Digital Marketing Metrics – The Fundamentals
If there is one thing that all successful online businesses share it is a real understanding of what works and what doesn’t when it comes to digital marketing. A strong understanding of how marketing efforts are paying off is crucial to ensure you get the most from your online investment. The great news is that there are a huge number of possibilities for measuring online marketing success, so many in fact that it pays to start by thinking about the basics.
Traditional vs Digital Metrics
Before direct marketing came along traditional advertising, particularly brand advertising was very difficult to measure in terms of ROI. Direct Marketing was built on being clearly measurable. You could calculate your ROI for all of your campaigns and use testing to adapt and improve future performance. That is also the basis of measuring metrics online but we now have some big advantages including:
- More measurement options – you can derive a much greater array of information from online customers than you can for offline by tracking their behaviour.
- Speed – you can measure customer behaviour in real-time. Try doing that with direct mail!
- Cost control – for example if you are spending money on PPC campaigns you can set daily and campaign limits for spending so there is no wasted budget.
Basic online metrics
The most popular method for reviewing digital metrics is google analytics. You can generate well over a hundred different reports using this tool but first things first. The most basic metrics you find on your google analytics ‘dashboard’ are:
- Visits – total number of non-unique visits to your site
- Page views – total number of page impressions i.e. number of times pages have been viewed
- Pages per visit – an average number of pages viewed by each visitor e.g. 2.9
- Bounce rate – the number of visitors leaving you site after viewing only one page
- Average time on site – otherwise known as ‘stickiness’. How well the site maintains visitors
- % new visits – how many visitors have first timers on your site
These metrics serve a purpose but if you are selling something online you need to look deeper. The first question to ask is ‘What is the goal of my website?’. You may have a number of goals but if you are in business your main goal is likely to be to sell X amount of X product, generating X amount of revenue.
Start with Goal Setting
Google analytics enables you to set-up a number of goals and run reports specifically to check how well you are doing in achieving them. Say your current goal is track how many visitors are reaching the checkout page on your site i.e. buying a product. You can set up a goal called ‘Buy Product’ and define this as a ‘URL destination’ goal. This will then enable you to report on how many times visitors reach the Confirmation of order page.
Different types of goal
Even the most hardened capitalist should be interested in more than just sales – you need to understand what leads to sales. Digital marketing success needs to be measured in more holistic sense. That’s why google analytics allows you to measure goals in 3 ways:
- A URL destination goal – allows you to see how many times visitors have visited a certain part of your site. For example, if they sign up for your email newsletter each time they do so a URL will be displayed. Google Analytics will count how many times that URL is reached so you can measure how many users are signing up against your objectives.
- Time on site goal – this is a useful metric because it helps to prove how engaging your content is which in turn helps to show how engaged customers are with your site. Engagement increases your chances of making sales and building a loyal customer base. In 2010 the average website visit was 5.2 minutes according to google analytics.
- Pages per visit goal – this helps to show much navigation around your site the average visitor is doing. Your goal might be to get visitors to visit at least 5 pages. Your report would then show the percentage of visitors doing so.
So these are a few basic but useful ways to measure your marketing goals online. When getting started for the first time the most important thing is to have a clear view of which pieces of information are most important for measuring success, your key performance indicators (KPIs) and to produce a number of structured reports for delivering that information. In my next post I will look conversion funnels, another important measure of your digital marketing performance.
Posted on May 15, 2012, in Analytics, Digital Marketing, Internet Marketing, Marketing, Online Marketing and tagged Digital Analytics, Google Analytics, Marketing Analytics. Bookmark the permalink. Leave a comment.