With marketing becoming increasingly data-driven, you simply cannot escape from assigning and monitoring KPI metrics or Key Performance Indicators.
KPI’s can be defined as numerical, quantifiable metrics that organisations use to track their progress towards marketing goals. They help you measure what’s working, what’s failing and how far are you from achieving your marketing objectives.
Selecting the right KPI metrics ensures that you easily identify your online marketing mistakes before they exhaust your wallet. Without determining your KPIs, you cannot accurately report or make decisions to scale your marketing.
In this blog post, we enlist important marketing KPIs that you should track across all digital marketing mediums.
20 Key Marketing KPI Metrics For Your Business
We have categorised the marketing KPIs enlisted below, based on their respective digital marketing mediums. However, before diving into each category, let’s explain to you a few basic but important metrics you should first understand.
Must-Know Marketing KPIs
Website Traffic: Since your website is the backbone of your online marketing, tracking incoming traffic is important. Remember that once customers enter your website, their movement is yours to track. Thus, by tracking website traffic you can subsequently understand the way users interact with your website.
Recommended tracking tools:
Additionally, it’ll help if you could distinctly measure, monitor and segment traffic based on their source. The sources can be varied such as social media, search engines, paid ads mobile etc. By monitoring the traffic source, you can invest time and resources only on those that are effective.
Leads (MQL and SQL): Leads as a marketing KPI refers to potential customers or prospects who express interest in your business. Leads are those who fill forms, subscribe to newsletters, signup for trials, download white papers and ebooks, etc.
30% of marketers report qualified leads as their top KPI. In practice, the more leads you get, the more effective your marketing is deemed to be.
There are two types of leads based on the prospect’s position in the marketing funnel:
- Marketing Qualified Leads: These are leads who express interest by downloading whitepapers, ebooks and signing up for newsletters etc. However, they are distinguished from other leads by their lack of interest in becoming a customer. So, marketers follow up with more content, nurture and nudge them towards the next stage of the sales funnel.
- Sales Qualified Leads: These are leads identified by their interest to purchase from your business. They are qualified enough to be followed up and nurtured by your sales team.
Revenue Based Marketing KPIs
Cost per acquisition (CPA): CPA or Cost Per Acquisition is used to define the cost incurred by you to acquire a new client.
CPA = Total cost spent on paid advertising (resources, time, ad budget) / total number of leads converted to paying customers
Customer Lifetime Value: Often, it is more expensive to acquire a new customer than to retain an old one. This is why it is important to calculate a marketing KPI called Customer Lifetime Value.
Customer Lifetime Value is defined as the total revenue a single customer generates for a business.
Calculating CLV helps in differentiating the value of one time customers and repeat customers. By doing so, you can tailor offers for respective segment. Moreover, it determines how much money you should allocate to acquire a new customer.
To calculate CLV, you subtract CPA of a single customer from the average revenue generated by them.
Return On Investment (ROI ): ROI is a marketing metric that reveals the profitability of your spending. Online marketers love calculating ROI as it helps them compare and contrast the effectivenss of various channels.
Generally, marketers increase their spending on the channel where they observe the highest return on investement.
Sales Revenue and Growth: Ultimately, marketing’s success is marked by the growth in sales revenue. Calculating this KPI, helps you explain to your C-suite, the impact of your marketing efforts on the company’s growth.
You can calculate sales revenue like this:
Sales revenue = Total sales for the year – Revenue generated from customers acquired through digital marketing.
Keywords: One important SEO KPI to track is your keywords, which are the search queries customer use to reach your website. The ultimate aim of using SEO is to rank your website for relevant keywords, resultantly, bringing in converting website traffic.
Read also: The Beginner’s Guide to SEO
You can use the following SEO KPIs to track the performance of your keywords.
Keyword rankings: This refers to tracking the various keywords your web pages rank for. Following up on keyword rankings, reveals if you are attracting relevant prospects on search engines.
A webpage can rank for multiple keywords. While tracking your keywords, be sure to jot down those that have high potential. Additionally, create content around the topic to rank better.
Conversion rate/keyword: Mapping conversions to keywords helps you understand which topics, themes to improve on. Besides, keywords also reflect the products and services your customers are searching for. Based on which keywords convert the most, you could also add new products or expand services.
You can measure this marketing KPI metric using Google Analytics.
Inbound Links: Links have been an important marketing KPI metrics for SEOs, since the advent of Google’s Page Rank algorithm. Backlinks are vital to boost SEO rankings. In practice, the more links you have, the higher will your website climb on the SERPs.
By tracking the source of your inbound links, you can replicate the efforts made to acquire them.
Moreover, you should track the quality and quantity of links that point to your website. Quality links are acquired from authoritative sources. The lesser the authority the lesser the quality of the link.
PPC Advertising KPIs
CTR: CTR or Click Through Rate is the ratio of the total clicks on your ads to the total number of impressions, Impressions refer to the number of times your content/ad has been viewed.
CTR = ( Clicks on your ads / Total number of impressions) * 100
Track this marketing metric helps you improve the quality score of your ads.
Conversion Rate: Conversion rate is the measure of how many clicks actually convert on your landing page. We can risk saying, conversion rate is the most important KPI in PPC.
You can measure this marketing KPI like this:
Conversion rate = (Total Number of Clicks / Total Number of Conversions) * 100
Quality Score: Quality score is Google’s score for your ad.
Google fixes this value based on
- Relevance of your keywords to ad groups.
- Relevance of your ad copy.
- Quality and relevance of your landing page.
Ads with high-quality scores appear often and cost less. Therefore, by tracking the Quality score of every ad copy advertisers can allocate ad budget for well-performing ads. Additionally, they can optimise ad copies, ad groups and landing pages of ads that don’t well.
Ad rank: Ad rank is the position your ad appears when triggered by a search query. It is calculated by,
Ad rank = Quality score * Max Cost Per Impression (CPM)
Average Position: Average position is where an ad appears on the paid listings most of the time. It is calculated by the taking the mean of all positions you ad has been displayed in.
Website And Traffic Metrics
Website leads to MQL ratio: Your website generates several leads for your business. However, you qualify only a few as marketing qualified leads.
Measuring the ratio of the number of marketing qualified leads to the total leads your website generates reveals how many of your leads become marketing qualified. By doing this, you can track the sources these leads come from and increase spending accordingly.
MQL to SQL ratio: How many of your MQL are you able to nurture and retain as SQL? Leads between the MQL and SQL stage are those who acknowledge that they have a pain or frustration that your business can alleviate.
Tracking the ratio of MQL to SQL helps you analyse where the problem lies- with the marketing efforts or sales teams.
SQL to Quote ratio: This marketing KPI metric is the ratio of number of leads qualified for sales to the number leads who have requested a quote from your business.
This KPI reveals how effective your sales team is in nurturing leads with information to make them request a quote.
On-Page KPI Metrics
Average session duration: Average session duration is the average amount of time users spend on your website
- Researching and
- Clicking on other pages
A higher average session duration means that the content on your website is engaging enough for users to stick around. In contrast, a lower count suggests that the content is thin or poor.
Bounce Rate: Bounce rate is the percentage of the website visitors who left your website without viewing another page. Tracking this marketing metric helps you understand if your visitors are able to find what they came looking for.
However, be careful when pulling insights off bounce rates. For instance, higher bounce rates for your blog doesn’t always mean bad content. Most read blogs and bounce off once their informational need is met.
Thus, compare your bounce rate with average session duration to understand if visitors find your content useful. Higher average session duration indicates that the visitor spent time viewing the content before they left. You could act on this insight to improve the position of links and content suggestions to decrease your bounce rate.
Social Media KPIs
Engagement: Are your posts laden with likes, comments and shares? If yes, how do you measure them? Engagement is a marketing metric that quantifies the number of reactions and shares your post receives.
Each engagement adds social proof to your post and raises brand awareness. Tracking this marketing KPI helps you understand which type of posts work well with your audience and those that don’t.
- Impressions and Reach: Impressions and reach are twin metrics. Impressions refer to the total number of times your post has been viewed. Reach refers to the number of individual accounts who viewed your post.
- Social media traffic and conversions: How many website traffic and conversions has your social media generated? You can track this by distinguishing traffic source and conversions concerning social media alone.
Tracking marketing KPIs is extremely important as without them you cannot spot any problems early on.
No marketing strategy can be made perfect without consistent testing. Using these KPI metrics, you can get a 360-degree view of how your tactics fare. This helps you identify digital marketing mistakes to fix and improves your strategies over time.
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