What are marketing metrics? Top 15 Metrics That Matter

Marketing metrics allow you to track your business performance and the effectiveness of your marketing efforts in a quantifiable way. Businesses use marketing metrics to record, measure, and monitor progress over time. It is essential to track these metrics as they will allow you to make informed decisions, optimize marketing channels, and justify budget allocations.

Here are the top 15 marketing metrics that businesses need to measure to track their performance effectively –

Top 15 Marketing Metric

1. Customer Lifetime Value (CLTV)

When you are able to calculate your average CLTV, you can easily understand the true return on investment of your marketing efforts. CLTV is calculated as the amount a customer spends on average on your business offerings each time they buy, how often they purchase, and how long they remain your customer.

Let's understand it with an example:

Stats of Business A in a year:

Revenue: $200,000

Purchases: 4000

Number of individual customers who purchased: 100

1. Average purchase value: $200,000/4000 = $50

2. Average purchase frequency rate: 4000/100 = 40

3. Customer Value: $50 × 40 = $2,000

4. Average customer lifespan: 2.5

5. CLTV: $2000 × 2.5 = $5,000

1. Customer Acquisition Cost (CAC)

By calculating your customer acquisition cost, you can make better marketing strategic decisions. To calculate CAC, divide the amount directed to a marketing channel by the number of clients acquired. For example, if you spent $20,000 on Instagram Ads and as a result generated 4000 customers, your CAC would be $5.

1. Cost per lead (CPL)

CPL is calculated in the same way as CAC is calculated. CPL as a marketing metric is important as it will demonstrate whether you are generating leads at a sustainable cost. Moreover, it will enable you to optimize the various stages of your sales funnel to minimize cost per lead while improving conversions.

For example, if you spend $5000 on ads and generate 5000 leads then your cost per lead would be $1.

1. Marketing Return on Investment (MROI)

The MROI metric delivers an objective and true view of your marketing campaigns. It demonstrates the amount of cold hard cash earned from marketing efforts. You can calculate it in two ways :

• Divide the amount dedicated to marketing efforts by CLTV

• Divide the amount spent on overall as well as specific channels by the revenue generated

1. Brand Mentions and Searches

One of the best ways to measure your brand awareness is by analyzing how often your brand is mentioned online. You can use Google Alerts to monitor the number of times people have mentioned you in their content.

You can also opt for in-depth functionality tools that will come with advanced features like real-time monitoring of brand mentions on social media.

1. Net Promoter Score (NPS)

This metric will measure not only how satisfied your customers are with your business but also customer loyalty. You can ask your customers how likely are they to recommend your company to a colleague or friend on a scale of 1-10.

Let's say that you survey 1000 customers. 100 responses are 6 or below, 300 responses fall between 7 and 8, 600 responses are 9 or above.

Percentage of promoters: 600/1000 = 60%

Percentage of passives: 300/1000 = 30%

Percentage of detractors: 100/1000 = 10%

Your business NPA: Promoters – Detractors = 60%-10% = 50

1. Customer Retention

Customer retention allows you to measure the number of repeat customers as they increase your brand's customer lifetime value. This metric is important as retaining customers is often less costly than acquiring new customers.

1. Referral Traffic

Referral traffic is a marketing metric that measures the amount of traffic that your website or products get from an outside source. This metric will show how your product or service is represented to others and how to optimize its presence on search engines and social media platforms.

1. Social Media Engagement

The social media engagement metric will not only measure your followers but also how your followers engage with your product. Engagement ranges from likes, shares, and comments. This metric will also help you identify how your digital marketing campaign is impacting user engagement levels and potential leads.

1. Website Traffic Sources

Identifying the website traffic sources that are providing your business with leads and higher conversion will minimize customer disengagement. Website traffic sources like search, direct, referral will enable you to understand which aspects of your customer experiences and products are most likely to boost conversions.

Sparkrental, an online rental learning platform, used SEO services to boost traffic to their Loan Amortization calculatorand Fire calculator page.

1. Conversion Rate

Conversion Rate Optimization refers to identifying goals, calculating, and optimizing conversion rates. Improving your CRO will allow you to directly improve your sales, whether it's a product purchase or subscription.

Moreover, it will provide you with an insight into the overall effectiveness of your website, app, and/or social media account.

1. Multi-Channel Attribution

This metric will provide you with insight into where your business traffic is coming from, converting from, and returning from, across different marketing channels. This will enable you to understand how much to invest in each channel and where to optimize your content.

1. Click-Through Rate

Click-through rate is the ratio of clicks on your website's call-to-action to the number of leads who view the email, page, or social media ads only without using the CTAs. Tracking your CTR will allow you to understand the effectiveness of your CTAs in improving conversion.

CTAs are usually created to move your leads deeper into the conversion funnel to boost sales. If you identify a low CTR, you need to work on problems like placement and copy of your CTAs.

1. Bounce Rate

This metric will calculate the number of times users visit your website and leave it immediately without any interaction. If your product pages or homepage have a high bounce rate, then it may indicate that your website needs reviewing as something may be wrong.

1. New Lead Generated

This marketing metric will enable you to determine the value and effectiveness of your marketing campaigns. This metric tracks the number of leads generated by your company's marketing efforts over a period of time.

Summing Up: Top Marketing Metrics

Tracking every other metric will not only be overwhelming but also counterproductive. This makes it essential to identify those metrics which will enhance your marketing strategy and grow your business. Comprehend each of the above-mentioned marketing metrics to understand how they are affecting your business. This will result in data-driven decisions and higher ROI.

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