Nowadays, it’s imperative for businesses to have a clear picture about whether their efforts to attract customers and drive sales, among other things, are bearing fruit or not. The main reason is that businesses invest a lot of time and resources into digital marketing, and they need to know that those resources aren’t being wasted. Luckily, modern technologies have provided means for businesses that leverage digital marketing to measure the effectiveness of their efforts and determine how their strategies are performing on the market.
Moreover, technology provides modern businesses with valuable data that helps them determine their target audience’s overall engagement, competitive analysis and how their efforts are resonating across various marketing channels. That’s why many businesses today base their campaigns on data-driven decisions. That way, they can track metrics to identify which strategies contribute the most to their business success and which methods are falling behind. Here are a few tips for measuring marketing effectiveness.
Clearly define your marketing goals
Every marketing campaign, promotion or custom offer, requires clearly defined goals. That way, when you measure the effectiveness of your efforts, you have something to compare it to. Setting marketing goals is determined by your business goals and what you want to accomplish with your marketing strategies. As an example, you may want to drive more sales, attract new customers, improve your exposure, improve customer engagement and so on, and so forth.
That’s why it’s important to have a well-established marketing plan that will align with your business goals. Once your marketing plan is in place, you can start developing marketing strategies that will inspire your customers to take the desired action and help reach your business goals. What’s more, you’ll be able to track valuable marketing metrics that will give you insight into the effectiveness of your marketing.
Look for feedback
Understanding your target audience is crucial for both the success of your marketing campaign and your business. Understanding the needs, expectations and desires of your customers can help you improve your marketing strategies and ensure your efforts have the right impact on consumer’s decision making. That’s why many marketers measure and tests their campaigns. If something doesn’t work quite well, they redesign it, repurpose it and then re-launch it. That way, marketers ensure their strategies appeal better to their target audience.
However, that demands a good understanding of target audience and their purchasing behavior. Relying on analytics can give you good information, but it sometimes isn’t enough to fully determine what really drives your customers. Therefore, instead of just relying on data, you can ask customers directly. For example, you can gain some valuable feedback by asking customers to complete paid surveys online. That way, you get a chance to learn much more about your audience, while they get something of value for their feedback.
Focus on measuring the right metrics
There are plenty of metrics to measure that will give you all kinds of information regarding your marketing efforts. However, tracking everything you can doesn’t necessarily mean it will be beneficial in measuring your marketing effectiveness. You’ll have a lot of data to interpret without much actionable insight. Instead, you should focus on metrics that are in accordance with your goals and the purpose of your marketing efforts. If your goal is to attract new customers and boost engagement on social media, you need to track metrics associated with those goals.
For instance, social shares and social sentiment to track engagement, social following and follower growth to track exposure, as well as website traffic and conversion rate to track new customers. Simply put, more is not always better when it comes to tracking metrics. The main reason is that more specific metrics give more valuable information on the effectiveness of your marketing efforts and how they contribute to your business goals.
Measure your return on investment
Businesses today measure their overall success, as well as the success of their marketing, by calculating the return on investment (ROI). It almost always comes down to resources invested into a marketing campaign and the revenue gained from marketing efforts. Measuring ROI is definitely one of the better ways to access your marketing efficiency.
You can track specific metrics that will effectively measure ROI related to specific actions. For example, customer acquisition cost (CTA) determines how much it will cost your company to acquire a new customer. On the other hand, customer lifetime value (CLV) metric determines the total gross profit obtained from a single customer during their lifetime. When compared, these two metrics will calculate ROI for a customer obtained. Moreover, other metrics can also point to profitable aspects of your campaign.
For instance, if you’re having a successful marketing campaign that improves website traffic, you need to measure the bounce rate. The bounce rate is the number of viewers who immediately left your website as soon as they’ve arrived. If your bounce rate is higher than 40% it means that your website visitors don’t like what they see on your landing page. In other words, your marketing campaign is successful at growing page visits, but your landing page isn’t able to drive conversions, which will negatively impact your ROI in the end.
In the modern age, tracking the effectiveness of your marketing campaign isn’t that much difficult at all. With the help of technology, businesses can measure each aspect of their marketing strategies to determine their performance. The key, however, is to focus on the right metrics that align with your business and marketing goals.