Every company in the world would like to know exactly what its return on investment is when it comes to investments in marketing campaigns. This valuable piece of information used to be almost impossible to obtain.
However, today, thanks to modern technologies and the fact that digital marketing has become by far the most important element in presenting a company’s offer to both existing and prospective customers, we can now measure the results of our endeavours quite accurately.
Still, having the tools to collect and process relevant data is not enough.
The most important thing is to know what to do with the obtained information and how to use it in the future to improve your business results. So, let’s look at some of the tools available and how they can be used to measure your marketing efforts.
ROI metrics and analytics
This is where modern tools really shine since they allow us to do something that would otherwise be impossible – to monitor and measure the traffic and other information relevant to your website. There are many programs and apps, both free and paid that can be used to measure almost any feature.
When it comes to website and SEO analytics, we have Google Analytics, Adobe Marketing Cloud or Moz as tools that can provide invaluable information about your online performance.
Social media require special attention since more and more people can be reached through them. Analytics and reporting tools, such as Simply Measured and Socialbakers Analytics, give excellent insight into your performance on social media, while social media management suites, such as Hootsuite, allow you to organise your presence on various social media in order to maximise the benefits.
The importance of identifying which acquisition channels are most commonly used by users is ever increasing.
When you compare conversion data in relation to paid ads, partnerships, or blog posts, you can get a pretty clear picture about what channels deserve your attention and which you might even simply let go of.
More and more companies are using customer acquisition cost (CAC) as a relevant metric when it comes to measuring performance. Since there’s no need any more for shotgun advertising, you can run extremely targeted online campaigns, which allow you to track the transition from an interested lead to a loyal customer.
CAC is the price you pay to convince a prospective client to choose your product or service. Based on the CAC, you may decide to take various steps to improve your performance.
Each company and marketing specialist is interested in reducing the cost of attracting a new client, because that will leave them with more funds for future investments.
In order to be able to measure your marketing efforts, you should start by adding up all the marketing expenses made over a period of time for the sake of attracting new clients.
Then, you divide that amount with the number of people who have become your clients in the given period. Ideally, you should avoid taking into account the marketing expenses related to entering a new region or starting a SEO campaign, since your CAC would be unrealistically high.
Tracking inbound leads, such as those that came to you via social media, phone, website, as well as those who were intrigued by the quality of the content you offer, rather than by your traditional advertisement is also very important if you want to measure the success of your marketing strategy.
Based on the results you get, you can adjust your content, method of reaching your customers and other elements of establishing excellent communication with your existing or prospective customers.
Without such data to rely on, you’d have to use your intuition, which is not really recommended in this case.
Basically, if you have content that is interesting enough to draw attention of potential clients, you already have the right leads. Your next task is to transform those leads into customers in a process called “closing”.
There are various marketing tools that can help you close the leads at the right times, such as Customer Relationship Management (CRM), which keeps all the relevant information about the clients and allows you to access the right information at any given moment, depending on your need.
Another useful tool is closed-loop reporting that lets you discover which marketing efforts are the most efficient. You can have a pretty good picture of your marketing and sales team performance if you integrate this tool with your CRM system.
Then there’s the good, old e-mail. One e-mail has hardly ever been enough to turn someone into your client. But, if you see that a visitor has clicked on your CTA button, you know there’s a prospective client.
However, being able to produce a series of relevant, informative e-mails will undoubtedly create trust, which is likely to bring you quite a few new clients.
Finally, there is marketing automation, where campaigns are designed in accordance with particular needs and lifecycle stage of each lead.
For instance, if someone has downloaded some material from your site in the past, a good idea would be to offer them a series of follow-up e-mails. Similarly, if a visitor keeps visiting certain pages, you can adjust your messaging to be relevant to the visitor’s interests.
Customer Engagement And Lifetime Value
A careful analysis of data about customer engagement should help you have successful and impactful communication with your customers. It can also help you create more relevant and meaningful content, which will hopefully generate more leads.
When it comes to customer lifetime value (LTV), i.e. net profit expected from a particular customer during entire future relationship, it is used as a powerful indicator of the success of your marketing strategy.
Although it’s important to attract a higher number of clients, one must not neglect the fact that this would inevitably lead to higher profit. So far, word of mouth and social media referrals are considered more profitable than those which come from a traditional ad campaign.
It comes as no surprise that LTV is now considered one of the most important metrics in business. Having an idea about how much you can expect from a client is potentially very useful, but there are still a lot of companies that claim they’re unable to measure this.
The most commonly mentioned reason is a lack of integration between disconnected units of the company, which makes a lot of sense since you need as much data as possible about the client to be able to give a precise prediction of LTV.
Still, it doesn’t mean that company should give up on it. Check this out if you need more information about how to calculate LTV.
Once you’ve measured your LTV, you should analyze how to improve it. Remembering that it costs much less to keep a client than to attract a new one, you should do your best to make the most of the trust your clients have honored you with.
Your task is not only to prevent any disappointment with your product or services, but you should be aiming to delight your clients. That way you’ll both increase their satisfaction, which, in turn, will be reflected in an increased LTV, and you’ll also benefit from them recommending your company to their friends, colleagues, and acquaintances.
In a world where almost every company is exploiting all available marketing channels, a personal recommendation and reference is definitely a potential game-changer that can help you build your customer base.
A direct way of finding out how successful your campaign was is by having a survey about your brand, a particular product or whatever you may need. The secret is to ask the right questions, which should in turn generate meaningful and relevant data.
Regardless of whether you’re trying to find out more about brand recall, recognition, identity or image, you’ll be able to choose between general, free surveys available online and targeted paid surveys, organised by experts.
Today, data seem to be crucial in marketing. Companies are calculating how many actions and activities are done as a consequence of your efforts and how many of them eventually become closed deals.
You want to be able to differentiate between profit-making activities and those that simply keep you busy.
Effectiveness is therefore the focus of everyone’s attention and companies all over the world are adjusting their strategies and actions to become as efficient as possible. Without collecting relevant data, it would be virtually impossible to know what to change and how.
All these methods may seem a bit overwhelming to some, but the fact that every successful company is applying them suggests that they are extremely useful.
If you’re one of those intimidated by all the changes that have been happening, you might want to consider consulting experts in digital marketing to help your company make the most of the resources invested in marketing campaigns. If applied correctly, these ways of measuring success can be invaluable for your future operations.
Emma Miller is a Sydney based writer with a degree in marketing. Interested in digital marketing, social media, start-ups and latest trends. She’s a contributor at Bizzmark blog