Leave ROI Behind
Metrics that measure real marketing success instead of ROI
Marketing ROI. A word that you hear too much as a marketer. Unfortunately, despite the word’s familiarity, marketing ROI doesn’t really have a huge value as a measurement indicator for comprehensive marketing performance. This is because it is really difficult to accurately measure the efficiency compared to resources invested in marketing as interdependent factors are connected within a marketing. Also, a lot of times multiple marketing processes proceed simultaneously, making it harder to distinguish clear starting and ending points.In other words, an accurate parameter setup that is crucial for performance measurement is impossible.
If someone says a ROI is being used in the context of marketing, it usually refers to campaign performance (Ad ROI), also known as ROAS. However, the ROAS doesn’t reflect all success across the overall marketing. If you start measuring ROAS, you may only focus on factors that can explicitly and visually show the performance of the executed campaign, like number of followers or likes. Such a practice excludes all interdependent factors and contexts within the marketing, thereby making the improvement of marketing and true measurement of performance much harder. Thus, if you wrongly focus on the marketing ROI, you may fall into a short-sighted thinking about marketing.
If you wish to measure the true marketing performance, you must look into the overall context and customer interaction that exist beyond the numbers. Today, we will introduce performance measurement metrics that you MUST see besides ROI as a marketer.
✅ Traffic Quality
Website traffic quality shows how much valuable interactions are being made by users within your brand’s website. Increase of website traffic can be seen as a positive sign for company growth. However, you must check whether this traffic is really meaningful. Some of the traffic can be the result of information or keywords that have nothing to do with the website, and the increase can be a temporary one resulting from your competitor’s marketing action or market trend. In some cases, the increased traffic doesn’t lead to sign up conversion, resulting in an increase of churn rate.
If you cannot determine the traffic quality, it is difficult to accurately understand the user’s true intent and action. You cannot know whether potential customers that really have interest in your brand increased as a result of marketing. This can divert resources away from focusing on the customer segments that really matter. Therefore, you need to figure out the traffic quality with the following ways:
-Use web analysis tools like Google Analytics to measure user’s behavior.
-If average session duration and page views per user increased after conducting a marketing, it is likely that potential customers who are really interested in your brand came in.
-User behavior analysis according to each funnel is also good. You need to check the page churn rate and session average duration of users who came through channels where marketing campaigns were made. This can give a hint on which marketing channel is the optimal channel afterwards.
✅Customer Lifetime Value (CLV)
Customer Lifetime Value (CLV) is the total value expected from a customer while the customer and company’s relationship is maintained. The value is calculated by taking into account the amount the customer spends on the company and the period of time the customer uses a product or service. Marketing involves both promoting your company and brand externally to acquire new members and strengthening relationships with existing customers. Because maintaining long relationships with acquired customers and maximizing their values contribute to the brand’s long-term growth more than continuously acquiring new customers does, marketers should look into this metric.
First of all, by looking at the increase and decrease of overall CLV before and after marketing, you can measure the overall performance and determine whether the invested budget was used efficiently. If you segment your customers based on CLV, you can find out which customer segment brings the most value for money. Thus, you can efficiently distribute your marketing resources in the next marketing.
-Optimize the expense needed to acquire new customers through CLV, which is calculated as ‘(Customer Value - Expense for Customer Acquire & Maintain) / Churn Rate’
-If existing customers’ CLV increased after marketing, this means the relationship between customers and company has been successfully maintained and you succeeded in promoting additional purchase from existing customers.
✅ Brand Awareness
You cannot rule out ‘Brand Awareness’ when talking about marketing performance measurement. But are you checking your brand’s awareness only with quantitative metrics such as ‘Likes’ or ‘Views’? Be cautious since the increase of ‘Likes’ and ‘Views’ might not actually mean the increase of people who truly identify your brand. Just because someone saw your marketing campaign once doesn’t mean it will stay in the person’s memory for a long time. We need to use other methods to determine whether your brand is well-received by people who already use a much wider variety of brands.
-Use the same brand awareness survey before and after a marketing campaign.
-If conducting a survey is cumbersome, monitor how much your brand is mentioned in communities or platforms where your target customers are gathered.
-Understand the amount of target keywords or brand mentions on social media and search engines. By using a keyword analysis tool, you can also check ‘trends’ that reflect the increase in search volume.
✅ Search Visibility
Search visibility is a metric of how well your brand’s websites and brand-related content appear in search engine results pages (SERPs) when people search for keywords. Being exposed at the top of search engines increases the exposure and awareness of your brand when people search for products or services. In other words, your brand will be more discoverable by potential customers, increasing your website traffic, conversation rate, and revenue.
Check how the most recently written posts are ranked on the search screen or whether content published before marketing has risen in search screen ranking when people search for the brand’s name or product. The more people mention and engage with your brand, the more trustworthy score your brand will receive in search engines, which will increase your brand’s ranking. With this, you can determine if your marketing has been effective in driving brand awareness and engagement.
-You can measure how much your brand’s search visibility has improved by looking at the position and change compared to your competitor in search engines.
-Check from which keyword is the inflow traffic happening most by analyzing the website’s search traffic. With this, you can indirectly check how much your brand is exposed in search engines and can also build new marketing strategies to target that keyword.
-Backlink is one of the factors that affect the search visibility. By monitoring the change of backlink score change with SEO tools, check how organically your brand is exposed and mentioned..
✅NPS
NPS(Net Promoter Score) gives important insights on customer experience and company growth. NPS is important because whether customers recommend a company reflects customer satisfaction and loyalty and because high NPS can be seen as a predictor of positive customer experience and the brand’s continuous growth. Therefore, by regularly tracking NPS, you can not only check your marketing performance but also get powerful hints from a customer-centric perspective in establishing your next marketing strategy.
- Actions are different for each NPS score. If you can understand the customer’s journey and determine points of improvement through NPS, you can approach your customer in a more optimal way.
-Compare your NPS with your competitor’s NPS or other companies’ NPS in your industry to judge your brand’s performance and find out your brand’s competitiveness. Through this practice, you can understand in which part your brand is doing good and in which part your brand needs improvement, thereby leading to a more effective marketing.
The 5 metrics we told you about today are indicators that can be used to check whether the marketing has actually had a positive impact on your brand. Verify the performance through these metrics and reach your customers in a better way. You can expect natural brand growth. 😀
