Digital media is growing at a faster rate each year than traditional media. In 2021, digital advertising alone made about 4% of all marketing budgets.
So, if your business contributes to this percentage, it would also be wise to check on how you're progressing. But how do you go about doing that? Digital marketing KPIs hold the answer to that question.
Key Performance Indicators: What Are They?
Key performance indicators (KPIs) are metrics that reveal the positives and negatives of your company's marketing initiatives. These are a type of quantifiable reference that enables you to monitor how well the business is doing in achieving its objectives.
In other words, KPIs are statistics used by corporations to keep their units and programs on schedule.
Why KPIs for Digital Marketing is Crucial
KPIs enable organizations to monitor market performance and help improve marketing choices. For instance, you should check the proportion of total sales to total leads if you want to improve sales performance. You can choose a precise ratio that you wish to strive towards based on the specific aims of the business.
Additionally, KPIs provide organizations a numerical means of comprehending how their marketing choices impact market success. A KPI based on the proportion of total sales to total leads demonstrates how marketing actions influence your progress toward your goal of increasing sales productivity.
The KPIs Best for Your Business
Many different KPIs can assist your company in achieving its objectives, but these particular KPIs are crucial, and every company should track them.
Customer Lifetime Value
The customer lifetime value (CLV) is a metric that shows a client's significance to an organization throughout their entire association. You may determine if there is more profit in retaining current customers than finding new ones using a CLV metric.
All you need to do is multiply the average purchase value by the frequency of the purchases to determine CLV. For instance, in order to evaluate CLV for a service-based corporation, one must first find the mean customer retention rate. Then, they must check how much clients typically pay in monthly payments.
Social Media Reach
Social media is becoming a vital part of every list of digital marketing guidelines. Knowing the supporters and participation counts across platforms is essential since you aren't simply collecting clients via emails; social media also contributes significantly to lead traffic.
Cost Per Click
The term "CPC" stands for "cost per click" and describes the cost associated with each click that your webpage generates as part of a pay-per-click advertising campaign. The amount you and your rivals bid for internet advertising spots is one of several variables that affect the cost per click.
In CPC ecosystems, bidders compete with one another for advertising space on well-known platforms like Google and Facebook in a manner analogous to a real estate auction.
Additionally, it's crucial to remember that CPC data might differ significantly depending on the advertising platform you're employing. Generally speaking, the average cost per click across all industries is currently $3.53.
Proportion of Traffic to Leads
The proportion of site visitors who become genuine leads is the website traffic to website lead ratio. It's crucial that clients who visit your website engage and become leads rather than only remaining as visitors. A better ratio indicates that (other factors being constant) your business is more adept at turning visitors into leads.
The ratio of internet visitors to website leads might reveal why your site isn't generating leads. For instance, if you are getting plenty of views but few leads, there may be an issue with the design or user experience of the website that prevents people from converting.
It's also possible that the appropriate audience isn't discovering your advertisements and external links.
Final Thoughts
Keeping track of data doesn't necessarily have to be a nuisance. It need not be difficult to keep track of data. KPIs are a crucial component of assessing marketing performance since they allow you to fine-tune projects and promote advertising wins, showing what is profitable for your company.