In 2016, this means leveraging analytics platforms and using key performance indicators (KPIs) to see what’s happening beneath the surface.The value of KPIs in modern marketing
Marketing really has one primary goal: to reach and engage relevant targets and transform them into paying customers
. There are obviously hundreds of unique ways to do this, but the goal remains the same across the board.
Sadly, the vast majority of marketers have no idea how to quantifiably measure the success of this overarching goal. Do you?
The secret is found in KPIs. With KPIs, you can track and analyse the efficacy of individual goals to better understand what’s happening. Ultimately, this gives marketers and other key decision makers within a business the ability to take actionable steps towards improvement and growth.
So what constitutes a KPI? Well, according to marketing expert Laura Lake, KPIs have four important characteristics
: quantitative, practical, directional, and actionable.
The last characteristic is especially important. In order for a certain measurement to be a KPI, you must be able to put it into practice to drive tangible change. Three KPIs you should be tracking
The most important thing you can do is figure out which KPIs you should be tracking. “When choosing the right key performance indicators, a company should start by considering the factors management uses in managing the business,” Lake says. “Then you must consider and identify whether these factors help in assessing the company’s progress against its stated strategies.”
While every company has its own unique goals and strategies, the following KPIs are commonly tracked in just about every modern business:1. Goal conversions
“A conversion is a desired action made by a visitor and this varies from business to business,” explains datapine
, a leader in business intelligence solutions. “Different parts of your website should have different conversion goals, and this matters when you track how well you are hitting your objectives.”
There’s simply not an accurate way to track isolated successes without making goal conversions one of your KPIs. Make sure you’re consistently tracking any goals you establish for a comprehensive understanding of how your customers are interacting with your brand’s messaging. 2. Customer lifetime value
Do you have any idea what a customer is worth to your business over the lifetime of your relationship? Sadly, most businesses have no idea. Not only is this foolish, but it could also prove detrimental to the future growth and stability of your organisation.
The great news is that it’s relatively easy to track customer lifetime value
. Simply take revenue and multiply it by gross margin and the average number of repeat purchases. 3. Website traffic to website lead ratio
Here’s a pretty simple, yet important KPI. It tells you what percentage of your website visitors convert into monetisable leads. This helps you gauge the quality of your traffic and the conversion rate of your website. From here, you can also track your lead-to-revenue ratio
, which tells you how many leads you need to attract in order to meet specific revenue goals.Make KPIs a major priority
As a marketer, KPIs must be a priority moving forward. There’s simply no other way to accurately understand what your customers are doing and how they’re interacting with your brand. While there’s a lot of trial and error when it comes to establishing, tracking, and using KPIs, you’ll eventually hone in on the techniques that work.
Whatever you do, make sure you start sooner rather than later!