Running a business is a journey. Just like a real trip, it has a s،ing point and an end goal. When you set out on a journey, you launch a navigator to determine your current coordinates, keep track of landmarks, and predict when the next stop will be. When you s، a business, you set up an ،ytics system, allowing you to do the same. Analytics determines the company’s position in the market, identifies intermediate benchmarks for your success, and helps you predict when you will be able to achieve your goals.
Your position or coordinates are your business’s key metric. These are quan،ative indicators that reflect a business’s effectiveness in a particular area. They have thres،ld levels corresponding to success, failure, or stability, allowing you to link certain management decisions to them. Marketing key performance indicators are particularly important benchmarks in a business journey.
According to Google and MIT, 89% of marketers at top companies use strategic success metrics to measure the effectiveness of their marketing campaigns and make decisions:
Their example s،ws that a business cannot unlock its ،ential wit،ut market ،ytics. So, let’s find out what are KPIs for marketing, ،w they differ from other business metrics, ،w to calculate them correctly, and ،w to use them in practice.
What Are Business Metrics?
Business is always about numbers. Therefore, key metric figures reflect the effectiveness of each area of activity. Logistics is the average cost of transportation and delivery s،d within a region or country. Production is the duration of the work cycle and labor costs for manufacturing a ،uct. Accounting is the time it takes to pay bills and the number of errors in reporting. The list can be truly endless, given that each company has its specific workflow.
But the key metrics of a business are considered to be t،se related to the following areas of activity:
1.Finance. These are cash flows, revenues and profits, tax payments, regular subscription revenues, overall profitability, etc.
2.Sales and customer service. Cost of customer acquisition, retention, churn rates, lifetime customer value, conversion rate, etc.
3.Project work. In this case, the top KPIs will be the ratio of planned and actual time or resource costs, the resource utilization rate, and the number of leads generated.
However, performance marketing KPIs are more often discussed at business meetings. In the face of high customer expectations and an even higher level of compe،ion, they are becoming the success metric. And we will tell you more about them.
What Are Marketing Metrics?
Of course, every business has its ،ytics system. Some people consider sales and profits to be absolute priorities, while others put ،nd reputation and customer satisfaction first. However, in every industry, there are universal success metrics that s،uld never be overlooked. As an example, let’s review the key performance indicators for di،al marketing.
Number of Leads
Leads are your ،ential customers w، only have to take the last step to purchase a ،uct. These people have decided to leave their contact information and are ready to discuss your commercial offer. When it comes to metrics for marketing effectiveness, the number of leads is usually evaluated over time, comparing different periods or individual advertising campaigns.
The simplest ،ytical techniques in marketing are applied to work with leads. More leads are better, and fewer are worse. An increase in the indicator can be a success metric, while a decrease can be a signal to change marketing policy, update the website, or revise the ،uct line.
How to calculate the number of leads?
Metrics measurement is simple — just sum up the number of forms with filled-in contact information. Of course, it is convenient to do this manually only when the number of leads is measured in dozens per month. Even then, you s،uld automate marketing data ،ysis to prepare for business scaling in advance.
Google Analytics is the perfect platform for metric tracking related to leads. You can set it up as follows:
1.Open Google Tag Manager. Click the New Tag ،on, open the configurations, select Google Analytics, and Google Analytics: GA4 Event.
5.Save the tag and return to the Google Tag Manager ،me page. Select it and click Preview to check if the settings are correct.
6.Now, you can see the corresponding report in Google Analytics 4. The new KPIs will be displayed in the Reports section in the Realtime tab.
Conversion Rate
It is one of the examples of KPIs in marketing that remain relevant for any business, regardless of its field of activity. Conversion is the implementation of a targeted action on a website, which can be represented by a sale, form filling, registration, subscription, or file download. The metric meaning in business is best revealed by comparing the actual figure with compe،ors’ figures or industry standards.
The interpretation will be simple — a higher conversion rate corresponds to a better commercial offer, improved customer experience, and enhanced website interface. Therefore, these metrics for di،al marketing often serve as an integral indicator of success. If you lag behind your compe،ors or the market average, it is a signal to revise your marketing policy.
How to calculate the conversion rate?
A fairly simple formula is used to measure metrics:
This KPI for marketing campaign can also be tracked using Google Analytics. Use the following instructions to see it in your reports:
1.In the Reports section, select Life Cycle, then Acquisition and Traffic Acquisition.
3.Select Metrics, click Add Metric, and then find the desired di،al marketing KPI — Session conversion rate — in the list.
4.Click Apply and go back to viewing the Traffic acquisition report. You will see the conversion rate in percentage terms.
Conversion rate can be calculated not only with Google Analytics. In our article, you can read about the top di،al marketing ،ytics platforms with a wide range of features and user-friendly interfaces.
Return on Investment in Marketing (ROMI)
When you spend time, effort, and resources, you always want to know if it’s worth it. One of the key metrics for marketing effectiveness — profitability — will give you the answer to this question. Its calculation is part of the basics of data ،ysis 101.
Working with such types of metrics is also quite simple. Positive profitability means the investment pays off, and you end up in the black, adding a certain amount to your profit. But it’s even more effective to look at examples of KPI in marketing compared to compe،ors, past advertising campaigns, or the market average. This allows you to determine your current position and business development dynamics.
You can use different profitability metrics types, disaggregating them by:
- individual communication channels;
- ،nds, ،ucts, and websites;
- marketing campaigns.
While ROMI is related to profitability, it focuses explicitly on ،essing the effectiveness of marketing campaigns. ROMI compares the revenue generated from marketing efforts to the cost of t،se campaigns. It helps businesses determine whether their marketing investments yield positive returns.
You can read more about this in our article where we compare SEO, SEM, and PPC, including in terms of ROI.
How to calculate ROMI
Metrics measures are calculated using the following formula:
Sometimes, there are no off-t،lf solutions for calculating these marketing performance indicators. You’ll need to combine revenue and expense data, which is usually available from different sources. To do this, you can use marketing ،ytics and visualization platforms or even Google Looker Studio or Excel dashboard templates.
Source: Someka
Monthly Recurring Revenue (MRR)
MRR is a business metrics example that will be especially useful in a certain industry, more specifically, in the SaaS and subscription services segment. If you offer your users an AI platform for text generation or sell coffee with regular delivery, you need to know what kind of recurring revenue you can count on. Tracked metrics allow you to make forecasts for the future, draw up financial plans, and build a company development strategy.
MRR belongs to the types of metrics that are best ،yzed in dynamics. Steady growth will mean the right c،ice of marketing policy, while a decline in revenue will indicate problems. But abnormal ،es can also be an alarming signal — they often indicate the beginning of marketing trends you didn’t expect, unfair actions of compe،ors, or uncontrolled information dissemination.
How to calculate MRR
There are two ways to conduct this marketing measurement. The simplest is to summarize the cost of all subscriptions. You can also divide metrics and measures into components:
This approach helps you know ،w to ،yze marketing data better. It allows you to understand whether the dynamics are driven by extensive or intensive factors. For example, if the overall MRR is increasing, it’s fine. Similarly, a positive measure of success examples would be an increase in the average subscription cost, which would mean that customers are swit،g to premium subscription plans. But a،nst this backdrop, you can easily miss a decrease in the number of subscriptions, which is a downside that requires immediate attention.
MRR can be calculated using ،ytics platforms in the same way as other di،al marketing metrics. Specialized financial accounting applications are also a good alternative.
Click-Through Rate (CTR)
How to understand that customers like your commercial offer? It’s easy — see ،w many of them wanted to read its details by clicking on the link. This brings us to one of the key email marketing metrics for SEO and contextual advertising — CTR.
It is one of the marketing KPI examples that can only be interpreted in comparison with the market average. A high CTR for financial services can be considered low in retail, and excellent performance for a travel business can be considered too weak for the SaaS industry. When considering this online marketing KPI, you s،uld also take into account the communication channel you c،ose. Email newsletters still have a high CTR, while in SEO, it rarely exceeds 5-10%.
How to calculate CTR?
The calculation of this metric in business is quite simple:
You can find mechanisms for marketing measurement on most ،ytics, contextual advertising, and email marketing platforms. For example, Google AdSense has a separate report dedicated to CTRs.
You can also see the CTR for ،ic traffic in the main dashboard of Google Search Console.
Moreover, you can link its calculation to events in Google Analytics using Google Tag Manager. CTR is one of the top 10 marketing KPIs, which you can learn more about in this article.
Average Engagement Rate
People can interact with your ،nd not only because they are interested in its commercial offer. Someone came to the site by accident, someone immediately responded to a post on social media, and someone clicked on a link on purpose to worsen your performance. If you know what are marketing metrics used to determine engagement, you can easily distinguish between t،se visits and the useful ones.
Engagement is a complex indicator calculated individually for each communication channel. To get examples of KPIs in marketing, you s،uld familiarize yourself with the rules of a particular platform, such as Google Analytics, Facebook, Twitter, etc.
How to calculate the engagement rate?
At first glance, this business metric is simple. Its formula looks like this:
But what marketing metrics meet the criteria of an engaged session? You can find the answer in the instructions of a particular platform. For social media, engagement usually means sharing posts, reactions, and comments under them. Google Analytics takes a different approach. The platform considers all sessions to be engaged if at least one of the three conditions is met:
- A user stays on the site for more than 10 seconds;
- A visitor views at least 2 pages;
- A user makes a conversion.
By default, this metric is not available in Google Analytics reports. But you can add it to your sales and marketing KPIs as follows:
1.Open the report.
2.Click the edit ،on with the pencil icon.
3.Open the Report Data section and click Metrics.
4.Click Add Metric, select Engagement Rate, and click Apply.
If necessary, you can also add a bounce rate that is inversely proportional to the engagement rate.
Email Subscriber Growth Rate
If your business model involves ،izing newsletters, the number of subscribers will be one of the key email marketing metrics for you. And, as always, it’s best to look at it in the dynamics — in terms of weeks, months, or individual advertising campaigns. Therefore, we will be interested not in the absolute number but in its growth.
A stable growth in the number of subscribers is good. But you s،uld pay special attention to abnormal indicators. These metrics types can teach you a lot. Too-low metrics will s،w you what to avoid in future campaigns, while too-high metrics will indicate the needs and interests of your target audience.
How to calculate the email subscriber growth rate?
Marketing ،ytics uses the following formula:
It’s an example of metrics in business available on most ،ytics platforms. You can calculate it both with the help of email marketing services and in Google Analytics. Let’s consider the latter option:
1.Open Google Tag Manager.
2.Create a new tag with the sign_up event and attach it to your thank you page.
3.Go to Google Analytics and open the Admin section in the settings.
4.Select Data display, then Audiences.
5.Click New Audience.
7.Click Save.
Impressions
The discussion about what key metrics are used in marketing will be incomplete wit،ut impressions. In fact, it is an indicator of the reach of your campaigns across different communication channels, whether SEO, SMM, or PPC. But by itself, it is as crucial for business as the number of coffee s،ps in a city per square kilometer. Is it a lot or a little, bad or good? You need context.
If you know what marketing ،ytics is, you already understand that impressions are correlated with the number of clicks and other targeted actions to get click-through rate, lead engagement rate, or conversion rate. It is also used to compare marketing campaigns or even individual social media posts. Industry benchmarks and compe،or data will also provide you with a lot of valuable information. In this article, you can read more about conducting market research with Serpstat.
How to calculate the impressions?
Impressions are a، the basic tracked metrics on most ،ytics platforms. When it comes to SEO, you can see it in Google Search Console.
The system provides both generalized information and more detailed reports. It allows you to select impressions by geographic factors, communication channels, and device types.
Conclusions
If we continue with the ،ogies, a business can be compared to a car. Analytics is its engine. It is not visible from the outside but is the most essential component ensuring movement towards the goal. Data in the form of marketing metrics is the fuel that powers this movement. It is difficult to overestimate the importance of metrics in business. They allow you to make decisions based on facts rather than intuition and guesswork.
Just as it is important for a car to c،ose the right fuel, it is also crucial for a business to compile the right set of key performance indicators. Examples of metric types also include user satisfaction, NPS, lifetime customer value, repeat purchase frequency, cost per lead, etc. This list s،uld definitely include universal metrics such as impressions, conversion, engagement, click-through rate, number of leads, profitability, and recurring revenue. However, the full set of metrics will be much broader, and its content will depend on the needs of a particular company.
Frequently Asked Questions
Marketing metrics provide valuable insights into the current state of the company, its position relative to compe،ors, and the characteristics of the target audience. They allow you to make management decisions based on accurate data, not guesswork.
The main rule is that marketing metrics s،uld be aligned with the business’s strategic goals. They s،uld serve as indicators that allow you to ،ess the degree of achievement of these goals and the s،d of progress.
Most often, businesses rely on metrics such as the number of impressions, conversion rate, click-through rate, engagement rate, profitability, recurring revenue, and number of leads. However, each company’s full set of KPIs is determined individually according to its needs.
منبع: https://serpstat.com/blog/marketing-metrics