- Revenue Growth – Revenue growth is a metric that your CEO and sales leaders will love to track. This shows you how much growth in terms of revenue your company is experiencing.
- Conversion Rates – This metric is a bit broad as it can apply to email marketing, paid search, SEO, social media, and more, but it’s one way to measure how well a campaign is performing in terms of acquiring customers, which is the purpose of marketing.
There are several other campaign-level marketing metrics like click-through rate, traffic, lead generation, click-to-open rates, and more. Select those metrics based on your campaign goals.
Hopefully, this article helped you get a better answer to the question, “what are metrics?” For more information about how to gather data and select KPIs, visit TapClicks today.