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Knowing Your Numbers – What KPIs You REALLY Should Pay Attention To…

When advertisers and business owners think about tracking marketing KPIs the first factors to come to mind are typically leads, sales revenue and cost per acquisition. However, there are several more key performance indicators you should pay close attention to in order to launch the most effective marketing campaign.

It is foolish to support a marketing campaign that only drains money from your company. By monitoring the appropriate marketing KPIs your business will be able to roll with the punches and maintain flexible strategies and spending.

If you are not focused on the right KPIs, your company might be planning strategies based on inaccurate or misleading information, and your reporting will be faulty. Consider the following list of important marketing KPIs all businesses should be watching:

Sales Revenue Tracking

  • Has your inbound marketing campaign brought in a significant amount of revenue?

It is vital for businesses to thoroughly understand their sales revenue and the effectiveness of their marketing campaign strategy. No one sets out to invest in a process that isn’t filling pockets with green.

Typically, if a plan is not working, the money would get shifted to other marketing ventures. To decipher what revenue is being generated from inbound marketing you need to understand the difference between inbound and outbound marketing, and what each entails.
Sales Revenue = Total year-end sales – Total revenue from customers gained through inbound marketing



Customer Acquisition Costs (CAC)

  • What is your cost per lead through inbound marketing as opposed to outbound marketing?

It is important to calculate both figures, factor in outbound marketing costs versus CAC for inbound marketing. This requires calculating the integration of marketing automation, CRM platforms and all relevant costs that come with ERP integration.

Relevant CAC Costs for Inbound Marketing Include:

  • Creative and technical
  • Software and technology expenses
  • Basic overhead

Relevant CAC Costs for Outbound Marketing Include:

  • Advertising costs
  • Marketing distribution
  • Sales and marketing manpower
  • Basic overhead

After you figure out the exact costs associated with your inbound and outbound endeavors you will clearly see what revenue accounts for new sales. You can then allocate budgets more properly for each particular marketing campaign. If you are mainly utilizing inbound marketing, you may consider breaking that component down even further by various campaign types, and assess the profitability of each. With this knowledge, you can begin to implement strategies to improve the outcome over time.

Customer Value

  • Are your current customers happy?

Through inbound marketing, the best way to gauge customer satisfaction and value is to reach out to loyal customers. This process will keep communication open with potential leads, it can possibly reduce churn, and help maintain a good relationship with happy customers. The goal should be to expand the lifetime value of your customers.

Customer lifetime value = AVG sale per customer x AVG number of times a customer makes a purchase each year x AVG retention span (months or years) for typical customer

Reach out regularly to your existing customers through lead nurturing campaigns to help increase their lifetime value. This will give your team plenty of opportunities to share information about new products, resources and services with your existing customer base.

Return on Investment (ROI)

To accurately assess your annual and monthly performance, it is vital for you to calculate your inbound marketing ROI. It is equally important to take advantage of this data and begin planning spending and strategies for upcoming months and the following year.

Don’t waste time and money investing in marketing activity that is only costing your business money. Whatever approach you are following, your ROI will determine whether or not that activity is worth pursuing any further.

Return on investment = (Sales growth – Marketing investment)/Marketing investment

New Contact Rate

  • Do you understand your traffic-to-lead ratio?

It is extremely important to understand where your website traffic is originating. Is it coming from social media, direct, or organic referrals? You know something on your web page is missing if your traffic-to-lead ratio is decreasing or remains low, even if traffic is increasing or steady.

For the sake of conversion rate optimization, watch this figure closely to help you determine the best times to update or completely change your site’s design.

Lead-to-Customer Conversion Ratio

  • Do you know how many leads your team is able to close after all of your efforts? Do you know your sales qualified lead conversion rate, your sales accepted lead conversion rate and the difference between the two?

Leads that are considered to be sales-ready based on certain activities or specific lead scores are sales qualified leads. Many businesses would consider someone who took the time to fill out an online form a lead who may be ready to purchase a product or service. For instance, a car buying service with a lead who completed a form “contact an agent,” would likely be considered a sales qualified lead.

Leads that your team simply views as opportunities are sales accepted leads. These prospects have either been scheduled to be called or have already been called directly.

When considering these two lead-to-customer ratios, how will you answer the following questions?

  • Is my marketing campaign successfully capturing leads?
  • Is our customer relationship management (CRM) successful at transferring qualified leads to sales at the best time?
  • Is our close rate high enough?

What you need to strive for is an answer of yes for each question, if you are falling short on even one of these points, have a meeting with your sales force to determine what may be lacking and devise a new plan to boost your numbers.

If the answer to any of these questions is no, meet with your sales team to determine what, if anything, is missing and how you can work together to improve your numbers. Here are a few questions to help encourage sales enablement and move the conversation along.

Landing Page Conversion Rates

  • You launched your landing page, it is attractive and follows the best practices, but do you know how well it is converting?

A landing page that isn’t generating leads has no value, it is of no use to you. Regardless of how much traffic funnels through or how well the site is designed, the bottom line is always about conversion. Monitor your lead conversion rate on a regular basis.

Much like your traffic-to-lead rate, a landing page loaded with traffic that isn’t converting indicates a need to make some sort of change to the site.

Consider testing some of the ideas listed below to determine concept which may actually help improve your conversion rate:

  • Try a different call-to-action color
  • Make your CTA text more prominent and convey more value to it
  • Write more compelling content
  • Use a more condensed form
  • Include social proof, such as case studies and testimonials


Organic Traffic

  • Is most of your traffic coming from organic searches?

Every company using inbound marketing should strive to gain most of their traffic from organic searches. This shows that consumers are tracking you down on their own, making the process much easier on you, requiring less effort and minimizing the cost of attracting viewers to your web page.

If you have a successful SEO strategy high organic traffic will follow. Be sure to monitor your rate of organic traffic and your most effective keywords. Rework your SEO strategy as needed.

Social Media Conversion Rates

  • Do you understand the importance of social media in your inbound marketing campaign?

Social media has proven to be an invaluable resource for every modern company’s success.

Consider the follow questions to analyze how social media impacts your inbound marketing efforts:

  • How many lead conversions have been generated by each social media platform?
  • How many lead conversions are generated by each social network?
  • What is the number of conversions generated through each platform?
  • How high is the percentage of traffic associated with social media?

You may not have the time and resources to utilize every social media platform effectively, but by breaking down how many leads, customers and the amount of traffic that is generated from each, you will be able to figure out the best directions to focus your efforts.

Mobile Traffic Conversion Rates

  • Is your business website optimized for mobile use?

More and more people are relying mainly on their smartphones and other mobile devices for web access. Google is now favoring websites that are optimized for mobile use. It is crucial to understand how your viewers are using their mobile devices.

Be particularly mindful of:

  • Rate of mobile traffic
  • Lead conversion rate from smartphones and other mobile devices
  • Bounce rates from smartphones
  • Conversion rates that result from mobile optimized landing pages
  • Which mobile devices are most popular

You can improve the customer experience by first understanding what they do on your site through mobile devices, and in turn, optimize the process for more conversions.

Lastly, let me know your thoughts and what other tips for KPIs that has helped you. Leave a comment below and I look forward to hearing from you.


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About Sean Donahoe

Sean is one of the most recognized industry leaders in business and marketing. As a popular speaker, author, consultant he has helped over 50,000 students world wide find success in their businesses and has consulted with Fortune 500 companies and businesses of every size grow and thrive...

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