{"id":9632,"date":"2024-10-08T18:21:49","date_gmt":"2024-10-08T18:21:49","guid":{"rendered":"https:\/\/www.valpak.com\/?post_type=post&p=9632"},"modified":"2024-10-08T18:53:27","modified_gmt":"2024-10-08T18:53:27","slug":"13-key-performance-indicators","status":"publish","type":"post","link":"https:\/\/www.valpak.com\/advertise\/blog\/13-key-performance-indicators","title":{"rendered":"13 Key Performance Indicators that Measure Marketing Success"},"content":{"rendered":"\n

One of the core necessities of any advertising marketing strategy \/ campaign is the ability to measure success. Identifying the key performance indicators (KPIs) that put your campaign results into perspective is a potent albeit beneficial practice. From revenue to cost of customer acquisition (CAC) to website traffic to mobile metrics, here are 13 of the most critical KPIs to help businesses better track their marketing campaigns.<\/p>\n\n\n\n

What Are Key Performance Indicators?<\/h2>\n\n\n\n

KPIs are metrics that help ensure your marketing is moving<\/a> you toward your goals. If you want to achieve maximum success, you need to consistently measure the right KPIs and make adjustments accordingly.<\/p>\n\n\n\n

The list below covers thirteen of the most important KPIs you might track in your marketing campaigns.<\/p>\n\n\n\n

13 Key Performance Indicators <\/strong><\/h2>\n\n\n\n
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1. Revenue<\/strong><\/h3>\n\n\n\n

Everyone\u2019s favorite KPI, revenue is the most direct link to ROI<\/a>. Your marketing should correlate to sales lifts. If you begin to see a drop in sales, it may be time to make an adjustment to your strategy<\/a>. Clear marketing channel attribution will make strategic adjustments more accurate and easier during the campaign. In other words, separate your KPIs by the channels used, such as social media<\/a>, direct mail<\/a>, email and so on. That way, when one of those channels fails to perform, you\u2019ll know which one needs an adjustment.<\/p>\n\n\n\n

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2. Leads<\/strong><\/h3>\n\n\n\n

Leads (prospective customers) are what drive sales, but knowing how many leads you receive is only part of the equation. Develop a method for \u201cscoring\u201d leads so you can track them during the purchase journey. For instance, if an email contact opens an email but doesn\u2019t click on a link, they are a cold lead, and you might assign them a score of \u201c1.\u201d If they click on the link and sign up for updates, you might consider them a warm lead and assign them a score of \u201c4.\u201d This way, you establish segmented leads and can approach them with marketing messages appropriate to their scores.<\/p>\n\n\n\n

3. Cost Per Lead<\/strong><\/h3>\n\n\n\n

Generating leads is great, but you need to understand how much each lead costs. Knowing your cost per lead (CPL) will help you identify your ROI. Today, many online search engine marketing<\/a> (SEM) platforms offer the option of ad bidding according to a desired CPL as opposed to cost per impression. (You guessed it, CPI.)<\/p>\n\n\n\n

CPL Calculation<\/h4>\n\n\n\n

To calculate your CPL, divide your marketing spend by the total number of leads received.<\/p>\n\n\n\n

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4. Lifetime Customer Value<\/strong><\/h3>\n\n\n\n

As the business gurus say: It\u2019s more cost-effective to retain good customers<\/a> than to acquire new ones. However, not all customers represent the same value to your business. Establish the lifetime value (LTV) of your current customers and then create a customer retention marketing budget based on the average customer value. Once you\u2019ve established your budget, develop a marketing strategy<\/a> designed to nurture and retain your customers. Doing so is a lot more affordable than trying to win them back.<\/p>\n\n\n\n

LTV Calculation<\/h4>\n\n\n\n

To identify the cost to maintain your customers, you would determine the total gross margin you anticipate from that customer over the relationship lifetime. Decide what percentage of that margin you need to invest in retaining them. Note: LTV should be about three times the cost for acquired customers.<\/p>\n\n\n\n

5. Cost of Customer Acquisition <\/strong><\/h3>\n\n\n\n

It would be easy to stop at measuring your CPL, but you\u2019d be missing the bigger picture. Take your marketing strategy to the next level and establish the customer acquisition cost (CAC).<\/p>\n\n\n\n

This cost will directly influence your future marketing budgets. This budget item can (and probably should) encompass the costs for the entire sales process in addition to marketing efforts.<\/p>\n\n\n\n

CAC Calculation<\/h4>\n\n\n\n

You can find out the CAC by dividing the costs of sales and marketing by the number of new customers acquired during the same time frame.<\/p>\n\n\n\n

6. Lead-to-Customer Ratio<\/strong><\/h3>\n\n\n\n

In addition to CPL and CAC, it\u2019s important to understand how many leads are transitioning to closed sales. If the number is low, there could be a breakdown between marketing and sales, or your marketing may not be successfully drawing customers far enough through the sales funnel to close the sale.<\/p>\n\n\n\n

This is the moment when performance tracking<\/a> can save you. When lead conversions begin to falter, you\u2019ll realize it sooner and be able to make adjustments needed to increase conversions to healthy levels.<\/p>\n\n\n\n

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7. Website Traffic<\/strong><\/h3>\n\n\n\n

If your marketing campaign lifts your website traffic<\/a> but doesn\u2019t impact the length of time consumers spend on your pages, convert sales, lower bounce rates, or generate leads, then the website content and calls to action (CTAs) on your site likely need to be evaluated and modified.<\/p>\n\n\n\n

Start with using stronger verbiage in your CTAs. You should also pay attention to button colors<\/a> and their position on the pages.<\/p>\n\n\n\n

8. Social Media Marketing Metrics<\/strong><\/h3>\n\n\n\n

Social media marketing<\/a> has been rising in importance for years, but not every channel is a good fit for every business. Invest in the right social channels by examining how much traffic is coming to your site from each platform as well as how much of that traffic turns into actual leads.<\/p>\n\n\n\n

Each social media platform provides page analytics you can review to find out how your page and shared content is performing, as well as any paid social ads. You should be actively measuring how many likes, comments and shares each post and paid ad receives.<\/p>\n\n\n\n

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9. Mobile Metrics<\/strong><\/h3>\n\n\n\n

Today, much of the purchase process begins on a handheld device, even if it ends on a tablet or desktop computer. It\u2019s crucial to understand how consumers are interacting with your marketing through their phones. Limited mobile traffic may mean Google<\/a> isn\u2019t finding your pages to be mobile-friendly, which also hurts your SEO and SEM performance.<\/p>\n\n\n\n

Ensure your marketing experience is intuitive and consistent across platforms. This will make tracking leads, bounces, and conversions easier and more accurate.<\/p>\n\n\n\n

10. Sales Response Time<\/strong><\/h3>\n\n\n\n

Research shows that you\u2019re seven times more likely to have a positive outcome<\/a> (e.g., book an appointment) if you follow up with a lead within an hour of their initial request. To maintain the quality of the leads being generated and turn more leads into sales, be certain that your team is quickly responding to leads. A slow response time will negatively impact closed sales, which will skew your marketing results and measurement.<\/p>\n\n\n\n

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11. Email Marketing Performance<\/strong><\/h3>\n\n\n\n

Email<\/a> is an effective marketing method to nurture your customers and acquire new ones. Send concise, creative, offer-driven emails relevant to each segment of your database. Be careful to ensure your emails comply with CAN-SPAM regulation<\/a>s<\/a>.<\/p>\n\n\n\n

Email marketing performance is typically analyzed through these KPIs:<\/p>\n\n\n\n