Business Owners Love Metrics
The language of an entrepreneur is results. Measuring the impact of your digital marketing strategy is key to communicating the value that online advertising delivers. Establishing a comprehensive plan to monitor your advertising campaign will provide proof that your advertising spend is generating results. Whether you are a business owner or a digital marketing professional, these metrics will provide insight into what is working and what can be improved to increase your bottom line and generate positive return on investment (ROI). Fortunately for us, Google Analytics provides nearly everything we need to track our success!1. Website Traffic Monitoring
The first goal of advertising is getting potential customers to your site. Google analytics will measure the total number of unique visitors that arrive at your landing page and will break it down for you based on seven insightful sources.
- Organic ( visitors who clicked on search engine results )
- Paid ( Visitors who click on search engine ads
- Social Media
- Referral (Visitors who clicked on a link from another website )
- Direct (Visitors directed to your site from an unknown source )
As a marketing professional, this your opportunity to provide valuable insight by determining whether or not advertising spend should be focused on one of these types of visitors or be re-allocated from one to another!2. Impressions and Reach
Impressions are the number of times that a particular advertisement has been visible on someone's device. Reach is the total number of unique viewers who have seen a particular ad, whether it was on a website or on someone's social media page. Although user's may not have clicked on it, research shows that it likely registered with them subliminally and this can be a powerful way to gain and measure brand awareness. Positive brand awareness is one of the first ways to start converting interest into customers.3. Conversion Rate
When website visitors complete an activity, we call that a conversion. Your conversion goal may be a purchase, an email sign-up, or some other action that indicates desired engagement. This metric has supreme importance because it often correlates directly with revenue. Determining how best to increase your conversion rate can be the difference between a good year and a great year. One strategy developed by a Saginaw Digital Marketing professional is related to funnel marketing. This strategy consists of generating brand awareness, targeted social media ads, and methods for triggering purchases.4. CPC (cost-per-conversion)
One advantage of tracking conversion is that it allows you to calculate a cost-per-conversion which is equal to the total cost of an advertising campaign divided by the total number of conversions. Not only may this provide evidence of the value of digital advertising, but it may also determine the potential opportunity that improving conversion may bring. If website traffic is picking up but conversion it still low, that's an opportunity to re-assess website content or target a different market segment.5. CPA (cost-per-acquisition)
The cost of running an advertisement divided by the total conversions of that advertisement is the average cost per acquisition. You may find out that running more ads ends up resulting in more customers but at some point will break down. By running multiple campaigns with increasing number of ads, you will be able to determine how well this metric scales and find the sweet spot for maximizing profit. This will help you determine the most effective way to allocate spending across your ad campaigns.6. Conversion rates by channel
You may see wildly different conversion results for different channel. For example, website visitors from a specific social media site may be dominating your sales. If that's the case, it might make sense to target those users with additional social media advertising. If organic search has a high conversion rate but low traffic, maybe its time to focus on some search engine optimization. That's how this tool will help for allocating marketing budgets efficiently.7. LTV (lifetime value)
Google provides several metrics for reporting LTV but the bottom line is that measures how valuable different users are over the lifetime of your business. Some customers may only make one purchase while others will keep coming back again and again. A customer LTV is calculated as the average transaction value times the annual purchase frequency times the expected years of customer retention. Investing some time to improve customer retention may improve LTV significantly. This metric allows you to focus more resources on attracting customers from your preferred channel.8. ROAS (return on advertising spend)
ROAS is the total revenue from a campaign divided by the total advertising spend of the campaign. This is often the bottom line for business owners in determining the effectiveness of a marketing campaign as it doesn't include the cost of the marketing department salaries. Comparing a year's worth of 1-3 month campaigns is the best way to determine which campaign was the most effective and where to devote resources in the future. A more comprehensive overview would compare year-over-year (YoY) ROAS as this will give a broader picture without the effects of seasonality or holidays. Improving ROAS may be a signal an opportunity for marketing teams request additional advertising budget to increase overall revenue and even salary bonuses!