For any business, marketing is a crucial part of the growth process. You can have the nicest product or service in the world, but if no one knows about it, then it’s not going to do much good for you or your customers.
That’s why measuring your marketing efforts is so important: it allows you to see what’s working and what isn’t so that you can optimize for success over time. By measuring your marketing efforts, you get to improve your marketing in the future.
This blog covers
- What Are Marketing Metrics?
- 5 Types Of Marketing Metrics To Measure In 2022
- Customer Acquisition Cost (CAC)
- Customer Lifetime Value (CLV)
- Bounce Rate
- Conversion Rate
- Website Traffic
Let’s dive in!
#1. What Are Marketing Metrics?
Marketing metrics are quantifiable measures of performance that are essential for measuring a campaign’s success. Marketers use various metrics to measure the impacts of their campaigns on the audience. However, in general, they measure the changes in audience actions as a result of their campaigns.
For example, a business goal may be sales generated for one marketing campaign, while incremental reach for another may be the most important marketing metric to measure. Using marketing metrics, marketers can optimize and plan future campaigns based on their understanding of how effective their current campaigns are.
Metrics in marketing are essential for brands because they help them determine the success of their campaigns, and they provide insights that can be used to adjust future campaigns as needed. Ultimately, marketers use them to provide insight into how their campaigns contribute to their business goals, and to optimize their campaigns and marketing channels.
#2. 5 Types Of Marketing Metrics To Measure In 2022
Measuring marketing metrics is a good way for you to know the impact that your marketing efforts are making for your B2B company. By the end of 2022, you should consider measuring the following marketing metrics:
Customer Acquisition Cost (CAC)
Customer Acquisition cost is the amount of money it takes to acquire a customer. This metric is useful if you want to know how much money you need to spend on marketing. You can calculate your customer acquisition cost by dividing the total marketing costs over a given period by the number of new customers during the same period.
Let’s take a look at this example: You have 500 customers, and your CAC is $10 per customer. So, in total, your marketing costs $5,000/month to get 500 new customers every month. In this scenario, you have a very good business model if each of these customers is worth $20/month in revenue, which means that they are very profitable for the company.
Customer Lifetime Value (CLV)
The customer lifetime value (CLV) is the revenue generated by a customer throughout their entire relationship with your business. In plain English, CLV is a measure of the total revenue you generate from a customer throughout their lifetime.
It provides insight into how much you can expect to make from each customer and helps you know whether it’s worth investing in them. The formula for calculating CLV is simple: multiply your customers’ average purchase value, average purchase frequency, and average customer lifespan.
Bounce rate is the portion of users who visit a page on your website and then leave without engaging further. As a metric, it’s considered a good indicator of how well your website is converting visitors into customers. If your bounce rate is high, you should examine why this may be happening and find ways to increase engagement among those visitors who stay on the site for more than one click.
Additionally, if you have an event or promotion that’s generating traffic to your site, you may want to track only these visits so that the metrics reflect only people coming from specific sources rather than all traffic sources in general. To calculate your website’s bounce rate divide the number of single-page sessions by the number of total sessions on the site.
You should be measuring the conversion rate of your marketing initiatives. The conversion rate is the percentage of people who take the desired action such as buying a product or making an inquiry when they are exposed to your marketing content.
For example, if 100 people see an advertisement and 100 of them click on it, that is a 100% conversion rate. Also, if 100 people see an advertisement and 20 of them click on it, that is a 20% conversion rate.
Conversion rates can vary widely based on factors such as:
- Audience demographics (e.g., age, gender)
- Frequency of exposure to messages in various channels (e.g., website vs email vs social media)
- Quality of the campaign content
Website traffic is a broad term that covers the number of visitors (unique IP addresses) that come to your website, the average time on site, and the bounce rate or percentage of visitors who leave immediately after visiting your home page. You can measure this using Google Analytics and implement it into your business strategy.
Your website traffic growth can be calculated by subtracting last month’s (or last year’s) sessions from this month’s (or this year’s). Then multiply the outcome by 100 to convert it to a percentage based on the number of sessions last month (or year).
If you’re not measuring these marketing metrics, you should start as soon as possible. Measure how much it costs to acquire a single customer. Measure how much more money customers will spend with you over their lifetime after buying just once from you. Measure your website visitors as well as the percentage of people who visit your website and leave without doing anything on it. Essentially, measure the percentage of visitors who buy something right away when they come onto your website.
With the changing business landscape, you must measure the right metrics. Measure the wrong ones and you might not understand your business. The five marketing metrics outlined above are some of the most important things you should be measuring if you want to succeed as a marketer today and tomorrow. These metrics will help you understand where your customers are coming from (and going), how long they stay on your site before bouncing off again, what kind of content drives conversions best, etc.