Digital marketing metrics your business should be using
You’ve invested both time and money into digital marketing. As a business leader, you need measurable ways to determine if your digital marketing efforts are working.
With the right analytics solution, it’s easy to gather data on your marketing initiatives. However, it can be hard to know which data you should pay attention to, which metrics matter the most, and which key performance indicators (KPIs) to focus on.
In this guide, we’ll cover what digital marketing metrics are and share 15 key metrics so you can begin measuring the true efficacy of your campaigns.
This post will discuss:
- What digital marketing metrics are
- Return on investment (ROI)
- Total website traffic
- Traffic from channels
- Average bounce rate
- Returning visitors
- Click-through rate (CTR)
- Cost per lead
- Page views
- Exit rate
- Cost per acquisition (CPA)
- Cost per click (CPC)
- Customer lifetime value (CLV)
- Return on advertising spend (ROAS)
- Customer retention rate
- Use a powerful software for your digital marketing metrics
What are digital marketing metrics ?
Digital marketing metrics are a quantifiable element of marketing used to track and record progress. Essentially, metrics are the numbers you use to set and evaluate your KPIs. This provides a framework to help you decide if a particular marketing strategy is working or not.
Metrics might sound interchangeable with KPIs, but they’re different. Digital marketing metrics are the raw data points collected from your analytics solution. KPIs, on the other hand, are a subset of these metrics that align directly with your business goals. In other words, your KPIs add more context to your metrics because they’re accompanied by normal values that are relative to your industry.
There are many different digital marketing metrics to choose from. They vary between platforms and channels, so you need to isolate the metrics that are most relevant to your business. But to do that, you need to understand what each metric actually measures and why it’s important.
15 key digital marketing metrics to measure your campaigns
If you take one look at your analytics, you’ll soon be awash in data. Instead of treating all metrics equally, track your progress against these 15 key metrics that every company should be using.
1. Return on investment (ROI)
Return on investment is the most basic — and important — digital marketing metric. It shows what revenue you received in exchange for your investment in marketing. ROI attributes profit and revenue growth to your marketing tactics, so you can see which efforts lead to the most financial results for your business.
Marketers measure ROI with this formula:
2. Total website traffic
Total website traffic measures how many visitors your website receives over a certain time period. This includes both new and returning visitors to your website, which gives you insight into your site’s visibility and popularity.
Total website traffic gives you an idea of how aware people are of your brand and how effective your online presence is in general. In conjunction with other digital marketing metrics, total website traffic tells you how effective a campaign is at driving customers to your website. Ideally, you should see steady growth in your traffic from week to week.
3. Traffic from channels
Once you know your website’s traffic figures, it’s time to determine where that traffic came from. Traffic from channels breaks down your total traffic numbers by channel. The right analytics platform will tell you which channels are the most effective at driving traffic to your website.
The most common channels are:
- Direct visitors. These are users who access your site by directly typing your URL into their web browser. This usually indicates that the users regularly visit your site or are very familiar with your company.
- Organic visitors. Organic traffic comes to your website through unpaid search engine traffic from Google or Bing.
- Referred visitors. Referrals come to your site from another site that links to yours. For example, if you earned a feature in a news article, that outlet’s readers would be referred visitors if they click on your link in the article.
- Email visitors. These users access your site via a link you send to them in an email message.
- Social media visitors. Social media visitors access your site from platforms like Facebook, Instagram, Twitter, or LinkedIn.
- Paid visitors. This traffic finds your site as a result of paid ads. This includes pay-per-click (PPC) advertising, display advertising, or social media ads.
When you understand which channels drive the most traffic to your website, you can identify the channels that most need your attention. For example, if your social media visitors are significantly lower than other channels, then you might want to improve that channel.
Conversions is a critical digital marketing metric that measures how many visitors turn into paying customers or subscribers. It’s a metric that measures whether a site visitor makes a transaction with you, whether it’s paid or not. While it’s great to have high traffic to your site, a lot of traffic doesn’t mean much if that traffic doesn’t convert. Your goal should be to convert as many site visitors as possible so you can bring them through your sales funnel.
Conversion rate (CR) is the numerical percentage of visitors that complete a desired action. This is the formula for calculating your CR:
You can either set your CR goals before or after starting a campaign. Use your target CR as a benchmark to determine whether your digital marketing campaign was engaging enough for your target audience.
5. Average bounce rate
Bounce rate tells you the number of users who visit your site and then leave (or bounce) without clicking a link, filling out a form, or making a purchase. It can also tell you how long visitors tend to spend on your website.
A shorter bounce rate indicates that users find your content valuable, which suggests the possibility of more conversions.
6. Returning visitors
The returning users metric measures the number of visitors who come to your site multiple times. If you have a lot of returning visitors, that likely means your audience finds your content valuable. But if your returning visitors is low, your content might not be engaging enough to encourage people to come back.
This metric is especially helpful for evaluating the value of content marketing campaigns. To use this metric, establish an evaluation period. This could be weekly, monthly, or quarterly depending on your campaign details and goals. At the end of the campaign, see how many visitors returned to your site. Try to optimize this figure over time to foster deeper connections with your audience.
7. Click-through rate (CTR)
Click-through rate measures the number of clicks a paid ad receives per impression. A higher CTR means that more people are clicking on your ads. You can calculate CTR with this formula:
CTR is helpful because it indicates how relevant your ad is. If people find your ad compelling, they’re much more likely to click it and engage with you. A low CTR, on the other hand, indicates that users don’t find your ad engaging enough to click on.
8. Cost per lead (CPL)
Cost per lead measures how much your business spends on capturing a lead, which tells you how profitable your marketing efforts are. This way, you can decide where to allocate funds for specific campaigns.
By optimizing your campaigns to generate more leads at a lower CPL, you’ll generate higher quality leads while protecting your margins.
9. Page views
Page views measures how many pages a user visits in a single session. This digital marketing metric is useful, but it’s best to use it in conjunction with how much time someone spends on your website. After all, someone who visits 10 pages in 30 seconds isn’t as engaged as someone who visits the same number of pages in 15 minutes.
Page views will show you the most-visited areas of your website. For ecommerce stores, this will tell you which products are the most popular. For blogs, it shows which content users spend the most time reading. By optimizing for page views, you can decide where to strategically place content on your website in the hopes of keeping people on-site longer.
10. Exit rate
It sounds similar to bounce rate, but exit rate measures how many users leave your site from a specific page. While bounce rate measures the rate at which people leave, exit rate measures which page people leave from.
Exit rate helps you identify holes in your conversion strategy. A page with a high exit rate indicates some kind of flaw with your strategy, like poor user experience or irrelevant content.
11. Cost per acquisition (CPA)
Cost per acquisition focuses on revenue. It calculates the cost you invest in each person who becomes a paying customer. CPA tells you how much the business spent to move a person from their first touchpoint to their ultimate conversion. For example, if you spend an average of $200 to convert a prospect into a customer, your CPA would be $200.
A lower CPA is ideal because it means your marketing efforts are high-value, but your target CPA will depend on your industry, products, and target audience.
12. Cost per click (CPC)
Cost per click shows you how much you paid when someone clicks on your ad. This digital marketing metric is used to determine how cost-effective your advertising campaigns really are. This simplified formula measures CPC:
CPC tells you the real cost of clicks received from an ad, versus the maximum cost indicated by your advertising account. The higher the CPC, the less likely you are to see ROI from a paid ad campaign. The goal is to get your CPC as low as possible while maximizing return on advertising spend (ROAS).
13. Customer lifetime value (CLV)
Customer lifetime value is the dollar amount you can expect a customer to spend with your company during their time with you. CLV can be historical, which is the sum of all profits made from the customer’s purchases. CLV can also be predictive, which means you use past data to project the revenue you expect to earn from each customer.
The longer a customer stays with your company, the higher the revenue. Measuring CLV will tell you how effective your marketing is at keeping customers happy and loyal to your business.
14. Return on advertising spend (ROAS)
Return on ad spend calculates profit or loss in advertising. It measures, in dollar signs, how effectively your campaigns perform. This allows you to determine which ad campaigns are effective and which campaigns won’t generate enough revenue to make up for advertising costs.
15. Customer retention rate (CRR)
Also called reverse customer churn, customer retention rate tracks customers who return to your company to spend money. It’s more expensive to acquire new customers than it is to retain existing customers, so optimizing your CRR can significantly cut marketing costs. You can measure CRR with this formula:
The ideal CRR is 100%, although that isn’t realistic. Even so, try to keep your CRR as high as possible. If you notice a dip in retention, assess why customers aren’t returning to your business.
Use powerful software for your digital marketing metrics
While qualitative data has its place, quantitative metrics are a must for understanding the true value of your digital marketing campaigns. Being able to accurately measure the progress of your marketing efforts will tell you if your strategies are working or not. Consistently tracking these metrics will give you insight into what you’re doing well and what you need to improve to make your campaigns better in the future.
When you’re ready to get started, evaluate your current analytics software to see if it’s capable of helping you measure, track, and record the digital marketing metrics that matter most to your business.
Adobe Analytics turns real-time data into real-time insights about your digital marketing campaigns. As more than a web analytics solution, it takes data from any point in the customer journey and turns it into an insight that guides your next best action.