08 May 10 Marketing Analytics Definitions: What are they?
I’ve always been a believer in measuring things that matter and marketing analytics definitions that can impact the business. It’s easy to be distracted and try to look at everything. The simple truth is the only things you should be actively monitoring are those that can help you make decisions to improve your results.
It might be interesting that you have visitors from 57 countries on your website, but if you only sell your product regionally, that’s all it is – interesting. It’s not information you can act on to grow your business. On the other hand, if you’re considering expanding your operations then where you have a following is very important.
My top 10 definitions of marketing analytics along with why I believe they matter:
Typically used in an email campaign, Click Through is one of the marketing analytics definitions that can also be used to measure effectiveness of Call-To-Action buttons or links on your website.
It’s simply the number of times a link has been clicked divided by the number of views it had. For email, that would be the number of delivered emails. This measures the ability of your marketing to generate an action among the recipients. Remember the job of an email or CTA is to get your buyer to take an action. Most likely visit your website or landing page on your site. It’s a starting point, not the finish. What’s a good number to shoot for? That depends on your business and customer base. However I like to target between 3% – 5% click through as a goal.
This is the percentage of your email recipients that click on the opt-out link. If you’re getting an opt-out rate of over 1% it’s time to rethink your approach. Watch this one closely. It’s one of the marketing analytics definitions that are an early warning for problems ahead. Is there something in your email content, message or offer that is irritating your customers enough for them to opt out? Frequency can also be an issue with both too often and surprisingly not often enough being a problem.
Cost per Click
Used to measure the cost of getting a visitor to your website through one of the paid search ads programs like Google’s Adwords or Bing’s Ad Center. Just like it sounds it’s what you pay per action, in this case a click. The real question is what is a visit worth to your business. The answer to that depends on your average sale, profit margin, and how successful you are at converting site traffic to customers. (more later)
Cost per Customer or Acquisition
Here you’re starting to get closer to your bottom line. How much money did you spend to acquire a new customer? This is traditionally calculated using the marketing spend of a campaign, calculated against how many new customers can be attributed to the campaign. With the growth of social media, I’d argue you should include your time spent as well. Posting, monitoring, and engaging may not be external cost activities, but they certainly are time intensive. What is the value of your time? Is the customer acquisition and revenue you’re getting in return worth it?
Another of my top 10 marketing analytics definitions is conversion. Conversion rate is a pretty broad term and can be used in multiple scenarios. However, generally it involves your prospect converting after some type of marketing contact to an action that you have set as a goal. Your goal might be to convert a suspect to a prospect by getting them to click on one of your links or call-to-action buttons on your site that takes them to a landing page where they can request information. Your conversion goal may be more ecommerce related and you’re looking to convert the visitor to an initial purchase or maybe upgrade of the product or service they’re currently using.
Bottom-line, by monitoring measurements like these marketing analytics definitions you’ll spend more of your time looking need-to-know decision points and less just rows of data.
Next week’s marketing analytics blog will pick up from here with more definitions around analytics for search and websites. However, I’m curious, what are you monitoring in your marketing, and what would make your top 10 list?