If you want to make efficient use of your time and money, measuring your digital marketing efforts and effectiveness is a must. But where do you even start?
In this blog, we’re going deep into the three metrics that every business owner should be tracking. If you measure nothing else, these three metrics will help you understand where your traffic is coming from, if your content is resonating with your visitors, and how efficiently your website is converting.
We’ll be teaching this – along with other important digital marketing measurement topics, in our exclusive CMA training, the Web Analytics Masterclass. If you’d like to join us, and learn how to fuel your business with data-driven marketing, register for the free masterclass now!
How to measure digital marketing success
Before you can say if something was successful or not, you’ll need to define what success means to you. In other words, what are your goals? It might seem obvious to start with goals, but you’d be surprised how many businesses cannot simply answer that question.
Goals can relate to sales transactions, revenue, process improvements, improvements in website experience, awareness generation, etc. The main thing here is to be as specific as possible. Some examples include:
- Launch new product / service
- Increase revenue from existing customers
- Increase new customer acquisition by targeting new segment
- Be more efficient with marketing budget
Once you know your goals, you can set measurable outcomes:
- Increase Conversion Rate by ___%
- Generate ___ Leads / Sales
- Acquire ___ new customers
- Increase Leads / Sales by ___%
- Decrease Cost per Acquisition by __%
- Increase existing customer revenue by ___%
These are examples of primary metrics or KPIs (key performance indicators). To determine what your primary metrics should be, you can have a look at our last blog, Getting Started with Digital Marketing Analytics.
Your primary metrics will be unique to your type of business. If you’re an ecommerce company, online purchases, and average order value will be important. If you’re a service provider, leads are likely going to be more important to you.
However, regardless of your business type, the three metrics we will be discussing today, will help you evaluate how your digital marketing efforts are working for your business.
Digital marketing metrics to track
In using analytics, the goal is always to understand WHY something is happening. When you understand what’s driving performance, you can either scale what’s working, stop what’s not, or optimize opportunity areas.
In order to understand the “why”, I always look at things in a step-by-step funnel. I start with my end goal, and then work backwards through the funnel to identify why things are or are not working well, and where they need to be optimized.
For today’s purpose, we’ll follow the most common marketing funnel:
Awareness -> Consideration -> Conversion.
Each of the three metrics we’ll look at, helps us understand how we’re moving users through this funnel, and helps answer the following questions:
How many people are visiting my site and where are they coming from?
Is my site content resonating with users?
How effectively and efficiently is my site converting?
To answer each question, we’ll be digging into Users / Sessions, Bounce Rate and Conversion Rate. Since I like to work backwards from the end conversion (or bottom of the funnel), we’ll do the same here.
How to measure your website conversion rate
A website Conversion Rate is a way to measure the efficiency at which your website converts leads, sales, or other “conversion” goals. Since there can be multiple Conversions, you can also have multiple Conversion Rates.
If you have an ecommerce store, you will want to measure a Purchase or Transaction Conversion Rate. If you are a lead focused business, you should be measuring Lead Conversion Rate. It’s also possible that both are important to you, in which case, you can measure both.
In all cases, input your “Conversion” into the metric definition:
Conversion Rate = Conversions / Sessions
What does Conversion Rate tell you?
Conversion Rate takes into account the full user journey from the start of their visit through to completing a purchase or submitting a lead form. It’s an all-encompassing metric, which means it’s a very important metric to measure!
Looking at Conversion Rate from an overall standpoint, you start to understand how effectively your site moves users through the web experience to complete your ultimate website goals – a lead or a sale.
However, because it is an all-encompassing metric, it’s a factor of all the customer actions throughout the customer journey, which means it gives a glimpse into:
- Traffic quality
- If you’re targeting the right audience
- How well your landing page performs
- If your site content is resonating with visitors
- If your site is user friendly and functioning properly
When you break Conversion Rate down by Dimensions, you can begin to answer all of the above questions. For example, looking at Conversion Rate by Channel will tell you which marketing channels direct the most high quality traffic to your site, along with which marketing tactics are most effective. Breaking it down by Landing Page will allow you to evaluate how each page performs and if the content is resonating. Viewing Conversion Rate by device type will help you understand if you have consistent performance across desktop and mobile devices.
Breaking Conversion Rate down by these same dimensions, among others, is the key to website and marketing optimization. It’s at the dimension level (campaign, creative version, audience, device type, landing page, etc.) that we start to understand what is actually driving the performance. Once we know this, we can take action to improve what’s not working, or scale what is.
We touched on Dimensions as a part of the larger measurement framework discussion in our previous blog. Check it out to get a better understanding of Dimensions.
What is a good Conversion Rate?
Though Conversion Rate benchmarks vary based on the type of Conversion, business and industry, we can use these benchmarks for reference:
- Overall site: 1-3%
- Purchase: 1-5%
- Landing page email capture: 20-30%
- Book a call / consultation or contact form: 2-15%
If you’re not within these benchmarks, first you’ll want to break Conversion Rate down by the previously mentioned Dimensions. You should get a sense of what’s holding you back. If not, then it’s time to move up the funnel, and assess what’s going wrong. It could be that your website content isn’t resonating with visitors, or you are attracting the wrong audience. To learn more, we look at the site Bounce Rate.
What is Bounce Rate?
Bounce Rate tells us the ratio of people who only viewed one page before exiting the site. They arrived, did not engage, and left, all within one page load.
The metric definition is:
Bounce Rate = Single Page Sessions / Total Sessions
Bounces occur for a few reasons:
- The landing page content was not consistent with the tactical content that brought the visitor there
- The landing page content was not engaging or the message wasn’t clear
- There wasn’t a clear CTA (call to action) on what to do next
- The audience being targeted is the wrong one
- The site or page was loading too slow
Since many of the above are related to the landing page content itself, Bounce Rate is a good way to measure if your content is resonating with your audience.
What is a good Bounce Rate?
Bounce Rate varies by marketing channel. If your site falls in the below ranges, you’re doing well:
- Direct: 30-40%
- Email, Organic Search, Referral: 40-50%
- Paid Media: 45-65%
Typically, the colder the audience the higher Bounce Rate. For example, someone coming to your site from an email you sent them would be considered warm traffic. They are already a lead, and they’re familiar with your brand, so their Bounce Rate should be lower. On the other hand, someone coming through a Facebook ad is cold traffic, and because they don’t know you yet, they are more likely to come and go a lot quicker.
As a baseline, look at your Bounce Rate for Direct traffic. If your website is functioning well and your content is resonating, you should be in that 30-40% range. If it’s not, assess the following:
- Look at page load times. If things take too long to load, people will not stick around. The quickest fix is often just compressing images.
- Break down Bounce Rate by device type. 60%+ traffic now comes from mobile devices. If your site is not mobile friendly, this could be driving up your Bounce Rate.
- Break down Bounce Rate by page. Is there a specific landing page that isn’t performing well and driving the Bounce Rate up?
If none of those jump out as the driver of high Bounce Rates, then it’s possible your site content needs a makeover. You may want to take a step back, and revisit your digital marketing strategy so you 100% understand who your ideal customer is, what problem you’re solving for them, and subsequently, the critical content that should be on your website.
If your Direct Bounce Rate is in the 30-40% range, but your Paid Media is much higher than 65%, it’s likely one of two things:
- Is your landing page performing well for other channels? If not, you’ll need to spruce up the landing page layout, messaging, CTAs, etc.
- If the landing page is doing well for other channels, dig into your audience performance to ensure you are targeting your ideal customers.
Once you’ve sorted out Conversion Rate and Bounce Rate, you’ve made your way to the top of the funnel.
How to track website traffic
When you make it to this stage of the funnel, you’re simply tracking Users and Sessions. Users are unique at the device level, and Sessions are counted each separate time they visit your site.
If you’ve already analyzed your Conversion Rate and Bounce Rate, you’ll know how your site is performing and what you need to do to improve performance. You always want to start there, so that if there are issues, you fix them before you start scaling traffic.
Assuming you’ve done that, you’ll want to know which marketing tactics are actually bringing traffic to your site. In other words, is the time you’re spending writing blogs, creating Instagram content, engaging in LinkedIn or Facebook Groups, actually paying off.
To measure this from a high level, you can simply view your Sessions by Channel. At this level, traffic is bucketed into Direct, Email, Organic Search, Paid Search, Referral or Social. For some, this may be enough to get some directional insights.
However, why stop there when you can…
Use UTM codes measure every single marketing tactic
UTM codes allow you to enhance your web analytics with information that allows you to truly understand where your traffic is coming from, what actions visitors take, and which marketing tactics perform best.
A UTM code is basically just an extended URL that contains a special text code at the end of your URL, and Google Analytics is programmed to recognize them.
You can input the information into a UTM code:
- Source – where the link is coming from
- Medium – the tactic you’re utilizing
- Campaign – which campaign the tactic is a part of
- Content – any additional information about the creative, audience, content topic, etc.
I’ve created a super simple UTM Code Builder, that allows you to create your coded URL in seconds. And trust me, it’s a few seconds well spent, because it’s at this level that you really get to actionable insights.
And you know what else will be time well spent…
I will be hosting a special training for CMA members. and would love to formally introduce you to the wonderful world of web analytics! Join me for this FREE LIVE TRAINING May 10, 2022.
In this Masterclass, you’ll learn:
My proven measurement framework that ties business goals and customer actions to measurable metrics across the customer journey.
Three metrics you should be measuring if you want to create engaging and high converting landing pages and marketing funnels.
Why Google Analytics and Hotjar are my marketing sidekicks and how you can use these FREE tools to improve your online user experience and conversion rates.
How to identify your top-performing marketing tactics so you can make more efficient, strategic and profitable business decisions.
Do YOU know how your marketing and website are working? Your web analytics are the key to investing your time and money in the right places. Let me teach you how to use them!
>> REGISTER NOW <<
About the author
Hey there, I’m Andi, a spread-sheet obsessed digital marketing nerd with a serious love for all things data!
I have always had an uncontrollable curiosity to understand what motivates our decision-making, and data is one of my favourite tools to uncover that mystery.
As the founder of Proof, I’ve helped my clients, big and small, transform their digital marketing strategies and business results – all with the magic of metrics. You might say the Proof is in the pudding.
And I’d be delighted to help you too! Let me introduce you to the wonderful world of analytics, how they can help you reach your goals and run your business more efficiently, and teach you a few tangible ways to get started.