Justin Shimoon

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Four New Business Metrics To Focus On In 2020

Four New Business Metrics To Focus On In 2020

Out of all the measurable metrics available to a business, marketing metrics are often the most confusing as many managers and sales teams have never run a digital campaign before and so are not aware of the many benefits digital marketing metrics can bring to their departments and businesses as a whole.


Not applying these metrics will not only omit crucial data relevant to a business’s marketing campaigns but also reduce its long-term success.


Being able to track marketing metrics over time can help a business in various ways.


Marketing metrics allow a business to measure department performance on an individual basis, identify areas of weaknesses within each department, help a company work towards their goals and objectives, measure what matters most to the business and focus resources towards those objectives.


The problem with using marketing metrics today is twofold: lack of knowledge on which marketing metrics to use and using outdated metrics that are not as relevant as they once were in the past.


Vanity metrics such as email opens and page views tell a business nothing of why those emails were opened, why those pages were viewed, and how to measure and follow them along the sales funnel.


The good news is that modern technology has now made it possible for marketing teams and the businesses they work for to track opens, clicks, and views to see how customers move from engagement to purchase.


The new marketing metrics businesses should focus on in 2020 are those that measure customer behavior because their behaviors are what drives engagement and sales for a business.


The following four new metrics are excellent measurements of customer intent and customer action.


Customer Lifetime Value (CLV)


According to Forbes and Entrepreneur, customer lifetime value might be the single most important metric for a business to measure as it gives an estimation of how much repeat business a company will get from a customer.


Historically, marketing teams used to measure lifetime value over the long-term but in 2020 and beyond they should focus more on how it relates to short-term business goals and strategies such as quarterly sales, paid campaigns, and content creation.


In doing so, they will be able to better measure various marketing channels and different sales funnels and see more clearly how they affect CLV.


When a business can gauge the customer experience via their campaigns and sales funnels they are better able to understand in real-time how they are impacting the lifetime value of a customer. They are then in a better position to create new pathways, strategies, funnels, and campaigns to increase that value over time.


The traditional method of calculating CLV is as follows:


Customer revenue minus all the expenses of acquiring and serving that customer.


However, the new and improved CLV metric adds the following criteria to the equation:


  • Measuring all touchpoints where customer value is created.

  • Maintaining and integrating records to keep the integrity of the customer journey alive.

  • Measuring customer revenue at each touchpoint.

  • Adding the entire revenue stream over the lifetime of each customer and coming up with an average.



What is left is a more holistic approach that focuses more on customer experience and how campaigns, content, and other acquisition methods can be optimized to keep customers flowing along the sales funnel, thus creating higher lifetime values.


Marketing Maturity Score


Businesses often get into a state of lax when it comes to their marketing. After all, if a campaign or marketing strategy is working then why fix it?


That justification may hold when measuring a direct response - an instant lead or a purchase - but not focusing on data that helps measure a customer’s experience will ultimately lead to a smaller lifetime value for that customer.


Focusing on short-term activities and not long-term results shows a lack of marketing maturity that must be recognized and adjusted so that campaigns can be optimized.


Using metrics to measure customer activities instead of actual results keeps the focus on campaign goals and objectives instead of on customer experience.


Instead, it is better to optimize a campaign around data points that show where customers are dropping off so that unsuccessful campaigns have a better chance of becoming successful once changes are made and successful campaigns becoming even more successful through data-driven optimization.


Measuring the maturity, and for that matter, the maturity of a marketing team, comes down to answering four basic questions:


Is there a willingness and eagerness to make changes to a campaign based on relevant metrics and data?


Is the focus more on the results of a campaign or the activities it produces?


Is data more important than activities or activities more important than data when it comes to campaign optimization?


Are customer objectives or campaign objectives more important?


Answering these questions will give a business a better idea of the maturity level of their marketing teams and the campaigns they are running.


To help in this regard, Adobe has come up with a Digital Marketing Maturity Assessment that helps company’s gauge and score the maturity level of their marketing department and their efforts.


Cross-Channel Visibility Measurement


Metrics that provide analytical insight into what channels and content on those channels created engagement are known as cross-channel visibility measurements.


Businesses should know which marketing channels are producing the best results and what content is driving the most engagement so that they can spend more of their time, money, and efforts providing similar content on those channels.


The problem with collecting and analyzing such data is that customers are constantly shifting from devices and channels so it is hard to measure where they are spending most of their time online and what kind of content they are looking for.


Google says that 90 percent of customers never stay on a single device when purchasing an item online.


Businesses can rectify this issue to a large extent by measuring the percentage of their customers who log in between two identifiable channels that businesses use for their marketing and content distribution.


For instance, Facebook and Shopify have a good cross-channel relationship that allows marketers to gauge the activities of their customers between the two.


Businesses and marketers can also utilize the following two measurements to increase analytical insights into cross-channel visibility:


Match Rate (Identification Rate): how many people a business can identify on various channels for cross-channel promotions.


View-Through Rate: how many people who viewed an ad or piece of content went on to participate in a specified and desired action.


Using the above cross-channel visibility measurements allows marketers to focus on those channels their customers spend most of their time on, uncover the content their customers like to consume and see how their customers move from one channel to another and one piece of content to another before they end up making a purchase.


Customer Health


Measuring customer health is nothing more than measuring the relationship between customers and the businesses that serve them.


Technology has made it possible to measure digital marketing metrics like engagement levels, buying propensity, and customer churn levels to monitor customer health.


If businesses just focus on how customers move through various channels and their sales funnels then they are missing out on the other important half - where and why they drop off during the sales process.


Knowing which campaigns and content promote healthy engagement and which ones do not, gives the marketing team a better idea of what to provide the customer with so they continue to stay a customer for a long time.


Aside from marketing metrics that gauge customer health like product purchases, engagement, and campaign ROI, businesses can also use the following five metrics to see if they are doing a good job nurturing their relationships with their customers:


Customer Duration: how long customers remain with a business.


Point of Contact: who in the company the customer interacts with the most - usually, the higher the position and the more seasoned the employee the better.


Number of Orders/Users: measuring the number of customer purchases against past averages.


Support Requests: gauging customer sentiment by measuring the tone of customer support requests on average.


Indirect Feedback: using third-party data such as customer reviews and Net Promoter Score (NPS) to measure customer satisfaction levels.


Conclusion


What is most important to businesses and marketers is what happens to customers when they come across an ad or a piece of content.


Modern marketing technology has given marketing teams the ability to measure behaviors such as customer intent and content affinity so they can provide what the customer wants and deliver it where they want to receive it.


If businesses want to stay relevant in the eyes of their current customer base and gain the trust of new customers, they will need to use metrics that measure and provide insights into customer lifetime value, customer engagement, campaign effectiveness, and customer health.



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Comments

Justin Thomas Before solving any problem we have to be aware that these are the problems we need to solve. Therefore your post resonates with me for your identified the problems. This is evidenced in your writing "The problem with using marketing metrics today is twofold: lack of knowledge on which marketing metrics to use and using outdated metrics that are not as relevant as they once were in the past". I enjoyed the rest of the Key Performance Indicators that you suggest in the post. They reflect marketing as it is and not as it was. I wrote recently a post on marketing and suggested few key indicators that need to be included in marketing plans (some of which aren't mentioned in this post). .Do we need marketing plans? https://www.bebee.com/producer/@ali-anani/do-we-need-marketing-plans Sharing the post

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