16 Marketing Metrics: Understand What They Are and How to Analyze
How do you track if a football team is doing well?
I imagine that due to the practical results of this team, such as its points in a championship, number of goals in a match, position, matches played, among other results.
All these numbers are nothing more than metrics. Whether it’s following a football team or knowing the results of your marketing actions, metrics are essential for identifying trends and knowing what’s working and what’s not.
With the more competitive market, marketing metrics are even more important, as it is based on their analysis that decisions must be made about marketing strategies.
As important as developing an action plan and executing it efficiently is knowing whether it works in practice and adapting it if necessary.
In this article, we will understand what marketing metrics are, what they are, and step by step how to analyze them. Follow along!
What are marketing metrics?
Marketing metrics are numbers related to some dimension (sales, leads, searches, visitors, buyers, followers, interactions), which function as a parameter to monitor the performance of marketing actions.
These are, fundamentally, indicators that allow the measurement of the success of campaigns or all marketing work, ensuring safe decisions and practical and direct monitoring of each stage of the project.
It is these indicators that should guide the decision-making process of marketing teams, so that they can make more assertive decisions, based on data.
There are several types of marketing metrics, which we can group into a few categories, the main ones being:
- Traffic metrics: measure the volume and quality of visitors to your websites, blog, or social networks, such as total number of visits/reach, engagement rate, and average time on a page;
- Conversion metrics: these are metrics related to some marketing action that the company wants its followers, visitors, and audience to do, such as filling out a form, signing up for a newsletter, downloading rich material, and getting in touch to get a quote, among others. Some examples of conversion metrics are conversion rate, cost per lead, and cost per acquisition;
- Revenue metrics: these are metrics generally used by company managers to monitor whether the marketing strategy is successful or not. They show how much the marketing work had an impact on the company’s finances. Some examples are ROI (return on the value invested in the strategy), LTV (consumer “lifetime”), revenue, and CAC (cost per customer acquisition);
- Engagement metrics: they are related to the level of interaction and engagement of people who come into contact with the brand and its content. Examples: number of followers, likes, clicks on CTAs, comments, and shares.
Let’s go into more detail on the main marketing metrics used in different areas so you can understand them in practice.
What are the key marketing metrics?
SEO, social media, CRM, paid media, SMS, email, PR, in short, there are so many channels and strategies that it is difficult to understand which metrics are most relevant.
Each channel has several different success indicators, from engagement metrics to revenue metrics, some shared, others not.
Let’s understand some of the most common ones!
Customer Acquisition Cost (CAC)
The Customer Acquisition Cost (CAC) is a fundamental metric for evaluating the financial health of a company, obtained by dividing investments in Marketing and Sales by the number of customers acquired in a given period.
- CAC = Investments in marketing and sales (R$) / Number of customers
Many professionals, however, include in the CAC calculation not only the value of the advertisements but also the salary of the employees involved, the necessary infrastructure, and other costs.
The metric can be used for the marketing area in general and also for different channels and specific strategies, considering only investments and customers originating from these sources. For this, it is important to have a well-structured data area.
The average ticket represents the average value of sales made over a period, which is normally an indicator of the sales team’s performance in obtaining more advantageous deals for the company.
It indicates how much on average a customer usually spends with the company, which can help with various decision-making related to the product/service and marketing campaigns.
Its calculation is done as follows:
- Average ticket = Total sales revenue / Number of sales in the analyzed time
The conversion rate corresponds to the percentage of visitors who carry out a specific conversion – which can range from purchasing to registering for a newsletter, for example.
It is important to remember, however, that not all pages will have a high conversion rate, but there are good practices that can be applied to increase it on your website.
Knowing that calculating this metric can be complicated, especially for start-up companies, we created a conversion rate calculator so that you know, in just a few clicks, how to optimize your conversion rate using CRO (Conversion Rate Optimization) strategies. It is worth checking!
Customer Lifetime Value
Customer lifetime value, or lifetime value (LTV), corresponds to the average revenue generated by customers during the period of their relationship with your brand, indicating your profit potential.
Customer lifetime value is directly linked to CAC because, for a company to remain viable, LTV must always be greater than CAC.
It is a good indicator, especially for companies that offer subscription services, where customers generally do not “pay for themselves” only in the first month of purchase.
Cost per Lead (CPL)
The Cost per Lead (CPL) indicates the value of each lead generated through investment in digital marketing, obtained by dividing marketing expenses by the number of leads generated from different traffic sources.
- CPL = Marketing Spend / Number of Leads
Therefore, measuring and comparing this value can strengthen the credibility of the marketing area and attract more investment to the company. Just like CAC, CPL can be calculated specifically for each marketing strategy and channel.
It is the total number of views that a page on a website had, without considering whether the same person viewed the same page more than once.
In the case of this digital marketing metric, repeated views of a single page are counted. In other words, each access, update, or page load counts as a view.
It’s an important indicator for tracking your website’s growth over time and how different campaigns drive website views over a given period.
A website’s exit rate shows which pages were last browsed by a visitor before leaving the website.
For a low exit rate, therefore, internal linking work within a website is essential. This increases the chances of you keeping the user on your website for longer.
It is worth noting that some pages, such as landing pages, are configured precisely to be the user’s exit page. Therefore, each case is different and it is necessary to analyze the metric closely.
Average session duration
Average session duration is one of the essential marketing metrics for blogs and news portals, especially. This is because this metric corresponds to the average time spent by users on a page.
Using this metric, it is possible to understand whether content is making sense or responding to the user’s pain. Not generating a good average session duration? So, it’s time to review and update the page content.
Cost Per Click (CPC)
When investing in a paid traffic strategy, one of the main points you need to understand is the CPC – or cost per click – which means that you pay for each time a user clicks on one of your ads.
- CPC = total cost on the campaign or ad / total clicks
The lower the CPC, the better for the business, as it means you don’t need to make a large investment to attract users with your paid media.
Email open rate
The opening rate represents the number of people who opened your email. A high rate suggests a certain loyalty from your contact base.
In other words, it means that your subscribers are eager to open your emails. The email opening rate formula is as follows:
- Opening rate = opening/number of emails sent x 100
The return rate is the percentage of a group of people who take an action and then interact again within a specific period.
This action may include filling out a form, clicking a Call to Action, and interacting with pop-ups or other tools.
Share of search
Share of Search is the participation in searches that a brand has within the market in which it operates and is directly related to its market share (portion it has of the market in which it operates).
The metric is calculated by the total searches for a brand on search engines such as Google and Bing, divided by the searches for all brands in the same category:
- SoS = Searches for a brand / Searches for all brands in the category x 100
Net Promoter Score (NPS), measures the level of customer satisfaction about a brand and its products/services.
It is generally calculated from a score of 0 – 10, subtracting the percentage of brand-promoting customers (scores 9 and 10) from the percentage of detracting customers (scores 0 to 6). It’s a great metric for optimizing your customer contact and value delivery.
CTR is the click rate on an ad, CTA, or content. The metric is calculated by the relationship between views of the content in question and the number of clicks to see more about it.
- CTR = Impressions/Clicks x100
CTR is widely used in advertising and SEO campaigns, to measure the attractiveness of page titles and descriptions on Google.
The classic ROI works to measure the return on the amount invested in the company’s marketing strategy.
It is a great indicator to present for C-level positions, such as CEOs, CTOs, and COOs, calculated as follows:
- ROI = (Gain obtained – Initial investment) / Initial investment
It is the percentage of delivery of content to the audience, such as email. For example, if you send an email to 100 people and only 90 of them receive that email, we can say that your delivery rate is 90%.
Monitoring this rate is essential to assess whether there is a problem with your CRM tool.
How important is it to analyze marketing metrics?
Monitoring digital marketing indicators is essential to evaluate the performance of your planning. By analyzing them, you can improve communication with your audience, understand the appropriate language, the CTAs that generate more conversions, and other valuable information.
With detailed insights, it is possible to identify accurate investments, such as in paid media, and understand which content formats generate the most engagement on social media.
Using specific tools, decision-making is improved, avoiding decisions based on guesswork. Marketing metrics are real data and cannot be ignored.
How to analyze marketing metrics in 7 steps?
Having covered some of the main marketing metrics, we will see below how to analyze them to extract insights and align them with your business’s marketing strategy.
1. Define your goals
The famous phrase “for those who don’t know where they’re going, any path will do” fits perfectly into this first step. After all, if you haven’t defined your objectives, how do you know what exactly to analyze?
Therefore, before anything else, put your objectives and goals on paper and, from there, understand which metrics will serve to guide the strategy that will take you to this goal.
2. Data collection
With the objectives stipulated, it’s time to collect the data directly from the source (Analytics, Search Console, and so on) and then transform it into information and insights.
At this stage, the use of tools is essential, as well as trained professionals to organize data from external sources and consolidate them into unified reports for other team members to read.
Without intuitive visualizations and practical ways to access your data, analysis will be significantly more difficult to perform.
3. Calculate metrics
In many cases, just having the data at hand will not be enough. You can have, for example, the number of visitors to a page and the number of leads generated by it in a certain period, but not the conversion rate.
In this case, simply calculate the conversion rate and add the new metric to your report. There are several tools, such as Google Data Studio, that allow good visualization and easy creation of calculations for these metrics, to use them in other reports, without having to calculate everything again.
Another important piece of information to add to the report is the goals set for each metric. You can compare them and create a new metric with the percentage of the goal achieved.
4. Compare and interpret results
With the data extracted, it’s time to transform it into information and insights. Compare them with previous periods, micro and macro analysis.
For example: the increase in the bounce rate of a page may have been due to a technical problem or even a content problem.
The sudden increase in the number of sessions on a website, for example, may have been due to a branding action, or simply because searches for a term on Google for which the page is ranked increased.
It is essential to have a holistic view of the business and consider many variables before reaching hasty conclusions about any movement in metrics.
5. Identify the causes and take action
Identifying the causes of the increase or decrease in a rate is directly linked to the interpretation of the result.
Using the previous example: if you have identified that a page with a high bounce rate is having a problem, the most obvious path is to take action to correct the page as soon as possible.
6. Follow up regularly
Monitoring marketing metrics necessarily needs to be included in the routine of a marketing team – especially management.
That’s why reports can help a lot, always having a record of the evolution of metrics over time. Periodic results meetings with the team can also help a lot.
7. Use analysis tools
Tools are powerful allies of a marketing strategy and analyzing metrics would be no different. There are even free tools like Google Analytics and Google Search Console.
The more you invest in resources to optimize and boost your business’s data analysis, the more information and insights you will be able to obtain from marketing metrics.
As we have seen throughout this article, defining marketing metrics is fundamental to the success of any business.
Therefore, if you do not already have these metrics defined, we recommend that you join your marketing team to define objectives and goals and, from there, define the ideal metrics for the business as a whole.
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