What Are The Best Marketing ROI Metrics?
By Brad Shorr
Business owners shy away from internet marketing when it appears to offer vague, immeasurable returns. In reality, Internet marketing campaigns can be measured, but many organizations put so much emphasis on the creative side, they forget to identify the key metrics that enable them to evaluate performance. Let’s take a look at important Internet marketing metrics, and how to use them.
Lead and Sales Generation
A common Internet marketing objective is generating sales leads or e-commerce revenue through SEO, PPC, email or social media campaigns. In terms of metrics, evaluating results is straightforward. The key metric is how many prospects submitted validated form or phone inquiries as a result of the campaign. These activities are called conversions.
Validation is an extremely important factor for lead generation campaigns. The validation process separates true sales leads from other types of inquiries, such as personal phone calls, sales solicitations, job inquiries, and spam. Many companies use non-validated inquiries as their main metric, which overstates results — often significantly. This lead validation infographic explains the process in a nutshell.
In addition to validation, tracking conversions granularly is also critical. For instance, in a PPC campaign, it is not enough to know that 100 conversions came from Google and 25 from Bing. You must also know, among other things, which keywords generated the conversion, the day the conversion occurred, and what time of day the conversion occurred. This type of granular information enables you to continuously improve your campaign, putting more emphasis on high-converting keywords, and bidding for ads on certain days of the weeks and/or certain times of day.
Another Internet marketing objective always important to small businesses is building brand awareness. This is harder to measure, since there is no specific conversion activity that takes place to tell a business that a new person has become aware of the brand.
Brand awareness can be measured to an extent, however. A typical brand awareness campaign is a combination of social media, email and content marketing. For instance, a company will try to build social media communities, send email blasts to various segments of its mailing list, and/or write articles (such as this one) for off-site publications.
How do you know if these marketing activities are producing results?
Email marketing is the most accurately measurable activity of the three. The most important metrics are: opens, clickthroughs, conversions, bounces and unsubscribes. Opens tell you how many people are seeing your brand/offer; clickthroughs and conversions tell you how many people are interested in your brand/offer; bounces and unsubscribes tell you how many people are definitely not interested.
Evaluating social media and content marketing are trickier. The three most useful metrics are: social media content shares, social media brand mentions and referred website traffic generation.
Social media shares of your content (both on-site and off-site content) indicate the number of people who have seen your brand. Social shares can be misleading, though. If 500 people retweet your off-site post, you don’t know how many actually read your post, or how many of their followers saw their tweet. On the other hand, five of those people could be the most influential Tweeps in your niche and their retweets represent a brand-building home run. Looking at social shares granularly, rather than just reporting gross numbers, provides far more insight.
Social media mentions can be tracked through a number of Web-based monitoring systems. Again, it helps to look at brand mentions in detail, to determine the commentator’s influence, reach, and of course, the nature of the comment.
Referred website traffic is also helpful. An uptick in traffic from social media sites and blogs publishing your off-site content tells you your branding efforts are hitting home with a fairly measurable number of people. This data also helps you decide which publishing sites and social media platforms to focus on going forward.
Don’t be discouraged if your metrics indicate poor performance in the beginning months of a campaign. More important is to establish a pattern of growth. Most Internet marketing campaigns take several months or longer to start moving the dial.