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We have the privilege of working directly with CEOs, CFOs and CMOs. These executives often ask me what high-level metrics we should be using to measure our digital campaigns and strategy on an executive level.
Some executives want to dig deeper into the digital strategy. Here are four things every CEO and their team should be tracking.
Conversion Rate
A conversion rate is the percentage of visitors who visit your website and then convert. This conversion rate can be measured in several ways depending on the type of business.
E-Commerce Businesses
This conversion rate is based on the number of visitors who complete an eCommerce checkout and buy a product. This percentage can be analyzed in more detail by comparing the number of “new” and “past” visitors, as well as “mobile” and “desktop” visitors, as well as “mobile” visitors versus “desktop” visitors who convert. Each site and business will be different, but you should aim for a conversion rate of at least 2%.
Lead Generation Businesses
This conversion rate is usually based on the number of visitors who come to your site and A) complete a form or B) contact you. CallRail is a great tool for tracking phone calls. CallRail, a Power Digital partner and popular service to track phone calls because of its seamless integration with Google Analytics, is the best option.
Lead generation sites should convert at a higher rate than E-Commerce, and we would like to see these above 5%. They can, however, exceed this metric. We have clients with sites that are at least 10% higher depending on their industry and traffic source.
Do not panic if your conversion rate is below the figures mentioned above. You can easily improve it!
- Verify the quality of your traffic by checking its sources. If not, create a plan for adjusting.
- Conversion rate optimization is one of your best investments. We have seen HUGE success using the Power Digital program. This data aggregation and A/B testing has generated huge returns for our customers.
Cost Per Lead (CPL), ROI on Ad Spend (ROAS), and Overall ROI
These metrics will vary depending on the type of business you have (e-commerce, Lead Generation, or Subscription). Subscription, etc.) But in my opinion, it is very important to keep an eye on and understand.
These metrics will show you the effectiveness and success of your campaigns. Many CEOs don’t know the numbers or have a goal of what they should be. You must have a plan and an “over/under point.”
Cost-per-lead
You’ll first need to know the answer to the question: “What would be the maximum amount I will pay for a good lead?” Would it be $50, $100 or $1,000? You can decide this based on the close ratio of your deals, average profit, etc.
It’s still important to establish a maximum threshold so that you can set a benchmark and then measure it. Your marketing team will strive to get you leads at or below this rate and continue to reduce the cost per lead as your marketing campaigns and data grow.
Return On Ad Spending or ROAS
E-commerce companies use this ratio to compare the amount they spend on ads and marketing (you can choose) with the sales generated. This metric is my main measure when it comes to Paid Media Ad Campaigns.
Example:
For every $100 spent, you would get $200 in sales.
If you spent $100, you would get $500 back in sales.
You’ll also need to find your break-even point for campaigns. What is your break-even point when you consider COGS (costs of goods sold) or other financial factors? You can then work to surpass that minimum ROAS.
It is not uncommon for CEOs to give me unrealistic goals, such as a 1,000% return on investment. This is only possible if you run a “branded campaign,” meaning that you are ProActive and you bid on the keyword “Buy ProActive Face Wash.” This goal is not achievable for campaigns that aren’t branded, such as those for “buy facewash.” In general, 250% to 300% ROAS can be achieved depending on the competition in your field. You are likely to do well once you reach 300%.
Total ROI
It will take a little more time to do this, but it is an important aspect to keep in mind. You should look at the overall marketing budget and analyze how it affects you and your business. I dive deep into this at least quarterly, if not even monthly, to ensure I’m spending the right amount of money and getting the returns I want. This is what drives me to allocate more budget towards initiatives that generate revenue or cut efforts that don’t.
Channel Growth
It’s easy. Each month, look at your traffic growth and decline for each of your main channels. You can then see which initiatives are growing and which parts of your digital program have refused. Remember that your business may have seasonality that can cause channels to decrease. As the CEO, you will know better than anyone what the trends are in your company. Your website will be affected by seasonality.
Tracking and measuring the core channels each month is:
- Direct: The number of people who type in your URL (This will show your brand awareness).
- Organic: Your organic SEO traffic.
- Referral: Traffic from your PR coming from media hits and other sources that link to your site. We heavily promote this channel through our PR programs. We create partnerships to make them work for you.
- Email: Insight into how your email campaign is performing.
- Paid This is your advertising campaigns, such as Google PPC and Display ads. This traffic can be bought and fluctuates depending on how much money you spend on advertising each month. So, this is not a metric that I pay much attention to. In a moment, I’ll go into more detail about how to measure the channel.
- Social: how your social media channels perform in terms of driving traffic to your site.
I would recommend that all CEOs track these channels to understand better the progress of various campaigns that your marketing team may be running, or perhaps should be running, or should be discussed in more detail.
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