Tracking metrics has become an essential part of marketing for all businesses. According to a Nielsen report, the average return on investment is just under $0.70 for every $1 dollar spent on marketing. This represents a marketing budget that delivers less profit than it costs to run. To alleviate this, increasing return on investment or ROI is necessary.
By understanding which success metrics are important to your marketing campaign, you can ultimately calculate your overall return on investment, or measure it by specific campaign or a group of campaigns.
Analyzing these metrics can help you decide if new media opportunities, new pricing strategies, different messaging approaches, or even developing new product lines are worth considering.
Selecting appropriate metrics depends on your advertising and sales model. For retail and online merchants, impressions and sales are most relevant. If your sales model is more complex, requiring longer-term and more extensive follow-up, lead conversion and sales metrics such as cost-per-lead and cost-per-sale become more important.
And in some cases, you’ll want to evaluate the impact of engaging with customers, prospects, and other key influencers to estimate your return on engagement (ROE).
Some metrics that marketing executives track include:
- Overall impressions
- Lead generation response rates
- Return on investment (ROI)
- Lifetime value of a customer
- Return on engagement (ROE)
- And many others
You can use these metrics to evaluate marketing initiatives at many levels to understand your performance by audience segment, product, media, and many more.