Our clients often ask us, what marketing metrics matter? How can you tell if your marketing efforts are doing enough to generate business opportunities? Ideally, you want to establish metrics that align with your business goals. While these objectives can vary from one industry or company to another, Launch Team has identified seven key performance indicators that are commonly valuable in assessing the effectiveness of a company’s marketing strategy.
1. Cost per lead
Calculating the cost of acquiring a single lead helps you determine where to spend and where to save in your marketing budget. Here are some benchmarks:
- The average cost per lead for companies with $250,000 to $10 million in revenue is $26-50. (HubSpot)
- U.S. companies spending more than $25K per year on inbound marketing in 2013 saw an average CPL of $36 vs. $41. (HubSpot)
Trade shows are one area where companies can track cost per lead. Simply add up what you spent on exhibitor fees, travel, sales and marketing, and promotional items and divide by the number of leads obtained. For further scrutiny, you can also calculate the cost per qualified lead.
Number of qualified leads an important indicator of how well you’re attracting the right type of prospects. According to our 2016 survey of Photonics West participants, 63% of companies track qualified leads as a measure of trade show ROI.
Exhibitor Magazine reported a few years ago that the costs per lead of trade shows were:
- $189 per attendee that visits your booth
- $276 per attendee that engages in conversation
Download our Trade Show Planner to set lead acquisition targets and other goals for your next trip.
2. New traffic
Our clients who are engaged in strategic, monthly inbound marketing activities are experiencing significant growth in new traffic each year. These companies are not startups—they’re pursuing organic growth and gaining market share through a content marketing strategy that that attracts the right visitors at the right time.
Learn how an optical assembly client doubled web traffic in one year and closed 6-figure accounts from web-generated leads.
3. Click-through rate
When quantifying the success of digital advertising, click-through rate, or CTR, is more important than number of impressions. Whether you’re using Google AdWords or paying for banners on a trade publication’s website, views alone don’t tell the whole story.
There is something to be said for impressions as a measure of brand awareness, if branding is your primary goal and your ad is well designed for that function. But for most product or capabilities ads, click-through visitors and their resulting interactions are better gauges of whether or not you’re effectively targeting your customer.
What should you expect?
- The average click-through rate on AdWords paid search ads is about 2%. (WordStream)
- Across all ad formats and placements, display ad CTR is about 0.8%. (SmartInsights)
4. Bounce rate
After visitors click through to your website, you want them to stay on your site for as long as possible. Niche B2B companies should aim for a bounce rate under 50%. Keep an eye on your landing pages for Google AdWords and other campaigns, and evaluate both quantity and quality of leads generated. If your page has a high bounce rate and low conversion rate, or if those leads aren’t relevant to your business, then the traffic you’re paying for likely is not the right traffic.
5. Marketing budget as % of revenue
In B2B marketing, companies looking to grow should budget 1-6% of revenue projections for marketing. If you’re also expecting to overhaul your brand or web presence, budget toward the upper range.
6. Sales funnel conversion
Driving new leads is one thing, but closing them is another. Identify opportunities for growth in your marketing and sales process. Learn more about using metrics to improve sales and marketing alignment.
7. Close rate
Aim to close 30% of qualified leads. Qualified means they’ve passed the “money test” and have an interest, need, and budget to purchase. For those companies whose leads come almost exclusively from word of mouth or referral, the close rate can be as high as 80%. But are these businesses getting enough referrals to thrive?
Download our Marketing KPI Worksheet to easily track your most important business and marketing metrics.
Want to better understand your marketing KPIs and how to improve them? Request a Free Marketing Assessment. We’ll identify and evaluate your marketing metrics and provide you with a specific, actionable plan to improve your marketing ROI.