If your company is using digital marketing to reach customers and prospects, then it’s important to track campaign performance. After all, the better the campaign performs, the higher your profits will be. To understand how your marketing performs, we rely on KPIs.
What is a Digital Marketing KPI?
A key performance indicator (KPI) is a quantifiable measure, or metric, that you can use to gauge some aspect of your business’ performance. KPIs can be related to any part of your business, from employee performance to sales. —DashThis
When selecting metrics to examine for digital marketing performance, you should look at numbers that are generated directly from your marketing strategy. Metrics including:
- Brand awareness
- Lead generation
- Sales growth
- Online sales revenue
- Website traffic
- Conversion rates
- Page conversion
- Marketing qualified leads (MQL)
- Engagement rate
- Total revenue
KPIs can be any measurable value that relates to your digital marketing strategy that is actionable. KPIs can come from any source that is part of your digital marketing campaigns, such as social media sites Facebook, Instagram, TikTok, LinkedIn, or online tools like Google Ads, Bing Ads, Google Analytics. You can also include metrics generated in-house from your sales team, lead conversion tools, or other marketing activities.
Why Track KPIs?
Tracking your KPIs will help you understand which marketing strategies are working and which aren’t. Maybe the majority of your revenues are coming from social media, for instance. If so, you need to understand why, and why the other channels are underperforming.
According to Amine Rahal in Forbes,
The KPIs you zero in on will depend on the nature of your campaigns and your intended audience. Naturally, you’re probably going to want to focus on revenue-based metrics if you’re presenting to the C-suite. If you’re speaking to a social media executive, then it makes more sense to concentrate on leads generated, total engagement, or cost per thousand impressions (CPM) on your ad spend.
Choosing KPIs to Track
How do you choose which KPIs are “key” for your business? Start by looking at your marketing goals and then work backward. If you don’t send out emails to a mailing list, for example, then you don’t need to track email marketing metrics. Whichever KPIs you choose to track must be SMART:
Don’t go overboard tracking everything and everyone. Track only the metrics that will give you useful insights into how you can improve your bottom line. If a metric isn’t anything you can act on, then it’s not worth tracking.
Important Digital Marketing KPIs to Measure
Although your company’s KPIs to track may not be the same as another company, most companies working with digital marketing will track these categories:
- Search engine optimization (SEO)
- Social media
- Email marketing
- Paid search engine marketing (SEM)
- Website and blog content (content marketing)
General Marketing KPIs
Customer Lifetime Value (CLV)
How much revenue does a typical customer generate over time? Time is relative to your business. It can be days, months, years depending on customer retention rate, service offerings, and back-end products.
Customer Acquisition Cost
What do you spend to gain a new customer? What is your process? This includes advertising, prospecting, and conversion costs.
Return on Investment (ROI)
How much profit do you earn related to the costs generated to gain new customers?
A conversion rate is what percentage of website visitors become leads, and how many leads become customers. You can track this as a general KPI, or track each channel separately.
Search Engine Optimization KPIs
Search engine optimization KPIs measure metrics related to search engine traffic.
Search traffic numbers include the following:
- Total visits
- Unique visitors
- Organic traffic
- Website visitors
- Traffic sources
- Page views
- Top pages
And anything else you track related to search engine traffic.
Keyword rankings measure how your search engine rankings compare for your keywords and phrases.
How many backlinks do you have from other sites? How do these backlinks affect your traffic and conversions?
How much authority do search engines assign your domain? How does that break down when looking at each page? This shows how important search engines rank your content.
Bounce rate is the measurement of how often someone reaches your page, then immediately clicks away. This can tell you which pages need improvement to retain visitors longer.
Social Media KPIs
This category measures metrics for traffic and engagement on social media.
Likes, Comments, Shares
Social media exposure is measured in likes, comments, and shares. These can tell you how popular your posts are, and how visitors engage with your content.
Follower Growth Rate
How fast does your list of followers grow? This metric measures growth over time.
Social Media Traffic
Similar to search engine traffic above, this metric measures traffic from social media sites. Some companies measure social media traffic from each channel separately.
Social Media Conversions
Similar to search engine traffic conversions. You can congregate conversions or measure them by each channel.
Paid Search Marketing KPIs
Paid search marketing KPIs measure costs and results from paid search engine ads.
Cost Per Click (CPC)
When using any kind of paid search marketing, CPC is a necessary KPI.
Click-Through Rate (CTR)
Another fundamental metric, your CTR tracks clicks, and may affect your CPC.
Ad Quality Score
Ad quality scores can affect your CPC. A more relevant ad with a better CTR usually has a higher quality score, which results in lower CPCs.
Email Marketing KPIs
This category measures KPIs related to your email marketing campaigns.
This metric measures the percentage of visitors that sign up for your email list, no matter the incentive.
How many email subscribers open the email? How effective is your email subject line?
Click-Through Rate (CTR)
Similar to CPC for social media, this measures how many subscribers open your email, and click on the links within.
Bounce rate for emails means emails are not being delivered; the email bounces back.
Which messages cause more people to unsubscribe to your mailing list? How many unsubscribe to each email?
Are you just getting started with tracking KPIs? Do you need help deciding which KPIs are important for your company to track? To learn more about KPIs that apply to your digital marketing strategy, contact a professional agency today.