Measuring Your Marketing Performance: 3 Markers for Success
Knowing how your marketing campaign is doing is necessary to give you the right insights for adjustments or improvements. The best thing about utilizing digital marketing is that you can efficiently collate the data your marketing efforts receive from shares, comments, and other forms of engagement. Reviewing your analytics and assessing your sales figures will be an excellent way to see how effective your marketing strategies are.
Marketing measurements matter
With all the variables you have to consider, it’s understandable to burn out and get overwhelmed with what you should focus on. Although all data is important for evaluation later, not all of them will be necessary to measure your marketing efforts’ success. This is why it’s vital to give attention to the facts and figures that matter most.
Although in Ballistic Arts we tend to use many Key Performance Indicators to make decisions for our clients, we wanted to keep things simple and outline 3 important metrics you must pay attention to if you want to hit your marketing goals.
1. Return on investment (ROI)
Many marketing campaigns use Return on Investment (ROI) to determine their ads’ overall success. Unfortunately, the issue with measuring the ROI can be simple and complicated simultaneously. Generally, calculating your ROI involves the total amount of resources spent to fund an investment. This includes several variables such as human resource, time, capital, operational upkeep, logistics, etc.
It’s an all-encompassing figure that will vary depending on which aspect of your project you’re comparing the returns to. For example, the ROI of an e-commerce campaign would be the sales profit over the costs involved in the campaign. It’s up to how you analyze your data to see the correlation between variables investments and returns numbers.
2. Return on ad spend (ROAS)
Unlike ROI, return on ad spend (ROAS) is more specific since it compares two variables in a similar category. ROAS compares what you earn in terms of revenue to how much you’ve spent on ad campaigns.
Benchmarking ROAS will depend on a few factors. If your fixed and variable costs are high relative to your ad spend you might desire a higher ROAS close to a 4:1 ratio. Alternatively, if advertisements are most of your costs, seeing a ROAS barely above one could still be a great sign.
The strength of tracking ROAS in digital marketing is scalability. As long as your ROAS is higher than 1, your ads are profiting. Seeing a high ROAS should be a strong indicator to immediately increase ad spend. Higher ad expenditure will likely decrease your ROAS, but do not let this bother you. With a positive ROAS more spend equals more profit.
Major companies can take a ROAS as low as 1.01 and turn it into millions with the right strategy.
3. Customer conversion rate
The ease of calculating customer conversion rates is one of digital marketing’s greatest strengths. Gauging customer conversion rates used to be a struggle to consistently pinpoint. With current data tracking, and proper funnels we can track when a customer converted and what advertisement caused them to convert.
To understand conversion rates, check for your industry benchmark online. Understanding your expected conversion rate is crucial to setting realistic goals and creating a proper strategy to achieve them.
Be mindful when using conversion rates to evaluate your advertisements, as it never tells the complete story. A low conversion rate could be caused by an experience the customer has once they are past the ad and on your website. Use alternative data points like bounce rates and click-through rates to help diagnose your ads performance.
Marketing measurements aren’t just for measuring success; they’re also for learning from your mistakes. It’s important to note that you won’t always be successful with your marketing campaigns, especially if it’s your first time engaging with a new audience. However, everything’s not a loss even after all the effort you put in. Tracking the right marketing metrics will provide you with an idea of your progress. Use these insights to decide what you should maintain or improve for your future attempts.
Ballistic Arts offers full-funnel digital marketing services for business owners who want to optimize their marketing campaigns. We specialize in designing compelling lead generation strategies to give your business a consistent revenue stream. Contact our digital marketing experts today, and we’ll collaborate with you to craft the best marketing strategy for your brand!