As a marketer, analyzing digital marketing data is the best way to see if your digital marketing tactics are working and where you can improve. In order to properly analyze marketing data and get actionable results, you need to know which metrics to observe - so let’s examine seven of the best ways to analyze digital marketing metrics and what those insights can do to help your business succeed.
1. Sales Revenue
The first metric to monitor and analyze is sales revenue. It's not always easy to tie your sales revenue to your marketing campaigns, but without it, you have no idea if your digital marketing is paying off.
To measure your sales revenue correctly, utilize a software program that specializes in measuring sales data and other key performance indicators (KPIs). The goal is to see a clear differentiation and year-to-year increase in your sales that can be associated with your digital marketing initiatives.
2. Customer Retention Rate
We’ve discussed the elements of a good social media campaign before, along with how digital marketing methods lead to new engagement and new customers. However, we haven’t fully discussed how digital marketing can help with client retention.
After all, current customers or clients are your most valuable assets, and retaining them over time is important. Measuring your client retention rate is absolutely essential. Fortunately, this metric is relatively easy to track, as long as you compile simple information (for example, time between purchases and repeat purchase rate). By doing this, you can see how well you are retaining current clients and determine how to raise this rate over time through marketing efforts such as retargeting campaigns.
3. Social Media Engagement
Many digital marketing campaigns focus heavily on social media. Social media engagement is one of the most important metrics to measure when looking at the longevity of your brand and how people interact with your company over time.
To measure the engagement rates of your social media accounts, you may want to first focus on putting your accounts into one highly-effective social media scheduling app, because many of them track engagement analytics for you.
One of the most important metrics to track is engagement rate. In order to calculate engagement rate by post, record the number of interactions (e.g., likes, shares, and comments) the post gets. Divide this by the reach of the post and multiply the result by 100 - this gives you that post's engagement rate (as a percentage). The benchmarks for social media platforms differ. Instagram and Facebook see engagement rates around 0.08%, while Twitter sees engagement rates around 0.05%.
4. Cost Per Click (CPC)
Cost per click measures how efficiently you're reaching the people who are likely to click on your ad. It's basically the amount of clicks you have had on a particular digital ad in relation to the money you’ve spent promoting it. Measuring your CPC can be done for almost every type of digital advertising, including campaigns on major platforms such as Facebook, LinkedIn, Twitter, and Google advertising. However, if your campaign is not able to directly report CPC as a metric, it’s as easy as analyzing how many clicks you're getting and dividing that by the amount of money you spent on the ad campaign.
5. Site Traffic
Another important group of metrics is site traffic. You can analyze these through Google Analytics with ease, and they are sure to provide a clear image of where your company is headed and whether or not your marketing is truly helping you to expand your brand.
To begin analyzing site traffic, you can monitor your site through Google Analytics, as well as incorporate site traffic data plugins on your site. Using these will give you a clear image of your site traffic and what digital marketing campaigns are doing the most for your company.
Furthermore, analyzing site traffic and choosing to collect the right data from your website visitors can actually help you grow awareness, know who to target in the future, and better hone your buyer personas over time.
6. Return on Advertising SpenD (ROAS)
ROAS measures the amount of money spent on advertisements in comparison to the amount of money made on sales directly linked to advertisements. Essentially, you should be making more than you spend on ads, and this is a great way to monitor whether or not your investment is ringing the register.
To measure your ROAS, take the sales revenue data (use only the sales data that can be linked to ads) and then compare this to the money spent on any and all advertisements. By doing this, you can determine if your advertisements are actually leading to a return on your investment and make adjustments accordingly. This will also let you analyze which of your channel strategies is most effective, and help you to determine how and where your money should be spent.
7. Conversion Rates
Conversion rates indicate the percentage of individuals, such as visitors to your website or audience members who engage with your ads, who go on to complete a desired goal. High conversion rates mean that your marketing campaign and website are proving to be successful - so it's a metric you really want to pay attention to.
Whether you're a B2B or B2C business, there is a standard equation you can use to measure your website conversion rates:
Conversion Rate = Total number of conversions / Total number of sessions
Find the number of sessions to your website, and your conversion metric, through Google Analytics or your Content Management System (CMS). Your conversion metric is dependent on what your goal is, and an example of a conversion metric could be number of orders, form submissions, CTA clicks, or number of downloads. Once you have these numbers, simply place them into the formula.
You may also want to calculate conversion rates for individual elements of your marketing, such as social media ads. There are a number of different formulas that you may use to calculate your conversion rate, and it depends a great deal on your overall goals and what your unique marketing efforts are. Carefully measure your conversions and the other metrics associated with your marketing efforts and contemplate the best way to determine the conversion rate you want to measure.
Conversion rate is important because it gives you insight into what works and what doesn't work - ultimately showing you what people or companies want. This will help you decide whether or not your strategy is working.
Wrap Up: Analyzing your Digital Marketing Metrics
Starting with the methods above, you'll soon be able to better measure what's working, and identify what isn’t, in your digital marketing campaigns. Marketing vehicles vary by business and industry, so be sure to monitor these metrics, invest in what's working, and minimize what is falling flat.
Want help in analyzing your digital marketing metrics? Our digital marketing strategists are ready and excited to make those numbers mean something to your bottom line. For help with your digital marketing efforts, you can reach out to our team any time. And for even more information on reporting and analytics, check out our ebook on the six marketing metrics your boss actually cares about.