Marketing has never been easy, but measuring its performance and determining just how to maximize marketing results has grown increasingly complex with the rise of digital marketing strategies.
Every organization needs to know if its marketing efforts are working, but evaluating marketing and media performance is now a much more challenging task than it’s ever been before.
And while marketing departments are universally required to provide detailed reports proving that their strategies are working, how can you tell if your marketing team is doing a good job?
Here we’ll review how to tell if your marketing team is giving you everything you need to determine just how well they’re performing.
We’ll review best practices for measuring marketing effectiveness, what and how your team should be monitoring, testing, and discussing regularly, and what you can to ensure that your limited marketing dollars are being spent wisely.
Understanding the Consumer Journey
Your marketing team should have an excellent understanding of the typical consumer journey, and they should have constructed solid models that help them predict what it takes to move a consumer from awareness to consideration and all the way through the sales funnel to completing a purchase.
If your marketing team doesn’t understand the consumer journey, then how could they intelligently plan sophisticated marketing strategies capable of maximizing your return on ad spend?
One take on the modern consumer journey model theorizes that there are five critical steps along the way, including:
Not sure if this is relevant or aligns with what we're presenting or saying, but I'm guessing we have something like this and we should probably use that instead?
A solid marketing strategy should incorporate your brand’s specific processes for engaging with consumers at each step in the consumer journey, along with established best practices used to move quickly, and cost-effectively, from Awareness through Purchase.
What Data Is Needed to Evaluate Marketing Performance?
When looking to determine whether or not your marketing team is doing a good job, one of the first and most important things you’ll need to inspect is the performance data, specifically, the results from their various marketing campaigns.
There are three critical things you’ll want to review to determine how well your marketing team is performing:
- Competitor Strategies & Performance
- Return on Investment (ROI)
Virtually every digital marketing channel, from display to paid search, has known benchmarks that you can use to get a general feel for how well your campaigns are performing.
For example, if you’re looking to evaluate how well your email marketing team is doing, you’ll want to review several of their performance metrics and compare them to known industry standards, like:
- Average open rates
- Average click rates
- Percentage of hard bounces
- Percentage of soft bounces
- Unsubscribe rates
Benchmarks vary by channel though, so you’ll need to make sure that your marketers are looking at the right benchmarks for each channel, and that they’ve chosen the most relevant data too, since benchmarks may vary wildly for different industries.
If your marketing team isn’t providing benchmarks and comparing their own campaign performance against the known channel standards, then you may want to dive a little deeper into just what they are comparing their performance against.
Competitor Strategies & Performance
Only an inexperienced marketer would run their campaigns in a bubble, without at least investigating what the competition is doing, and how well what they’re doing appears to be working.
In fact, any savvy marketer who thinks critically and operates strategically is certainly going to spend at least some of their time regularly evaluating competitor strategies and attempting to measure their effectiveness, as this data could unlock all sorts of actionable insights that could be applied to their campaigns.
If your marketing team isn’t regularly conducting competitive analyses and benchmarking your brand’s performance against the competition, then there’s at least a remote chance that they aren’t doing a great job.
Return on Investment
Finally, the best way to evaluate the success of any marketing team is to simply measure their return on investment, calculating how much is being spent vs. how much revenue is being generated.
While the other metrics outlined above are all helpful at giving you an idea of how well your team is handling their duties, the best way to determine if what they’re doing is truly working is to calculate the ROI of their efforts.
This is a calculation that your marketers should be able to provide, and which should be reported regularly along with other performance metrics.
ROI is critical to determining the real-world business value being generated by your marketing strategy, so don’t neglect it when attempting to evaluate how successful your marketing team has been.
How to Measure Marketing Effectiveness
There are four primary metrics that every digital marketer needs to understand, monitor, and utilize when shaping their digital strategies, which are:
- Revenue and sales
In digital marketing, traffic refers to visits to your websites, apps, social media properties, and even brand awareness, and your marketing team should be regularly evaluating their success at generating these behaviors.
They should know not just how much traffic and visibility is being generated, but also where it’s coming from and what it’s doing once it arrives on your platforms.
It’s critical that traffic is being analyzed for both quantity and quality, so your marketers should be using engagement metrics and conversion rates to help evaluate which forms of traffic are the most useful and valuable based on how well they perform.
Importantly, they should also be aware of the forms of traffic that are underperforming, in case you need to adjust your marketing spends to create a more efficient buy.
For example, if you’re purchasing media, but are unable to attribute any measurable form of traffic against it, should you continue spending money on that channel, or shift limited dollars to another channel where results are measurable?
Traffic analysis, however, is only the beginning of a robust marketing performance review, since simply generating impressions isn’t going to move the needle when it comes to real-world business performance.
One of the true strengths of digital marketing is that it allows us to collect data that goes far deeper than simple traffic reports, so if your marketers aren’t going beyond traffic statistics, then they’re missing out on one of the most important and most compelling reasons to choose digital media as a marketing strategy; the ability to collect a specific performance data that goes far beyond simple traffic metrics.
Traffic is one thing, but it’s just the first step in calculating the effectiveness of any particular media strategy or tactic.
It’s important to next evaluate just what that traffic is doing once you’ve captured it! Whether you’re reviewing visits to your website, an app, a social media listing, or some other resource, it’s important to understand what those visitors are doing to engage with your brand after arriving.
Are they reading deeply into your content, attempting to redeem coupons, adding items to a cart, or simply bouncing back from where they came from?
Engagement metrics can give you an early indication about which forms of media, and even which specific marketing messages or creatives, are generating engaged visitors vs. window shoppers, allowing you to optimize your marketing spends and focus your efforts on generating better-targeted visitors.
Leads are a more important measurement than traffic, especially when attempting to evaluate the true value that any given marketing channel or strategy is generating.
If your marketing team isn’t measuring, rating, and optimizing against leads, then there’s likely to be a major disconnect in what they’re doing vs. what they should be doing.
Every marketing team should be able to answer basic questions about leads, like:
- How many total leads are we generating every month?
- Where are those leads coming from?
- What’s our cost per lead, per channel?
- How well are the leads converting, and are any channel’s leads converting better than the others?
- Are we allocating our marketing spend based on lead counts and lead performance? If not, why not?
This is a great place to start asking questions of your marketing department since it’s such an obvious point where things can go wrong if the data isn’t being properly measured, monitored, and utilized to produce ongoing optimizations.
Revenue and Sales
At the end of the day, any marketing campaign is only as effective as the revenue that it generates, and if that revenue isn’t outpacing marketing costs, then is anything being accomplished?
One of the most important questions to put towards your marketers is just how much revenue each of their initiatives is responsible for generating, and exactly what the return on ad spend (ROAS) for each of their initiatives comes out to.
If they aren’t able to explain these basic measurements, and if they can’t detail the relative revenue and ROAS by marketing channel, then you may need to think about bringing in new assets to help take care of this essential step in the modern digital marketing process.
Other Useful Metrics
Traffic, leads, and revenue are just the beginning steps of fully understanding marketing performance, and you may want to dig much deeper into some additional performance metrics for each specific marketing channel that your team is utilizing.
For a quick sample of some typical metrics that you may want to use for each of the most popular digital marketing channels, here are a few of the measurements your team should be monitoring:
- Display – Click, CPL, CPA, Viewability
- Video – Video Completion Rate (VCR)
- Email – Viewed, Clicked, CPL
- PPC – Click, CPC, CPL, CPA
- SEO – Click, CPL, CPA
- Affiliate – Click, CPL, CPA
If your team isn’t at least paying lip service to some of these metrics regularly, then you may need to dig deeper into what measurements they are monitoring because something could be amiss.
Ongoing Testing & Learning
Marketing campaigns and strategies that worked extremely well a year ago, six months ago, or even a month ago may be far less effective thanks to changes in the competitive landscape, technology, or consumer demands.
To make sure that your dollars are being spent effectively, it’s critical that your marketing team regularly tests new initiatives, strategies, and tactics to make sure that they’re maximizing the efficiency of their efforts.
Three things to test regularly include:
- Media Channels
- Media Partners
Adjusting your media mix is critical to understanding what is driving traffic and sales.
Companies often rely on lower-funnel strategies such as paid search, but there is a point of diminishing return as well as a need for upper-funnel awareness to keep feeding the lower funnel channels.
You should adjust your media channels to understand both the point of diminishing return as well as what drives customers into the upper funnel portions of their consumer journey.
With digital’s ability to target granular audiences, products, and services, your creative should be customized to specific audience segments and behaviors.
This means developing and testing different ads using dynamic creative or multi variants across each of the different advertising platforms.
Your re-targeting ads should also be based on consumers’ interest and actions, speaking specifically to whatever it was that they’ve shown an interest in and working to generate further engagement based on how they interacted with your branded content.
Re-targeting creative should also be distinct from typical prospecting ads, and if you’re using the same creative across both strategies, then there’s a huge opportunity to further optimize your strategy.
To maximize ROI, you must pay close attention to media partners, creating benchmarks to score them against, comparing the performance of different partners you’re running media with, and regularly testing new ones.
Technology and data continuously change and improve and so should your media strategy.
To keep your marketing campaigns operating at maximum efficiency, your marketing team should be regularly testing their strategies, like channel allocations, target audiences, and other elements of the process that they may simply be taking for granted as constants.
Digital marketing is no longer the absolute wild west it was a decade or two ago, where changes were occurring so rapidly that hardly anyone could keep up with all the new ideas, channels, and tactics emerging regularly, but new technologies, platforms, and strategies do continue to emerge regularly, and any effective marketer needs to regularly review new opportunities and test new marketing strategies.
Your marketing team should be evaluating performance at least quarterly, but ideally monthly or even more frequently, and investigating, then testing any new channels, strategies, or tactics that seem promising.
It’s simply not possible to do a good job as a marketer if you aren’t regularly evaluating your performance, monitoring key performance indicators, and optimizing your marketing strategy based on the results that your campaigns are generating.
Simply put, if your marketing team isn’t running comprehensive performance reports, which they then analyze, evaluate, and use to drive operational strategy, then there is very little chance that they’re doing a good job.
Marketing teams need to evaluate their effectiveness regularly, running consistent, accurate reports that do a good job of capturing the value delivered by their marketing initiatives.
If your team isn’t regularly reviewing performance reports at both the macro and micro level, then it’ll be incredibly difficult for them to tell just how well their strategies are working, and it may be impossible for you to tell if they’re doing a good job.
Without regularly evaluating critical performance data, how could your team tell which digital channels are performing well, which are lagging, and which need to be cut off entirely or adjusted to save ROI?
How would they know which specific creatives, messaging points, and vendors are bringing the most value to your organization?
How would they decide how to optimize their efforts moving forward to ensure that your campaigns remain efficient and effective?
In short, any marketing team that isn’t regularly reporting on their progress, and making optimizations based on the data found in those reports, isn’t likely to be doing a very good job.
But don’t just take your marketing team’s word for how well their campaigns are performing, because there can be problems with performance reporting platforms.
It’s incredibly important to reconcile your digital marketing reports against internal sales data, and you should also be monitoring how well digital marketing results are helping to reach internal sales goals as well.
If you aren’t aligning the numbers coming out of different reporting platforms, it could be extremely difficult, if not impossible, to create a clear picture of overall performance.
Are Your Marketing Strategies Scalable?
Perhaps your marketing team is doing an incredible job of generating excellent results with limited spends, but if you were to open up the budget and offer them 2x, 5x, or 50x the spend, would they know what to do with it?
As your business grows and your goals expand, it’s important that your marketers can adapt and overcome the new challenges they’ll face, like the law of diminishing returns, and the need to increase reach and add scale, while maintaining effective ROI.
Efficiency is vital to the success and health of digital marketing strategies, but small campaigns may be capable of hiding inefficiencies that become outrageously expensive at scale.
To prepare your team for long-term success, they must have solutions in place to prevent and control against large-scale disasters like overspending or wasting limited resources on platforms, channels, strategies, or audiences that simply don’t produce a positive ROI.
Could Your Marketing Team Be Performing Better?
Every marketing campaign could be slightly better optimized, but are your marketers missing any significant opportunities to improve their performance?
If your team doesn’t have a clear picture of the consumer journey, if they aren’t measuring the right performance metrics, and if they haven’t been testing new strategies to evaluate them for potential use, then how could you possibly know whether or not they’re doing a good job?
Unless your team is handling all of these mission-critical tasks, and doing them well, it’s unlikely that they’re maximizing your ROAS.
Measure & Improve Your Marketing Performance With Matrix Point
MatrixPoint is prepared to help you find out how well your team is performing by auditing your marketing activities, reviewing your marketing strategies, media spends and marketing results, then providing optimization suggestions to maximize your performance.
Our media and marketing analysts help organizations evaluate the effectiveness of their marketing activities, ranging from strategy, vendor selection, setup, and optimizations.
This service provides a non-biased analysis of marketing activities and effectiveness, ensuring you have all the data you need to make an informed decision about how well your team is performing, and what you may need to do to alter your campaigns to maximize ROI.