Today, business literature is full of zealous advice on how to measure marketing (and sales!) effectiveness. These concepts might help your business in the short term, but in most cases, the volume of advice can leave you weary.
Your ability to cut through the noise and prioritize mission-critical marketing key performance indicators will position your business for sustained success. You’re probably already tracking page views, conversion rates, and other obvious marketing metrics, but those KPIs only scratch the surface. These metrics might look good on paper, but won’t give you the real insight you need to refine or finetune future marketing campaigns or promotions.
“Most people use analytics the way a drunk uses a lamppost, for support rather than illumination.” – David Ogilvy
For deep insight into the marketing performance of your business, you need to consider other advanced metrics. These KPIs should challenge your marketing and force you into delivering more effective communications to prospects and customers.
As an industry-leading business text messaging provider, we’ve helped thousands of businesses to forge a path towards high-value marketing and communications. The savviest executives and marketers know that text marketing is a proven way to generate increased awareness, engagement, and more.
In fact, short message service (SMS) marketing produces engagement rates six to eight times higher than email. But engagement is only one of the important KPIs to be tracking within your marketing strategy. To outpace your competition, prioritize the following marketing performance measurements.
How are your marketing activities contributing to sales growth? Unfortunately, without a clear view of marketing spend versus revenue generated, your business is at risk for overspending on marketing that just doesn’t work. How do you know if you’re spending too much or not spending wisely, and how does this all contribute to sales?
Start with a review of your company goals and revenue projections. Next, set your marketing budget in terms of total dollars, select the marketing channels used to deliver these messages, and establish performance metrics to benchmark these activities against total sales. Not only does sales growth serve as a good indicator when it comes to strategic planning, it also allows for the identification of trends.
Unfortunately, email, social media, and other content distribution channels face serious deliverability challenges and, by themselves, may not contribute to sales growth. As such, many recognized businesses and organizations diversify their marketing channels as a means to generate positive and immediate sales growth.
The more leads your business gets, the more sales opportunities you have. It all sounds fairly simple, right? The importance of leads cannot be overstated, however. A lead is the lifeblood that powers all marketing, support, and sales teams.
Under most circumstances, a lead is a prospect who has expressed interest in your company. In most cases, this is done through the sharing of important personal information such as an email, phone number, or even a social media handle.
Unfortunately, most marketing teams spend countless hours and dollars drumming up leads, but once those leads hit the sales department, a majority of those contacts are immediately junk. Why? It’s a devastating conflict that costs even the most successful enterprises millions per year.
When marketing and sales teams work asynchronously, the criteria used to define a lead simply doesn’t match. To remedy this, teams must align and agree on what a lead is. According to recent reports, companies with strong marketing-sales alignment achieve a 20% annual growth rate. Additionally, when sales and marketing are in sync, sales wins increase by 38%. From there, you can nurture leads and categorize leads into marketing qualified and sales qualified contacts.
3.Lead-to-Marketing-Qualified-Lead Conversion Rate
The question must be asked then, of all the leads generated, how many get promoted to marketing qualified lead status? Under most circumstances, a marketing-qualified lead shows a greater level of interest than standard leads and matches the target customer profile.
In most cases, marketing-qualified lead status is triggered through some kind of lead score that’s generated through such behavior as a landing page visit, content download, demo request or free trial account creation. This key performance indicator will help you understand the quality of leads your marketing is generating.
If lead quality is waning, we recommend investing in value-driven solutions designed to generate high-value marketing qualified contacts. For instance, a simple text blast can be all it takes to spread the word about your new lead magnet or digital offer.
4.Marketing-Qualified-Lead-to-Sales-Qualified-Lead Conversion Rate
If your business is monitoring marketing-lead-to-marketing-qualified conversion rate, you’ll then need to consider the rate of marketing-qualified leads to sales-qualified leads. In most cases, a sales-qualified lead is someone who has requested additional information related to your product/service. A sales-qualified lead is ready for a direct sales followup, and your team should work diligently to get in touch with these contacts.
Again, this requires some synchrony between marketing and sales teams. By working together to achieve meaningful alignment around this key performance indicator, teams can craft powerful messaging that gets leads really interested in your business.
Read More: Best Ways to Increase Inbound Leads
5.Sales-Qualified-Lead-to-Customer Conversion Rate
Finally, of those sales-qualified leads, how many contacts convert to customers? Basically, this is your sales team’s close ratio. Is this ratio higher or lower compared to other months, quarters, or years? Simply tracking sales-qualified leads to customer conversion isn’t enough. You need to monitor this key performance indicator religiously and look for attributable spikes in conversions.
What can you do to improve this metric? Outreach like simple text reminders are one of the most effective tactics for driving increased sales to customer conversions. After a member of your sales team meets with a sales qualified lead, try sending an automated reminder a few days after the initial touchpoint:
Hey _______. Did you have any additional questions or concerns related to our product/service? To get started, visit: _______. To speak with a customer service representative, reply ‘SERVICE’.
6.Customer Lifetime Value
How much are your customers worth? It’s a fairly arbitrary question that seems a bit daunting to determine. This key performance indicator is a great way to gauge the total return on investment of your company and can be used to strategize future goals and objectives of the business.
Follow this simple formula to calculate customer lifetime value: Revenue x Gross Margin x Average # of Repeat Purchases. If your company doesn’t receive repeat purchases, simply remove that part from the equation.
Use this KPI to make changes to your pricing strategy. For example, if you have a very high price, and customers aren’t seeing matching value from your product/service, you’re probably suffering from poor retention rates. To address this problem, potentially reduce the price, change the packaging, or look for opportunities to deliver greater value to your customers.
7.Landing Page Conversion
A landing page is any webpage that collects visitor information. If landing pages aren’t drawing suspects in and converting them to marketing qualified leads, your business is destined to fail. To assess the effectiveness of your landing page, start by reviewing your calls-to-action and making simple on-page optimizations.
Do your calls-to-action promote a clear and logical next step? Are your calls-to-action compelling? Are your landing pages easy to navigate? Are your forms simple and easy to fill out? Have you considered other optimizations like meta information, content hierarchies, and image alt tags?
Ask any inbound marketer, and they’ll tell you that organic traffic is one of the most important data points to monitor. In short, organic traffic measures the effectiveness of your content marketing programs. Your total organic traffic can be made up of any number of traffic sources as long as the results are earned, not paid.
In most instances, organic traffic is driven by search engine optimization. Businesses and organizations that consistently create optimized content will see a steady increase in total organic traffic. As business owner, executive, or marketer, it’s your duty to monitor search keywords and high-ranking pages to identify new search engine optimization opportunities.
We know that the pace of technological innovation is getting faster and faster every day. Today, businesses and organizations use all-new digital innovations to create deeper and more authentic connections with prospects and customers. As such, an increasing number of industry-leading enterprises have begun to prioritize mobile traffic as a KPI.
The fact is, mobile marketing innovations promise to revolutionize the way businesses and organizations deploy marketing messages. Additionally, more and more consumers use mobile devices as a primary means of communicating, shopping, and more. If you’re thinking about investing in a mobile marketing strategy, know that it is a worthwhile investment destined for success.
For many businesses, focusing on the right marketing metrics starts with asking the right questions. What are your marketing goals and objectives? What marketing channels, tactics, and strategies should your business prioritize in order to accomplish these marketing goals and objectives? Following up these questions with thoughtful answers and then setting actionable marketing KPIs will get you on the right path.