Identifying the Right KPI for Your Digital Marketing Strategy
Reporting & Analytics | ROI
When investing in digital marketing, you want to make sure that what you’re doing is working. You can track things like sales and leads generated, but sometimes marketing efforts can take a while before they bear fruit especially for considered purchases and large capital investments. So how do you know you’re moving in the right direction? In this post, I’ll discuss some of the Key Performance Indicators that I find the most impactful when evaluating the effectiveness of your digital marketing.
Determine Your Marketing Objective
Before we get into the specifics, an important piece to define is your specific marketing objective. You can’t determine how you’re going to measure your results if you haven’t defined what “success” looks like. There are four common objectives that we see with our clients that I’ll be covering:
- Lead Generation
- Ecommerce Sales
- Thought Leadership
- Brand Awareness
This is probably the most common objective for our industrial and manufacturing clients because their products and services are often highly customized and the sales process is often numerous weeks or months. With this marketing goal, the end result is obviously the quantity and quality of leads generated, but I’ll go through three metrics we look at to determine if the marketing tactics are having an impact.
Conversion Rate (Forms & Calls)
Typically a lead will come in either via a form submission (RFQ or Contact Us) or a phone call. Google Analytics can track form submissions with a little bit of additional setup work. Phone calls can be tracked either with an event that triggers when someone clicks on the phone number, or you could use a paid call tracking service that can provide additional details.
Benchmarking your conversion rate (the percentage of users to your site that complete one of these actions) before you start your marketing campaign will give you a baseline for comparison. As you execute your strategy, monitor changes to the conversion rate to see if things are moving in the right direction.
Cost per Lead
Understanding how much you’re paying for each lead generated can determine if a marketing tactic is worth investing in. This can be a comprehensive analysis of your total marketing spend (ad spend, agency fees, hours spent, etc…) or you can evaluate by channel with a metric like Return on Ad Spend for paid advertising channels like Google Ads. Again, you’ll want to benchmark early and monitor changes as your strategy is put in place.
Lead Source is less of a metric and more of a drill down of your leads generated. The purpose here is to identify your most successful channels at driving new leads. Google Analytics’ Acquisition reports can show you where your website traffic is coming from as well as how effective they are at generating leads.
As more and more manufacturers move into the ecommerce space, incorporating a strategy to drive online sales has become vital. Whether you’re selling consumables and parts or large pieces of equipment you need to track your online sales and here are some metrics to watch to judge your success.
Conversion Rate (Transactions)
Specifically looking at your website’s ability to convert users into buyers, you can track the conversion rate specifically for sessions with ecommerce transactions. If your website is a hybrid of lead generation and ecommerce, you’ll need to filter out other leads to hone in on sales. This is another metric to benchmark and monitor throughout the course of your digital marketing campaign.
Average Order Value
Knowing your average order value can help you when your goal is to either start selling larger pieces of equipment or to get users to add additional complementary products to their cart before checkout. Average order value is also valuable in comparing to your cost per sale, as you want to ensure you’re not spending more to get a transaction than you are getting in revenue.
Cart Abandonment Rate
Before the checkout process even begins, you can measure how your website performs by getting users to view a product, add it to the cart, and then start the checkout process. There is a bit of additional setup to accomplish this within GA4, but after that’s completed, you can create user funnels to measure the percentage of users that move from product views to cart adds to checkout started. This will help you identify potential issues with the usability of your website or changes needed to product pricing.
Checkout Abandonment Rate
As with the cart process, you can also set up GA4 to track the checkout process. This could follow the typical path of beginning checkout to adding shipping to adding payment details and finally completing checkout. Here abandonment rates are of the utmost importance as these are users who are getting close to completing a purchase, but leave for one reason or another. Make sure you are auditing your checkout process to ensure that there is as little friction as possible to maximize sales.
Thought Leadership is a hot topic but it is also a bit nebulous as the “end goal” is to be considered an authority in your given field. So what is the metric that defines your status? The following KPIs are some of the most common that we use to measure the impact of a Thought Leadership strategy.
If you are running a Thought Leadership strategy, you probably have a “hub” that is home to all newly generated content. This could be a company blog, a Medium account, or LinkedIn Articles. Regardless of where it lives, you’ll want to track how many times that content was viewed. Track the trends over time and if possible, where the users are coming from to maximize those channels for future posts.
Similarly, an integral part of Thought Leadership is promoting your… thoughts. This is typically done through social media channels so take the time to track the growth of your followers to validate that you’re putting out the right kind of content.
Engagement (likes + comments + shares)
The social aspect of social media is where Thought Leadership truly thrives or dies. You want people to like, share, and/or comment on your posts. Most social media platforms offer some form of analytics to track the engagement of your audience but there are also tools out there that will provide additional insights. Use this data to identify the types of posts that generate the most engagement to inform future activities on the platform.
I couldn’t think of a better way to define this next metric as it can take many forms. An aggressive Thought Leadership campaign will likely have content pieces that require some additional engagement from the audience to get it. This could be in the form of a podcast (or guest podcast appearance), an ebook, a webinar or workshop, or even an in-person event. Regardless of what it is, make sure that you have measurement tools in place to track the success of those additional content pieces.
Where I believe Brand Awareness and Thought Leadership diverge is the subject of the promotion. Thought Leadership campaigns are typically promoting an individual, whereas Brand Awareness campaigns are focused on a company or specific product. Below are three KPIs to track when running a Brand Awareness campaign.
Creating buzz around your brand is the ultimate goal of a Brand Awareness campaign so tracking mentions of your brand is a key metric. If you have a unique enough brand name, you could utilize a tool like Google Trends (free) to view mentions over time. Otherwise, there are a bevy of paid tools available that can track this trend as well.
At the very least, set up a Google Alert (also free) for your brand name and you’ll get an email with new mentions that Google discovers. It’s not perfect, but it can provide insights into what’s being said and where. This can also be useful in identifying potential partners for collaborating on marketing efforts.
Social Media Reach
Similar to Thought Leadership, you want to see how many people are seeing and interacting with your brand on social media. Each platform will have reports on reach so monitor regularly to capitalize on spikes in engagement when they come around.
If you are promoting your product or company via an advertising platform like Google Ads, you can track how many times your ad was viewed (impressions) to see if you’re getting your name out there effectively. Some platforms even allow you to target who sees your ads based on demographic information, job titles, or industry, so make sure you’re utilizing those features when analyzing your results.
Take the time to review your marketing objectives in order to identify which of the above KPI will give you the best picture of your progress. Then benchmark those metrics in order to show how your digital marketing has been impactful. While it may be tempting to change tactics quickly if you don’t immediately see success, keep in mind that marketing takes time. These measurements should just be part of a greater evaluation of your marketing effectiveness.