Friday, May 6, 2016

5 marketing metrics every entrepreneur needs to know

By David Ronald

There are metrics, and then there are metrics.

Metrics need to be measurable and actionable—if you are going to select your marketing programs based on data, those data need to correlate directly to the success of your business.

Web and marketing analytics tools such as Google Analytics, HubSpot Analytics, and KISSmetrics enable you to delve into the metrics that will help you to understand the customer journey and identify what sort of content and which channels are contributing to the bottom line.

But what, exactly, should you be measuring?

In this post I will examine five key metrics that provide insights into how your marketing is performing.

1. Customer acquisition cost
Add up all money you spend on marketing programs and divide it by the number of new customers. Track this over time to determine and observe if the cost is increasing, decreasing, or staying constant (ideally the cost should decrease as the efficacy of your marketing programs improves).

2. Marketing contribution to revenue
Quantify all of the new customers you signed up and look at what percentage of them started with a lead that marketing generated. This is much, much easier to do when you have a marketing analytics systems, but you can do it manually by contacting each new customer by email or phone.

3. Revenue per channel
Identify your most effective channels (organic, ads, social media, direct email, referrals and so on) by looking at how much revenue each one generates and compare it to the cost of running the channel.

4. Inbound traffic mix
Determine how much traffic is coming into your website and which channels your visitors are coming from—you can do this manually using tracking URLs, Google Analytics, spreadsheets and the like, and marketing automation programs help too. Track how the total volume and mix changes over time.

5. Conversion rates
Track how well your website is performing. Better yet, monitor how specific pages are working. Adjust landing pages and see what changes. Test, for example, if the wording and layout can be improved or if the Download button should be higher up. or determine if your call to action is underwhelming or your forms too complicated. And explore which offer your visitors respond to.

Measuring these metrics with as much precision and consistency as possible should be an integral part of your marketing focus.

And, of course, statistics mean nothing if you don’t do something with them. Getting to the people and journeys behind the numbers delivers insights that help you direct spending to the most beneficial programs.

Thanks for reading. Do you agree with everything on this list?

Did we leave anything off?

Leave us a comment or question.

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