The Most Important Key Performance Indicators for Online Marketers
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Today’s business world is heavily impacted by metrics and performance tracking. However, it isn’t practical to try to analyze all of the data available to a modern business. This has led to the increasing use of various key performance indicators (KPIs). In the marketing world, these are primarily used to track how effective a current campaign is at generating more profits for the company.
Chances are if you are a marketer or business owner, you are aware of the most common KPIs such as sales revenues, cost per acquisition, and leads generated. However, these may not be creating a completely clear picture for your business. Fortunately, by simply tracking a few more KPIs, you can ensure that your campaigns are as effective as possible.
Customer Lifetime Value
The customer lifetime value (CLV) is the value of a customer over the entirety of their relationship with your company. This can be calculated by multiplying the average revenues per sales by the average number of times a customer buys from you in a year, and then multiplying that by the average length in years that you retain a customer. Using CLV, you can gain significant insight into how much you should be spending on gaining new customers.
Traffic to Lead Ratio
This KPI can be calculated as the number of visitors to your website necessary to generate a sales lead. While there is no magic number that fits every business, typically this should be around 3%. If you are significantly lower than this, your marketing is likely not targeted or enticing enough. If it is significantly higher than this, you may be able to increase sales by attracting a broader audience to your website.
Lead to Customer Ratio
Another important KPI, this is the number of leads necessary for your sales team to close. Using this KPI, you can determine whether you are generating strong enough leads or not. This should generally be calculated separately for qualified leads and accepted leads. Qualified leads are those that have met a quality score or completed a certain action in order to be considered sales ready. For example, a website visitor filling out a “contact a rep” form is a qualified lead. An accepted lead is one that your sales team considers an opportunity and hasbeen contacted directly.
Landing Page Conversion Rates
This is the same as the traffic to lead ratio but specific to each landing page. Using this information you can determine if your content is persuasive enough to attract sales. For each landing page, this should be higher that your overall traffic to lead ratio because landing page visitors are usually more targeted. If this is less than 10%, you may need to consider altering that page. This KPI is extremely useful for conducting A/B testing on landing page content.
Keeping track of these essential marketing KPIs can help to provide you with a much clearer picture of how effective your online marketing is. These should be used in conjunction with the old standards such as sales revenue, cost per acquisition, and leads generated. They will help you to quickly and easily identify whether the campaign you are investing money into is generating a superior return on investment or not.