Marketing metrics are the key performance indicators (KPIs) used by marketing teams to quantify a campaign’s results. Marketing metrics are used to measure a campaign’s performance and represent how effective it was in reaching specific goals. Marketers then use these statistics to communicate their progress and validate their efforts in the eyes of executives and decision-makers. Often campaigns utilize metrics that indicate traffic, impressions, and clicks driven by ads. While these KPIs are valuable to understand a campaign’s performance, there are different metrics you can utilize to paint a picture of how a campaign’s performance and cost impacts business performance and outcomes.
There are long lists of metrics available, but reporting on dozens of KPIs can obscure your campaign’s marketing performance and distract from the real progress made. In this blog, we’ll define a few metrics that you should be tracking to prove your marketing campaign’s impact on the bottom line.
Marketing qualified leads (MQL)
Marketing qualified lead (MQL) is a metric that aligns sales and marketing teams and allows them to frame conversations around lead generation efforts. The MQL metric is the number of qualified leads generated through marketing efforts. It can be tracked to inform how many leads your campaign is feeding into the sales funnel.
An MQL is a lead who has been deemed more likely to become a customer compared to other leads based on their interactions with your digital marketing campaign. The criteria to qualify a lead should be set in collaboration with your sales team. This qualification can be based on how a user has interacted with your ads, pages on your website, or if they’ve downloaded content from you.
Ideally, the criteria that is used to evaluate the number of conversions that are marketing qualified leads is defined at the beginning of the campaign and doesn’t change. This will allow you to optimize towards the same outcome by not having a moving target. The standardization of actions your leads will need to take can help keep your campaigns focused while developing strong leads that your sales team will want to follow up on.
Cost-per-acquisition (CPA)
Cost-per-acquisition (CPA), also referred to as cost-per-action, is a digital advertising metric that measures the dollar amount needed to convert one person. CPA is a vital metric that indicates digital advertising success as it represents the investment needed to acquire or qualify a customer through paid marketing.
CPA evaluates campaign performance based on the number of users completing specific actions that you define from the outset of a campaign. This makes this metric very flexible based on the goal of the campaign. An action tracked by CPA can be several things—a sale, a download, an email signup. This makes CPA a great metric to track for companies that don’t directly sell a product. Tracking CPA can help set marketing budgets for the future and understand the interactions customers have with your campaigns.
Effective cost-per-mile (eCPM)
eCPM stands for effective cost-per-mile (i.e., thousand impressions) and is used to calculate media costs regardless of what buying method or ad format is used in the campaign. Because different ad formats perform based on different metrics and are purchased with different pricing formats, eCPM can help level the playing field and give you a much clearer picture of how the different inventory types are performing.
By dividing the ad revenue earned by the number of ad impressions served and multiplying the result by 1,000, eCPM translates impressions based on clicks, actions, or video completions into one value. eCPM can immediately reveal which format or network is performing better in terms of revenue and engagement while also providing a solid prediction for future costs.
Return on ad spend investment (ROAS)
ROAS stands for return on ad spend investment and is a sub-metric of return on investment (ROI). ROAS represents the financial value generated by a marketing campaign against the total cost of the marketing efforts.
ROAS is a benchmark number that can be used to measure how much revenue your marketing campaign generates compared to the cost of running the campaign. This is a super important KPI to utilize when proving the value of your marketing efforts, but because it captures such a high-level view of marketing costs vs. returns, it’s not ideal for understanding the more granular results of a campaign.
Combined with customer lifetime value, insights from ROAS across all campaigns inform future budgets, strategy, and overall marketing direction. By keeping careful tabs on ROAS as well as other metrics, you can make informed decisions on where to invest ad dollars and how they can become more efficient. This is why ROAS is just one metric to consider, and why you should never over-emphasize any single metric on its own.
The metrics you track and focus on improving will depend on the nature of your campaigns and your intended business outcomes. Include only those KPIs that speak to your objectives while representing the value your campaigns create.
Want to read up on more marketing acronyms? You’re in luck. We have a full list of digital marketing acronyms you can reference whenever you need.
