Modern digital marketing is a complex and expensive process, making it vital that you measure the results of your marketing efforts, and that your marketing teams adapt their strategy and tactics to maximize their results.
Many companies continue to run marketing campaigns, including sophisticated digital marketing strategies, without truly understanding how to determine whether or not what they’re doing is actually working, and this is a critical mistake that could cost the company dearly.
Unfortunately, many digital advertising campaigns squander at least some of the funds allocated to them with either misdirected or simply inefficient marketing strategies, resulting in a failure to maximize marketing return on investment.
Here we’ll review how to determine if your marketing strategy is working, including explaining which key performance indicators you should be using to evaluate performance. Additionally, we will highlight how to improve your marketing results, even if your existing campaigns are already “working”.
The Importance of Regularly Reviewing Marketing Performance
Finding out whether or not your media and marketing strategy is working is no easy task, as it requires a great deal of data, analysis and interpretation but, regardless of what channels you’re utilizing, the process both begins and ends with measurement.
It’s simply not possible to tell if your marketing efforts are working unless you’re measuring them against specific goals or objectives. Running regular performance reports is an absolutely essential element to ensuring that your marketing and media campaign will be successful.
Marketing experts suggest leveraging several different performance metrics for measuring marketing effectiveness, including monitoring overall goals for combined marketing activity, as well as watching specific metrics for each individual marketing channel.
Without regularly reviewing marketing performance at the macro and micro levels, it’s extremely difficult to determine whether or not your marketing strategy is efficient or effective.
Some organizations review marketing results only annually, semi-annually or quarterly. The reality is that data should be monitored as often as possible, and ideally, not just monthly, weekly, or daily, but in real-time.
Professional marketers, and especially digital marketers, utilize a whole host of reports, analyzing data at a variety of levels, including annually, quarterly, monthly, weekly, daily, and in real-time to ensure that their campaigns are producing optimal results.
But which metrics are they measuring to determine whether or not their marketing initiatives are successful?
Which Performance Metrics Should Marketers Be Measuring?
To tell if your digital marketing efforts are working, you’ll need to be able to determine overall results of your total marketing campaign, as well as the results being generated by each specific marketing channel.
Since digital marketing is complicated and typically utilizes a mix of strategies and channels, your reporting and measurement process will also need to be relatively complex.
Just like your marketing activity requires a mix of channels and strategies, your marketing reporting process should also utilize a variety of platforms and metrics.
However, there are three core performance metrics that every marketing campaign should be measured against, and which should also be used to evaluate the relative success of each individual digital marketing channel as well, which are:
- Cost per Lead
- Cost per Action
As long as you’re measuring these three key performance indicators across your entire marketing strategy, and within each marketing channel you choose to utilize, then you should be able to get at least some indication of the effectiveness of your marketing efforts.
Measuring the same metrics across different channels will also be vital when it comes time to set allocations for limited media spends, as determining how much to allocate to each channel is a vital part of the process for maximizing marketing ROI.
Without the ability to measure ROI by channel, it becomes exceptionally difficult to determine which channels should be prioritized (and which should be pulled away from), when planning for future media and marketing initiatives.
Which Performance Metrics Are Most Applicable to Each Digital Channel?
Most modern digital media campaigns include a mix of marketing channels, allowing marketers to diversify their approach, target niche audiences, and better utilize limited marketing spends, but which metrics are most appropriate for measuring performance of each digital channel?
We suggest prioritizing the following key performance indicators (KPIs) for each of the digital channels listed below:
- Display – Click, CPL, CPA
- Video – Video Completion Rate (VCR)
- Email – Viewed, Clicked, CPL
- PPC – Click, CPC, CPL, CPA
- SEO – Click, CPL, CPA
- Affiliate – Click, CPL, CPA
C-Level Executives definitely do not need to be reviewing each of these metrics in detail, but your marketing team should absolutely be measuring, reporting and optimizing against these metrics in order to maximize their results.
Data, Analytics, Reporting – Do You Have the Right Tracking in Place?
To make sure that your marketing initiatives are driving real-world business value, it’s vital that you’re able to align marketing performance indicators with actual business results.
For example, any organization looking to determining how well marketing efforts are truly working can’t only look at marketing KPIs listed above, but also needs to tie those marketing KPIs to important real-world revenue metrics, like:
- Cost per Sale
- Return on Investment (total, and per marketing channel)
Aligning and integrating your digital marketing performance data with your organization’s sales and revenue data will allow you to better determine just how much value your marketing efforts are actually driving.
This process may sound simple, but it isn’t, as different models, and different systems, can produce dramatically different results.
The best way to ensure you’re getting accurate, useful data and uncovering actionable insights will be to employ an expert, or an entire agency, focused on developing sophisticated marketing analytics solutions.
These agencies are well-versed in tying marketing data to sales data, building models, systems, platforms and reports that produce useful insights and helping steer organizations like your own to make better decisions about your marketing strategy, based on real-world business results.
This process is complex, and is likely to require integrating your marketing data with advanced marketing visualization platforms, like Tableau, Dataroma, TapClicks or Domo.
Is Your Marketing Strategy Scalable?
Some organizations have no trouble generating excellent marketing results with limited spends, but end up floundering when attempting to scale their efforts.
As businesses grow, markets expand and especially as marketing budgets increase, media and marketing strategies must adapt to overcome new challenges, like the law of diminishing returns.
Efficiency is important, but not absolutely necessary when spends are low, but as marketing scales, inefficient campaigns, strategies or reporting solutions can lead to disastrous overspends, wasting limited marketing dollars on ineffective platforms, strategies or audiences.
Your marketing team may be doing an excellent job performing with the budget they’ve been allocated today, but are you confident that they could scale their strategy to a 10x, 100x or even greater increase in spend?
Could Your Marketing Campaigns Be Doing Better?
It’s always possible to do better, but is it worth investing the time, funds and marketing team’s efforts on altering your marketing strategy if you’re not certain it’s going to improve performance?
How can you decide ahead of time, to make sure that you aren’t wasting resources and spinning your wheels only to produce incremental, or worse, inferior, results?
If you’re not already able to measure digital media and marketing performance in real-time, if you’re having trouble pulling actionable insights from marketing data, or if you’re struggling to make optimization decisions based on the marketing data you do have access to, then it may be a good idea to simply outsource the marketing measurement and evaluation process to a third party expert who specializes in the field.
MatrixPoint is prepared to assist your team by auditing your marketing activities, reviewing your marketing strategies, media spends and marketing results, then providing optimization suggestions to maximize your performance.
Measure & Improve Your Marketing Performance with MatrixPoint
MatrixPoint’s media and marketing analysis practice helps organizations evaluate the effectiveness of their marketing activities, ranging from strategy, vendor selection, setup and optimizations.
Our objective is to provide a non-biased analysis of marketing activities and effectiveness, ensuring you have all the data you need to make an informed decision about how to alter your marketing campaigns to maximize ROI.