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There are an infinite amount of metrics to measure in marketing. Your job is to find which of these metrics is the key performance indicator or KPI (everyone’s favorite acronym to use in a meeting). Now this may seem obvious to some, but to decide which metric indicates performance, you have to decide what you’re trying to “perform.”
This seems self-evident, but we marketers often forget about performance and run straight to boasting about our indicators. It sounds like this, “Look how many views on this video!” or “We got a ton of clicks on this ad.” or “A lot of prospects downloaded our white paper.”
But what are the metrics indicating about your performance? Hard to say if you don’t know what you are measuring. It helps to begin with the macro goals of your marketing.
The 4 Goals of Marketing
Obviously the goal of all marketing is to increase revenue, or in the case of B2B marketing, increase your company’s revenue. And that’s a great goal to have. But we can break the goal of revenue into 4 main sources.
Marketing to your current customer base with the goal of loyalty.
Marketing to your current customer base with the goal of generating new revenue from different products and services.
Marketing towards past customers with a goal of re-capturing lost business.
Marketing towards prospects who have never done business with your company with the goal of capturing new revenue.
Odds are you place more of your marketing budget into one of these categories. And each of these performance goals have a different KPI. It would look something like this.
I would recommend creating a baseline for the KPI or KPIs that most closely align to your marketing. This way you can monitor the growth and measure your efforts within these goals.
Measuring Your Performance
Many of the above KPIs are not completely within your control. You should break it down even further. Each of the above goals align with a different type of account. These accounts which are essentially prospects, can be placed somewhere along the process of the“buyer’s journey.” For each stage of the buyer’s journey we can establish another KPI to measure the success of your marketing. For the sake of this article, we can look at the goal of retention. It look would something like this.
Branded search lets you know how exactly how often people who already know who you, are engaging with your brand. This would be a great indicator with the awareness stage or when clients first come on board. NPS measures current satisfaction and would make a great indicator of clients loyalty or plans to stay with your brand. And finally lost opportunities will tell us which clients have decided to leave. Tracking each of these metrics within the overall goal of retention is a much more accurate way of measuring the performance of your marketing. The third column indicates the best tools for measuring these specific KPIs.
You don’t have to use this approach exactly, and maybe your KPIs will look a little different. The main concept here is knowing your goal and what metric is indicative of your progress towards it. Then you break down that goal into smaller goals and create lead measures that correlate to these smaller goals. If you want accurate KPIs, you must create clear goals and lead measures.