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5 Marketing Metrics Every Smart CEO Should Measure
By: Tiffany Sauder - President, Element Three
Category: Marketing and Brand Development
As a business owner, I always look for ways to measure and monitor my business so I know what’s going on and can respond accordingly. I have financial metrics, operational metrics, sales metrics, and yes, marketing metrics.
IIB Twitter WatchSmart CEOs know if you can't measure it - you can't manage it.
Let’s take a look at the marketing metrics every B2B CEO should be tracking:
1. Total website visits
2. Visit to lead conversion rate
3. Lead-to-customer conversion rate
4. Total leads per month
5. Cost of customer acquisition
1. Total website visits
Total website visits is pretty straightforward. How many people are coming to your website each month? It's important you look at trends (are you trending up or down) and be aware of seasonality inherent to your business. Year-over-year comparisons may be a more meaningful comparison than just looking at increase over prior-month. Increasing your website visits is an important indicator to the overall traction you are making in the marketplace.
But, not all website traffic is created equal. Understanding where your website visits are originating is key to knowing how to intentionally grow your traffic numbers. Defining which portion of traffic is coming from organic search (Google, Yahoo, etc.), referral traffic (other internet sites), paid search, direct traffic, email marketing, social media or PR campaigns, can help you know what to proactively influence.
2. Visit to lead conversion rate
Did you know that over 70 percent of a sale is completed before a sales person ever gets involved? As consumers, in both the B2B and B2C space, we do a tremendous amount of research online evaluating options and educating ourselves on the product or service we are consuming. Position your company as the thought leader - and you’ll be the one educating prospective consumers.
Lots of visitors to your website is nice (and it might feed your ego), but it's more beneficial if you know who is visiting your site, right? Spectacular calls-to-action on your website - download a white paper, case study or view a how-to-video - are the lynchpin to generating leads - and developing thought-leadership in your category. Entice your website visitor to download great content in exchange for their name and email address.
3. Lead-to-customer conversion rate
Leads are a leading indicator of a successful marketing effort, but not the ultimate goal. What every business wants is more customers - and leads are simply a step in the process. Lots of unqualified leads only create a lot of work for the sales team. To monitor lead quality - we must have a closed-loop reporting system in place to let us know which leads are converting into profitable, paying customers.
A defined sales process and tracking of key conversion points throughout the funnel arms marketing with the feedback needed to make smarter decisions with the time and money available to market the company. If sales and marketing are aligned and have intentional feedback across the organization - continuous improvement can occur.
4. Total Lead Count
Knowing exactly how many leads marketing needs to supply each month to support the sales quota is one of the most important numbers for a marketing team. This creates a clear, defined goal and allows the process of optimizing your marketing effort to achieve both lead quantity and lead quality.
5. Cost of customer acquisition
This metric is slightly more 'math-y' in nature, but a very valuable statistic for companies to track. For a customer to be profitable for a firm, their customer acquisition cost must be less than their lifetime value. Here is an example. If it costs you $1,000 to get a new customer, but their contribution to your company's net income over the life of their relationship with you is only $900, then you have lost money on that customer.
This calculation can get very complex for large organizations with different divisions or product segments, but at its core - is vital to ensure you are not overspending to acquire customers. Customer acquisition costs come from marketing and includes all direct marketing costs (people, allocated overhead, admin staff supporting marketing) and outside spend (agency fees, PR) and advertising spend (PPC, print, banner advertising).
If you are not purposeful about measurement in your marketing – you will never know what's working - and what's not.
Tiffany Sauder is the President of Element Three, a strategic inbound marketing firm that brings together brand development, marketing strategy and creative execution to measurably advance clients' businesses. With a background in finance, Tiffany brings a 'business first' approach to helping clients meet their strategic objectives.
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