Marketing Metrics – The Importance of Measurement
Marketing can be a challenging process to ‘value’ and it’s never been more important to measure the performance of your marketing. This then allows you to channel your investments to the methods that work best for you and your clients.
Marketing Metrics that can be measured – & how to measure the ones that can’t!
It is important to find measurements that can allow you to measure marketing effectiveness. However, some marketing can be tricky to measure … here’s our thoughts on a wide range of marketing metrics that we’d recommend you consider … but also some thoughts on how to then ‘laser focus’ your thinking:
Email Marketing: An easy one to start with, but still an area many small businesses don’t measure well. Sending marketing email messages using email marketing software (we use MailChimp, for instance – but there are many others) allows you to see results from your campaigns. In our experience, an ‘open rate’ of 20% or more is acceptable and a click rate of around 1% or more means your message is interesting to the recipients.
However, within email marketing, you can try to start influencing these numbers using A:B split testing and email marketing software makes this possible. See more on email marketing on our main article page here.
Download our marketing plan template
Website Analytics: Another easy one (on the face of it). Analytics (frequently Google Analytics – because it’s powerful but free!) simply measures visitors to your website. However, there’s so much more available here if you; a) know what information you would like and, b) know how to set it up. For instance, here at Yorkshire Powerhouse, we know someone is enjoying their visit to the site if they view 4 pages of more in the same session – so we’ve set up ‘event tracking’ to keep a count of how many times this happens. We also monitor the number of downloads someone requests as this is, again, a measure of performance – as well as advert views and clicks for our advertisers.
Search Advertising: Here is a world of technical challenges to consider. On the face of it, pay-per-click (PPC) advertising (here in Yorkshire, almost always Google Adwords or Google related) appears to be fairly simple … select your trigger words / keywords / key phrases, agree a bid and budget, choose what day and time to display your advert, select any appropriate negative words and that’s it – watch the visitors flow in! In reality, you need to pay much more attention to PPC, adjusting settings constantly, monitoring results and improving efficiencies. This is hard, technical, administrative work and needs a firm discipline to stick to. Very few people really understand what they should be doing once you get into the details of a PPC campaign so consider paying for some training if you want to keep control yourself – or seek a PPC techie who can help you manage your campaign.
Social Media: The metric that people obsess about on Facebook is how many friends they have – or how many followers they have on Twitter. This number is important, but only to a point … without many friends or followers, your messages are simply not going to be seen. But actually, the more important marketing metrics, assuming you have plenty of friends / followers, is to measure how many times your messages are shared, commented on, reposted or liked as this is the actual measure of whether you are influencing the potential of ‘word of mouth’ referrals on social platforms. If your posts never get any interaction then you are definitely getting the message wrong – see our detailed article on social media for more thinking on this subject.
Traditional Advertising: Generally perceived as impossible to measure (“half my advertising works, if only I knew which half!”). The reality is that with modern techniques you can easily measure traditional advertising. Buy (and use on your advert) a similar, but different domain name and connect this to your existing website or a dedicated landing page within your site that reflects the message of the advert – this allows your web analytics to measure visitors. Buy a virtual telephone number and connect it to your main line – your customer will never know, but you will – and you can then easily and cheaply measure your advertising successes or failures!
Networking: Hardly anyone ‘measures’ their networking efforts – yet networking is time intensive and therefore extremely costly to a business. Of course, you can measure how many new people you meet, how many follow up meetings you have, etc. But what about how many email addresses you’ve collected to put into your email marketing, what about how many new connections you’ve made on Linkedin, how many new friends on Facebook or followers on Twitter … these all have long term benefits as it allows you to keep the communication going outside of the meeting. Remember, also, that only 1 in 4 new visitors to a networking meeting will return so you should always make sure they remember you!
Exhibitions / Events: If you are an exhibitor then this is easy, you should measure the new contacts and conversations you had. You can boost contacts with ‘business card prize draws’ but you can also start combining marketing metrics here. You are supposed to pre-market your attendance at an event (social and email normally) and then, post-event, send out follow ups, etc. All this is measurable data that allows you to draw an insight into the event and its effectiveness.
PR: This is always a tough marketing channel to measure. Sure, you can monitor how many column inches you achieve per months, number of insertions achieved, etc. But, actually, what matters is the end-result these efforts have on sales. So you should, perhaps, also look for the results of these insertions and inches elsewhere – did it achieve a spike in website visitors, phone calls, newsletter sign ups or visits to you … what can you measure that would indicate a great result from the PR?
Telesales / Telemarketing: You should never embark on telephone activity without clear marketing metrics in mind. Remember – ‘not talking to a decision maker’ is low value – you might be able to elicit some additional information but you’ll never make a sale. Call length is an interesting measure as calls longer than a couple of minutes generally indicate that you’ve had a worthwhile conversation. It’s expensive so measure it!
Identifying Trends & How to influence them
Mapping one-off marketing metrics is rarely useful – what are you comparing to and is it good or not? Taking the results over time is much more effective and allows you to build up an enhanced degree of intelligence.
So, if you’re measuring a range of inputs to identify prospects (say the last 6 weeks of email marketing, website downloads and prospects booking on to attend an event you’re hosting) you’ve built up a degree of prospect intelligence which means your follow up conversations can be extremely precise. Not having this precision means that you’re risking your efforts and will have less of a chance to convert a prospect into a sale.
However, remember that just because you ‘know’ they clicked on an email doesn’t mean you should tell them you know this – it’s a little creepy. So think how else you can influence a prospect – perhaps by applying more touch points elsewhere. For instance, if a prospect has clicked on your emails, send them a brochure in the post … you can then legitimately follow up on this on the phone in the knowledge that you’re not wasting your stamps!
Remember also the suggestion in the email section above about A:B split testing. This allows you to do some ‘what if’ scenarios where you can increase or influence open and click rates. See our article on the sales funnel for more thinking in this area.
How to monitor a single metric for improved clarity
Any ‘normal’ business owner will be hard pushed to ignore all the observations above. Clearly, marketing metrics are available and this is what provides the data to any serious marketer.
But, what about taking a more refined and laser pointed approach. Sure, within any sales cycle, you can observe many different marketing metrics … but you can also consider your conversation rates and become obsessed with the ‘feed metric’. If you know that to make one sale you need to meet and quote two prospects, and if you know that to set up a meeting with a prospect normally needs you to meet five new contacts at a networking event, AND that you need two months to nurture these contacts into prospects then you only actually NEED to measure the number of new contacts you meet to know that you’ll be signing up two new clients in a couple of months after you’ve met ten new people!
Having this single number provides you with two things:
1. Clarity of ‘success’ … using a simple thought process similar to the above example, if you want to make 10 new sales per month then you’d better get networking fast! Indeed, the reality is that you’ve instantly worked out that you can’t possibly meet that many new people to achieve that number of sales (you’d need to meet 50 brand new people every month!). So this improved clarity means you now need to change the model to support the ambitions AND the desires. Perhaps the solution in this example would be to work on improving the conversion from new contact to client!
2. Clarity of ‘focus’ … if you’re running a larger business then you can manage and motivate a team using this approach. Here at the Yorkshire Powerhouse, we encourage the ‘drumbeat meeting’. These quick, instantly measurable meetings would focus on three or four of these ‘feed metric numbers’ that indicate performance. You then, dispassionately, apply a green or red highlight to the metric – if it’s green then you’re on track for that measurable element so that’s fine. If it’s red, and especially if the trend keeps showing it as red, then you’ve identified the elements that needs focus. One rule of the drumbeat meeting … if it’s green, it doesn’t need discussion!
Conclusion – importance of marketing metrics to monitor a business
Clearly, running a business is normally focused on the creation of wealth to benefit the owner / shareholders. Having a clear understanding of the metrics in your marketing indicates whether you have the control and true understanding of your business.
It’s often hard to identify the marketing metrics to measure in your own business – use external expert help (your business coach, mentor or consultant) to help you tighten control on your business.