How To Measure Marketing Performance in 7 Steps
Marketing performance management (MPM) is a process your team can use to analyze if your campaigns work as effectively and efficiently as possible. The process often uses technology to collect and analyze big sets of data to give you the most in-depth look at how every campaign runs. Today, we’re exploring how your team can measure marketing performance for any campaign and get insights to prove your team’s worth to relevant management and stakeholders:
What Are the Best Metrics to Measure Marketing Performance?
One of the primary reasons marketing teams measure their campaign performance is to prove the department’s worth to the company leadership and stakeholders. If your job as a marketer is to bring in more leads and generate more sales for the company, you have to have proof that you’re doing so. The concept sounds simple as if you can just total up the number of leads that contact the company or the sales revenue you make during a period and find out if your efforts worked. But MPM isn’t that simple.
Many factors affect whether a potential lead contacts your company or makes a purchase. The customer lifecycle may span across multiple campaigns. To know how effective each one was in each stage of the marketing funnel. You have to be able to pinpoint which actions the campaign influenced. You can do that by measuring a variety of metrics for each marketing campaign. Here are the best metrics to review to get a clear picture of how efficient and effective your marketing campaigns are:
Lead Generation
Most top-of-the-funnel marketing aims to generate and capture leads. This is a good metric for tracking the performance of your marketing campaigns because it proves that clever, informative, persuasive, or personalized marketing efforts worked. They brought new people into your company’s fold. You can now communicate with those people with their consent.
Generating leads helps expand your audience and increase your brand’s potential selling power. Tracking where leads come from can be simple, thanks to marketing tools like UTM codes. These tracking tacks help you understand which campaigns entice leads to complete a conversion, such as signing up for an email list or scheduling a sales call with your company.
Lead Nurturing and Management
Once you’ve captured leads at the top of the funnel, those people are ready to begin their customer journey. And it’s your marketing and sales teams’ jobs to nurture those leads from curious newbies to serious buyers. Tracking how well your teams nurture a lead through the marketing funnel and buyer journey is another great metric to use for MPM.
Remember, your marketing performance is more than just the outcome of making a sale. There are many facets to the process. Tracking every step along the way helps you see where your team succeeds and where you can improve. Tracking lead nurturing and management helps you see which channels leads use most, and which ones progress to the most sales or additional conversions.
Revenue and Sales
Revenue and sales are two of the easier metrics to track and prove to management that your marketing efforts work. If you can prove specific sales happened due to your marketing, your team will have more value in the eyes of stakeholders. What becomes tricky is proving that an individual sale happened because of your marketing efforts and not another factor.
Tracking revenue and sales based on campaigns is easier with the right tools. Customer relationship management (CRM) tools help you track a customer’s journey throughout their interactions with your brand. This allows you to follow the customers from the first touchpoint they encounter to when they make a purchase. Tracking all your customers’ movements helps you see which marketing campaigns they interact with and how those interactions affect the choices they make throughout their buying journeys.
Customer Retention
Marketing isn’t all about getting new leads and customers. It’s also about keeping the ones you already have. According to Semrush, only 18% of businesses focus on customer retention. That margin is low, considering your chances of selling to an existing customer are between 60% and 70%. Compare that to the probability of selling to a new customer, which falls somewhere between 5% and 20%.
Just because a marketing campaign doesn’t bring in any new customers doesn’t mean it’s a waste. Especially if it appeals to and increases sales from existing customers. Having the data to back up this kind of customer loyalty is helpful when proving your team’s worth. The data also shows the success of a specific campaign to brand leadership.
Brand Awareness
While not quite as important as some of the other metrics, brand awareness can be a helpful MPM metric depending on individual campaign goals. Especially for startups, sometimes you have to spend money to make money. That means marketing and advertising to get people to learn your business exists, not just to make sales.
Content marketing campaigns are some of the best for brand awareness. Individual KPI metrics that fall within the brand awareness category include organic traffic, search engine positioning, and website traffic. While brand awareness doesn’t always contribute to direct sales or conversions, it can help you predict other MPM factors like lead generation.
Marketing Metrics To Avoid
There are plenty of metrics out there to track, but some that aren’t worth wasting your time reviewing for MPM. These metrics include some of the easier ones to gather and analyze, like:
- Followers
- Likes
- Impressions
- Conversions
- Clicks
It’s not that you should never keep track of these types of engagements throughout your campaign. They’re just not the most beneficial as standalone metrics for your MPM because they don’t measure any categories of substance in your campaign. These vanity metrics show the potential your marketing campaign has to work, not if it actually does.
The more followers you have the more people have the potential to see your campaign content. The more likes and clicks you get, the more you know they saw your content. But in social media culture, hitting the follow or like button doesn’t equate to any real business success. People follow hundreds if not thousands of brand accounts on their personal or even business profiles. That doesn’t mean they interact with all of them, and it certainly doesn’t mean they ever inquire about services and make a purchase from each one.
These types of metrics are great for measuring things like brand awareness, which is its own helpful metric for MPM. But MPM, as a whole, digs deeper to prove your department’s worth to company leaders. It’s better to show actionable data from other metrics to prove that point.
How To Measure Marketing Performance
Use these steps to measure marketing performance for any campaign and learn how to provide context on how your team’s efforts contribute to larger company goals:
1. Set Campaign Goals
Measuring your marketing performance only matters if you have something to measure it against. If you’re not trying to reach a goal, there wouldn’t be a reason to track how your campaigns or content perform. What do you want to achieve with your marketing campaign? More importantly, how does that achievement relate to a greater company goal? MPM helps you prove your worth to company leadership and stakeholders, so it’s always important to make sure each campaign goal directly relates to an overall company goal.
For example, if one of your company goals is to get new customers, then your campaign goal may focus on attracting new leads in a particular niche market. Once you know what you want to achieve from each campaign, it’s easier to choose how you plan to monitor its progress.
Related: Marketing Goals: How To Set and Achieve Them
2. Choose the Right Metrics
There are many metrics to track and follow throughout any marketing campaign. While you can track all of them, not every single metric is worth analyzing for MPM, as we noted earlier. The metrics you choose depend on your campaign goals and expectations.
If you’re trying to generate leads, you’re not going to analyze the number and demographics of people who like your social media posts. The metric doesn’t fit the success criteria. The metrics you choose may differ for each MPM report depending on the stakeholders you’re working with or to who you’re trying to prove team success. What’s most important is making sure every metric helps you measure the return on investment of your campaign to help reach the goals you set at the beginning.
3. Track Performance on an Individual Level
The easiest way to analyze and prove data for your MPM report is to track all your marketing variables on an individual level. That means looking at performance by channel, post, and single lead or customer. Looking at analytics on this singular basis helps you link individual conversions, sales, or generated leads to specific marketing efforts. Working on a smaller scale like this also helps you get more accurate results rather than generalized ones. You can pinpoint specific campaign instances or lead behaviors rather than giving a general overview of what a big segment of your audience does.
4. Plan Your Campaign
Plan your marketing campaign as you normally would. Work with your team to conduct keyword and topic research and write or design assets for content marketing. Pay for advertising space and complete any other tasks that go into planning and executing the campaign. Using tools like a content calendar helps you pick individual channels and posts or content to put on each one. Planning your campaigns this way makes it easier for you to track success on that one-to-one level.
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5. Collect Campaign Data
To measure your performance, you have to have data to analyze. Depending on the platforms you use throughout your campaign, some of them may track metrics for you within their own analytics programs. This is true of channels like social media, and direct marketing channels, such as Mailchimp for email marketing.
For other campaign channels, you may have to use a third-party tracking service, like Google Analytics for your website. If you want to make things easier for your strategy team, consider a program like a CRM that allows you to import data from all your metrics sources into one program and platform. Doing this makes analysis easier because it brings all the information you need into one dashboard. This saves your team from having to hunt for and compare data in multiple programs and documents.
6. Conduct Analysis and Calculations
When the campaign is over, and you’ve collected and sorted all your data, then you can measure how close the campaign came to reaching its goals. This phase does more than just look at the numbers you collected from data. It interprets what those numbers mean in terms of campaign and overall brand success.
For example, if your campaign goal was lead generation, you may collect 300 leads from the marketing effort you put in. That sounds great, right? But how qualified are those leads? What we mean is how many of them are really going to continue through the sales funnel to make a purchase. Maybe after careful analysis, you find that 100 of those leads are highly qualified to keep pushing through the sales funnel. That’s still a great number, but it’s not as high as the 300 that the metrics alone showed.
This is also the step where you do any kind of mathematical analysis, such as calculating the return on investment of the campaign or cost per lead. Doing this helps you understand performance across channels and touchpoints, as well as how each one contributes to the campaign’s success on a singular level. Bringing all your data together helps add context and validity to your findings, and serves as the proof stakeholders want to see about your department or campaign’s success.
7. Display Your Results With Data Visualizations
You’re not done when you collect all your numbers and put them in context. You still have to share them with company leadership and stakeholders to prove that your department helps reach company goals. To make it easier for others to understand your analysis, use data visualizations to share complex information. These include charts, graphs, and scatter plots to show individual data sets. You can also use infographics along with your data visualizations to give more context about a campaign or project and its effect on the company.
Related: Data Visualizations vs. Infographics
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