Digital Marketing Metrics That Matter

9,776 views

Published on

Organizations strive to minimize the cost to acquire a customer. This pyramid shows the key metrics that impact CAC, their formulas and the chain of events that builds value and efficacy in digital marketing.

Published in: Business, Technology

Digital Marketing Metrics That Matter

  1. Digital Marketing Metrics that Matter
  2. {value } {efficacy } {spend } REVENUE METRICS When marketing ROI increases, marketing’s portion of CAC (MCAC) is reduced—improving marketing efficacy and creating more revenue from less investment. POST-CLICK METRICS When CVR increases, CPL decreases and ROI increases. PRE-CLICK METRICS When CPC decreases and CTR increases, you get more prospects in your funnel. Clicks / Impressions * 100 Total Cost / Number of Leads CPC Cost Per Click CPL Cost Per Lead Total Period Cost / Customers Acquired in Period CAC Cost to Acquire a Customer CTR Click Through Rate ( Gain - Cost ) / Cost * 100 ROI Return on Investment Converted Visitors / Total Visitors * 100 CVR Conversion Rate Digital Marketing Metrics Pyramid
  3. © i-on interactive, inc. All rights reserved • www.ioninteractive.com The Pyramid Shows the Relationship Between traditionally ‘low-level’ metrics and business-changing marketing metrics.
  4. {efficacy } REVENUE METRICS When marketing ROI increases, marketing’s portion of CAC (MCAC) is reduced—improving marketing efficacy and creating more revenue from less investment. Total Period Cost / Customers Acquired in Period CAC Cost to Acquire a Customer Cost ) / Cost * 100 ROI
  5. © i-on interactive, inc. All rights reserved • www.ioninteractive.com Revenue Metrics CAC becomes a strategic indicator when used in ratios to judge the scalability of a business. Lower CAC is better. Way better. CAC Cost to Acquire a Customer
  6. © i-on interactive, inc. All rights reserved • www.ioninteractive.com Holy Grail 101: Use less cents to make more bucks.
  7. {value } {efficacy } REVENUE METRICS When marketing ROI increases, marketing’s portion of CAC (MCAC) is reduced—improving marketing efficacy and creating more revenue from less investment. Cost to Acquire a Customer ( Gain - Cost ) / Cost * 100 ROI Return on Investment
  8. © i-on interactive, inc. All rights reserved • www.ioninteractive.com ROI is just beneath CAC If you can increase marketing return on investment by getting more business out of equal or lesser spend, you will reduce CAC. Higher ROI is better. ROI Return on Investment
  9. © i-on interactive, inc. All rights reserved • www.ioninteractive.com Post-Click Metrics Drive Value.
  10. © i-on interactive, inc. All rights reserved • www.ioninteractive.com Post-Click Metrics Drive the R in ROI. ROI Return on Investment
  11. {value } POST-CLICK METRICS When CVR increases, CPL decreases and ROI increases. Total Cost / Number of LeadsCPL Cost Per Lead ( Gain - Cost ) / Cost * 100 ROI Return on Investment Converted Visitors / Total Visitors * 100 CVR Conversion Rate
  12. © i-on interactive, inc. All rights reserved • www.ioninteractive.com CVR feeds ROI CVR Conversion Rate If you can increase your conversion rate—the percentage of people who take marketing’s desired action—you will increase your marketing return on investment. Higher CVR is directly related to higher ROI.
  13. {value } POST-CLICK METRICS When CVR increases, CPL decreases and ROI increases. Total Cost / Number of LeadsCPL Cost Per Lead ( Gain - Cost ) / Cost * 100 ROI Return on Investment Converted Visitors / Total Visitors * 100 CVR Conversion Rate
  14. © i-on interactive, inc. All rights reserved • www.ioninteractive.com CPL contributes value if… you can reduce CPL by increasing CVR—improving conversion quality while reducing spend. Lower CPL is better—unless quality suffers. CPL Cost Per Lead
  15. © i-on interactive, inc. All rights reserved • www.ioninteractive.com CPL naturally goes down when—all things being equal—conversion rate goes up. Lower CPL is the result of higher CVR. CPL Cost Per Lead
  16. © i-on interactive, inc. All rights reserved • www.ioninteractive.com {spend } PRE-CLICK METRICS When CPC decreases and CTR increases, you get more prospects in your funnel. Clicks / Impressions * 100CPC Cost Per Click CTR Click Through Rate Spend-focused marketing delivers spend-focused results.
  17. © i-on interactive, inc. All rights reserved • www.ioninteractive.com CPC & CTR improve when—all things being equal— the post-click experience is amazing. The post-click experience drives value— in ROI as well as spend. CTR Click Through Rate CPC Cost Per Click
  18. {value } POST-CLICK METRICS When CVR increases, CPL decreases and ROI increases. Total Cost / Number of LeadsCPL Cost Per Lead ( Gain - Cost ) / Cost * 100 ROI Return on Investment Converted Visitors / Total Visitors * 100 CVR Conversion Rate
  19. © i-on interactive, inc. All rights reserved • www.ioninteractive.com Post-Click Focused Marketing Drives ROI-Focused Results.
  20. © i-on interactive, inc. All rights reserved • www.ioninteractive.com What CMO doesn’t want more revenue from less investment?
  21. © i-on interactive, inc. All rights reserved • www.ioninteractive.com More returnfrom lessinvestment.
  22. {value } {efficacy } {spend } REVENUE METRICS When marketing ROI increases, marketing’s portion of CAC (MCAC) is reduced—improving marketing efficacy and creating more revenue from less investment. POST-CLICK METRICS When CVR increases, CPL decreases and ROI increases. PRE-CLICK METRICS When CPC decreases and CTR increases, you get more prospects in your funnel. meet.ioninteractive.com/CAC Clicks / Impressions * 100 Total Cost / Number of Leads CPC Cost Per Click CPL Cost Per Lead Total Period Cost / Customers Acquired in PeriodCAC Cost to Acquire a Customer CTR Click Through Rate ( Gain - Cost ) / Cost * 100 ROI Return on Investment Converted Visitors / Total Visitors * 100 CVR Conversion Rate Digital Marketing Metrics PyramidOrganizations strive to minimize the cost to acquire a customer.This pyramid shows the key metrics that impact CAC, their formulas and the chain of events that builds value and efficacy in digital marketing.

×