Marketing Metrics 101: What You Need to Know & How to Use Them

Marketing effectiveness is the ability of marketing efforts to achieve the desired results. It is essential for any company, regardless of its size or industry, to measure how well its marketing activities are performing. To do this, companies need to use marketing metrics, which are quantifiable values that indicate the performance and impact of marketing campaigns. In this article, we will discuss the different kinds of metrics, how to select the ones that match your objectives, and how to use them properly to improve your marketing outcomes.

What are metrics in marketing?

A marketing metric (also known as marketing key performance indicators – KPIs) is defined as a quantifiable measure or value that marketers use to track, evaluate, and analyze the performance and effectiveness of their campaigns and assets across marketing channels. These numbers vary depending on the goals and platforms of the campaigns, and they can show how the campaigns influence audience actions and generate value.

Why are marketing metrics important?

Marketing metrics are crucial because they give businesses information about the performance of campaigns and allow them to make informed adjustments to future initiatives. They support decisions for optimizing campaigns and marketing channels by assisting marketers in understanding how their efforts are contributing to their corporate objectives.

A marketing team may use these metrics to determine if its objectives – which may include attracting new clients and generating leads – have been met. These digital analytics may aid in making wise decisions and real-time campaign adjustments. They also act as an early warning system for marketing efforts that aren’t operating as anticipated.

Lastly, these metrics are the main means by which marketers may demonstrate the contribution that marketing and advertising are making to their business or organization. Beyond current monitoring and campaign planning, this may influence annual budgets and staffing, making these insights crucial.

Common marketing metrics to track

Traditional channels

Marketing metrics of traditional channels are the values that marketers use to measure the performance of their campaigns on non-digital platforms, such as print, TV, radio, billboards, etc. These metrics can help marketers evaluate the reach, awareness, and impact of their traditional marketing efforts. Some examples of such metrics in traditional channels include:

• Circulation: The number of copies of a print publication that are distributed to the audience.
• Readership: The estimated number of people who read a print publication or a specific ad within it.
• Cost per thousand (CPM): The cost of reaching 1,000 people with an ad on print or broadcast media.

• Gross rating point (GRP): The measure of the total exposure of an ad campaign on broadcast media, calculated by multiplying the reach (percentage of the target audience who saw the ad) by the frequency (average number of times the ad was seen by the audience).

• Cost per point (CPP): The cost of buying one rating point (one percent of the target audience) on broadcast media.

• Direct response rate: The percentage of people who respond to a direct mailer or a call to action on a print or broadcast ad by contacting the advertiser or taking a desired action.
• Return on ad spend (ROAS): The measure of the revenue generated by an ad campaign on any media, divided by the cost of running the campaign.

Digital channels

By using some metrics for marketing campaigns, marketers can measure the performance on online platforms, such as websites, social media, email, search engines, etc. These types of marketing metrics can help marketers evaluate the reach, engagement, conversion, and revenue of their digital marketing efforts:

Ads

• For Branding campaign: Impression, Reach & Frequency, CPM, CPV (Cost per view), CPE (Cost per engagement)…
• For conversion campaigns to increase sales: CR, CPS (Cost per session), CPC, CPO (Cost per order), ROAS…

Social Media

Facebook

• Brand engagement: How many fans interact with the Page and the brand online.
• Content performance: How many fans like, share, and comment on the posts on the Page.
• Facebook reach: How many people see Facebook posts and ads from different sources.
• Conversion rate: How many people click on Facebook posts and ads and take a desired action on the website or app.
• Cost per result (CPR): How much it costs to achieve a specific result from Facebook posts and ads, such as a purchase, a sign-up, or a lead.
• Return on ad spend (ROAS): How much revenue the Facebook posts and ads generate compared to the amount spent on them.
• Reactions, comments, and shares: How many people engage with the Facebook posts and ads by liking, commenting, or sharing them.
• Facebook click-through rate (CTR): How many people click on Facebook posts and ads after seeing them

Youtube

• Traffic sources: Where the viewers came from.
• Impressions and click-through rate (CTR): How many times the video content was shown and clicked on.
• Watch time: How long viewers watched the videos.
• Watch time for subscribers: How much time subscribers watched the videos.
• Average view duration: How long a viewer watched a video on average.
• Key moments for audience retention: How well a video retained viewers during playback.
• Likes, dislikes, and comments: How many people reacted to the videos.
• Demographics: The age, gender, location, and language of the viewers.
• Returning/unique viewers and subscribers: How many people watched the videos more than once, for the first time, or subscribed to the channel.

Tik Tok

• Total number of videos published: How many videos an account has posted over some time.
• Average engagement rate per post: How many engagements (likes, comments, shares) per view.
• Follower evolution: How many followers you gain or lose in a period.
• Follower growth: How many followers you gain or lose each day.
• Hashtag growth: How many times a hashtag is used on TikTok in a period.
• Tag usage: How many times you use a tag (@mention, #hashtag, sound) in your videos.

Instagram

• Impressions: How many times your content is seen by users.
• Reach: How many unique users see your content.
• Engagements per follower: How many likes, comments, saves, and shares per follower per post.
• Follower growth: How your follower count changes over time.
• Comments received: How many comments your posts get from users.
• Most engaged hashtags: The hashtags that get the most engagement for your posts.
• Referral traffic: How many users click on your bio link or swipe up on your stories to visit your website.
• Instagram Stories metrics: The performance of your stories, such as views, reach, impressions, exits, replies, taps, and swipes.

Email Marketing

• Openness rate: How many people have opened your email
• Email click-through rate (CTR): The percentage of recipients who clicked on one or more links in your email.
• Unsubscribe rate: The total number of people who unsubscribe from emails
• Delivery rate: How many emails were sent
• Earnings per email/click: How much income your email/link click is generating

Website

• Website traffic: The number of users who visit your website as a result of your digital marketing campaigns. This metric can help you assess the overall popularity and visibility of your website.
• Traffic source: The medium or platform that drives users to your website, such as organic search, direct, referral, social, paid search, etc. This metric can help you identify which channels are most effective at attracting and retaining your audience.
• Conversion rate (CR): The percentage of users who complete a desired action on your website or landing page, such as buying a product, signing up for a newsletter, or downloading a resource. This metric can help you measure the effectiveness and impact of your digital marketing campaigns.

• Bounce rate: The percentage of individual page visits or sessions that users leave the website from the login page without further browsing.
• Session: A set of visits recorded by a user within a given time.
• New and returning users: The number of new and returning visitors.
• Engagement: The behavior of users on the website (such as time per page, comments, sharing, and clicks).

Marketing metrics examples

Shopify

Shopify tracks a number of marketing metrics to measure and improve its marketing performance. Some of these metrics are:

• Website traffic: Shopify measures how many visitors come to its website from different sources such as organic search, paid search, social media, referrals, direct, etc. This metric reflects the reach and visibility of Shopify’s brand and content. According to SimilarWeb, Shopify had 113 million monthly visits in November 2023.
• Conversion rate: Shopify measures how many visitors take a desired action on its website such as signing up for a free trial, creating an account, starting a store, upgrading to a paid plan, etc. This metric reflects the effectiveness and persuasiveness of Shopify’s website design and copy. According to Growcode, Shopify had an average conversion rate of 1.6% in 2023.
• Customer acquisition cost (CAC): Shopify calculates how much it spends on average to acquire a new customer through its marketing efforts. This metric reflects the efficiency and profitability of Shopify’s marketing campaigns and strategies. According to ProfitWell, Shopify had an average CAC of $29 in 2023.
• Customer lifetime value (CLV): Shopify estimates how much revenue a customer generates over their entire relationship with the platform. This metric reflects the loyalty and satisfaction of Shopify’s customers and the quality and value of Shopify’s products and services. According to Smile.io, Shopify had an average CLV of $2000 in 2023.
• Social media engagement: Shopify measures how many people interact with its social media posts and profiles such as liking, commenting, sharing, following, etc. This metric reflects the awareness and interest of Shopify’s target audience and the relevance and appeal of Shopify’s social media content. According to Socialbakers, Shopify had 3.9 million followers on Facebook, 1.8 million followers on Instagram, 1.1 million followers on Twitter, and 722 thousand followers on LinkedIn in December 2023.
• Email open rate: Shopify measures how many people open its email messages such as newsletters, promotions, announcements, etc. This metric reflects the attention and curiosity of Shopify’s email subscribers and the attractiveness and clarity of Shopify’s email subject lines. According to Mailchimp, Shopify had an average email open rate of 18.7% in 2023.

Netflix

Netflix is known for its innovative use of big data, machine learning, and personalization to deliver relevant and engaging content to its subscribers. Some of the marketing metrics that Netflix tracks are:

• Subscriber growth and retention: Netflix measures how many new subscribers it acquires and how many existing subscribers it retains over time. This metric reflects the overall performance and health of the business, as well as the effectiveness of its pricing, content, and customer service strategies. Netflix reported 208 million paid memberships worldwide as of Q1 2023, a 14% year-over-year growth.
• Customer lifetime value (CLV): Netflix calculates the average revenue that a subscriber generates over their entire relationship with the service. This metric helps Netflix determine how much it can spend on acquiring and retaining customers, as well as how to segment and target them based on their value. According to one estimate, Netflix’s CLV is around $139 per subscriber.
• Content performance and engagement: Netflix tracks how well its content performs in terms of viewership, ratings, reviews, social media buzz, and awards. This metric helps Netflix evaluate the quality and popularity of its content, as well as the return on investment (ROI) of its production and licensing costs. Netflix also measures how engaged its subscribers are with its content, such as how often they watch, how long they watch, what they watch, and what they skip or rewatch. This metric helps Netflix understand its subscribers’ preferences, behavior, and satisfaction.
• Recommendation system accuracy: Netflix uses a sophisticated recommendation system that uses algorithms and machine learning to suggest personalized content to its subscribers based on their viewing history, ratings, and other factors. This metric measures how accurate and relevant the recommendations are, as well as how much they influence the subscribers’ choices and retention. According to Netflix, its recommendation system saves $1 billion per year by reducing churn.

Spotify

Spotify is a leading music streaming platform that offers millions of songs, podcasts, and playlists to its users. Spotify’s marketing goals are to increase its user base, retain its existing customers, and generate more revenue from its premium subscriptions and ad-supported services. To measure its marketing performance, Spotify tracks the following metrics:

• Website traffic: Spotify counts the number of people who visit its site directly or through referrals, sponsored searches, social media, and other channels. This indicator shows how far and how visible Spotify’s content and brand are. In November 2023, Spotify received 271 million monthly visitors, according to SimilarWeb.
• Conversion rate: Spotify counts the number of website visitors who complete a desired activity, such as creating a free account, installing the app, starting a free trial, or upgrading to a premium plan. This rating shows how well-designed and convincing Spotify’s website is. Growcode reports that in 2023, Spotify’s average conversion rate was 2.4%.
• Customer acquisition cost (CAC): Spotify determines how much it costs on average to bring in a new customer through marketing initiatives. This indicator displays the effectiveness and profitability of Spotify’s marketing initiatives and plans. Spotify had an average CAC of $15 in 2023, according to ProfitWell.
• Customer lifetime value (CLV) is a measure used by Spotify to determine how much money a user will bring in throughout their use of the service. This indicator shows the fidelity and contentment of Spotify’s consumers as well as the caliber and worth of Spotify’s goods and services. The average CLV for Spotify in 2023 was $500, according to Smile.io.
• Social media engagement: Spotify counts the number of likes, comments, shares, followers, and other interactions with its social media postings and profiles. This indicator displays the target audience’s knowledge and interest as well as the value and allure of Spotify’s social media material. In December 2023, Spotify reportedly had 26 million Facebook fans, 9.8 million Instagram followers, 7.2 million Twitter followers, and 4.5 million LinkedIn followers.
• Email open rate: Spotify tracks the number of users who open its emails, including newsletters, promotions, announcements, etc. This measure captures the interest and piqued the interest of Spotify’s email subscribers as well as the beauty and readability of Spotify’s email subject lines. Spotify’s average email open rate in 2023 was 21.3%, according to Mailchimp.

How to measure key marketing metrics

• Determine what your overall goal is: This will help you align your marketing metrics with your business objectives and choose the most relevant ones for your campaigns. For example, if your goal is to increase brand awareness, you might want to measure metrics such as impressions, reach, and share of voice.
• Select your channels to track: Depending on your marketing approach, you may utilize a variety of platforms to connect with your target market, including email, social media, your website, videos, etc. The best channels to use for your campaigns should be chosen, and you should evaluate both the individual and overall success of each channel.
• Choose your metrics: There are hundreds of metrics you can use to measure your marketing performance, but not all of them are equally important or relevant. You need to choose the metrics that reflect your goals, channels, and formats of your campaigns. For example, if you are running an email campaign, you might want to measure metrics such as email opens, clicks, conversions, and unsubscribes. If you are running a video campaign, you might want to measure metrics such as video views, watch time, completion rate, and engagement.
• Look at how much revenue each channel is generating: One of the most essential marketing metrics is revenue, which shows how much value your campaigns are creating for your business. You need to look at how much revenue each channel is generating and compare it with the cost of running the campaigns on that channel. This will help you calculate the return on investment (ROI) and the cost per acquisition (CPA) of your campaigns.
• Examine website traffic to lead ratio: Another important performance indicator is website traffic, which shows how many people are visiting your website as a result of your campaigns. However, not all website visitors are potential customers. You need to examine how many of them are converting into leads by filling out a form, downloading a resource, or signing up for a trial. This will help you calculate the website traffic-to-lead ratio, which shows how effective your website is at capturing leads.
• Observe landing page conversion rates: Landing pages are web pages that are designed to persuade visitors to take a specific action, such as buying a product, registering for an event, or subscribing to a newsletter. Landing pages are often used in conjunction with paid ads or email campaigns to drive conversions. You need to observe how many visitors are landing on your landing pages and how many of them are taking the desired action. This will help you calculate the landing page conversion rate, which shows how effective your landing pages are at converting visitors.
• Look at customer lifetime value and churn rate: Customer lifetime value (CLV) is a metric that estimates how much revenue a customer will generate for your business over their entire relationship with you. Churn rate is a metric that measures how many customers stop buying from you or subscribing to your services over a given time. These metrics are important for measuring customer retention and loyalty, which are essential for long-term business growth and profitability.
• Use a unified marketing measurement approach: To measure marketing metrics effectively in the post-cookie era, you need to use a unified marketing measurement (UMM) approach that combines two critical components: marketing mix modeling (MMM) and multi-touch attribution (MTA). MMM helps you determine how individual campaign elements contribute to conversions and revenue across channels and over time.MTA helps you assess the impact of each customer touchpoint in driving conversions and revenue along the customer journey. By using UMM, you can gain a holistic and accurate view of your marketing performance and optimize your campaigns accordingly.

Read more: Content Types in Digital Marketing – An Extensive Guide

Latest trends in marketing metrics

Leveraging AI for prescriptive analytics

Artificial intelligence (AI) can enable marketers to go beyond descriptive and predictive analytics and use prescriptive analytics to suggest the best course of action for future outcomes. Prescriptive analytics can help marketers optimize their marketing metrics, such as conversion rate, return on ad spend, and customer lifetime value, by providing personalized and relevant content, offers, and recommendations to their customers.

Enhancing customer experience

Customer experience (CX) is a crucial factor for brand success in a digital and competitive market. Marketers need to measure how their marketing activities influence the customer journey, satisfaction, loyalty, and advocacy. Marketing metrics such as net promoter score (NPS), customer satisfaction score (CSAT), and customer effort score (CES) can help marketers assess and improve their CX and increase customer retention and referrals.

Accelerating marketing decisions with real-time metrics

Marketers need to be agile and responsive to changing customer needs and preferences. This means they need to measure their marketing performance in real-time and make data-driven decisions quickly. Metrics such as real-time dashboards, marketing velocity, and marketing agility can help marketers track and adjust their campaigns on the fly and respond to market opportunities and challenges faster.

Prioritizing first-party data for marketing insights

With the rise of data privacy regulations and the decline of third-party cookies, marketers need to rely more on first-party data that they collect directly from their customers. First-party data is more accurate, relevant, and trustworthy than third-party data. Metrics such as first-party data quality, quantity, and usage can help marketers gain deeper insights into their customers’ behavior, preferences, and needs and deliver more personalized and effective marketing campaigns.

Final thoughts

Marketing metrics are essential for measuring and improving your marketing performance. By choosing the right metrics for your goals, channels, and audience, you can gain valuable insights into your marketing effectiveness, optimize your budget and resources, and increase your ROI. However, these indicators are not static or universal. They change and evolve with the market trends and customer expectations. Therefore, you need to stay updated with the latest trends and adapt your strategy accordingly. By doing so, you can ensure that your marketing campaigns are relevant, engaging, and impactful.

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