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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.

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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.

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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.

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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.

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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.

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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?

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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.

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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.

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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.

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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.

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 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.

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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).

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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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Measuring Content Impact Across The Customer Journey

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Measuring Content Impact Across The Customer Journey

Understanding the impact of your content at every touchpoint of the customer journey is essential – but that’s easier said than done. From attracting potential leads to nurturing them into loyal customers, there are many touchpoints to look into.

So how do you identify and take advantage of these opportunities for growth?

Watch this on-demand webinar and learn a comprehensive approach for measuring the value of your content initiatives, so you can optimize resource allocation for maximum impact.

You’ll learn:

  • Fresh methods for measuring your content’s impact.
  • Fascinating insights using first-touch attribution, and how it differs from the usual last-touch perspective.
  • Ways to persuade decision-makers to invest in more content by showcasing its value convincingly.

With Bill Franklin and Oliver Tani of DAC Group, we unravel the nuances of attribution modeling, emphasizing the significance of layering first-touch and last-touch attribution within your measurement strategy. 

Check out these insights to help you craft compelling content tailored to each stage, using an approach rooted in first-hand experience to ensure your content resonates.

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Whether you’re a seasoned marketer or new to content measurement, this webinar promises valuable insights and actionable tactics to elevate your SEO game and optimize your content initiatives for success. 

View the slides below or check out the full webinar for all the details.

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How to Find and Use Competitor Keywords

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How to Find and Use Competitor Keywords

Competitor keywords are the keywords your rivals rank for in Google’s search results. They may rank organically or pay for Google Ads to rank in the paid results.

Knowing your competitors’ keywords is the easiest form of keyword research. If your competitors rank for or target particular keywords, it might be worth it for you to target them, too.

There is no way to see your competitors’ keywords without a tool like Ahrefs, which has a database of keywords and the sites that rank for them. As far as we know, Ahrefs has the biggest database of these keywords.

How to find all the keywords your competitor ranks for

  1. Go to Ahrefs’ Site Explorer
  2. Enter your competitor’s domain
  3. Go to the Organic keywords report

The report is sorted by traffic to show you the keywords sending your competitor the most visits. For example, Mailchimp gets most of its organic traffic from the keyword “mailchimp.”

Mailchimp gets most of its organic traffic from the keyword, “mailchimp”.Mailchimp gets most of its organic traffic from the keyword, “mailchimp”.

Since you’re unlikely to rank for your competitor’s brand, you might want to exclude branded keywords from the report. You can do this by adding a Keyword > Doesn’t contain filter. In this example, we’ll filter out keywords containing “mailchimp” or any potential misspellings:

Filtering out branded keywords in Organic keywords reportFiltering out branded keywords in Organic keywords report

If you’re a new brand competing with one that’s established, you might also want to look for popular low-difficulty keywords. You can do this by setting the Volume filter to a minimum of 500 and the KD filter to a maximum of 10.

Finding popular, low-difficulty keywords in Organic keywordsFinding popular, low-difficulty keywords in Organic keywords

How to find keywords your competitor ranks for, but you don’t

  1. Go to Competitive Analysis
  2. Enter your domain in the This target doesn’t rank for section
  3. Enter your competitor’s domain in the But these competitors do section
Competitive analysis reportCompetitive analysis report

Hit “Show keyword opportunities,” and you’ll see all the keywords your competitor ranks for, but you don’t.

Content gap reportContent gap report

You can also add a Volume and KD filter to find popular, low-difficulty keywords in this report.

Volume and KD filter in Content gapVolume and KD filter in Content gap

How to find keywords multiple competitors rank for, but you don’t

  1. Go to Competitive Analysis
  2. Enter your domain in the This target doesn’t rank for section
  3. Enter the domains of multiple competitors in the But these competitors do section
Competitive analysis report with multiple competitorsCompetitive analysis report with multiple competitors

You’ll see all the keywords that at least one of these competitors ranks for, but you don’t.

Content gap report with multiple competitorsContent gap report with multiple competitors

You can also narrow the list down to keywords that all competitors rank for. Click on the Competitors’ positions filter and choose All 3 competitors:

Selecting all 3 competitors to see keywords all 3 competitors rank forSelecting all 3 competitors to see keywords all 3 competitors rank for
  1. Go to Ahrefs’ Site Explorer
  2. Enter your competitor’s domain
  3. Go to the Paid keywords report
Paid keywords reportPaid keywords report

This report shows you the keywords your competitors are targeting via Google Ads.

Since your competitor is paying for traffic from these keywords, it may indicate that they’re profitable for them—and could be for you, too.

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You know what keywords your competitors are ranking for or bidding on. But what do you do with them? There are basically three options.

1. Create pages to target these keywords

You can only rank for keywords if you have content about them. So, the most straightforward thing you can do for competitors’ keywords you want to rank for is to create pages to target them.

However, before you do this, it’s worth clustering your competitor’s keywords by Parent Topic. This will group keywords that mean the same or similar things so you can target them all with one page.

Here’s how to do that:

  1. Export your competitor’s keywords, either from the Organic Keywords or Content Gap report
  2. Paste them into Keywords Explorer
  3. Click the “Clusters by Parent Topic” tab
Clustering keywords by Parent TopicClustering keywords by Parent Topic

For example, MailChimp ranks for keywords like “what is digital marketing” and “digital marketing definition.” These and many others get clustered under the Parent Topic of “digital marketing” because people searching for them are all looking for the same thing: a definition of digital marketing. You only need to create one page to potentially rank for all these keywords.

Keywords under the cluster of "digital marketing"Keywords under the cluster of "digital marketing"

2. Optimize existing content by filling subtopics

You don’t always need to create new content to rank for competitors’ keywords. Sometimes, you can optimize the content you already have to rank for them.

How do you know which keywords you can do this for? Try this:

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  1. Export your competitor’s keywords
  2. Paste them into Keywords Explorer
  3. Click the “Clusters by Parent Topic” tab
  4. Look for Parent Topics you already have content about

For example, if we analyze our competitor, we can see that seven keywords they rank for fall under the Parent Topic of “press release template.”

Our competitor ranks for seven keywords that fall under the "press release template" clusterOur competitor ranks for seven keywords that fall under the "press release template" cluster

If we search our site, we see that we already have a page about this topic.

Site search finds that we already have a blog post on press release templatesSite search finds that we already have a blog post on press release templates

If we click the caret and check the keywords in the cluster, we see keywords like “press release example” and “press release format.”

Keywords under the cluster of "press release template"Keywords under the cluster of "press release template"

To rank for the keywords in the cluster, we can probably optimize the page we already have by adding sections about the subtopics of “press release examples” and “press release format.”

3. Target these keywords with Google Ads

Paid keywords are the simplest—look through the report and see if there are any relevant keywords you might want to target, too.

For example, Mailchimp is bidding for the keyword “how to create a newsletter.”

Mailchimp is bidding for the keyword “how to create a newsletter”Mailchimp is bidding for the keyword “how to create a newsletter”

If you’re ConvertKit, you may also want to target this keyword since it’s relevant.

If you decide to target the same keyword via Google Ads, you can hover over the magnifying glass to see the ads your competitor is using.

Mailchimp's Google Ad for the keyword “how to create a newsletter”Mailchimp's Google Ad for the keyword “how to create a newsletter”

You can also see the landing page your competitor directs ad traffic to under the URL column.

The landing page Mailchimp is directing traffic to for “how to create a newsletter”The landing page Mailchimp is directing traffic to for “how to create a newsletter”

Learn more

Check out more tutorials on how to do competitor keyword analysis:

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Google Confirms Links Are Not That Important

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Google confirms that links are not that important anymore

Google’s Gary Illyes confirmed at a recent search marketing conference that Google needs very few links, adding to the growing body of evidence that publishers need to focus on other factors. Gary tweeted confirmation that he indeed say those words.

Background Of Links For Ranking

Links were discovered in the late 1990’s to be a good signal for search engines to use for validating how authoritative a website is and then Google discovered soon after that anchor text could be used to provide semantic signals about what a webpage was about.

One of the most important research papers was Authoritative Sources in a Hyperlinked Environment by Jon M. Kleinberg, published around 1998 (link to research paper at the end of the article). The main discovery of this research paper is that there is too many web pages and there was no objective way to filter search results for quality in order to rank web pages for a subjective idea of relevance.

The author of the research paper discovered that links could be used as an objective filter for authoritativeness.

Kleinberg wrote:

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“To provide effective search methods under these conditions, one needs a way to filter, from among a huge collection of relevant pages, a small set of the most “authoritative” or ‘definitive’ ones.”

This is the most influential research paper on links because it kick-started more research on ways to use links beyond as an authority metric but as a subjective metric for relevance.

Objective is something factual. Subjective is something that’s closer to an opinion. The founders of Google discovered how to use the subjective opinions of the Internet as a relevance metric for what to rank in the search results.

What Larry Page and Sergey Brin discovered and shared in their research paper (The Anatomy of a Large-Scale Hypertextual Web Search Engine – link at end of this article) was that it was possible to harness the power of anchor text to determine the subjective opinion of relevance from actual humans. It was essentially crowdsourcing the opinions of millions of website expressed through the link structure between each webpage.

What Did Gary Illyes Say About Links In 2024?

At a recent search conference in Bulgaria, Google’s Gary Illyes made a comment about how Google doesn’t really need that many links and how Google has made links less important.

Patrick Stox tweeted about what he heard at the search conference:

” ‘We need very few links to rank pages… Over the years we’ve made links less important.’ @methode #serpconf2024″

Google’s Gary Illyes tweeted a confirmation of that statement:

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“I shouldn’t have said that… I definitely shouldn’t have said that”

Why Links Matter Less

The initial state of anchor text when Google first used links for ranking purposes was absolutely non-spammy, which is why it was so useful. Hyperlinks were primarily used as a way to send traffic from one website to another website.

But by 2004 or 2005 Google was using statistical analysis to detect manipulated links, then around 2004 “powered-by” links in website footers stopped passing anchor text value, and by 2006 links close to the words “advertising” stopped passing link value, links from directories stopped passing ranking value and by 2012 Google deployed a massive link algorithm called Penguin that destroyed the rankings of likely millions of websites, many of which were using guest posting.

The link signal eventually became so bad that Google decided in 2019 to selectively use nofollow links for ranking purposes. Google’s Gary Illyes confirmed that the change to nofollow was made because of the link signal.

Google Explicitly Confirms That Links Matter Less

In 2023 Google’s Gary Illyes shared at a PubCon Austin that links were not even in the top 3 of ranking factors. Then in March 2024, coinciding with the March 2024 Core Algorithm Update, Google updated their spam policies documentation to downplay the importance of links for ranking purposes.

Google March 2024 Core Update: 4 Changes To Link Signal

The documentation previously said:

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“Google uses links as an important factor in determining the relevancy of web pages.”

The update to the documentation that mentioned links was updated to remove the word important.

Links are not just listed as just another factor:

“Google uses links as a factor in determining the relevancy of web pages.”

At the beginning of April Google’s John Mueller advised that there are more useful SEO activities to engage on than links.

Mueller explained:

“There are more important things for websites nowadays, and over-focusing on links will often result in you wasting your time doing things that don’t make your website better overall”

Finally, Gary Illyes explicitly said that Google needs very few links to rank webpages and confirmed it.

Why Google Doesn’t Need Links

The reason why Google doesn’t need many links is likely because of the extent of AI and natural language undertanding that Google uses in their algorithms. Google must be highly confident in its algorithm to be able to explicitly say that they don’t need it.

Way back when Google implemented the nofollow into the algorithm there were many link builders who sold comment spam links who continued to lie that comment spam still worked. As someone who started link building at the very beginning of modern SEO (I was the moderator of the link building forum at the #1 SEO forum of that time), I can say with confidence that links have stopped playing much of a role in rankings beginning several years ago, which is why I stopped about five or six years ago.

Read the research papers

Authoritative Sources in a Hyperlinked Environment – Jon M. Kleinberg (PDF)

The Anatomy of a Large-Scale Hypertextual Web Search Engine

Featured Image by Shutterstock/RYO Alexandre

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