Evaluating the success of your marketing efforts across key performance indicators (KPIs) is essential; however, making those KPIs meaningful can be a challenge. Here are four steps that can ensure you are accurately measuring the performance of your marketing efforts.
1. Start with your business objective. Aligning with the company’s overall business objectives is important in proving marketing activities have the ability to directly impact the overall performance of the business. Additionally, this can help you develop marketing objectives and a strategy that aligns with the business objectives.
Ensure these marketing objectives have the ability to be universal and translate to KPIs across all of your efforts, from the goals established in your website analytics to media objectives. All too often marketers can get tactical in evaluating performance by expected metrics. For example, leads from a trade show or completion rates from online video are metrics or data segments typically used to evaluate these tactics; however, if leads or awareness is not part of the objective then how is that working to move the needle?
2. Invest in research. Frequently we hear about “the power of data.” However, many organizations need to reevaluate the data they have, how they are using the data, how they are getting the data, and what additional data is essential in measuring their objectives. Working with what data you have is valuable, but also knowing what data you want to have and investing in the research can be a big win for many stakeholders across the business. Set up a research effort to ensure the data you want is going to be clear, measureable, and actionable.
3. Know what success looks like. Creating KPIs, establishing benchmarks, and iterating to improve performance is essential in realizing the potential of any marketing effort, but you also have to know where to draw the line in order to determine if the effort is successful enough for you to continue to optimize. Having a hard cost-per-acquisition metric is easy, but not all businesses are able to have such clear metrics. Evaluating the lifetime value of a customer or specific segment audience is a good place to start in understanding that value.
4. Look at the big picture. The lifetime value of a customer is critical for many organizations to recognize not only on the importance of acquisition and growth, but also where they need to invest more on retention. Additionally, when looking at metrics on a higher level insights emerge that can help to identify where problems or issues are. For example, spending $500,000 in media for an online marketing campaign to drive orders is fruitless if there is a problem with the website conversion rate. Spend the time and energy in looking at the big picture before you start throwing money around. Building benchmarks and KPIs from a poor user experience is hardly ideal. Identify your weaknesses, show your improvements, and then start benchmarking and optimizing.
While there are only four steps, the overall process can be overwhelming. To make sense of it all, map out a long-term plan of where you want to be and how you will get there with regular performance reporting and analysis along the way. It’s OK to make an assumption with the data you have in an effort to move forward and qualify that assumption later. The most important part is ensuring you have the ability to evaluate everything not only against the laid-out KPIs, but how it all works together in supporting the objectives.