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15 Digital Marketing ROI Metrics You Need To Know

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15 Digital Marketing ROI Metrics You Need To Know


Digital marketing and its corresponding metrics of success and ROI are evolving at break-neck speed.

Over the last few years  (and especially due to COVID), the transformation to digital has accelerated years ahead of what was expected.

Any marketer who has ever dipped their toe into the Google Analytics pool can attest that the sheer volume of data available can be overwhelming.

In order to cut through the noise and accurately measure the ROI of your digital marketing efforts, it’s important that you’ve identified the key metrics you want to track.

In this article, you’ll find 15 essential metrics that will help you measure the ROI of your digital marketing, tell you if your efforts are successful, and show you where adjustments may be needed.

Which Metrics Help You Measure Digital Marketing ROI?

  1. Cost per lead (CPL).
  2. Lead close rate.
  3. Cost per acquisition (CPA).
  4. Average order value (AOV).
  5. Conversion rates by channel.
  6. Conversion rates by device.
  7. Exit rate.
  8. Blog click-through rates.
  9. Customer lifetime value (CLV).
  10. Net Promoter Score (NPS).
  11. Time invested in project/campaign vs. returns.
  12. Traffic to lead ratio.
  13. Return on Ad Spend (ROAS).
  14. Overall revenue.
  15. Customer retention rate.

1. Cost Per Lead

If your website is collecting leads, you need to know how much you’re paying for each lead.

If the cost of each lead is more than what you produce by closing leads, that indicates a backward return on investment.

Knowing your cost per lead lets you know how well your marketing efforts are performing and give you the insight you’ll need for making further strategic and budget decisions.

2. Lead Close Rate

How do you track your lead closes?

Too often, this is happening offline which means that data isn’t being integrated into analytics or the online data you’re gathering.

That’s fine, but you need to make sure you keep an eye on your lead close rate so you can check that against the leads being generated.

This will help ensure your digital marketing efforts are delivering leads profitably.

This information is also helpful to use as a control against new digital marketing efforts.

If you suddenly get an influx of new leads but find they close at a lower rate, you may need to adjust your targeting efforts.

Measuring close rates also gives you insight into how sales teams and representatives are closing leads into sales.

3. Cost Per Acquisition

Using the data above, you should now be able to figure out your cost per acquisition.

This can be figured out simply by dividing your marketing costs by the number of sales generated.

You now know what it costs to get a sale, which will help you get a firmer grasp on your ROI.

Many digital marketing leaders operate on Cost per Acquisition (CPA) models as they only pay for lead or sales based on a set amount or goal.

This helps push and drive goals to conversions or pre-set outcomes.

 4. Average Order Value

While you want to see the number of your orders increase, paying attention to the value of the average ticket can reap significant rewards.

AOV is an essential metric that can help marketers keep track of profits and manage revenue growth and profit reporting.

A slight increase in average order value can bring in thousands of dollars of new revenue and can often be as simple as improving user experience and providing up-sell opportunities.

5. Conversion Rates By Channel

Integrated digital marketing strategies are now essential to overall performance and revenue.

CMOs are increasingly looking and under pressure to see what channels are performing and what channels are the most cost-effective.

As marketers, we all like to know where our traffic is coming from.

Whether it’s organic, paid, social media, or other avenues, this information tells us where the bulk of our customers are and/or where the marketing efforts are producing the most buzz.

But that’s not the whole story.

Conversion rates can be a better indicator of success and let you know where the best opportunities lie.

Let’s say 75% of your traffic comes from organic marketing and 25% from PPC. But lo and behold, your PPC conversion rates are double that of organic.

What you learn from this is simple: Invest more in PPC. If you can increase PPC traffic to match organic, you’ve just doubled your ROI.

Screenshot from Google Analytics, January 2022

Attribution reporting also helps you understand how channels interact and which channels can influence others with conversion lift.

6. Conversion Rates By Device

Just like checking conversion rates by channel, you want to do the same by the device.

If one device has lackluster conversion performance, it may be time for you to reinvest in that area, especially if you see traffic for that device increasing.

Mobile is an excellent example of how device shifts happen, and depending on the device, conversion rates will vary.

This is especially true for marketers in ecommerce and retail, where more and more are purchasing via mobile and tablet devices.

7. Exit Rate

How many visitors leave your website from a specific landing page?

Your website analytics should give you the specific number of exits from each of your landing pages.

It may also give a percentage that is the number of exits/the number of page views the landing page has received.

Use the highest number of exits or highest exit rate percentage to determine which landing pages need conversion rate optimization and additional improvement for stickiness.

8. Blog Click-Through Rates

Blogs are a great way to showcase your brand and thought-leadership and get traffic to your site, but what are you doing with that traffic?

While blogs have notorious high bounce and exit rates, that doesn’t mean you have to resign yourself to those ridiculously valueless numbers.

Instead, use them to set goals for driving traffic from your blog to your main site.

A small increase in blog click-throughs can provide valuable new business at almost no additional marketing costs.

9. Customer Lifetime Value

You can’t truly understand the ROI of your marketing efforts until you have a good idea of what the average customer will spend over their lifetime.

Let’s say, for example, that it costs you $500 to bring in a new sale or client. But they only make a $500 purchase.

Well, that seems like a net loss once you consider the cost of everything else beyond your marketing investment.

But what if you knew that that customer would go on to spend $500 every six months for the next five years.

The average lifetime value of that client is $5,000.

Now, $500 to get that customer doesn’t seem so bad, eh?

LTV = Average Revenue Per User (ARPU) x 1/Churn

That’s not to say you want to come out at a loss on every first-time customer, but if the initial investment brings a hefty long-term profit, you can more easily chalk up that first sale as a marketing expense, knowing profits are to come.

10. NPS

Net Promoter Score (NPS) is a metric where customers indicate if they would recommend a product or service to other people and companies.

Net Promoter ScoreScreenshot from SurveyMonkey, August 2021

Based on a scale of 1-10, the scores given are a good indicator of customer loyalty and satisfaction.

NPS = % promoters v % detractors

Tracking promoters v detractors (customers who have left or are thinking of going) helps you measure and improve customer service strategies and tactics.

11. Time Invested In Project/Campaign Vs. Returns

Do you know how much time each person in your organization invested in a particular project or campaign?

If you want to get the most out of each employee’s expertise, you need to ensure that they are working on projects that are worth their time.

For example, if you have programmers who range from entry to expert, who would you want to work on the projects that generate the highest revenue in your organization?

The expert-level programmers, of course.

Once you know the value of your projects, you can distribute the right people to the right projects.

12. Traffic To Lead Ratio

An increase in website traffic is a positive sign that your digital marketing campaigns are working. But do those results actually affect your company’s bottom line?

Another way to determine the value of your marketing campaigns is with the traffic to lead ratio. This KPI simply measures the percentage of visitors who turn into leads.

For example, let’s say that your website received 5,000 visitors this month. 500 visitors converted into a lead. For this month, you would have a 10:1 traffic to lead ratio or 10% conversion rate for visitors to leads.

 13. ROAS

Measuring Return on Ad Spend helps identify how well your advertising and paid campaigns are doing.

Digital Marketers are able to see that they spent X and got Y.

This is particularly important when reviewing performance, comparing channel spend and forecasting for the future.

The majority of marketers work to a rule that you should have a 3X return on your investment.

14. Overall Revenue

As marketers, we are constantly challenged with comparisons to sales performance.

  • When sales perform, sales are the star, and marketing gets little mention.
  • When sales don’t go well, marketing suddenly gets more mentions.

Try to avoid these conflicts by measuring and attributing everything you do.

This could be an entire campaign, a marketing touch or assist, or an asset.

Ensure that your marketing and sales team has synergy in tracking and reporting on bottom-line revenue.

Agree on rules and accountability paths on leads, opportunities, and any marketing activity that impacts or influences sales revenue.

15. Customer Retention Rate

Do you know how to measure the number of customers your business has retained?

To calculate your customer retention rate over a specific time period, use the following formula.

Customer Retention Rate = ((E – N) / S) x 100

For the time period you are analyzing, you will use the number of customers you ended the period with (E), the number of customers you gained during the period (N), and the number of customers you started the period with (S).

Let’s say that you began the quarter with 200 customers. During the quarter, you gained 35 customers and lost five.

Your formula would look like this:

97.5% = ((230 – 35) / 200) x 100

Conclusion

Regardless of your industry and type of business “what is the ROI?” is the question all CEOs and CMOs will be asking this year.

As digital marketing grows and adoption soars, so does the pressure to deliver results.

Utilize the digital metrics identified in this article and let the data tell your ROI story.

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Featured Image: Grayscale Studio/Shutterstock





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12 Powerful Email Marketing Tips You Need to Know

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12 Powerful Email Marketing Tips You Need to Know

There is no doubt that email marketing is effective. But how many times have you sat down to begin an email marketing project and immediately felt overwhelmed?

Sometimes, it’s hard to know where to start, especially when working with a newer brand.

The good thing is that email marketing has never been easier, thanks to automation tools and innovative ways to deliver emails directly into subscribers’ inboxes.

If you don’t know where to begin or want to improve your current workflow, this article is for you.

So now, let’s look at some simple steps you can follow to ensure you’re using email marketing wisely.

Where To Begin With Email Marketing

So, you’re planning your email marketing strategy for your client. Where do you begin? Here are some helpful tips to get you started:

  • Keep your emails short and sweet. People get tired of reading long emails, so keep yours between 60 to 200 words.
  • People love visuals, especially in email marketing, so include images of your products or services.
  • Social proof helps convince readers that your offer is legitimate and worth their time. This includes sharing links or information in your emails from experts in the industry, positive testimonials, or influencers using the brand.
  • People want to know where to go next after reading your content. And since emails are usually opened on mobile devices, you need to provide a clear CTA at the end of each email. Whether it’s to a product page or recent content produced on the website.
  • Email marketing works best when you send regular emails. But even once a week isn’t enough. Studies show that people respond better to frequent emails than infrequent ones.

Now, let’s discuss the top 12 email marketing components for your strategy:

1. Create Optimized Lead Magnets

So, how do you get people to actually subscribe to your email listing? An effective lead magnet.

A lead magnet is usually the first thing visitors see when they land on a brand’s website. It gets them to click through and read more about a brand, so it needs to be eye-catching and compelling.

And if you don’t optimize your lead magnets for conversion, a brand could lose out on potential leads.

So, how do you make sure your lead magnets convert?

Your lead magnet should grab visitors’ attention right away. That means making it interesting, unique, and relevant to the business.

For example, you can use an incentive like a freebie or discount code to entice people to take action. You could also give away a free report or ebook in exchange for their name and email address.

Your lead magnet could also be the first email they receive, which can be a part of your welcome series (which I’ll talk about briefly).

It entices the users to keep receiving emails, so they don’t immediately unsubscribe after they receive a discount code or something similar.

2. Segment Your Subscribers

You’ve probably heard the term “subscriber segmentation.” It refers to a way of grouping your subscribers into groups based on their interests and behavior so that you can send them more relevant content, offers, and other messages.

This is an integral part of email marketing because it allows you to target your audience with personalized emails.

You can also use this technique to create multiple versions of your emails, such as a welcome email, a thank you email, and a follow-up email.

Segmenting your subscribers can help build trust and long-term interest for a brand because it presents them with information or offers they actually want to receive.

3. Craft A Welcome Series 

Welcome emails are usually sent automatically to new subscribers when they sign up, purchase a product, or make an account.

When creating a welcome series, you need to consider where the customer is in their journey with a brand. So, it’s beneficial to space the emails out over a set period of time and create each one with a specific intention.

A welcome series is a great way to keep potential customers engaged after they sign up. Especially since they receive emails from companies almost daily.

Some examples include: “Welcome! We hope you like our product” or “Your account has been activated.”

You can also send welcome emails to existing customers who haven’t logged in for a while.

For example, if someone signs up and doesn’t use the service for three months, you could send an email saying, “Hey, we noticed that you signed up recently. Would you be interested in using our service?”

This type of marketing is very effective because it’s personalized and targeted. It shows that you’re not sending out mass emails but rather ones specifically tailored to specific customers.

These emails are also a great way to help build trust with your customers and get them used to receiving emails from you.

4. Implement Automation

So now, you’ve done the work to craft an email series. Next, it’s time to automate their delivery, so you don’t have to send them out each time you need to, according to your schedule.

Automation in email marketing is easy to do using tools like MailChimp, Constant Contact, Campaign Monitor, and Convertkit.

These types of programs allow you to create automated emails based on triggers, such as when someone opens your email, clicks on a link, or purchases something from you.

This way, you no longer need to manually send out those emails, which can alleviate some stress when you’re dealing with a multitude of different subscribers.

5. Design Mobile-Friendly Emails

As I mentioned earlier, most people use their phones to check their emails, so making them mobile-friendly is crucial.

The email should be optimized for mobile phones if it promotes sales or discounts. For example, any sales information or product pictures should be easily viewed on their mobile device.

And users should be able to click on the promotion, link, or image and give them the option to view the brand’s site in their preferred browser on their phone.

The key elements to consider when designing mobile-friendly emails include:

  • Placing important links at the top of the page rather than down below.
  • Keeping graphics small.
  • Using text only where appropriate.
  • Optimizing images.
  • And testing different sizes of fonts and margins.

6. Personalize Your Emails

Even though the average person receives numerous unsolicited emails daily, sending personalized messages to potential leads is proven to boost response rates.

Personalizing your emails makes them feel less like spam. Plus, it gives your subscribers a sense of connection to you.

The key to successful email marketing is knowing exactly who you want to send emails and which messages resonate best with each group of recipients.

Once you know what works and what doesn’t, you can tailor your messages specifically to your audience and keep them coming back for more.

First, choose a subject line that clearly states what you will say in your email. This will help readers decide whether or not to click through your email.

Next, include a call to action, such as asking subscribers to check out a new product or sign up for a free trial.

Finally, customize each individual message by adding links to pages on your site where interested parties can read more information.

Get creative and do your research for the industry. For example, does adding emojis help to personalize the email, or is that a no-no for that specific industry?

7. A/B Test Email Content

The A/B testing of email content is a great way to improve your open rate. It’s also an excellent way to get more people on board with a product or service.

But it can be challenging to figure out what works best for you and your audience.

A/B testing helps marketers decide what works best for their business. For example, when designing email campaigns, it’s often necessary to split-test different versions of emails to determine which one performs better.

You can also test different subject lines. Subject lines are one of the most important parts of any email. They’ll help determine whether someone opens your message or not. It’s what hooks the subscriber to learn more.

The best way to test different variations of emails is to use A/B email testing software. This allows you to compare two versions side by side while showing only one version to half of your users at any given moment so that they don’t realize they’re receiving two different messages.

Most email automation platforms can also conduct A/B testing for your emails. And A/B testing isn’t just beneficial for email. For example, it’s important to test copy and content on a brand’s website, so A/B testing will come in handy in more ways than one.

8. Find The Best Timing

The best time to send emails to customers depends on several factors – such as when they last visited your website, what action they took while on your site, whether they completed any transactions, and more.

One way to determine which times work best for email campaigns is by using Google Analytics. You can use the Goal conversion section to view bounce rate, exit pages, and other data related to goal completion.

You should also consider other factors and incorporate them when you send emails based on people’s schedules. For example, you can see lower open rates on holidays, late into the evening, as well as Monday morning and Friday evenings.

9. Scrub Your List Of Non-Opens

It’s essential to manage your subscriber list. When you click “send” on your newsletter, your list contains all subscribers who did not open the email. If you see that certain people are ignoring all your emails, you might want to delete them from your list.

To delete them from your list, you need to go to the unsubscribe page, then select remove and confirm. This process may be repeated until all your non-opens are removed.

You don’t want to overload people who have already purchased or are no longer interested in the brand, so you don’t create a negative relationship with them.

Incorporating one of the email management tools to help you eliminate the consistent non-opens can help you manage your subscribers and decrease time spent on this repetitive task.

10. Include A Real Reply Email Address

This is one of the best ways to keep customers coming back for more. Users may want to send any follow-up emails directly to their spam folder if you don’t include an actual reply address.

But when you put your email address in the footer, they know exactly where to go. If a person has questions, they can email the brand’s team.

Again, this also helps build trust with the brand. They know they are communicating with real people who selected these emails for them versus being spammed with nonrelevant or generic content for the masses.

11. Experiment With Lead Generation Ads

The goal of lead generation ads is to reach people who may be interested in buying from the brand.

They usually appear at the top of the page, where they are visible for longer periods of time than other types of ads.

This means people tend to click on them more often than ads below the fold. So, as long as you don’t use these ads too frequently, you should be able to generate leads.

12. Utilize Email Analytics To Improve Campaigns

One way to utilize email analytics to improve campaigns is to check the bounce rate, opens, clicks, and unsubscribes for your emails. Then use that information to enhance your current efforts.

This includes sending emails at different times throughout the week, testing subject lines, changing up the call to action, and testing creative variations.

If you’re still struggling, try experimenting with lead magnets, such as free ebooks, white papers, and webinars.

These allow you to capture leads from those interested in learning about new topics. In addition, measuring results lets you know which emails work and which ones don’t.

You should also compare these variables (such as open rates) to industry metrics. For example, what’s the percentage of bounce rates for the industry you’re working with?

If you aren’t measuring results, you won’t have much data to base future decisions for your next email marketing campaign.

Final Takeaways

Email marketing is still one of the most effective ways to promote your online store, build relationships with customers, and generate sales.

The final step in this process is to put all these pieces together into an effective strategy. This means coming up with creative and effective ways to construct emails and email series.

It also means being able to measure the results of each tactic so that you can continue to improve your efforts going forward.

Leveraging email metrics and incorporating A/B testing can help build relationships with subscribers by presenting them with the information they want to read.

With a little bit of effort and creativity, you can use email marketing to increase a brand’s sales and help create long-term customers.

More Resources:


Featured Image: 13_Phunkod/Shutterstock

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