Nobel prize-winning economist Robert Coase once asserted that “if you torture the data long enough, it will confess to anything.” Robert here was highlighting the value of data-driven insights and why data should be the starting point, not the end, of every foundational decision.
For a marketer, working on a data-driven marketing strategy can be the silver bullet missing in your general marketing campaign. The world is drowning in data on almost any topic conceivable on earth, and customers constantly search for new products online based on the data available to them on the internet. According to research, one in five customers changed brands between March and August 2021 alone based on the information they encountered online.
So, how can marketers leverage this change in the status quo? How can you bait and catch the undecided consumer base? The answer lies in your data-driven marketing strategy’s Key Performance Indicators (KPI).
Understanding customer data through KPI analysis will allow you to make the right decisions when developing your next marketing strategy. You will be able to find out why a customer chooses a specific product through their search patterns and how you can reach them.
Okay, before we put the cart before the horse, let’s rewind and answer a few basic questions; What is a data-driven marketing strategy? What are KPIs?
What Is a Data-driven Marketing Strategy?
A data-driven marketing strategy uses quantitative and qualitative data to make informed product development and marketing decisions. The process involves collecting data based on the targeted audience’s needs and using it to create products that answer their problems.
You will further use this data to predict future customer behaviors and address them beforehand using your product. As new data emerge, you must revise your strategy to create personalized marketing campaigns targeting the highest possible investment returns.
But there is tons of data on the internet; how do marketers sift through all that information? Enters key performance indicators!
What Are Key Performance Indicators (KPI)?
A KPI is a specific tenet of measurement for the performance of your business against a specified marketing objective. These indicators split the data chunks into easy-to-digest bits focusing on different areas of your business. They enable marketers to measure the success of their campaigns by evaluating various tenets of a marketing strategy.
With KPIs, you can monitor the growth of your brand, engagement with the target audience, marketing outreach, and its respective conversions and make relevant decisions based on this data. So, what KPIs should you look for when running a data-driven marketing strategy?
KPIs You Need for Data-Driven Marketing
Google Analytics tags new visitors to your website and social media pages as ‘unique visitors.’ The system gives each visitor a unique ID to track their activity on your website. It records items searched, clicked on, purchased items, and the amount of time spent on your website. This information is crucial in predicting the user’s desires and keeping track of their behavior, which you can implement in your marketing strategy.
Google Analytics also saves the user’s ID as cookies for future visits and filters off non-human visitors such as web crawlers, spiders, and bots. The number of unique users appears on your analytics account as soon as you log in as ‘visits and unique visitors since your last login session. The feature is crucial in tracking the performance of your search engine optimization (SEO) campaign using specific keywords.
Bounce rates are another unique KPI on Google Analytics. A bounce refers to a single-page session on your site. It is calculated as a session triggered by only a visit to a single page on the site, which further triggers a single request to the analytics server.
However, in most cases, visitors will visit multiple pages, in particular visits to your site. In this case, a bounce rate is calculated as a percentage of all sessions on your site, which the visitors only checked out a single page.
A high bounce rate means that most visitors only click on a single page of your website. This could be bad news if the page is a gateway to the rest of the site, say it’s a home page, where you want it to trigger more clicks to other pages.
Google Analytics gives you a chance to view your bounce rates from different perspectives;
- The audience reports: Analyses bounce rates for your site
- Channel reports: Gives bounce rates for each channel category
- All traffic report: Gives the bounce rates for each source pair
- All pages report: Gives the bounce rates for individual pages
You can use this information to make an informed decision in your data-driven digital marketing campaign.
Click Through Rates (CTR)
This KPI gives you feedback on the performance of your ad, specific keyword, or product listing. Once you run an ad campaign, you expect people to click and check it out. The click-through rate is the ratio of the number of people who saw your ad or product listing to those who clicked it.
Each ad, keyword, or listing gets a separate CTR on your Google Analytics platform. A higher CTR means that internet users find your listing helpful, giving you insights on the keywords and ads you should focus on and the ones you should eliminate from your campaign.
Conversion refers to achieving the set objective from the consumer’s end. For instance, if you posted a copy seeking to attract prospective customers to subscribe to your email listing, we say that the copy has a conversion success if it convinces readers to subscribe to the intended listing. It can also apply to the moment when the customer finally purchases at the end of a marketing funnel.
A complete purchase is often termed macro-conversion, while a complete activity within a marketing funnel, such as signing up for an email listing, is termed micro-conversion. As a marketer, conversion rates hint at marketing techniques that work and those that do not work for your business.
Average Cost per Acquisition
Conversion per acquisition is the average amount of investment you have accrued for your ad conversion. For instance, if your ad received three conversions of $4, $6, and $8, respectively, your average cost per acquisition will be $6.
Cost per acquisition (CPA)is the amount charged for a specific ad’s conversion. These two categories of KPIs allow you to monitor your ad campaign’s return on investment (ROI), enabling you to make relevant adjustments where needed.
Cost-per-click (CPC) is another crucial KPI when running paid ad campaigns. It refers to the amount you pay your ad agency for each click your ad receives.
Ad agencies such as Google Ad Words allow you to set a maximum amount you are willing to pay for a click on your ad, known as the Max. CPC. If you select a higher max. CPC, ad agencies will push your ad to a broader audience.
CPC allows you to keep track of your ad performance with the investments made. You can set your ad setting to manual CPC bidding, enabling you to choose your max bidding manually; alternatively, you can select it to an automatic function on Google Ad Word. CPC is sometimes referred to as Pay-Per-Click.
The whole point of running a marketing campaign is to increase the revenue generated from your products. Google Analytics has a particular revenue tracking function that powerfully combines your CPC, CPA, and CPL to track the investment return from each marketing technique. This allows you to make informed, data-driven decisions.
Google Analytics allows you to track revenue generated from your e-commerce websites through universal analytics and non-commerce sites that generate leads online and offline. These functions give you a grasp of your marketing tabs, revenues, and investments.
Social Media Engagement
Social media platforms have become a goldmine for marketers leveraging data-driven marketing techniques in their social media marketing strategies. Top marketing tools such as Google Analytics allow you to track your engagement on various social media platforms per post. One of the key performance indicators of social media marketing is social media engagement.
Setting up social media tracking on your Google Analytics account is straightforward. Google Analytics allows you to set your social media marketing goals to measure your social media engagement. However, it is wise to think of metrics that directly affect your business while critically setting up social media marketing goals.
Meta also has incredible digital marketing tools for social media platforms such as Facebook, WhatsApp for Business, and Instagram. These tools allow you to track various KPIs, including social media engagement, and make appropriate decisions on your marketing strategies.
Data-driven marketing strategies are the gateway to the future of marketing. It allows you to leverage free information available on the internet and make better marketing decisions. KPIs will enable you to dissect these data into manageable portions and easily interpret them into meaningful information.
Now, dozens of KPIs are out there, and keeping tabs on them can be cumbersome and cost-ineffective. Therefore, it is wise to pick KPIs that correlate with your business setting and marketing strategy and focus on them. If you have trouble setting up a data-driven marketing campaign for your business, our experienced digital marketing experts at Romain Berg can help you make the most of the internet marketing goldmine. Contact us today to learn more.