What Are Marketing Metrics?
Marketing metrics are quantifiable measurements that businesses use to track and evaluate the success of their marketing campaigns. These metrics can provide insights into how marketing initiatives are impacting key business objectives such as revenue, customer acquisition, and customer retention.
Marketing metrics can encompass a wide range of measurements, from digital advertising metrics to retention metrics (more on those later). By measuring metrics such as those, businesses can gain a better understanding of the effectiveness of their marketing campaigns and make data-driven decisions to optimize their efforts over time.
To effectively measure marketing metrics, a business needs to establish clear goals and objectives for its marketing campaign to enable it to identify the most relevant metrics to track and evaluate the success of its marketing efforts. Enter the almighty KPI.
What is a Marketing KPI?
A Key Performance Indicator (KPI) is a specific metric that businesses use to measure the success of their marketing campaigns against their goals and objectives. KPIs provide clear, measurable targets that businesses can strive to achieve, and enable businesses to focus on the metrics that matter most to their desired outcomes.
KPIs are important because they provide businesses with a way to measure the effectiveness of their marketing efforts. By tracking KPIs, businesses can identify areas of their marketing campaigns that are performing well and areas that need improvement. This information can then be used to make data-driven decisions about future marketing strategies and to optimize existing campaigns for better performance.
KPIs can vary depending on the type of marketing campaigns or initiatives that are being undertaken, but they all serve the same purpose of measuring performance.
To determine what their KPIs should be, marketers first identify their business goals and objectives and then determine which metrics are most closely aligned with those goals. For example, if a business's primary objective is to increase revenue, they may set a KPI related to sales or customer acquisition.
Choosing the right KPIs can be a challenge, but it's important to select KPIs that are aligned with business goals and are relevant to the specific marketing initiatives being measured. In order to choose the right KPIs, marketers should:
- Start by defining specific marketing goals.
- Determine which metrics will best measure progress toward those goals.
- Select KPIs that are easy to measure and track over time.
- Continuously evaluate and adjust KPIs as marketing strategies evolve.
Why Marketing Metrics and KPIs are Important
The relationship between KPIs and metrics is one worth fostering and nurturing. If you’re marketing and selling online, you can derive performance metrics from any number of reliable sources. But if you don’t have KPIs in place to give context to those metrics (and vice versa), you’re sailing a boat without a rudder: You likely have an idea of where you want to end up and points of reference that suggest you’re moving in the right direction, but without the mechanisms needed to guide you, who knows when you’ll get there?
KPIs and metrics work together to clear as straight and efficient a path as possible to the outcome you want — providing insights into how your marketing efforts are performing while helping you identify areas for improvement and optimize your campaigns to achieve better results and drive growth. In a nutshell, they help businesses:
- Measure the effectiveness of their marketing campaigns and strategies.
- Gain insights into customer behavior and preferences.
- Identify areas for improvement in their marketing efforts.
- Make data-driven decisions about marketing initiatives.
- Justify marketing budgets and expenditures.
- Track progress toward specific marketing goals and objectives.
How Businesses Use Marketing Metrics and KPIs
In the real world, the mix of marketing metrics and KPIs vary depending on the type of marketing campaigns or initiatives that are being undertaken. In that context, some common metrics and KPIs include:
- Conversion rate
- Customer acquisition cost (CAC)
- Customer lifetime value (CLV/CLTV)
- Return on investment (ROI)
- Click-through rate (CTR)
- Cost per click (CPC)
- Bounce rate
- Engagement rate
A couple examples to help make sense of things:
- If a business is focused on increasing website traffic, metrics like CTR and CPC would be more relevant than metrics like CLV. The business would prioritize website traffic, bounce rates, and time on site as key metrics.
- If a business is focused on customer retention, it may prioritize customer lifetime value (CLTV), churn rate (the percentage of new customers who stop making purchases after a predefined period of time), and repeat purchase rate as key metrics.
Now that we have discussed what (and why) marketing metrics are, let's dive into how they’re derived.
How Marketing Metrics are Measured
When it comes to getting the job done, measuring marketing metrics involves a combination of data, tools, and techniques, including web analytics platforms, social media analytics tools, email marketing software, and customer relationship management (CRM) systems. Those resources enable businesses to track a wide range of metrics, such as website traffic, conversion rates, click-through rates, email open rates, and social media engagement.
Once data has been collected, it needs to be analyzed in order to gain insights that can help inform marketing strategies — a process that involves looking for and assessing trends, patterns, and correlations within the data. For example, if website traffic is increasing but conversion rates are decreasing, it may be time to re-evaluate the website's user experience or messaging.
There are countless marketing metrics that businesses can track, but some of the most important ones include:
- Digital advertising metrics: Click-through rates (CTR), cost per click (CPC), and conversion rates are all important metrics for measuring the effectiveness of digital advertising campaigns.
- Website metrics: Website traffic, bounce rates, and time on site are all important metrics for measuring website performance.
- Social media marketing metrics: Engagement rates, follower growth, and reach are all important metrics for measuring social media performance, along with many digital advertising metrics too.
- Email marketing metrics: Open rates, click-through rates, and unsubscribe rates are all important metrics for measuring email campaign performance.
- Retention metrics: Customer lifetime value (CLV/CLTV), churn rate, and repeat purchase rate are all important metrics for measuring customer loyalty and retention.
The Differences Between Internet Marketing Metrics and Traditional Metrics
Fortunately for businesses of all kinds and sizes, metrics have come a long, long way. That evolution has everything to do with the Internet, but it doesn’t mean old-school marketing metrics don’t matter.
Internet marketing metrics and traditional marketing metrics differ in the way they are measured and the types of insights they provide. Internet marketing metrics are focused on measuring the performance of online marketing campaigns, such as social media marketing, email marketing, and digital advertising. Traditional marketing metrics, on the other hand, focus on measuring the performance of offline marketing campaigns, such as print advertising, TV ads, and billboards.
Businesses need both types of metrics because they provide different types of insights into the effectiveness of their marketing campaigns. By tracking them in tandem, businesses can get a more complete picture of their overall marketing performance. And those insights can be used to optimize existing campaigns, develop new marketing strategies, and allocate marketing budgets more effectively.
How Snapchat Can Help Businesses with Marketing Metrics?
Snapchat offers a range of tools and features that can help you manage your marketing metrics and KPIs. Our Ads Manager platform provides real-time analytics and reporting that can help you track the performance of their ads. Additionally, you can check audience insights that can help you better understand your target audience and create more effective marketing campaigns.