So, you created an e-book or sent out an email. That’s great, but what happens next? You’ve already determined where you want to invest your marketing dollars, but are you calculating if the effort you spent writing the content, designing it, and sharing it on social media was worth it?
If you say no, you're not alone, but getting content out there isn't enough. You have to measure it. Measuring the effectiveness of your efforts is the key to understanding ROI in digital marketing.
You may be asking yourself, “how do I track and measure my efforts?” That’s where key performance indicators, known as KPIs, come in.
In this article, we are going to walk you through everything you need to know about digital marketing KPIs and how to use them to guide your marketing strategy, determine value, and calculate ROI.
What are Digital Marketing KPIs?
Digital marketing KPIs are the key performance indicators that help you track and measure the success of all your digital marketing efforts.
They are essential because they help you visualize how your campaigns and digital marketing channels are performing. This knowledge will help guide your budget, future campaigns, and your business decisions.
Without tracking your KPIs, you don’t have any real data on how that e-book performed. Was it worth the 40+ hours it took you and your team to create it? Should you create another e-book?
Once you understand the digital marketing KPIs you need to track, you can use the to guide your strategy. This mindset shift will help you build more effective campaigns and, ultimately, have a higher ROI.
What is ROI in Digital Marketing?
ROI in digital marketing is the measurement of the profit or loss that you generated from a particular digital marketing campaign based on the amount of money you invested to run that campaign. It is extremely important to calculate and measure because it determines if your campaigns made you money or cost your money. The value of each campaign is determined by your ROI.
What Digital Marketing KPIs Should I Measure?
Your KPIs depend on your marketing strategy, goals, and the channels you are using to achieve them. Before you start building out your campaign or decide to start using a new channel, think about what you want to accomplish.
We like to put our goals into two categories – macro goals and micro goals. Our macro goal is the big goal, and micro goals are the smaller goals that will lead to us to accomplishing our bigger (macro) goal. Your macro goals can help you determine more specific micro goals for each channel.
For instance, if you are starting a campaign and you want to get $5,000 worth of new business from your campaign. That $5,000 in new business is the macro goal. But you will need micro goals to get you there. To get $5,000 of new business, you know you need to drive 3,000 people to your website and convert 6% of those visitors.
Your micro goals for this campaign will be to convert 6% of website visitors and drive 3,000 new visitors to your website. Once you know this, then you can determine the strategies you will use to drive that website traffic. Most likely, you will use a combination of channels – email, social media, google ads, etc.
Although all those channels are working together for one macro goal, each channel has a different set of KPIs. It’s important to understand which KPIs are trackable on each channel so you can plan and measure your campaign.
Now, it’s time to dive into some of the major marketing channels. We are going to talk about each channel and help you get an handle on the digital marketing KPIs that you need to measure success.
Your website is the hub of most of your campaigns. It’s where you drive all of your traffic. It's crucial to understand how your website is performing, where your traffic is coming from, and how many people are converting to leads and, ultimately, customers. To know this, you have to dive into your website analytics.
Google Analytics is where you will find all of your website analytics. It’s imperative that you have Google Analytics set up on your website to track all of your website and digital marketing KPIs. When you first enter Google Analytics, you will likely see the audience overview chart pictured below. This chart is fundamental to see how engaged your audience is with your website content. However, most of these KPIs fall into the micro bucket. They are influencers to bigger macro KPIs on your website.
Let’s dive into some of the essential micro website KPIs.
Website Micro KPIs
- Website Users – This number indicates how many people have visited your site during a specific period. For the example campaign mentioned above, you would track users to get to that 3,000 visitors.
- Website Pageviews - The total number of pages that those users visited on your site during one visit. For instance, one user could visit five different website pages before leaving your website.
- Website Bounce Rate – This indicates the percentage of users that visited one page on your website and then left. The bounce rate shows how engaged users are on your website. You want your bounce rate percentage to be low.
- Pages Per Session – The average number of pages a user views before exiting your website.
- Blog Click-Through Rate – The number of people that continue to another page after reading a blog article. If you have a blog on your website, this helps you understand if those efforts are driving traffic back to your main site.
While all of these metrics are important and should be analyzed, they don’t show you any quantifiable ROI. Website micro KPIs are there to influence the macros.
Here are a few important macro KPIs that you should be tracking on your website.
Website Macro KPIs
- Website Conversion Rate – The percentage of people that visit your website and fill out a form or make a purchase. In Google Analytics, you can create goals to track specific conversions.
- Website Qualified Leads – The number of prospective buyers that come from your website (meaning they filled out a form, called your phone, or saw redeemed on offer on your website). Only include people that are searching and/or interested in your product or service.
- Website Landing Page Performance – Measures the performance of specific pages on your website. The higher-performing pages are driving more conversions and leads.
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Now that you understand how to track and quantify your website traffic, let’s talk about the strategies you use to get people to visit your site. The two most popular earned media channels are email and social media marketing. Both contain major digital marketing KPIs that are important for your marketing success.
Email Marketing KPIs:
Email marketing helps you communicate your message and has one of the highest ROIs of any marketing channel. That is because, when executed correctly, email marketing builds a relationship with your subscribers. The Balance Small Business says it best with this definition:
“In its most basic sense, email marketing is the use of email to promote products or services. But a better email marketing definition is the use of email to develop relationships with potential customers or clients.”
But how do you know if your email marketing strategy is working? That's where you need to dive into the data. Just like for your website, there are micro and macro email marketing KPIs also.
Email Marketing Micro KPIs
- Email Open Rate – The percentage of people that open your email in their inbox. The average open rate is around 20%. The open rate tells you how your subject lines are performing. I always recommend A/B testing subject lines to increase the open rate.
- Email Click-Through Rate – The percentage of people that open your email and click on a link within the content. An average click rate is around 2.5%. This KPI shows you how many people are interested in the content that you sent.
- Email Unsubscribe rate – The percentage of people that opt-out of your email list after receiving an email from you. You want to keep your unsubscribe rate low. If you have a high unsubscribe rate, you may be spamming people or sharing unwanted information with them.
- Email Bounce rate – The percentage of emails that bounce when you send an email. If your bounce rate is high, it means that your email list is not clean. You have old email addresses or invalid addresses. If you have an old list, get your emails verified before sending out an email.
Email Marketing Macro KPIs
- Website Traffic – The number of email recipients that visit your website from an email. You'll track this in Google Analytics. You can also see how long the visitors from your emails spend on the site, the content they are viewing, and if they convert. You can view this data in Google Analytics (Acquisition > All Traffic > Channels).
- Email Conversation Rates – The number of people that convert to leads or customers from email marketing. This builds on website traffic. Once you can identify the source, you can see how many of those visitors fill out a form, become a customer, or make a purchase on your website.
To dive deeper and see which email your visitors came from, you’ll want to set up Google UTM parameters. UTM parameters are simply snippets of code, which can be appended to the end of a URL to track information about the visitors arriving on your website. By doing this, you can follow exactly which email and piece of content drove visitors to your site.They look something like this:
I know that the URL looks complicated. But, trust me, it's not. Google does it all for you. All you need to do is fill in the details here, and Google will generate the UTM for you.
You will then be able to see this data in multiple places in Google Analytics.
- Acquisition > All Traffic > Source/Medium
- Acquisition > Campaigns > All Campaigns
This data can help you identify the most successful content you are sending via email. Which, in turn, enables you to understand the material to create in the future for your audience.
There are many different KPIs that you can measure in your email marketing efforts, but the few mentioned above are the KPIs I believe you need to track in order to understand ROI in digital marketing.
Now it’s time to conquer social media marketing KPIs.
Social Media Marketing KPIs:
Social media marketing is the use of social media platforms to share content and connect with your audience to achieve your marketing goals. Common social media platforms are LinkedIn, Twitter, Facebook, Instagram, and YouTube. However, there are many more out there that can be useful for your brand. And new channels are constantly emerging, like TikTok.
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Tracking KPIs for social media marketing depends on your goals. Many companies use social media marketing to enhance brand awareness, increase sales, drive website traffic, or all three. Your goals for social media will determine the micro and macro KPIs. For instance, if your goal is to increase brand awareness, then your macro KPIs might be new followers, engagement rates, and website traffic. If you want to increase sales, then new followers may not be as important as conversions.
Once you determine your social media marketing goals, then the KPIs will be easier to identify. Here are a few of the social media marketing KPIs that can (and should) be tracked by your organization.
- Social Media Engagement Rates – The number of people that interact with your posts (likes, comments, reactions, shares).
- Social Media Click-Through Rates – The percentage of people that click on a link in your posts or your bio.
- New Followers – The number of people that follow your page in a given timeframe. If you are tracking new followers, you should also track unfollows.
- Website Traffic – The number (or percentage) of visitors that come to your site from social media.
- Social Media Conversion Rates – The percentage of visitors that come to your site from social media and complete a goal (fill out a form, make a purchase, sign up for an event, etc.).
- New Business – The number of new customers that you get directly from social media.
The key to measuring the value of your social media efforts is choosing the right KPIs and content for your channel goals. For example, if your content doesn’t align with your goal of increasing sales, then you won’t hit your KPIs. By being strategic and aligned, you will have a better chance of generating value and ROI in your digital marketing efforts.
Digital Marketing Campaign KPIs
Marketing campaigns are organized efforts to achieve a company goal such as increasing purchases of a product or service, collecting customer feedback, or establishing your brand as thought leaders on a topic. Usually, these are achieved by using a combination of all of the channels mentioned above, and most likely, a few others too.
Marketing Campaign KPIs are a bit different than the ones mentioned in the channels above. With your campaign, you want to see how all of your channels perform together to achieve your goals. It's a more coordinated effort than an individual channel.
Marketing Campaign Micro KPIs
Your micro KPIs for your campaign will most likely be some of the KPIs by channels such as website traffic, new followers, social media engagement rates, or email click-throughs.
The Macro KPIs are the most important to determine if a campaign was successful for not. So, let’s skip right to those.
Marketing Campaign Macro KPIs
- Goal Completions – The number of website visitors that completed a specified goal in Google Analytics. For campaigns, I highly recommend that you set goals and build funnels in Google Analytics. Goals and funnels allow you to see how many people converted, and if they didn't, where they dropped off.
- Cost Per Lead – The Total Campaign Spend divided by Total New Leads received from your campaign efforts. CPL helps you calculate how much you had to spend on one new potential customer.
- Lead Close Rate – The percentage of leads from your campaign that turn into customers. By knowing how many customers you converted in your campaign, you can calculate ROI. Did those customers bring in more revenue than your campaign? If not, what is their customer lifetime value? Will that bring in more revenue over time than you spent on your campaign?
Remember, Coordination is Key to Success
Hopefully, you are ready to dive into those digital marketing KPIs. It can seem a bit overwhelming, but it's extremely important to understand your successes, areas of opportunity, and overall ROI in digital marketing.
Remember, it's genuinely a coordinated effort between all of your channels. As you saw above, each channel influences the other channels. They are all integrated and work together to achieve your goals. Start with your goals, build a strategy, identify your KPIs, execute, and evaluate.
You got this! 💪