Digital marketing is directly linked to web analytics. You can’t do analytics without metrics. In this article I will talk about digital marketing metrics.
Confused? No problem. For now I will focus on digital marketing metrics. Web analytics and digital marketing will be covered in other articles.
- Attributes of good digital marketing metrics
- Example of a good digital marketing metric
- Important Lessons
- Choosing good digital marketing metrics
- In conclusion
Be honest, do you know how to measure the success of your brand? Do you know what represents value to your customer and what can be reflected in results for your business? That’s a tough one, isn’t it? Maybe you can answer those questions (congratulations!) but I bet it wasn’t so easy.
To measure these results you need metrics. But not just any metric will provide insights for you to better understand your business. A good digital marketing metric needs to fulfill some requirements.
Read also: Dimensions and metrics in Google Analytics
Attributes of good digital marketing metrics
If you look in analytics books, economics and statistics books, or on the web, you will find dozens of metrics to measure everything that happens in your business. Finding really relevant metrics is another story and requires more effort.
Some attributes of good digital marketing metrics:
They must be simple
In most cases, good metrics are simple. Don’t confuse simple with simplistic. Good metrics solve complex problems, but they don’t have to be complex.
Decisions in companies are usually not made by a single person. They are not taken by the CXO, manager or consultant. Decisions are made jointly, all the time. If only one person understands the metric, we have a problem.
If you are the only person who understands the metric, the Key Performance Indicator, then you have just guaranteed that your company, big or small, will not take action. Because you know the metric, but not the business.Avinash Kaushik – Google Digital Marketing Evangelist
Simplify! Make sure everyone understands the metrics and can make decisions based on them.
Digital marketing metrics need to be relevant
Are the metrics you are tracking relevant to your business?
Maybe the answers is “yes” (congratulations again), or maybe it is “yes, because these are the metrics that all companies track.” Vish… if your answer was the second one, possibly a large part of the metrics you are using do not bring any value to your company.
Each business is unique. A digital marketing metric that brings value to one company may not for another.
Metrics that are relevant for a restaurant, for example, may not make any sense for a supermarket. Both sell food but the similarities end there. They are two very different businesses.
It is perfectly acceptable that you use benchmarks from your industry. But in the end, what will tell if the metrics you have chosen are relevant will be tests and more tests.
They must be available at the right time
Let’s face it! One of the most frustrating things for an executive is to make decisions “now” taking into consideration metrics and insights that were collected, analyzed, and interpreted six months ago.
I am not a fan of real-time metrics. They can negatively impact your business in many ways: 1) more reporting, less analysis; 2) allocation of resources (financial and personal); 3) real-time analysis tools are sometimes less effective; 4) increase the complexity of the analyses; 5) provide a false sense of security and trust in the data.
Anyway, between real-time and six months there is a considerable time gap. Find the metrics that bring value in this range.
Working with biweekly insights when the market is changing every 7 days does not bring much competitive advantage.
Similarly, working with real-time metrics to solve strategic problems is like trying to destroy a war tank with a slingshot.
Your metrics must reach the responsible parties at the right time.
Sacrifice complexity and perfection for punctuality.
They need to be useful and understood instantly
Fewer metrics, presented in the right way, deliver better results than long dashboards stuffed with metrics that no one understands.
The operator needs to immediately understand the metrics being presented and what is being presented. Fewer metrics does not mean we will have fewer insights.
Remember when I commented earlier that decisions in companies are not made by a single person? Think of your boss or customer, think of his boss, and so on. Do they know as much as you or whoever wrote the report?
If a metric is not instantly understood it is instantly discarded.
If your simplest metrics can be instantly assimilated, congratulations! You will be able to open doors to dig even deeper into them and move on to more complex analyses.
Read also: Marketing Metrics: Partner Metrics
Example of a good digital marketing metric
An example of a good metric is the bounce rate. Let’s see:
- Simple: related to page views, easy to understand and explain;
- Relevant: shows when the page is not performing as well as it should and if you are spending money from your campaigns properly investing in them;
- Available at the right time: it is available in virtually every analytics and reporting tool on a daily basis;
- Instantaneous: just look at it and realize if the page is good, demands attention, or needs an emergency action.
Read also: Bounce rate in Google Analytics
Analyzing a metric in isolation can lead to errors. Always look for a metric that correlates to the metric you are analyzing for better insights.
Some lessons I’ve learned on a daily basis as an analytics consultant:
Perfection is the enemy of “good enough
The quality of data collected through web analytics tools is not perfect. In fact, it is often far from it. In initial audits of my clients’ analytics tools (especially Google Analytics), I realized that they were making decisions based on data with 50-60% accuracy (that’s when it wasn’t even lower).
My efforts are to have at least 85-90% confidence in the data we collect and analyze.
Don’t spend too much time pursuing data perfection by correcting small details without impact. The market is dynamic. It is more important to make a wrong decision, correct it, and learn than to make no decision at all.
Read also: Mini audit of Google Analytics
Focus on few metrics
Ah…. how tempting it is to work surrounded by dashboards and reports with a dozen metrics. I have already made this mistake!
Which metrics define you, your department, or your company? Choose two or three metrics that can guide your analysis and decision-making. If you look at a dozen metrics daily you are possibly (not to say certainly) doing something wrong.
Metrics Life Cycle
The market changes, your company changes. Why a metric for evaluating the performance of your business should remain the same year after year.
The idea is simple: use the four attributes described above to test whether it is a good metric (define), collect data ( measure), analyze the collected data (analyze), take action based on the analyzed data (action). If you can’t take an action then the metric is not good, throw it away (delete). If you can, go ahead and continuously improve (improve).
Periodic review of metrics is something that varies from industry to industry. Having an evaluation every three to six months is a good starting point.
Also read: What are users in Google Analytics?
Choosing good digital marketing metrics
One technique for choosing good metrics for your business is to focus on the customer journey. Simply put, the customer journey can be defined as Acquisition, Behavior, and Results. This is the ABO model (Acquisition, Behavior and Outcomes) introduced by Avinash Kaushik.
- Acquisition: what we are doing to bring traffic to the site.
- Behavior: what happens after the customer enters the site.
- Results: what was the impact on our business (online and offline).
Are we able to attract the right people and influence them? Do we deliver a great experience for our users? User and company both win (user has an amazing experience and becomes a loyal customer)?
Most of the time analysts and companies are focused on only one of these aspects, maybe two. Rarely in all three. In some cases this occurs because the organizational structure does not encourage all areas to know the project from end to end. In others, there is a lack of technical skills to analyze the complete consumer journey.
Based on this journey, let’s look at a suggestion of good digital metrics:
- Conversion rate: this one is relatively basic. Looking at the conversion rate applied to various segments can generate valuable insights for your business.
- Assisted conversions: although the market standard (enforced by analysts and the market) is last-click conversion attribution, I like to look at assisted conversions. If you use assisted conversions you will do better analysis of your conversions and better target the efforts of your marketing team.
You can choose other acquisition metrics that are more suited to your industry (e.g. cost per acquisition, churn, LTV, etc.).
- Rejection rate: this is to provoke the improvement of the users’ landing pages. Many content producers and advertisers do not care about what happens after the user enters the page. This needs to change.
- Visitor Loyalty: based on your industry establish an expected pattern of behavior of a loyal visitor. Let’s say that for your industry 10 visits in a month characterizes a loyal visitor.
Do you understand the connection of these two metrics? Lower the bounce rate (by making your pages more attractive), your visitor will interact on more pages (more satisfaction) and will return to your site more often. Recipe for success!
- Macro conversions: help to measure the result immediately.
- Micro conversions: help you design your business and think strategically. Micro conversions can and should be used as a source of information for future launches and adaptations of your products. Micro conversions are responsible for continuous improvement.
Thus we have:
Realize that we have dozens of metrics that can be used, but at the end of the day, half a dozen of them may be enough for an overall picture of how your company’s digital marketing is doing.
Extrapolate this model to different segments (e.g. subscribers vs. non-subscribers or desktop vs. mobile) and different areas of the company. Metrics that are presented to directors can (and usually should) be different from those presented to managers, who are at a more tactical and less strategic level.
Read also: Analytics tools: 5 reasons not to use them
We have seen that for a metric to be good it needs to be simple, relevant, must be available at the right time, and needs to be useful and instantly understood.
Don’t look for perfection in data. Strive to achieve a degree of confidence that allows you to do productive analysis. Use few metrics and pay attention to the cycle of a metric.
A good model for choosing which metrics to track is Acquisition, Behavior and Results. Use it with the best metrics for your business and provide better decision making within your company or for your customer.
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