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Not only are marketing departments under increased pressure to deliver results that can be tangibly measured, they are also expected to fill the sales pipeline and demonstrate that outbound marketing efforts are having a clear impact on deals won and revenue generated.
So how do you determine the effectiveness of your marketing programs and campaigns?
First, measure their direct impact on sales and revenue. While ROI will always be your most important metric, there are other numbers to consider when you are trying to find out what is working, what isn’t working, and how you can improve your results.
In the old days, outbound marketing methods were used almost exclusively. TV, radio, billboards, and print media—such as direct mail and magazine ads—were the primary ways to reach people. While companies knew whether revenues were increasing, it could be difficult to understand which marketing efforts made the difference. Back then, outside of direct customer feedback, measuring marketing effectiveness relied heavily upon assumptions.
Digital technology has changed everything. By using digital marketing methods, marketers can better measure and analyze their efforts. Marketers have a variety of new tools at their disposal: thought leadership papers, landing pages, social media, and blogs. With the help of SEO, Google Search, and paid search and ads, audiences can now find them instead of the other way around. More importantly, marketers can actually engage with their prospects in a variety of ways including emails, videos, case studies, demos, newsletters, ebooks, text messages, webinars, and white papers.
By using digital marketing methods, marketers can now better measure and analyze their efforts. Today’s marketers can track every action prospects and customers take and determine their level of interest. Marketing teams rely on real-time data to see which approaches are working and which are not. At the same time, marketers must make sure that the data they have is accurate and reliable. The better the data, the better decisions and adjustments they can make in the course of a campaign.
But which metrics should they pay attention to?
There are a variety of way to measure the success of your marketing programs. Here are a few core metrics that most organizations assess and value when it comes to determining the impact of their online and content marketing programs.
Most organizations today measure:
|Email opens||How many recipients of an email campaign actually opened the email?|
|Click-through rate (CTR)||What percentage of those who opened the email actually clicked a link or button within the email to take advantage of the offer?|
|Form conversion rate||What percentage of those who clicked through actually finished the process by completing a form?|
Other metrics you might want to take a close look at include:
|Pipeline growth||Seeing how well your marketing program is generating leads and how these leads are moving through the sales funnel is critical.|
|Conversion rates||How many prospects become leads and how many leads become customers.|
|Cost per lead and cost per opportunity||Budget concerns have to be considered. How much money are you putting into each customer and each marketing opportunity? How can you decide if it is worth it?|
For websites, the following metrics will help you find out how engaging your content is and if it has been properly optimized:
|Unique visitors||The number of people who visit your site in a given period of time.|
|Returning visitors||The number of people who return to your site within a given period of time.|
|Page views||The number of pages that your visitors click on within a given time period.|
|Search engine traffic||The amount of traffic that’s driven to your site by search engines such as Google.|
|Bounce rate||The percentage of people who leave a webpage without clicking on another page or taking another action.|
|Inbound links||These are links that come from an external website to your website. The more engaging and valuable your content is, the more people will want to link to it, which will also help you rank higher on a search engine.|
For social media posts, you might want to keep track of the following to learn how much interest and engagement you are driving:
|Reposts||How many times your posts are shared.|
|Comments||How many comments a given post generates.|
|Followers||How many people are following your social media platforms.|
When looking at other metrics, be sure to also factor in the interest your social media is driving. If you have a large number of followers and reposts, but aren’t seeing a large amount of traffic being driven to your site or prospects are not converting, there could be some weak spots in the customer journey that begins on your website.
Although not a metric, you should also consider brand identity. For example: what does it mean if your brand identity is strong, but your pipeline is weak? Are your leads not converting? Are people opening your emails but not clicking through on a link? If that’s the case, it bears closer scrutiny into your marketing and sales processes. Keep in mind that building a brand identity takes time. If you are still establishing your brand, it might show in your numbers.
How do your metrics vary for mobile compared to web? If your metrics are showing growth and conversions for one, but not the other, you might want to look into how you have optimized your marketing for either channel. Explore what marketing methods are working better for one versus the other.
Tracking marketing effectiveness by these measurements helps marketing departments determine if their campaigns have been successful in compelling prospects to take a desired action. Marketers can then fine-tune their strategies in the midst of a campaign while keeping executive management posted on revenue generation. But to understand what happened to the leads that marketing passed off to sales, marketers need an even higher level of analysis.
To truly understand the effectiveness of any campaign, you must be able to track everything that happens after marketing has touched the leads that the campaign generated. Closed-loop marketing is the practice of analyzing the entire chain of events that influenced a prospect to purchase a product. It involves examining the impact a specific campaign (or many campaigns) may have on revenue.
By tracking all campaigns that influenced a successful deal, marketing can cite attribution for its share of the revenue generated, and can even determine the ROI of specific programs. To do so, marketing must possess visibility into where their leads end up in the sales funnel, and must be able to tie their campaigns to individuals or companies so they’ll know when a deal has been completed. By "closing the loop” between a completed campaign form and that prospect becoming a customer, marketing can report with confidence on the ROI of marketing campaigns—and demonstrate their impact on revenue.
Closed-loop marketing helps provide a more accurate picture of how marketing impacts a company’s bottom line. To use it effectively, you must constantly update and enrich your data so that you can analyze and act upon it.
For marketing, the value of data can never be underestimated. Data allows you to target and segment your audience to add more relevance and personalization. Data shows you what is resonating with customers and gives you an indicator of how to plan ahead.
However, you must make a continual effort to ensure the quality of your data. It must be cleansed and enriched to assure its accuracy and quality. A marketing campaign created with outdated data is not as effective. In fact, it might even sabotage your campaign. In addition, you need to be sure that the data you collect can be analyzed and understood because it has to serve as the rationale for a change in direction or a tweak that you are making. It is your justification for the actions that you take.
When designing marketing campaigns, be sure to have a process in place for tracking and measuring your efforts. Doing so requires that you:
|Define your goals||What is your campaign looking to achieve?|
|Decide on your key performance indicators (KPIs)||In other words, what metrics and measurements are you going to be paying the most attention to?|
|Plan for how you will collect this data||Do you want data broken down by segment? By month or week? Who is going to gather the data and who is going to analyze and act upon it?|
Marketing, sales, and customer service teams can all get feedback from customers, either directly or in the form of metrics. This feedback lets you know how satisfied customers are with your brands, products, and services. Do you have repeat customers? Do they still follow you on social media long after the deal was completed? Are they still active on your social media? Did they post any reviews? Did they give you any referrals? Taken all together, these answers provide a complete picture of how well you are doing.