What are Marketing Metrics and what do they actually mean?
In the age of digital marketing, keeping track of your marketing metrics have become essential. We no longer have the excuse of not having access to data or clarity of performance. So, at MADTRIX we thought we’ll start right at the beginning and explain what the hoopla about Marketing Metrics is all about.
What are Marketing Metrics?
First things first, let’s define what we mean by marketing metrics. “Simply defined, metrics refers to performance measures and operating statistics. Metrics are key performance indicators, allow firms to track performance over time and enable greater precision in the execution of business activities.” (source: http://dstevenwhite.com)
What are Marketing Metrics used for?
Simply put, marketing metrics are used to understand how your marketing activities are performing. These can be both quantitative and qualitative results it is meant to enable to you to make decisions about improving your productivity and profitability. Here is a very good article on marketing metrics that explains the importance of having these statistical measurements in place for your business, click here.
What are some of the basic metrics?
Here are some basic marketing metrics:
- Impressions – An impression is when an ad has been shown. Or actually, when an ad has been loaded into a browser that is visiting a page that holds ads. If you are running your ad as Pay Per Impression, this metric is important for you as it directly affects your campaign spend. Even though you may not run a Pay Per Impression campaign, it is still important for you to know how often your campaign was seen by the audience. This gives you a good indication how relevant to your add is to your target market when you compare the clicks that came from those impressions. (source: DeltaProjects.com)
- Clicks – When a digital ad of any sort is clicked it triggers a script that counts clicks. Even when you post something on social media and someone clicks on the link that indicated your content as relevant enough for them to look further into your product or service offering. Although the click in itself does not mean a sale it is a very good indicator of the level of interest your audience has in your offering.
- Sales/Demo/Enquiries – This is the ultimate metric that any business is looking for. How many sales, demos, or enquiries you received as a result of your marketing efforts. This metric is most often compared to the rest of the results of your marketing activities to indicate the success of your campaigns. To read more about conversion rates click here.
- Spend – After you have seen the result of the main marketing metrics then I’m sure you or other stakeholders in the business would be interested in the spend. Afterall this is what it comes down to. Spend on digital campaigns can be explained in several ways, below are a few metrics explained by DeltaProjects.com
- CPM – Cost Per Mille (mille is Latin for thousand). This shows your cost for 1000 impressions. Since impressions are bought individually in programmatic marketing, CPM is often called eCPM ( =effective CPM).
- CPC – Cost Per Click. This is the average cost for one clicked ad.
- CPO – Cost Per Order. This is the average cost for one order.
How can Marketers utilise these metrics?
The Digital Marketing Institute has a few key suggestions for us marketers when it comes to using marketing metrics.
- Identify the value of your most important metrics – compare these to your spend like cost/visit; cost/enquiry; cost/sale
- Compare your monthly/weekly progress (calculate as a percentage).
- If your performance is down, give a reason why. Similarly, if your performance is up your CEO will want to know what you did differently to generate growth.
- Finally, aim at creating a digital dashboard which allows you to eliminate manual report handing and see up-to-date reports as you need them. MADTRIX can help!
Here’s a great blog on how to choose a Marketing Dashboard.
Author: Amelia Dash
A bit about me. I’m the Marketing Technologist at Avarea Analytics for Marketing. My background is in digital marketing and I’ve continued my passion by embarking my PhD thesis on online consumer psychology. Working in Australia, China and now Finland I’ve acquired a pool of knowledge about digital marketing.
If you want to speak directly to me, you can find me on LinkedIn