What Marketing Metrics Matter
How do you build a KPI dashboard for the boss? In the world of your business it’s the numbers that matter. Marketeers need to get better at building our skills to report effectively, not delivering vanity metrics, and flashy pie charts downloaded from our marketing reporting tools, (sorry guys and gals!).
How do you build a KPI dashboard for the boss?
In the world of your business it’s the numbers that matter. Marketeers need to get better at building our skills to report effectively, not delivering vanity metrics, and flashy pie charts downloaded from our marketing reporting tools, (sorry guys and gals!).
In this post I’m going to work through a framework to help you shape your approach to data driven marketing using the Smart Insights PRACE model.
A theme I have seen again and again is a mental wall that some marketers put up when it comes to the numbers, because they think they can’t do it, or they have a fear “I was never good at maths at school” said one delegate recently. I was in this camp at the early stage of my career. I learned quickly that if you can master the ability to track marketing and report on the metrics that matter, you will get more respect, and if you do find maths quite difficult just give yourself a little bit more time to crunch the numbers.
What’s important is that you understand the reasoning behind the formulas available and the output you’re trying to achieve. That output being information that you can use to improve your strategy and campaigns, with data at its core and not an opinion. So, what metrics should you care about and how do you build that framework? One of the best, and simpler approaches to get yourself on the data-driven road is to use Smart Insights (P) RACE model.
I find it useful to see a live example, so I will be using a hypothetical examples along the way, a Software as a Service (SaaS) content curation company that offers a subscription to use their tools (with 3 price points) and a free trial as a gateway to get them in the system.
Quickly just recapping on the lingo…..
What is a metric
A metric is a number that gives you information about an aspect of your business. It’s more formally looked at from quantitative measures describing events or trends on a website and they typically look at two aspects.
Scale these tend to be a number such as visits all time on-site or
Efficiency is normally expressed as a ratio such as return on investment or average order value
What is a dimension
Dimensions are attributes that give context to the metric you are measuring, these are either text or time values.
Text dimensions could be referring to source location keywords campaigns and
Time dimensions are an hour of the day time of the week etc.
What is a Key Performance Indicator (KPI)
KPIs are unique to your business, a KPI for one business is going to be different to another. Just think of KPI’s as promoted metrics. You report and track a lot of things but there will be a very small handful of KPIs that really matter to your board or investors. Don’t be afraid to look beyond commonly cited KPIs and work to find the most important metrics for your specific business audience that your reporting up to the board.
The PRACE model breaks out as:
Planning- creating your overall strategy, doing your audits, reviews etc
Reach- how you build awareness
Act- engage with your audience
Convert – convert them
Engage- build advocacy, retain customers
Here is a simple summary of RACE KPIs which form a dashboard.
To help you apply this to your unique business, we will work through my use case example for the SaaS business.
What are the key business objectives for your business? Establish your goals upfront and focus on outcomes. Remember if you can’t measure it you can’t manage it.
You will of course map out your big-hitter-business-will-go-under-if-we-don’t-getem macro goals, and you need to draw a line in the sand and state what your target is. To manage expectations, it can sometimes help to set your best case and worst case scenarios. If you’re a start-up and you have no historical data then you’re going to be using benchmarks, whereas an established business will have historical data for you to base your estimates on.
Sell more online subscriptions
Increased unique visits
Monthly Unique Visitors
Reduce churn to 20%
Upsell basic users to the next subscription package
50 accounts per month
20 accounts per month
Each of your business objectives need to have an output, this is the goal, something that shows that the objective was achieved. As there will be a lot of data available, and a number of metrics that can report on that goal, you want to pull out the promoted metric, your KPI. You need context, so draw a line in the sand and establish what is the best case and worst case for each KPI
Don’t forget about your micro conversions. If 3% converted on your website, what are the other 97% doing?
Do they watch a video, download content, share on social media, click on a CTA, interact with your live chat, add a product to cart but didn’t buy….etc etc. Understanding how users move through their buyer journey means you can adapt your strategies to push them through more effectively.
Design your programmes to be measurable
Now you need to roll up your sleeves and audit all your data collection points. Check that your tracking is in place on all your marketing programmes – we have a great event tracking template here to help get you started. And also spend time auditing your Google Analytics setup, get the bread and butter basics sorted first.
I like to map out the flow of a business through their funnel, from top to bottom, and check what tracking solution they need (based on their website configuration). This is a worthy exercise to do as you may find that you’re not tracking everything correctly for you to understand and find a solution to the questions you’re trying to answer. For example, you have a lot of video content assets and you want to know if they help people convert for a free trial, a micro goal would be that they ‘watched the video’. So in your analytics audit you need to check and set up event tracking on your website to see this data.
Macro and Micro Goals
Tracking/ Goal Type
Yes / No
Read Blog / case study
Event (YT script GTM)
Lead gen- form for content
One Month Trial
Watch Video (how to get started)
Contact form (enterprise accounts)
Buy ‘Get Started’ (Self Service)
Buy Subscription –
Focus on decisions that improve your bottom line
You don’t want to get carried away here, just because you can measure everything, doesn’t mean you should, you will end up drowning in data and ‘data vomiting’ all over your boss. Measure what is going to guide your decision making process and improve the company’s performance.
The RACE model is a strategic and high level structure, but what if your boss or investors want an even shorter, succinct version? Can you put the company’s top level metrics on a post it note?
Well actually, yes you can. Depending on who you are talking too! Focus on what they care about. What metrics matter to them?
Your VP of marketing may want.
Reach = Events per session
Act= Number of Free Trials
Convert= Return on Investment
Engage= Churn Rate
Your CFO may want
Reach = Cost per Visitor
Act= Cost per Acquisition
Engage= Monthly Recurring Revenue
And always provide data ranges for context. What was your churn rate this month compared to last month and the same month last year.
A tip from the trenches. If you are focusing on a particular metric, and you are working to optimise it, make sure you choose a paired metric.
Why would you do this? You can optimise something, which looks great on paper, but it has a negative impact somewhere else in the business. Using my hypothetical business scenario in this post, let’s say if a user subscribes they get a personal call with an onboarding agent, and the business wants to get the onboarding call time down. This is just going to incentivise the agents to get through the calls quickly and not focus on the quality side. A paired metric in this scenario would be Customer Satisfaction.
So by now you should have a really good understanding of exactly what you want to be reporting to your boss following the RACE model and focusing on decision that improve the bottom line – remember this is key when presenting to the powers above!