When companies create a marketing plan to organize the most important actions to be developed within the value chain of their campaigns, they set clear objectives with the purpose of guiding their operations and evaluating, over a given time, whether or not those objectives were met. Measurement comes into play in this process, the purpose of which is to know if the promotion of a content, product and/or service was as successful as expected.
It is well known that what is not measured cannot be improved, therefore, quantifying results becomes a very important task for companies that need to know the “health status” of their business model. It is about comparing the behavior of the market and the receptivity of an audience, before and after implementing a marketing strategy with the aim of analyzing its effectiveness.
KPIs are an important part of this process, as they act as metrics to compare these results. Before knowing which are the main KPIs that you should consider in your digital marketing strategies , we invite you to first learn the concept of this term:
What is a KPI and what is it used for?
KPI , which stands for Key Performance Indicator , is a measurement unit that is responsible for quantifying the degree of compliance with your objectives. As we have already mentioned, these performance indicators are generally present in the strategic plans of organizations and reflect their profitability over a given time.
KPIs can be used in various areas of a company, such as: marketing, purchasing, sales , customer service, production, etc. They are, roughly speaking, metrics that determine the value of a quantitative variable, such as: income, expenses, number of sales, number of visits, etc. These indicators can provide useful information about your company and reveal opportunities to improve some actions that are not working.
Using KPIs in your digital marketing strategies will give you a much broader view of the variables that affect your success in practice. Each company must create its key performance indicators and in turn the variables it wants to measure in a personalized way, according to its purposes and the industry in which it operates. However, here are some KPIs that companies mostly use both to evaluate the performance of their objectives (economic and scope) and to create benchmarking indicators within digital platforms and media with a long history:
Cost per click (CPC)
Cost per click is the charge made by digital advertising platforms, such as Google AdWords or Facebook, when a user clicks on an advertisement. In other words, it is a method of paying for online advertising in which you only pay when the user clicks on an advertisement or banner.
Cost per click is a KPI because it allows you to determine which digital media have the greatest impact, that is, receive the greatest number of clicks. For example, when you decide to implement native advertising based on a strategy to boost your content marketing , cost per click is an effective metric to know if that advertising pays and receives an optimal number of clicks to make your investment worthwhile. You can calculate this investment/profit ratio by dividing the total campaign expense by the number of clicks obtained.
In the conversion process of the inbound marketing methodology, companies use content offers to motivate their readers to take certain actions. Calls to action , landing pages and forms come into play within this metric, as they are tools that further boost the relationship of readers of a blog or social network with the brands that promote that content, converting them from simple visitors to sales opportunities.
There are marketing strategies that do not necessarily meet their objectives by the number of clicks they receive, but rather, what is much more important for them is the actions that Internet users carry out when they see their ads. An objective that can perfectly connect with this KPI is: time on the site, page views per session, number of shares, likes, comments, among others.
The way to calculate this indicator is by dividing the total cost of the campaign by the number of interactions completed. Keep in mind that, although the cost per interaction is usually cheaper than a CPC advertising model, it is more geared towards generating engagement, so your ROI may be more favorable under this model.
Cost per acquisition (CPA)
Cost per acquisition is an advertising cost that is determined by the action you consider valuable on your landing page, such as purchasing a product, submitting a form, downloading a PDF, playing a video, etc. That is, the action that allows you to convert a visitor into a lead within the conversion process, that is, acquire a new sales opportunity who may be interested in purchasing your products and/or services.
While CPC measures the number of clicks received and cost per action, the number of actions a person took on your website, CPA is much more accurate because it really condenses all of those metrics, the people who actually became a sales opportunity for your company. Cost per acquisition is a much more valuable KPI that will allow you to evaluate the success of your inbound marketing strategies.
When you want to define your objectives based on cost per acquisition, it is important to ask yourself: How much will each conversion cost you? How many conversions can you buy? However, to calculate your CPA you must divide the total cost of the campaign by the number of people acquired (leads) or sales.
Return on Investment (ROI)
ROI is a formula that allows you to know the economic benefit obtained from an investment made. In other words, ROI allows companies to know their profit margin in relation to the performance of an applied marketing strategy .
ROI is an important KPI because it allows you to measure the profitability of a business (in terms of investment and income) and, in the case of social media , of a particular piece of content. In digital marketing , ROI takes on a strong role, since if the return on investment generated by some strategies is not known, it would not be possible to correctly evaluate whether they are meeting the stated objectives or not.
To calculate your ROI, you must subtract the money you earned from sales from the amount of your investment and divide that result by the amount invested. For example, if your company invests $2,000 in social media advertising and the profit is $10,000 (i.e., that was the profit obtained from the sales generated by that advertising), the ROI would be calculated as follows:
ROI = 4% (The ROI value, being the quotient of two related magnitudes, is a ratio, so it is expressed as a percentage). Based on the example, your ROI would be 4%.
Number of followers, likes and shares obtained
The KPIs that are most closely related to the social media field are those that allow you japan whatsapp number to evaluate the performance of your posts on social networks such as Facebook, Twitter and Instagram. The number of followers is a very important metric because it allows you to see how much your reader communities have grown. At the same time, it is an important indicator to know what the reach of your content has been. The number of likes is another key performance indicator, which, together with your objectives, will serve as a sample of how enjoyable your posts are for your followers.
The number of shares , therefore, measures the impact and influence that your content has on reaching other audiences. All of these are KPIs applied to marketing strategies that connect with your social networks, which in the same way will allow you to know their performance in the short or long term.
Quantity and quality of leads obtained per month
In inbound marketing , a lead refers to a person who, by providing their contact information, automatically becomes a sales opportunity for companies. If the cost per acquisition (CPA) measures the economic effectiveness of a paid campaign, the quantity and quality of leads measures the number of people who, through the conversion process already mentioned, have become sales prospects for your company. In other words, the number of people who not only clicked, but also followed the calls to action and connected with the content offer.
When you publish content on your blog post and add a call to action with a content offer, you are automatically creating a lead capture strategy . To do this, there are also measurement formulas that will allow you to know the effectiveness of your CTA or form on your landing page.
Let's remember for a second that the inbound marketing sales funnel works like this: you attract traffic or visits to your online destination (website, blog post, social network, etc.), convert the visitors into prospects and a percentage of these, in turn, can become new customers.
In this sense, the more leads you generate, the more likely you are to increase your sales. But it's not just the quantity that's important; the quality of those leads is also worth measuring. You can use different measurement scales (from 1 to 5) for the variables that you consider to determine the quality of your leads (lead scoring), including: their socioeconomic level, their receptivity via email and phone calls, how interested they are in your content offers, how many purchases they are willing to make, etc.
Conversion rate
I now understand the importance of leads for the performance of your marketing strategies . The conversion rate is nothing more than a KPI that tells you how many people converted into sales opportunities have ultimately become customers of your company. This performance indicator, as you may have deduced, is widely used in the inbound marketing methodology because it really quantifies the final effectiveness of that content used to voluntarily attract people's attention. In this sense, you can set a conversion rate of N% as a goal to measure that effectiveness, after a certain time has elapsed.
To calculate this KPI, divide the total number of leads generated by the number of customers obtained from that same prospect base and multiply it by 100. Now, you can also calculate a visitor-to-prospect conversion rate, that is, calculate what percentage of the visits received on your page converted into a contact or prospect for your business.
Conclusion