Marketing Qualified Leads / Sales Accepted Lead
These two metrics are slightly different ways of quantifying the same achievement. Both focus on the ability of the marketing team to find potential customers and prepare them to buy. The key difference between the two is that Marketing Qualified Leads may seem like prime prospects when they first appear, but may become less promising when the sales team picks up the baton. This can create a significant discrepancy between MQLs and actual sales, which can reflect badly on the sales team. For this reason, it may be preferable to use the more stringent metric of Sales Accepted Leads (SAL) to demonstrate to senior executives that your marketing efforts are attracting high quality prospects that lead directly to sales.
For businesses that don’t use sales people, such as ecommerce brands, new customer acquisition might be a more meaningful way to track performance.
Return On Ad Spend (ROAS)
How effective is your advertising spend? This metric helps to demonstrate that your wise choices in terms of creative, media spend and scheduling is effective, while also connecting the budget to the increased revenue it generates.
While ROAS is typically calculated by comparing your ad spend with the value of conversions it generates, you might also consider looking at the lifetime value of the new customers you acquire.
Customer Lifetime Value (CLV)
Your CLV calculation takes into account average customer spend, average order frequency, and how long you typically retain customers. This gives you a single figure that shows how much a single customer will spend with your business during the period they remain a customer.
This metric is interesting on two levels. Firstly, it helps to quantify the average value of a new customer. This helps to frame conversations about your marketing budgets, activities, and performance.
Secondly, CLV helps to track your effectiveness at retaining customers. Over time, your CLV should increase as you get better at retaining customers for longer. This customer retention or customer marketing activity is one of the main starting points during business recovery. Given the incredible value of retaining customers, senior leaders must respect and value the marketing activity.
Your marketing team is working hard to raise brand awareness, identify leads and convert customers. But what is the impact of all this effort? What is the impact on revenue?
Creating a formula for calculating revenue impact is a powerful way to demonstrate the importance of marketing. How much business revenue can be tied back to marketing activity?
Perceived Value / Brand Recognition
These kinds of metrics, which help to quantify how well your marketing activity is raising awareness of your brand, and shaping perceptions of your business post pandemic, can be problematic in the sense that CEOs and senior leaders may prefer the KPIs that have a clear link to revenue or profit.
However, there is clear value in a brand that is trusted, liked, and valued by customers and prospects. These factors can increase the value of your business while also making future customers easier to win. Not to mention the fact that if your business is making all the noise, your competitors may struggle to be heard.
With this in mind, you may want to include a metric like share of voice, customer sentiment, or net promoter score, to help track the perception of your brand over time.
Other useful marketing metrics
There are many different ways to measure your marketing performance and success, including:
- Conversion rate
- Click through rate
- Cost per click
- Customer acquisition cost
- Lead pipeline (forecast conversions)
Watch: Marissa increased website performance by 80%