The importance of marketing metrics in digital advertising
April 15, 2021
Marketing metrics measure the success of marketing campaigns and show how well campaigns are tracking toward key performance indicators (KPIs). They are one of the most important elements of any campaign, and without them, marketing teams wouldn’t have a clear picture of whether their marketing strategy is a success. Here, we’ll explore the basics of marketing metrics and KPIs, share helpful metrics for digital marketers, and discuss which Amazon Ads solutions can help measure campaigns most effectively.
What are marketing metrics?
Marketing metrics are a quantifiable way to track performance and are an important marketing measurement tool for gauging a campaign’s effectiveness. The most appropriate marketing metrics vary greatly from one campaign to the next, but in general they measure the effects of your campaign on audience actions. The right marketing metrics to measure will be the ones that ultimately have the most impact on your business goals, which may be sales generated for one campaign but incremental reach for another. By helping you understand how effective your campaigns are, marketing metrics help marketers optimize their current campaigns and plan for future campaigns.
What are some examples of marketing metrics?
There are hundreds of metrics marketers can use to determine a campaign’s success—it’s a matter of choosing the right one for each particular strategy.
Different metrics give you different insights. For example, email opens and clicks can show engagement level, while the unsubscribe rate can indicate if audiences find your content interesting and relevant. Ad impressions and video views help measure your campaign reach. Cost-per-action can help you track the efficiency of your campaign.
Here are examples of metrics for various marketing channels that can help marketers make informed decisions about how to best optimize their budgets.
- Email marketing: as email opens, email forwards, and unsubscribes
- Digital marketing: click-through rate, cost-per-action (CPA), and impressions
- Social media: follower count, impressions or reach, and engagement rate
- Website: total traffic, bounce rate, new customers, returning customers, time spent on site and traffic sources, as well as conversions
- Content marketing: blog traffic, amount of content shared, content downloads, and qualified leads through lead generation form fills
- Video and streaming TV ads: impressions and total viewing time
- Sales: sales team response time, sales call volume, and sales call reviews
- Revenue: how much revenue each channel is generating
- SEO: keyword average rankings, keyword search volume, and organic traffic
- Quality: Quality Score, Net Promoter Score, reviews, and monthly recurring revenue
Why are marketing metrics important?
Marketing metrics are critically important because they help brands determine whether campaigns are successful, and provide insights to adjust future campaigns accordingly. They help marketers understand how their campaigns are driving towards their business goals, and inform decisions for optimizing their campaigns and marketing channels.
These insights help a marketing team understand if it has achieved its goals in terms of reaching new customers, awareness, engagement, sales, lead generation, and more. These digital analytics also serve as an early warning system if marketing campaigns aren’t performing as expected, and can help with effective decision making to adjust campaigns in real time.
Finally, marketing metrics are the primary way marketers can show the impact that marketing and advertising is making for their company or organization. This can inform annual budgets and headcount, making these insights essential beyond ongoing measurement and campaign planning.
Which marketing metrics and KPIs are most important for digital advertising?
Key performance indicators show how well campaigns are tracking against each campaign goal. Though marketing teams monitor a wide variety of metrics, each campaign should only have a handful of KPIs. They should be specific, measurable, and achievable within the campaign timeframe.
KPIs change over time, and there is not a set of KPIs that work for every campaign. What’s more, measurement looks different at each stage of the marketing funnel. That said, here are three KPIs and metrics that can be helpful for digital marketers to measure.
1. Lead generation
Tracking new leads generated and conversion rate—or the percentage of leads that become customers—are two of the best metrics for measuring the increase in lead generation from a digital advertising campaign. Users of Amazon Ads can find these conversion metrics in Amazon campaign reporting, and see the breakdown of these metrics by dimensions such as campaign, creative, and product ASIN. Tools like Amazon Attribution (beta), which is a marketing attribution tool focused on measuring non-Amazon campaigns such as email, search, and social, can also help advertisers understand on-Amazon conversion metrics, including detail page views, Add to Carts, and purchases.
2. Return on investment
To measure return on investment (ROI), marketers should compare customer lifetime value (CLV) versus customer acquisition cost (CAC). Customer lifetime value is how much revenue an average customer generates over a specified period of time, whereas customer acquisition is how much a brand needs to spend to gain a new customer. If customer acquisition cost is very high and a customer lifetime value is low, that’s a strong indicator there’s a need for a change in which audiences you reach with your marketing strategy.
3. Impression share
Impression share is the measure of how well a brand is performing on a certain channel in comparison to its total potential audience—for example, how many times your display ad was viewed as a percentage of the total number of potential eligible impressions. An increase in impression share can mean that a brand appears more frequently and has the potential to drive an increase in sales.
Measuring campaign effectiveness on Amazon
Amazon Ads offers multiple options for supporting a metrics-based strategy. For example, Amazon DSP offers, at no additional cost to advertisers, audience insights and performance reporting before and after campaigns. This helps marketers understand which marketing metrics are driving results. Amazon Attribution (beta) is an advertising and analytics measurement solution that can help you track the impact of your non-Amazon marketing channels—including search, social, video, display, and email—in relation to your brand performance on Amazon.
Our reporting and measurement solutions can help all marketers—from start-ups to agencies and established brands—accurately measure the impact of advertising and make it easy to plan, optimize, and measure marketing campaigns.
Connect with an Amazon Ads account executive to learn more about using these solutions to elevate your measurement strategy.