If you’re a small business owner or early stage company, budgeting for digital marketing activities may seem superfluous at first.
You may wonder whether the money you’ll spend on marketing can be better used for something else. You might wonder whether it’s possible to effectively measure your digital marketing activities. You also probably wonder whether you can measure the Return on Investment (ROI) you’re getting from investing in digital marketing activities, if any.
Well, there’s good news…In the digital age, measurement is what makes marketing a science. It is imperative that you consistently track and report important digital marketing metrics, especially if you’re a small business owner. These digital marketing metrics will make the difference between the unpredictability and instrumenting the success of your digital marketing efforts and your business.
Let’s talk about the most important digital marketing metrics to measure, if you’re a small business owner. So, here goes…
1) Reach/Impressions: Reach is the number of people who received impressions of a post or ad. Impressions are the number of times a post or ad is displayed whether the post is clicked or not. People may see multiple impressions of the same post. Reach typically is less than impressions, as one person can see multiple impressions.
2) Click-throughs: A click-through is when a URL has been clicked to view the webpage it directs to. The click-through rate (CTR) is the ratio of users who click on a specific link to the number of total users who view a page, email or advertisement.
3) Number of Social Connections: This is an important metric today. The number of your social connections will impact other social media related metrics, such as engagement, acquisition, sentiment, influence and social reach.
4) Visits to your website: This is a key metric. You should measure the total visits to your website by customers and potential customers. Besides measuring visits to the website, you can also calculate visits to landing pages and your YouTube page as part of a digital marketing campaign. Measuring the total number of visits will help you understand how well and whether your marketing campaign and marketing channels are driving traffic. In an effective campaign, the total number of visits to your website should grow steadily.
5) New and recurring visitors: This metric tells you how many of your site visitors are new and how many are repeat visitors. This metric is important because it measure the “stickiness” of your website and tells you whether you are encouraging repeat customers and also measures the effectiveness of your outreach efforts.
6) Segmentation of traffic based on point of origin: Channel-specific traffic is important, because the total number of site visits cannot really provide you with a complete picture. The four main channels are: direct, which tell you how many people visited your site directly; referral, which include external links from other sites; organic, which includes visitors who found you after a search, and social, which includes visitors who found you through social media.
7) Bounce rate: This metric tells you how many visitors left your website without exploring it. For example, if a visitor goes to your homepage and then leaves, without exploring any other pages, they will be considered to have “bounced”. If your bounce rate is high, consider changing elements of your home page.
8) Total conversions: This is one of the most important metrics to measure. Conversion means different things to different people. To some, it may mean filling out a form for a newsletter subscription, to others, it may mean buying a product or service through your website. You can typically measure conversions on your website, depending on how it’s built. You can also set up a goal in Google Analytics to track your progress.
9) Customer retention rate: You can measure this by tracking what percentage of customers return to your business (over a specific period of time) to buy again. This metric is also important for calculating the average life-time value of a customer.
10) Cost per Lead: This is a metric typically used by companies selling to businesses. You can calculate your cost per lead by comparing the average monthly cost of your campaign to the total number of leads you generated with that specific channel over the same period. For example, if you spend $1000 on a pay-per-click campaign and achieved a total of 50 conversions over the same period, your cost per lead is $20. Besides this, you should also factor in so called “invisible costs” such as management time, start-up costs and other expenses.
11) Projected Return on Investment (ROI): This is an important metric, because it measures the profitability of your digital marketing campaigns and efforts. A positive ROI means your digital marketing strategy was effective, whereas a negative ROI means that your strategy needs tweaking at best and a total revamp at most. You can calculate your ROI by comparing your cost per lead to your lead to close ratio and then, compare that figure against your average customer value. So, for example, if your cost per lead is $50, and you close 50 percent of your leads, you’ll pay $100 for each successful, new customer. If your customer value for this particular offering is more than $100, your campaign has a positive ROI.
12) Business reputation: Even though this is an intangible metric, the reputation of your business is essential to its survival. The trust and confidence that a consumer has in a particular business translates directly into the bottom line for the business. While in the past, businesses relied on word-of-mouth for reputation building, in today’s age of social networking, websites and other methods of instant communication, businesses have to be even more concerned about the trust they generate in the minds of their consumers.
These are some of the metrics used to measure not just your tangible goals such as the success of your digital marketing campaign, but also less tangible goals, such as brand awareness. If you’re a small business owner or start up, it’s essential to track these metrics to measure the success or failure of your digital marketing efforts.
So keep these metrics in mind when you launch your next digital marketing campaign and you’ll be well on your way to digital marketing success!
by Bruce Worrall, Sep-14-2016