There are many different metrics for marketers to potentially keep track of, and some aspects of digital marketing can be harder to quantify than others. Nonetheless, it’s always helpful to assess how your campaigns are performing. That’s especially true for content marketing, where you may need to evaluate sales results that aren’t easily attributed.
In any case, it’s difficult to set goals when you’re not measuring progress. Certain sales metrics can help you better understand the relationship between your digital marketing strategy and your revenue growth. With those insights in mind, you’ll have clearer insights into where you should put your energy and resources.
Read on to learn which sales metrics you should monitor in your digital marketing strategy.
Cost per lead (CPL)
As the name suggests, your cost-per-lead (CPL) is the cost of generating a lead. This is typically defined as someone who is in your pipeline but has not yet purchased. A key metric in performance-based marketing, CPL is most often measured for paid ad campaigns. If someone clicks on your ad and gives their contact details, they become a lead.
The formula is ostensibly simple:
CPL = [total campaign spend] / [total attributed leads]
However, “attributed” is the sticking point there. Attribution is increasingly difficult to measure. These days, leads can be generated in many different ways, from mailing-list signups to inquiry forms to Facebook messages. All those channels cost you something. It takes time and money to set up your website, create a lead magnet, and run an automated drip sequence to people who give their email addresses.
What if someone clicks on a Google ad but ends up subscribing to your mailing list via a social link? The cost-per-click and any subsequent actions (e.g. a sales rep must reach out to them) could all technically be part of the CPL.
That’s why marketing automation platforms such as SharpSpring can lower your CPL. After the prospect clicks on the ad, the platform handles the tedious tasks of collecting their information and sending them some warmup emails. (Plus, more than three-quarters of marketers generate and convert more leads by using automation software.)
While that CPL may be significantly less than in a paid ad campaign, it’s worth considering whether the cost is justified. If no one downloads the whitepaper you paid $2000 for, you’ll either need to change how you promote that lead magnet or shift your budget to another tactic.
Cost per acquisition (CPA)
A lead is precisely that: a potential sale, not yet acquired. So, any marketers calculate the cost-per-acquisition (CPA) separately from CPL.
The formula captures the overall conversions from a campaign:
CPA = [total campaign spend] / [total conversions]
However, that can be difficult to quantify as it’s not always clear why a lead converts, especially if your campaign encompasses multiple channels or touchpoints. If you capture a lead and your sales rep convinces them to purchase in one phone call, great! Your cost for that acquisition is the CPL plus the time-labor cost for the rep.
Unfortunately, it’s rarely that simple. The oft-cited statistic that it takes 6-8 touches to convert a lead is a fact — and for some industries, it takes even more touches. The question of which marketing channel/campaign to which a conversion can be attributed is a common challenge for marketers.
If attribution is unclear, it’s difficult to assess the cost-per-lead, let alone the cost-per-acquisition. Sadly, more than 34% percent of businesses don’t even attempt to use attribution. This problem can be helped through marketing automation software that tracks prospects’ activity across channels, giving you a clearer picture of their conversion journey and a more accurate CPA.
Clickthrough rate (CTR)
The clickthrough rate (CTR) typically refers to email campaigns, landing pages, social posts with a link — any medium where leads read a marketing message then have the option to take a next action.
That next action could be anything from booking a call to visiting a webpage to making a purchase. CTR is a vital metric for any content marketing campaign, as it evaluates how many people moved further down your funnel in a particular campaign.
This metric also applies to paid ads. The clickthrough rate is the number of people who saw the ad and clicked on it. This is distinct from cost-per-click as it doesn’t measure what you spent on the ad — just how many people actually took action on it.
The CTR formula is simple:
CTR = [(total number of clicks) / (total impressions)] x 100
Note that the formula is based on impressions, not overall subscribers or followers. You may send an email campaign to 5,000 people, but if only 500 open it, that’s the number of people who could potentially click.
Your CTR is a helpful measure of how your content resonates with your audience. Low clickthrough rates often indicate that the call-to-action did not land well or that your messaging/the potential benefit needs to be tweaked. It could also be a matter of placement or timing. For example, email campaigns sent at 2 am are less likely to be opened, let alone clicked on!
One key metric for websites and landing pages is the bounce rate — the percentage of people who visit a page and click away within a few seconds. Obviously, that’s rarely ideal. In that context, your bounce rate should typically be as low as possible.
That said, Google Analytics also considers “bounce rate” to be a “single-page session” (i.e., users only visit one page on your website, then leave). This may not be a bad thing if, say, people land on your Services page, fill out your inquiry form, then leave without visiting other pages. It can be helpful to set unique bounce rate goals for each of your pages.
In most contexts, though, “bounce rate” means that people view the site and leave without taking action or visiting other pages. That can indicate that your messaging or user experience (UX) is not aligned with your target audience. Indeed, one study found that 70% of e-commerce cart abandonment is due to poor UX.
Unfortunately, there is no clear standard for what’s a “good” or “bad” bounce rate. Some types of content, such as landing pages, tend to have a higher bounce rate. That makes sense: if visitors aren’t ready to convert, they’ll leave. So, it’s vital to be sure that you’re sending only highly qualified traffic to those pages.
The source of your traffic matters, too. Visitors who are coming from email campaigns or referral links are less likely to bounce, likely because they’re primed for your content.
In sum, pay attention to your bounce rate, but be sure to give it the proper context and measure appropriately.
Another Google Analytics metric, “goal completions” refers to your goal conversion rate (GCR). In other words, how many people took the action you wanted them to take?
That action could be anything from subscribing to a newsletter to adding a certain product to their cart. The rate is calculated as:
GCR = [(total actions on that page) / (total visitors on that page)] x 100
There are no industry standards for goal completions. Obviously, you’ll want them to be as high as possible. Some actions will naturally have a lower GCR. For example, it takes more convincing to get someone to make a purchase, so that goal’s completion rate will be lower than getting someone to join your mailing list.
If your GCR is lower than you’d like, though, consider how your pages are structured and positioned. As mentioned above, a poor UX design can turn off potential customers. Goals that are unclear or hard to find tend to have a lower completion rate.
Also, evaluate the page’s content and how visitors reach the action point in question. Especially if you’re sending traffic from other marketing channels (email, social media, etc.), your messaging should be consistent and in line with their needs along their buying journeys.
Typically used to assess social media content, your engagement rate describes the number of people who liked, commented or clicked on, or shared a post out of all those who saw it. High engagement is a good sign that people enjoy your content and find it valuable.
The formula is essentially:
Engagement rate = [(total likes, comments, shares, clicks) / (total impressions)] x 100
As with clickthrough rate, this metric is based on your impressions — the number of times your content appeared to people. It doesn’t matter how many followers you have. So, your first goal in improving your engagement rate is to boost your impressions, such as by posting at optimal times.
From there, engagement rate is a key metric for brand-building and top-of-funnel campaigns. Don’t confuse it with clickthrough rate as engagement includes likes, comments, and shares. In fact, the engagement rate is a bit tricky to evaluate as it doesn’t always translate to revenue growth. Your post may perform so well that it gets thousands of likes but doesn’t bring anyone further down the funnel.
However, engagement rate can be helpful for determining attribution. If you’re able to see which converted leads engaged with certain social posts, you can gain insights into which social content best supports your audience’s buying journeys. A marketing automation platform that integrates social media activity can help you assess how your social strategy boosts your overall conversions.
All these metrics help link your marketing activity to your revenue growth. But at the end of the day, what truly matters is how many leads become sales. Just because someone goes through your entire funnel and singlehandedly boosts your marketing campaigns does not mean they’re going to make a purchase.
This has often been a challenge for businesses that use content marketing. Their high-value content may attract “tire-kickers” who want the freebies and nothing more. Moreover, if your marketing campaign attracts leads who ultimately won’t be able to afford or benefit from your business’s solution, you’ve spent a lot of time and money for nothing.
That’s where the MQL-to-SQL ratio comes in. Your Marketing Qualified Leads (MQLs) are those who went through your entire marketing funnel. They downloaded your lead magnet, joined your mailing list, and have opened and clicked on your emails. Once they’re passed a certain point, though, they must be re-qualified.
Sales Qualified Leads (SQLs) are those who are actually primed and able to convert. They have a clear intent to buy and they’ve shown continued interest in your business. Your sales team can actually get in touch with them.
Evaluating how many MQLs turn into SQLs is crucial to evaluating your overall digital marketing strategy. If you’re spending tons of money on social media and whitepapers that don’t turn into conversions, you’re creating too many MQLs who can’t qualify for sales.
And even if you have plenty of SQLs, it’s worth considering how much to invest in bottom-of-funnel activities. High campaign spending may not be necessary if your mid-funnel leads tend to convert easily into SQLs.
By measuring your MQL-to-SQL ratio, you can gain a clearer picture of where to invest your marketing and sales efforts. A combined marketing/CRM automation solution such as SharpSpring can track activity levels and relevant costs at each point of the funnel, ultimately helping you make informed decisions.
There you have it: the seven vital sales metrics that all marketers should keep in consideration. While none of these metrics provide conclusive guidance on their own, together they help you build a comprehensive portrait of your strategy’s performance.