Measuring the effectiveness of digital marketingis one of the greatest challenges facing organizations today.
According to HubSpot’s 2018 State of Inbound report, 42% of marketers cited “proving the ROI of our marketing activities” as one of the biggest challenges they face within their company. Brands also say they plan to increase spending on marketing analytics by between 75 and 100 percent, says a study by VentureBeat.
The trouble is, when most marketers hear ‘digital analytics,’ they tend to think of the metrics you’d typically associate with a simple web analytics tool like Google Analytics — traffic, bounce rate, unique visitors, etc.
However, web analytics is only part of what encompasses digital analytics.
While web analytics can provide you with a wealth of insight and data into the performance of your website, marketers need richer data to understand the impact of their marketing campaigns on conversion rates and a buyer’s journey. Looking at top-level web analytics metrics like traffic is only the first piece of the puzzle.
Enter: digital marketing analytics, which offers a much more comprehensive view of what’s working when it comes to your marketing strategy — and what isn’t.
Regardless of how you fit into your company’s marketing puzzle, learning how to understand and leverage digital marketing analytics is incredibly important. Analytics data not only tells you if your marketing is working (or not), but it also tells you precisely how and where you can improve. This type of insight can benefit everyone.
That’s why we built this guide. We want you to master marketing analytics so your business can grow better. Below, we’ll talk about what marketing metrics to monitor, how to read and apply them to your marketing decisions, and how to leverage them to grow your business and bottom line.
Bookmark this guide for future reference and use the chapter links below to navigate through the content.
What is digital analytics?
Digital marketing analytics is the translation of customer behavior into actionable business data. Today’s marketers can use digital analytics tools to examine the many online channels their buyers might interact with and identify new revenue opportunities from existing campaigns.
Digital marketing analytics also give the creative, fluid side of marketing a data-driven foundation on which businesses can build a profitable, scalable marketing strategy. Analytics draw the line between opinion and fact.
Before we dive into how to use digital analytics for your business, let’s talk about what marketing metrics you’ll be measuring and analyzing.
Digital Marketing Metrics to Know
Digital marketing metrics are statistical measures that marketers use to determine the success of various marketing efforts as they relate to their overall campaign goals and industry standards.
You’ve heard of vanity metrics, yes? Vanity metrics are the surface level numbers that often tease you into thinking your efforts are working. Unfortunately, to get a clear picture of your campaign’s impact, you need to look at a wider variety of actionable metrics. We’ll be covering both in this section.
Here’s a comprehensive list of all the marketing metrics you need to know — and what they can tell you.
The following are digital marketing metrics associated with websites and web activity — a.k.a. web analytics.
A Visitor (or User) is someone who visits your site. Visitors are tracked by a cookie placed in their browser by a tracking code installed on your site.
A Page View is when a page on your site is loaded by a browser. A page view is measured every time your tracking code is loaded.
A Session is a series of activities taken by a visitor on your website, including page views, CTAs, and events. Sessions expire after 30 minutes of visitor inactivity.
Traffic (or Visits) is the total number of site or page visits in a given time period
Traffic by Channel
Traffic by Channel is the total number of site or page visits per referral channel, e.g. social media, email, landing pages, etc.
Traffic by Device
Traffic by Device is the total number of site or page visits per device type, e.g. smartphone, tablet, desktop, etc.
Ratio of New Traffic to Returning Traffic
The Ratio of New Traffic to Returning Traffic is the percentage of net new site or page visitors you receive as compared to the total amount of returning traffic
Time on Page
The Time on Page is the average time each visitor spends on your site or page
Interactions per Visit
Interactions per Visit are what actions your visitors took did when on your site or page
The Bounce Rate is the percentage of people who visited your site or page but didn’t take any action or look at any other pages as compared to the total number of page or site visitors
The following are digital marketing metrics associated with lead magnets and content offers.
Call-to-Action (CTA) Click-Through Rate
The CTA Click-Through Rate is the percentage of total clicks on a CTA as compared to the total number of page or site visits
Submissions is the percentage of total people who filled out and submitted your web form
The Conversion Rate is the total number of actions taken (e.g. a download, sign-up, etc.) on your lead magnet as compared to the total number of visits
Free Trial Conversion Rate
The Free Trial Conversion Rate is the percentage of free trial users who converted to customers
Pop-Up Conversions is the percentage of total pop-up form completions who converted to customers
Ratio of Generated Leads to Marketing-Qualified Leads (MQL)
The Ratio of Generated Leads to MQL is the total number of “good fit” leads collected from your lead magnet as compared to the total number of leads generated
Leads to Close Ratio
The Leads to Close Ratio is percentage of leads converted to customers as compared to the total number of leads
The following are digital marketing metrics associated with email marketing.
The Open Rate is percentage of opened emails as a proportion of the total number of emails sent
Opens by Device
Opens by Device is the total number of email opens per device type, e.g. smartphone, tablet, desktop, etc.
The Click-Through Rate is the percentage of total clicks on an email link, or CTA, as a proportion of the total number of email opens
The Bounce Rate is the percentage of undeliverable emails as a proportion of the total number of emails sent
The Unsubscribe Rate is the percentage of people who unsubscribe from your email list over a given period of time
The following are digital marketing metrics associated with content and social media.
The Engagement Rate is the total number of engagements (e.g. comments, clicks, likes, etc.) as a proportion of the total number page or post views
Follows and Subscribes
Follows and Subscribes is the total number of people who’ve shown interest in your content and want to receive updates when new posts or pages are published
Shares is the total number of times a post or page has been shared on social media, a website, or a blog
The following are digital marketing metrics associated with e-commerce.
Shopping Cart Abandonment Rate
The Shopping Cart Abandonment Rate is the total number of online shoppers who put items in their shopping cart but don’t complete a purchase as a proportion of the number of people who complete a purchase
- Tip: We’ve found that you can improve your e-commerce conversion rates by changing your shipping options
This section serves as a high-level review of the most important marketing metrics per channel. Depending on what software you use or marketing channels you pursue, you may see different metrics.
So, why exactly do digital marketing analytics matter? Let’s take a look at what makes digital analytics so important today, and how they compare to (and improve on) the insights offered by more basic web analytics.
Digital Marketing Analytics vs. Web Analytics
Quite simply, web analytics (like many of the metrics we defined above) just isn’t enough. The data that web analytics provides alone doesn’t cut it for marketers who need to understand how their work makes an impact throughout the entire marketing and sales flywheel.
Let’s face it: Today’s marketing extends well beyond the bounds of your website. It also includes how your marketing channels interact, the insight you gain from those outcomes, and the progress you track through your reporting.
This perspective provides the foundational data you need to structure your flywheel — delighting your existing customers enough to attract and engage new ones.
Web analytics measure things a webmaster or technical SEO specialist cares about, like page load speed, page views per visit, and time on site. Digital marketing analytics, on the other hand, measure business metrics like traffic, leads, and sales, and allows you to observe which online events determine whether leads will become customers.
Digital marketing analytics include data not only from your website, but also from sources like email, social media, and organic search.
How Digital Marketing Analytics Connects Every Business Activity
With digital marketing analytics, marketers can understand the effectiveness of their entire marketing strategy, not just the effectiveness of their website. Using digital marketing analytics allows marketers to identify how each of their marketing initiatives (e.g., social media vs. blogging vs. email marketing, etc.) stack up against one another, determine the true ROI of their activities, and understand how well they’re achieving their business goals.
The central question is: How can you structure an appropriate business goal to visualize your marketing team’s efforts in the most accurate way possible?
As a result of the information they can gather from full-stack digital marketing analytics, marketers can also diagnose deficiencies in specific channels in their marketing mix, and make adjustments to strategies and tactics to improve their overall marketing activity.
You can spend hours and hours slicing and dicing data in web analytics tools, comparing new vs. repeat visitors month over month. But when it comes down to it, you’ll come up short of a truly comprehensive view of your marketing performance.
There’s no doubt that marketers are aware there’s a deficiency in how they’re able to measure the effectiveness of what they do; here’s how full-stack digital marketing analytics makes up for that deficiency.
The ‘Full Picture’ of Digital Marketing Analytics
Digital analytics can be used to structure a business goal into outcomes based on three broad categories:
- The relationship between different marketing channels
- People-centric data on the buyer’s journey
- Revenue attributed to specific marketing efforts
Download our free ebook on inbound marketing analytics — the key metrics your executives really want to see.
Let’s highlight these main differentiators.
1. The Relationship Between Marketing Channels
Digital marketing analytics provides a good, solid look into the direct relationships between your marketing channels. It’s great to be able to see how each of your individual channels (e.g., social media, blogging, email marketing, SEO, etc.) are performing, but the true power of analytics comes into play when you can easily tie the effect of multiple channels’ performances together.
For instance, let’s say you sent an email to a segment of your database. Digital marketing analytics not only tells you how many people clicked through from your email to your website but also how many of those people actually converted into leads for your business when they got there.
Furthermore, you can compare the impact of that individual email send with other marketing initiatives. Did that email generate more leads than the blog post you published yesterday? Or was the content you shared via Twitter more effective?
2. People-Centric Data on the Buyer’s Journey
As we mentioned earlier, a key differentiator between web analytics and digital marketing analytics is that the latter uses the person — not the page view — as the focal point.
Digital marketing analytics enables you to track how your individual prospects and leads are interacting with your various marketing initiatives and channels over time. How did an individual lead first come to find your website? From Google? Facebook? Direct traffic? Is that lead an active part of your email subscriber base, clicking and converting on marketing offers presented via email? Do they read your blog, and have they downloaded any content offers that could indicate an interest in your products/services?
Full-stack digital marketing analytics can tell you all of this and more, providing you with extremely valuable lead intelligence that can help inform the direction of your future campaigns.
Looking at all of this information in aggregate can help you understand trends among your prospects and leads and which marketing activities are valuable at different stages in the buyer’s journey.
Perhaps you find that many customers’ last point of conversion was on a certain ebook or white paper. Having this data makes it possible to implement an effective lead management process, enabling you to score and prioritize your leads and identify which activities contribute to a marketing-qualified lead (MQL) for your business.
3. Revenue Attributed to Specific Marketing Efforts
One of the most useful functions of marketing analytics is its ability to attribute specific marketing activities to sales revenue. Sure, your blog may be effective in generating leads, but are those leads actually turning into customers and making your business money? Closed-loop marketing analytics can tell you.
Download our free ebook on closed-loop marketing and take your digital marketing analytics to the next level.
The only requirement here is that your digital marketing analytics system is hooked up to your customer relationship management (CRM) platform.
Having this closed-loop data can help you determine whether your individual marketing initiatives are actually contributing to your business’ bottom line. Through it, you can determine which channels are most critical for driving sales.
Perhaps you find that your blog is your most effective channel for generating customers, or conversely, you find that social media is really only powerful as an engagement mechanism, not a source of sales.
By measuring the relationship between marketing channels, tracking people-centric data, and analyzing what revenue is linked to which efforts, you’ll be equipped to set goals that support your bottom line. Now, let’s talk about how to use these marketing analytics effectively.
How to Use Digital Marketing Analytics Effectively
Most marketers know they need to be looking at more than just traffic and website performance to get the insights we’ve talked about so far. But why do so many of us still struggle to measure the impact and prove the ROI of our online marketing activities?
- We don’t have solid goals in place for our campaigns, or
- We don’t have the means to measure our success.
Quite often, you’ll find it’s a combination of the two.
One way to mitigate this is to have an actionable business goal combining your marketing team’s priorities. Typically, this can be achieved using the S.M.A.R.T. format. In this strategy, each goal you create must be:
A good business goal will inherently organize your team’s tasks towards producing specific outcomes or metrics to measure their progress. For marketing teams, this can be broadly summarized into three major categories:
- Web traffic and diversity of sources
- Conversions generated from traffic to produce leads and (eventually) customers
- Identifying net new revenue as a direct result of certain marketing efforts, laying a roadmap for further growth and cost-effective marketing investments
The fact is, in order to gain the insights needed to understand their marketing performance and make sound decisions, most marketers balance a number of different digital analytics platforms. (Remember how many categories of marketing metrics we reviewed above?)
For example, they gather data about their email marketing through the analytics provided by their email service provider, information about their social media performance through their social media monitoring tool, blog analytics from their blogging platform … and the list goes on.
But this fragmented approach to reporting makes it really difficult to connect the dots and make informed decisions about the future of your digital strategy.
The ideal solution is to implement an all-in-one marketing and reporting platform that offers end-to-end visibility on your marketing activities, allowing you to measure everything in one place.
Rather than just looking at canned reports for each traffic source you can use custom reporting capabilities to construct data charts that depict an entire marketing campaign’s progress, not just how certain content is doing through certain channels.
Here’s how you can configure your digital analytics to capture this holistic view, showing you where a potential buyer came and where they are going. We’ll use HubSpot’s Marketing Hub as an example. Here are some of the types of analytics you can see in a quality marketing tool:.
This is an easy report that you can configure by date range and/or original source to show what marketing channels you can capitalize on to turn more of that traffic into leads and customers. You can use HubSpot’s Traffic Analytics tool to get access to this.
This report quantifies your impact by the number of new contacts you’re able to create based on the first content offer or form submitted, and tie that back to the original source of that lead.
Another way to look at this is to segment your contacts by a particular persona to show which ones are giving the most return for which your team is creating content.
This calculates the conversion rates down the marketing and sales funnel, showing new leads that become marketing qualified leads, sales qualified leads, and, ultimately, new customers.
This custom report depends on your use of the marketing qualified lead lifecycle stages, visualizing those that converted into customers and their relative value in terms of revenue generated.
These closed-loop reports are just some of the capabilities available to depict your progress towards your business’s bottom line.
All of the insights, information, and data you can gather from your digital marketing analytics tool(s) is really only useful if you do something with it. The true value of analytics isn’t just to prove the value of marketing to your boss; it’s also to help you improve and optimize your marketing performance — on both an individual channel-by-channel basis as well as an overall, cross-channel machine.
With digital marketing analytics, you should also be able to implement closed-loop reporting, making it easier to prove how your marketing efforts are positively impacting your sales team, who are being fed much higher quality leads.
Grow Better with Digital Marketing Analytics
The most important takeaway from this article is: If you’re relying solely on top-level web analytics, you’re missing out on a lot of powerful data that can help inform your marketing strategy and better connect with your audience and customers. So, when evaluating digital analytics tools for your business, be sure you’re looking for evidence of digital marketing analytics, not just web analytics.
While web analytics provide a rosy picture of your top-line activity, digital marketing analytics can help you turn your business objectives into measurable outcomes that support your bottom line. Prioritize the data that reflects people — not page views — and you’ll be growing better in no time.
View original article on Hubspot Blog