In a world where it feels like every dollar of marketing spend comes under constant scrutiny, you have to know how to prove your return on investment (ROI). But with a sea of metrics to wade through, that can feel easier said than done.
This blog is here to help. Read on as we break down the 10 essential metrics that can help you prove the ROI of your digital marketing efforts—and score that next big budget.
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10 ROI-driven metrics for digital marketing
Here’s a breakdown of the 10 metrics that matter for digital marketing ROI.
- Return on ad spend (ROAS): Shows how much revenue you generate for every dollar spent on advertising. For example, if you spend $1,000 on ads and generate $4,000 in revenue, your ROAS is 4:1.
- Customer lifetime value (CLV): Helps you understand the long-term revenue potential of acquiring and retaining customers, allowing you to make smarter marketing investments.
- Revenue per visitor (RPV): Measures the average revenue generated per website visitor, helping you understand the quality of traffic from different campaigns.
- Conversion rate: Tracks the percentage of website visitors who complete a purchase.
- Average order value (AOV): Tracks the average amount spent each time a customer places an order. Increasing AOV can have a big impact on overall revenue without needing to acquire new customers.
- Add to cart rate: Measures the percentage of visitors who add items to their cart, providing insights into how effectively you’re enticing shoppers to take the first step.
- Cost per lead (CPL): Tracks how much you’re spending to acquire each lead. This is especially valuable for businesses with lead-generation goals.
- Cost per acquisition (CPA): Calculates the cost of converting a lead into a paying customer.
- Share of voice (SOV): Measures your brand’s visibility in the marketplace compared to competitors, including organic and paid impressions.
- Net promoter score (NPS): Gauges customer loyalty and satisfaction with a simple 2-part question.
5 more tips for proving digital marketing ROI
Here are five more tips for communicating your digital marketing ROI in a way that wows stakeholders and secures more budget—and accolades—for your marketing team.
1. Focus on the metrics that connect to business goals
Digital marketing offers no shortage of data, but not every metric is created equal. It’s tempting to focus on surface-level metrics like impressions or likes, but stakeholders are more interested in how your efforts tie directly to business outcomes like revenue and customer acquisition. When communicating ROI, make sure to align your metrics with the most important goals for your organization.
2. Track metrics across the full funnel
To prove ROI, you need to measure performance at every stage of the marketing funnel, from awareness to conversion. Top-of-funnel metrics like impressions and reach might not tie directly to revenue, but they lay the groundwork for later-stage conversions.
3. Don’t ignore attribution modeling
Attribution modeling helps you understand which channels and campaigns are contributing the most to your success. Multi-touch attribution models, for instance, distribute credit across every touchpoint that influences a conversion, giving you a clearer picture of where to focus your efforts.
4. Communicate your wins clearly
Numbers alone won’t tell the full story. To prove ROI, it’s critical to present your results in a way that resonates with stakeholders. Combine hard data with visuals like charts and graphs to illustrate your performance.
5. Use benchmarks to set expectations
Metrics are more meaningful when they’re put into context. Compare your results to industry benchmarks to show how your campaigns stack up. For instance, if your CPA is below your industry average, highlight it as a cost-efficient win.
Are you ready to prove the ROI of your digital marketing?
By focusing on metrics that matter, tracking performance throughout the funnel, and communicating your results effectively, you’ll not only justify your marketing spend but also position yourself as a strategic leader in your business.
It’s time to squeeze more ROI from your digital marketing efforts. Contact Your Marketing People today to learn how.
