Digital marketing is an industry that’s constantly facing a lot of pressure from business executives and customers. To stay afloat, you need to know the Key Performance Indicators (KPIs) that are most important for digital marketers.
It’s challenging to keep up with the industry standards and trends. It’s even more difficult to know what to prioritize in your marketing campaigns to ensure they achieve the most optimal results for their marketing efforts.
So, that’s why it’s so important to keep track of your KPIs. When you familiarize yourself with the key factors to measure your performance, you will bolster your strategy.
We wrote this article to help you learn the right KPIs for digital marketing. That way, it will be easier for you to know which campaigns are working or which digital marketing strategy is worth your time. So, let’s start with the definitions and overview of KPIs for digital marketers.
What are KPIs for digital marketers?
KPIs or Key Performance Indicators for a digital marketer are the measurable values that the digital marketing team uses to evaluate their performance in working to achieve their objectives. The focus of a KPI is simply the objectives or the targets of a business, such as an increase in revenue or web traffic, then outlines the activities or set of goals that can help achieve those particular objectives.
Digital marketing KPIs are either high-level or low-level, depending on their impact on a brand. High-level KPIs affect the overall business, while low-level KPIs affect a specific marketing department.
KPIs are important in evaluating a digital marketer’s efforts to know whether there is a positive impact on their actions or not. And because digital marketers can assess the relevance of their efforts through the KPIs, they can easily set expectations and work to fulfill them.
The ten main KPIs for digital marketers
At the outset, digital marketing may seem difficult to measure. However, with the right KPIs, this is not the case. Digital marketing is more painless to measure than offline marketing. And today, this article will explore the ten main KPIs that allow digital marketers to measure their performance.
So, let’s dive in!
Web traffic is a useful KPI because it enables the marketer to understand which traffic source drives more visitors to a website. Attracting web visitors to a business website can help maintain and turn them into leads.
The traffic sources that can drive traffic to your website may include:
- The direct visitors of your website who landed on your page after typing on your URL
- SEO optimization that drives traffic from search engines
- Email campaign visitors and any other email efforts
- Social media platforms’ visitors who may land on your page via links
- Referrals; traffic from your partner websites, such as guest blogging.
If you keep a close eye on this KPI, you will determine the sources working well and double your efforts to gain more. Also, you will identify the sources that are not working well and fill the existing gaps.
Social media engagement
Social media KPIs are metrics that show the performance of social media’s return on investment(ROI). It is an essential KPI because it ensures that the social media management team engages with the relevant audience so that the business can achieve its goals.
Your social media engagement KPIs should be SMART, that is:
- Specific: Your goals must be as clear as possible.
- Measurable: Are you able to follow up and quantify your progress?
- Attainable: Set realistic goals. Goals should be within an achievable scope.
- Relevant: Every social media KPI must connect to the larger goals of the business
- Timely: You must set a timeframe within which you should expect to meet your goals.
When you use SMART social media KPIs, it becomes easier for you and your team to focus on fulfilling your goals and remain consistent. It also becomes easier to track and report the success rate of social media campaigns and sales.
According to Rule Analytics, lead generation is the most critical goal for 91% of all marketers. Lead generation is a top KPI that enables marketers to determine their marketing strategies that effectively attract their target audience.
The number of quality leads involves both the marketing and sales teams. Marketing, in this case, focuses on marketing qualified leads. For new leads to turn into qualified leads, the marketing team will nurture them using specific targeted marketing goals.
You can make better decisions on generating more leads because KPIs can predict incoming sales. The cost of acquiring a new lead is called cost per lead. The cost per lead of an effective marketing strategy must be at its minimum.
The conversion rate shows how many visitors complete a specific action. The conversion rate is calculated using the formula below:
Conversion rate = (Number of conversions/Total number of visitors) x100
A working marketing strategy should lead to a higher conversion rate in lead generation. You can choose to calculate the conversion rate of the entire domain or selected pages. For your conversion rates to be higher, you should apply the most effective ways to improve your conversion rates.
Customer acquisition cost
Customer acquisition cost is the amount spent looking for and gaining new customers. The cost also includes those incurred through marketing offers, like free trials. The calculation of the customer acquisition cost is necessary for a digital marketer because it ensures that the business stays within a set budget. Customer acquisition is calculated as shown below:
Customer acquisition cost = money spent on marketing/Total number of new customers
The customer acquisition cost should be as low as possible to avoid using profits to gain paying customers. A high customer acquisition cost will reduce your return on investment, making your marketing strategy ineffective.
The Click-through rate is used to measure the rate at which listings on Search Engine Results Pages generate clicks within their time of the appearance in search results. Listings are very useful in increasing the number of clicks.
Under this KPI, depending on your set goals, you can know the level of interest your web visitors have in your products. The success indicators of the click-through rate are:
- The high-click-through rate for a particular search term
- The high goal completion rate for a specific search term
If a particular term has a high-click rate, then you know that there is success in the product(s) related to that term. High-click rates are most likely to attract more visitors. Therefore, digital marketers can track their performance using the number of clicks.
Customer Lifetime Value
Customer Lifetime Value is the expected income a business may earn because of the relationship with a customer. A customer lifetime value is the most significant metric impacting revenue that allows marketers to identify their best customers.
As a marketer, you should know the lifetime value of an average customer. The longer your relationship with your customers, the more valuable those customers are to your business. You can easily track your progress using the customer lifetime value.
If you have many customers with higher lifetime values, you have the cumulative value of what they are to your business, and your efforts have a positive impact.
Goal completion rates
The goal completion rate shows the rate web visitors accomplish the required actions. It is a ratio of the total web visitors to the total number of goals completed. These goals may include signing up for a particular activity or subscription to a mailing list.
Every campaign will have a different objective than the others, so each should have its goal requirements at its beginning. The goal completion rate is mainly used in website optimization to determine how the target audience resonates with the website.
The success indicator for Goal Completion is the higher rates showing that your campaigns effectively encourage the target audience to complete more desired actions.
Keyword ranking is a performance indicator used to measure the effectiveness of your SEO efforts in driving search engine traffic to your website. This ranking allows you to improve your existing rankings or rank on new keywords.
For best results in keyword ranking, you should keep updating your keywords. Remove or update all your stagnant keywords as they may not align with the new trends or information on new technologies.
You can check your organic traffic landing pages. The keywords chosen must effectively drive traffic to the site to know whether you used effective keywords. The success indicators of keyword ranking are:
- An improving rank of a keyword
- Increasing click-through rates
- Improvement in goal completion rates.
Traffic lead ratio
The website traffic lead ratio shows the number of web visitors who get converted to leads. This ratio is a significant KPI because it indicates the quality of your web traffic. The traffic lead ratio will be crucial to you if you are operating a business that uses a website as a leading marketing tool.
You may have a popular website that is not bringing you any financial changes. Therefore, to be wise, use your traffic by monitoring the traffic lead ratio. To calculate the traffic lead ratio, you use the formula:
Traffic leads ratio = (number of leads x total number of website visitors) x 100
If the traffic lead ratio is less than 4%, you must change your content strategy because it is not attracting potential customers. There is no need to drive people to your website to see viral content that is not generating any income.
The KPIs for Digital Marketers: What next?
Key performance indicators are crucial to digital marketers, especially now that we live in a digitally changing world. Each campaign has its separate set of goals and requirements, and you need evaluation to determine the effectiveness of the efforts.
Every activity must push the business forward towards achieving its set goals. Therefore, every digital marketer needs to master these key performance indicators to avoid wasting business resources such as time and money on activities that do not boost sales.
Now that you know the most important KPIs for digital marketers, are you ready to take your digital marketing to the next level? We hope you do — and if you found this post resourceful — don’t forget to check and see how Dataslayer.ai can help you along the way.