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Marketing KPIs: How to Track Your Business Goals

Shae Henrie

Content Strategist @ AdRoll

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It doesn’t matter if you’re a digital marketer for a small business or a large corporation. Being attuned to your campaign’s performance is the difference between success and failure. Alignment with corporate expectations will help keep budgets under control, but how do you measure performance against those expectations?

Creating clear goals for your marketing campaigns provides the benchmarks you’ll use to determine what is and isn’t successful. The key performance indicators — the metrics that show how your efforts stack up — are what you use to show results.

First, the Goals. Then, the KPIs

To start tracking marketing goals with KPIs, you must clearly establish them. And be specific. In other words, a marketing goal should not just be to increase the number of email subscribers. Rather, you should zero in on a target, such as 5,000 additional email subscribers by September. 

Consider the most important goal for your brand overall, as well as the most vital goal at each stage of the buyer journey. Then, attach a marketing KPI to monitor progress. 

If your brand is new to this, your goal will be to build an audience or awareness as well as strong KPIs, including page views, followers, and subscribers. If your brand is more seasoned, you can graduate to boosting revenue with a specific marketing KPI, such as conversions. 

Always keep your goals in mind so you know whether certain KPIs are bringing you closer to your goal. This will ensure you focus on the right KPIs and avoid wasting time and resources on metrics that ultimately aren’t useful for what you’re trying to accomplish. 

What Are Key Performance Indicators (KPIs)?

KPIs describe the metrics that businesses use to measure performance and progress. They’re quantitative measurements. Companies focus on KPIs to identify opportunities and benchmark performance. When you use KPIs effectively, you can stay ahead of the competition because they monitor their real-time business performance and take action as soon as possible.

What Are Marketing KPIs?

Broadly speaking, here are the most common KPIs to help track the performance of online marketing campaigns:

Click-through rate

Click-through rate,” or CTR, measures how many people click a link after seeing it. High CTRs mean more people are interested in your offerings and click the link to learn more. CTRs measure the effectiveness of your advertising and help you understand if people are engaging with your content.

You can also use CTR to compare different marketing channels and figure out which one sends more traffic to the website. The higher the click-through rate, the better!

Conversion rate

A conversion rate is how many people complete a transaction or action on a website after clicking through via an ad or other marketing campaign. Conversions can include things like:

  • Making a purchase

  • Downloading an asset

  • Entering contact information

  • Signing up for emails

Cost per click (CPC)

The cost per click (CPC) of an ad campaign refers to how much it costs you when an individual user clicks on your ad. CPC is a common metric for search ads, but it’s also present on social media platforms.

You’ll set a maximum CPC bid, and the advertising platform will charge you this amount each time a user clicks the ad. Actual CPC costs vary based on competition and other factors, but you’ll only be charged when someone clicks the ad.

CPC is important because you can use it to assess the effectiveness of your ads. You’ll also use this to adjust bid amounts, targeting, or even the ad creative to help improve conversion and CTR.

Cost per lead (CPL)

Cost per lead (CPL) measures the cost associated with acquiring one new lead. Most businesses calculate it by dividing total marketing costs by the number of new leads generated. CPL is a useful way to measure return on investment (ROI). You can also use CPL to compare different marketing and ad campaigns. This lets you determine the budgets needed to generate a specific number of leads for different campaigns.

Cost per mille (CPM)

Cost per mille (CPM) is a marketing metric that measures the cost of serving 1,000 ad impressions on a publisher’s website. CPM typically matters for display ads and programmatic campaigns, where ads are purchased on a per-impression basis.

Tracking CPM can help you assess the cost-effectiveness of display ad campaigns and compare them with other advertising channels.

Customer lifetime value

A customer lifetime value (CLV) measures the amount of money a company can expect a customer to spend over the duration of their relationship. Factors that influence customer lifetime value include, but aren’t limited to:

  • Purchase history

  • Purchase frequency

  • Expected future behaviors

CLV is an estimate of how valuable a customer is to a business over time. For those companies who want to maximize engagement and revenue, it’s a crucial metric to understand.

Organic traffic

Organic traffic refers to all website visitors who arrive at a website via unpaid, natural search engine results versus paid advertising. If someone uses Google to search for a term and clicks on a website that appears on the search engine results page (SERP), that traffic is organic.

Organic traffic is valuable to site owners because it indicates that people find and visit their site naturally. It can also be of higher quality than paid traffic, as it can be more likely to result in engaged, interested visitors who are willing to convert.

Return on investment (ROI)

ROI refers to the measure of profit or loss generated by particular investments relative to the amount of money invested. In digital marketing, this means evaluating the success or effectiveness of a campaign by comparing the dollar amount spent with the revenue that campaign generated.

ROI is one of the most important metrics for digital marketers because you can use it to determine the efficacy of any strategy. Tracking ROI is essential. It allows you to assess which tactics are working and which ones aren’t.

Similar to ROI is the return on ad spend (ROAS). ROAS measures the revenue a business receives for every dollar it spends on advertising. For businesses that rely heavily on paid ads to drive traffic and sales, it’s another crucial metric.

Using ROAS allows you to gauge advertising success and fine-tune your future campaign investments. It leads to allocating their ad spending more effectively, prioritizing higher-performing campaigns, and adjusting strategies accordingly.

Have questions? Use this ROAS calculator to help determine your current ROAS.

Financial KPIs

In terms of financial KPIs, revenue, or gross profit, is the most common. It’s simply how much money you’re bringing in, which is clearly important. If revenue is increasing, you’re on the right track. If not, there’s a problem you need to identify and resolve. Other financial KPIs you need to understand include:

  • Net profit: This financial KPI measures the total amount of profit generated by a company after deducting all expenses and costs, including taxes, operational expenses, and interest payments.

  • Gross margin: This KPI measures the difference between the total revenue generated by a company and its cost of goods sold. Gross margin is usually expressed as a percentage and can help a company assess its pricing strategy and its ability to control costs.

  • Cash flow: Cash flow is a KPI that measures the amount of cash a company has available to pay its expenses, debts, and other financial obligations. Positive cash flow is generally seen as a sign of financial health, while negative cash flow can indicate that a company is struggling financially.

  • Debt-to-equity ratio: This KPI measures the proportion of a company's debt to its equity or assets. High debt-to-equity ratios can indicate that a company has a high degree of financial leverage and may be at risk of default or financial distress.

Customer and Lead KPIs

If you know how many customers you need in a given time period, you can calculate what kind of traffic you need to generate with the following KPIs:

  • Average client tenure: How long clients stay with you.

  • Cost per customer acquisition: How much you spend to acquire new customers, which can help set targets and budgets.

  • Cost per lead: How much it costs to attract each sales lead. This helps you understand the effectiveness of existing advertising campaigns.

  • Lead-to-customer ratio: How many leads actually become customers. Use this to determine how many leads you need to meet your customer acquisition goals.

  • Leads generated: The number of leads gained in a specified time period.

  • Traffic-to-lead ratio: How much traffic you need before a site visitor becomes a sales lead. When you know cost per lead, the lead-to-customer ratio, and how many customers you need, traffic-to-lead tells you how much traffic is required to meet your customer goals, according to Flywheel.

Site and Content KPIs

The following KPIs help maximize leads and conversions by assessing how consumers engage with brand content:

  • Traffic sources: Track the sources that drive traffic to your site. Include direct, meaning visitors who typed the URL, organic search, paid search, traffic from email, social media channels, and even referral traffic.

  • Sessions: Can include the series of actions a visitor takes on your website over a specific period of time.

  • Pages per session: The average number of pages a user has visited in a session.

  • Average session duration: The amount of time a visitor spends on your website during one session.

  • Bounce rate: The percentage of visitors who click on a page and quickly leave without doing anything else on the site.

  • Unique visitors: The number of unique users who come to your website. This gives a sense of how discoverable you are on the internet.

  • Email conversion rates: The percentage of recipients who become leads or clients.

  • Email open rates: The percentage of recipients who open your emails. It should be about 30% but could be lower if you have a particularly large list, per Flywheel.

  • Inbound marketing ROI: The ROI of specific marketing efforts, which helps determine what marketing programs are yielding positive results, Flywheel says. 

For more on the different types of content to incorporate into your marketing strategy:

Monitor and Adjust

Once your marketing goals and related KPIs are set, you will have to monitor them with analytics tools like Google Analytics on a recurring basis. Then you’ll want to record the results and compare them to your goals. From there, adjust as necessary — including when you have accomplished said goals. 

Though there are other KPIs to consider, this list focuses on those most important to marketers. By starting here, you’ll set your brand up for long-term success. 

Maximize Your Marketing KPIs With AdRoll

If marketing KPIs leave you mystified, AdRoll can help. We work with clients in several different industries to help them improve their digital marketing efforts, including paid ads and social media campaigns. You can learn more about how we streamline your digital advertising and marketing efforts here.

Marketing KPIs FAQs 

What are KPIs in marketing? 

Marketing KPIs are metrics that help determine whether a campaign is successful or not. KPIs can also benchmark progress toward specific goals or compare performance across different channels.

What are the most commonly used marketing KPIs?

The most commonly used marketing KPIs include website traffic, conversion rate, cost per lead, and customer lifetime value. Other metrics such as average order value, website engagement, social media engagement, and time on page can be useful to track. By analyzing these KPIs over time you can get a better understanding of what is working and what needs improving in your campaigns.

How do I determine which marketing KPIs are most relevant for my business?

Consider your campaign objectives. If email is a cornerstone of your marketing efforts, open rate, CTR, and unsubscribes are things to focus on. Paid campaign metrics like CPC and cost per lead are another example. Website traffic and time on page can be useful for measuring content engagement.

Ultimately, you should compare performance across different channels to focus on optimizing those with the best results.

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