The Importance of Marketing Performance Measurement
By Marketing / February 22, 2023
When it comes to marketing, there is no one-size-fits-all approach. Every business has unique goals and must develop a tailored strategy to meet those needs. However, there is one key factor that is essential for any marketing campaign to be successful: MEASUREMENT.
Measuring your marketing efforts is critical in understanding your campaigns' effectiveness and identifying areas for improvement. It allows you to track your campaigns' performance and the success of individual tactics, identifying which strategies are working well and which need improvement. Measuring also helps you better understand your target audience so that you can focus your efforts on those most likely to convert and help you make more informed decisions about your marketing budget and how you allocate resources.
According to Liam Branghan, Performance Market Lead of Uber Eats, “Measurement is as critical as ever. Unfortunately, measuring impact and attributing results is becoming increasingly complicated for marketing teams. Advertisers that can find reliable and practical ways of demonstrating the success of their campaigns will have a huge advantage over those lost in a quagmire of noisy data and ambiguity."
How Do You Measure Marketing Performance?
To effectively measure your marketing efforts, it is essential to outline the goals you hope to achieve before beginning your campaign. This will ensure you can identify which tracking mechanisms are needed and set them up at the onset of your campaigns, enabling you to track the conversions and metrics that matter most.
Setting Smart Goals
Your goals should be SMART, which means:
- Specific: Ensure that goals are clearly defined
- Measurable: Identify HOW you quantify your success
- Achievable: Realistic and attainable
- Relevant: Supporting your overall business objectives
- Timely: Setting timelines for measurement and performance evaluation
A SMART goal needs criteria to help you measure your progress. Here are some questions that will help guide you:
- How many leads are you hoping to gain with your campaigns?
- What methods will you use to reach those goals?
- What does “success” mean for your campaigns?
Identify Key Marketing Performance Metrics
Each marketing tactic type has specific metrics available to help reach your goals. These will be your key performance indicators (KPIs) for each tactic that will quantify your progress in achieving your goals. Defining the right metrics to measure will determine the tools you need to use.
What are the most useful marketing performance metrics?
- Conversion Rate (CVR): the ratio of customer conversions - (i.e., those who take specific actions like signing up for email newsletters, making a purchase, or filling out a lead generation form) - divided by the total number of site visitors.
- Cost Per Lead (CPL): refers to how much money it costs to acquire a new lead. You’ll need to factor in the cost of advertising, tools, and other elements used to generate each lead.
- Customer Lifetime Value (LTV): refers to the total amount of money a customer is expected to spend with your business during the lifetime of an average business relationship. You can get the value by multiplying the average purchase value by the average purchase frequency.
- Return on Investment (ROI): the profit you earn, measured against the amount you invested.
Tools To Measure Digital Marketing Performance
In addition, it’s important to have a comprehensive reporting platform in place with the ability to aggregate the details from several important sources, such as your website visits and page views, as well as your ad campaign metrics, including impressions, click-throughs, and conversions. You should also track efforts on social media channels, such as post engagements, video plays, swipes, likes, and reach.
Here are a few of the most popular measurement tools:
As one of the most robust tools you can use, Google Analytics offers more than what meets the eye. Signing up is free, making it widely available to businesses of all sizes. Monitoring begins by setting up your account and linking your website by adding a tracking code. Google Analytics will help you track your website’s performance in areas such as:
- Page visits: Refers to the number of pages accessed on your website within a specific timeframe
- Event actions: Measures instances like clicking a button or performing other specific actions on a page of your website
- eCommerce purchases: Pertains to the number of purchases a website visitor made
Google Tag Manager (GTM)
When it comes to digital advertising performance measurement, many digital ad campaign types require additional tracking mechanisms to help capture the details behind what transpired with a campaign or to offer better reach to the target audience. Unfortunately, this often results in tracking scripts that need to be added to your website, which can impact your website’s load time and cause downright messy code if left unmanaged.
A Google Tag Manager or GTM container can help minimize the tracking pixel scripts needed for multiple digital campaigns, thus reducing load time. In addition, GTM offers one easy location to house your site's digital ad tracking information.
Google Search Console (GSC)
Like Google Analytics, this free tool helps businesses monitor their website’s SEO performance. This tool lets you easily monitor if Google crawls or indexes your website. In addition, there are other pieces of information that you can view on your GSC dashboard, such as:
- Total number of clicks on your website from search results
- Average position on search engines
- How your website appears on search results
- Security issues
SEMRush is a helpful tool that will help monitor your website traffic, social media performance, and competitor analysis. Primarily an SEO tool, it will also help you create content marketing strategies you can use for your campaigns.
After connecting your social profiles, you can monitor which channels are performing well for your business and which are not. Then, you can create curated campaigns from there that best suit your target audience.
Cloud-Based Marketing Analytics & Reporting Platforms
Across the digital marketing landscape, several reporting platforms with various features and price points are available. When selecting a tool to use for your business, it is important to consider the following:
- Partner/Vendor Access: If you’re working with a marketing partner, will they provide you support or access to a reporting platform?
- Data Sources Available: Will the platform link to all of the necessary sources for information that are important to your business?
- Ease of Setup: Will the platform come ready for you out of the box, or will it require extensive setup and configuration before you can generate results?
- Ongoing Use: Will the platform be able to grow with your company over time? What is required to add new channels and data sources?
- Level of Support Offered: What type of support is available from the platform, and what needs to be supported by your team?
Once you have your tracking systems in place, reviewing and analyzing the data to identify trends regularly is vital. This will help view areas of success, such as which campaigns are driving the highest amount of leads, conversions, and overall traffic, plus areas that need improvement.
Benefits of Marketing Performance Measurement
Marketing performance measurement encompasses both your marketing campaigns' efficiency and ROI. Here are the benefits of regularly reviewing your marketing performance:
Measuring your marketing campaigns will highlight which aspects of your campaigns are working well and which need attention, allowing you to pinpoint the marketing channels that best achieve your goals.
Improved Transparency and Accountability
You need to set clear goals to properly measure your campaign’s effectiveness. By doing this, you’ll need to provide your marketing teams with clarity and accountability on what you’re working to achieve, ensuring your team collaborates towards accomplishing these goals.
Marketing reporting can hold a wealth of data for your business. From tracking website usage to identifying which ads people responded to the most, this data can guide your teams in making decisions that will catapult your success.
Exceptional Customer Experience
With the insights from your marketing, you’ll learn how your audiences “feel” about your products, services, and company. Then, you can tailor your efforts in new ways to support them in the best way possible, improving customer satisfaction.
Work with a Partner You Can Trust
Measuring your marketing efforts is the ultimate key to success. By measuring, you can identify areas for improvement and ensure you get the most out of your marketing efforts. Many digital marketing agencies and providers claim transparency in their reporting, but not all will provide direct access to that reporting.
At AffinityX, we specialize in offering effective digital marketing solutions to help grow your business. We utilize best-in-breed digital ad technologies, including a robust ad reporting platform powered by the industry leader in advertising reporting, TapClicks. Measure your campaign effectiveness and identify early signals for adjustment with our reporting dashboard, offering direct access to campaign analytics in nearly real-time. Ready to take your marketing efforts to the next level?
Get in touch today to get started!