10 Inbound Marketing KPIs You Should Be Tracking

10 Inbound Marketing KPIs You Should Be Tracking

10 Inbound Marketing KPIs You Should Be Tracking

Even if you don’t know what the term inbound marketing KPIs means, you probably already know what they are. Here in the inbound marketing world, KPI is short for Key Performance Indicators. You might just know them as metrics. Tomato, tomahto.

Just kidding — it doesn’t really matter what you call them, so long as you use them. 

Inbound marketing KPIs, or metrics, provide your best estimate of success. They tell you how well your marketing efforts are working and what results they’re producing. They can also tell you where your marketing strategy could use work. 

While there are dozens of KPIs to measure depending on what your marketing, sales, and growth goals are, here are a few of the KPIs that every team with an inbound marketing strategy should be keeping track of:

#1 Qualified Leads

You want leads. Who doesn’t?

But, not all leads are created equal. There are leads you’re actually interested in — leads who are a great fit for your product or service. And there are leads you’re not interested in — leads who aren’t a good price fit, don’t really need your product, or who aren’t ready to buy. 

The qualified leads KPI tells you exactly how many qualified leads you’re getting. Sounds basic, but qualified leads vs. plain ol’ leads is key.  

Even if your campaign is seeing a relatively low number of leads, but all of those leads are highly qualified and likely to close, then you know you’re doing something right.

That’s a much better sign of an effective campaign than one that delivers a ton of leads who never convert into prospects or sales. 

#2 Organic Traffic

Inbound marketing is built (loosely) on an “if you build it, they will come” mindset. At its core, the inbound marketing methodology believes that if you are putting out the right, helpful content that speaks to your target audience and that is optimized for the way your consumers search, then you will draw in the right leads. 

Organic traffic is one of the best inbound marketing KPIs to measure your website’s success in drawing in the right people

The organic traffic KPI is an oldie, but a goodie. It’s been around for a while because it’s relatively easy to track, it’s straightforward, and it can tell you a lot. The higher your organic traffic rate, the more your content is resonating with the right people. When you have a high organic traffic number, you know that your content marketing strategy is working to 1) place you ahead of the competition in search rankings, and 2) speak to your ideal audience. 

And when you’re drawing in big numbers of organic traffic, it means you’re getting a whole bunch of leads without paying for them. Major win.

#3 Social Media Traffic

Social media traffic is also a great inbound marketing KPI to watch because it can help you figure out which platforms are best to focus your efforts on. 

These days, there are tons of social media platforms. They’re all great for engaging new potential clients and keeping your existing clients in your inbound marketing flywheel. But, not every social media channel works for every company or industry. 

By monitoring the traffic coming to your website from social media, you can determine:

  • Which channels are driving the most traffic and the most leads to your site
  • How many conversions you’re seeing through social media channels
  • How much website traffic is coming to your website from social media

This inbound marketing KPI helps you determine which channels are delivering the most qualified visitors who stick around and tend to read your content or convert into leads. And when you know that Facebook is the one delivering you 15 new leads every month, while Pinterest has delivered none, you can invest more money in your Facebook strategy, and forget about Pinterest for now. That’s marketing optimization at its finest. 

#4 Time-on-Site

If inbound marketing is your focus, the time-on-site KPI is an important one to keep track of. Again, the point of inbound marketing is to teach and engage new potential clients and qualified leads with content that solves their pain points and answers their questions.

The time-on-site KPI tells you how much engagement your content is getting. 

If you have a long average time-on-site, then your visitors are browsing around. They’re reading your content and navigating deeper into your website.

 A short time-on-site is a good indication that it’s time to change something up. Consider adding a different image or a different content offer on your front page. Change up your calls-to-action and make sure you’re really working to answer the questions your ideal buyer is asking the most. 

#5 Time-on-Page

Time-on-page is just as important as time-on-site. Though it might sound obvious, the time-on-page metric measures how long a site visitor spends on a particular page of your website. 

This is an especially useful metric if you’ve been working to incorporate pillar pages, or are working on developing longer-form content. 

It’s not easy to get readers in the digital age to stick around for long, so when you start to see pages with lengthy time-on-page metrics, you’ll know your content marketing strategy is working. 

#6 Bounce Rate

On the opposite side of the time-on-page coin, you have bounce rate. As an inbound marketing KPI, bounce rate means what percentage of people make it to a page on your site and bounce right off, or navigate away immediately. 

The bounce rate metric is useful for everything from a web design standpoint to understanding if your landing pages are working properly. 

If you have a high bounce rate, your visitors probably aren’t resonating with the particular page they’re being sent to. 

Are they bouncing off of a landing page? Consider taking out some of the required fields on your form. Maybe tighten up the content a little, and take away the navigation bar. 

High bounce rate on a piece of content? Your hook might not be strong enough, or your content might not seem like it’s offering enough information. Add in an exciting first paragraph, make sure you have plenty of eye-grabbing, but informational headers, and check to make sure that your content is actually saying something. 

High bounce rate on your home page? Maybe you’re not being clear enough about what you do. Consider changing up your headers, adding in new visual elements like images or video, and see if that KPI starts to improve. 

#7 Conversion Rate

Conversion rate is one of those KPIs you hear about all. the. time. 

That’s because it can tell you quite a lot about your inbound marketing strategy. 

Like bounce rate, conversion rate is used in a variety of contexts. It can be used when talking about a landing page, about an ad, or even about how many site visitors convert into leads. 

That could be downloading a content offer, clicking over to your site from an ad, or even closing on a sale. 

No matter what version of the conversion rate metric we’re talking about, it’s always important to track, because it tells you how effective your campaign is. 

If your weekly newsletter has a high number of content offer conversions, for example, that shows that you’re doing a great job of nurturing those email subscribers closer to a sale. 

If your landing page has a low conversion rate, that might be a sign that what you’re offering isn’t attractive enough, or that you’re asking too much in return for what you’re offering. 

Conversion rates are always important to follow because they tell you more than just how many people are seeing an ad or a page or a content offer. They tell you how many people are actually interacting with that item. And engaged visitors are leads

#8 Customer Acquisition Cost

Your customer acquisition cost KPI is a measurement of how much it actually costs your company to acquire a new customer. For most companies, it’s more expensive to pick up a new client than it is to retain an old one. But your customer acquisition cost (CAC) can tell you more than that. 

It can also tell you if your marketing strategy is effective. If you’re spending thousands of dollars on Facebook and Google Ads, but you’re only bringing in one or two new customers, then you’ve got a pretty high CAC, and it’s probably time to change something up. 

For example, if your outbound marketing strategy isn’t converting at the right CAC, you might want to invest more heavily in inbound marketing. 

Your CAC can also be used to help calculate the overall ROI of your marketing campaign. We’ll talk more about that later, but read this blog about Calculating Marketing ROI for more info. 

#9 Lifetime Value of A Customer

Just as your CAC tells you how much it costs to acquire a customer, the Lifetime Value of a Customer tells you how much you earn from a customer over the term of their engagement with you. To figure out the overall value of a customer, check out the following equation:

(Amount of average sale per customer) x (Average number of times a customer buys per year) x (Average retention time for a typical customer (whether that’s a year, a month, or more))

Typically, the lifetime value of the customer shows you how important it is to keep nurturing leads, even after they’ve closed on a sale. On average, most companies find that it’s more expensive to acquire a new client than it is to retain consistent business with an existing client.

#10 Return on Investment

Return on Investment (ROI) is the KPI that everyone wants to know. We probably don’t have to tell you that you need to be tracking it, because who isn’t?

But, we do have to include it on this list because it truly is one of the most telling inbound marketing KPIs that exists. 

This is an important metric if you’re trying to convince your boss that inbound marketing is legit, but it’s equally important after you start using inbound marketing. 

The ROI metric tells you when your efforts are paying off, and when you might be spending too much on an effort that’s not performing. 

Let’s say, for example, you still take out a Yellow Pages ad. That costs you a few hundred dollars each time you place the ad. For the sake of simplicity, let’s say you never get any referrals from that Yellow Pages ad. In this situation, there is virtually no ROI. You’re spending money on a marketing effort that isn’t returning any revenue. 

So, you see that your Yellow Pages ad isn’t working out. You decide to take the money you would’ve spent on that ad, and use it to hire a content writer to start your blog. After a few months, you have a ton of leads calling in, and they’re all referencing information they saw on your blog. 

When you close on some of those sales, for more than you spent on the content writer, you have a positive ROI. 

In the end, if you’ve got a great ROI percentage, then you know your marketing strategy is working. If you’re spending more than you’re making, or if you’re not seeing a great return on your marketing strategy, it’s probably time for a change. 

Check out this blog from Impact for more information about calculating your marketing ROI. 

Deciding Which Inbound Marketing KPIs to Track

As you probably know, there are way more than just 10 inbound marketing KPIs to track. But, if you’re just getting started with the inbound methodology, these 10 are some of the most important, and the easiest to make sense of. 

If you’d like to learn about more inbound marketing KPIs you can track to better optimize your marketing strategy, or if you’re interested in an inbound marketing agency, let us know. We can help you determine which KPIs make the most sense for your goals, and we’d be happy to explain a little bit more about the inbound marketing methodology, too.

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Marketing ROI 101: Setting Goals and Calculating Your Marketing Budget

Marketing ROI 101: Setting Goals and Calculating Your Marketing Budget

Marketing ROI 101: Setting Goals and Calculating Your Marketing Budget

If you’re like any other marketing department we’ve ever talked to, your boss wants to know exactly how much your efforts are contributing to the company’s overall sales. You probably also know that proving that number isn’t as easy or as straightforward as you’d like.

Too often, companies put pressure on the marketing department to track every single outbound marketing dollar spent to a lead generated or a sale closed. And because marketing does things like create brand awareness and foster positive relationships, that can be difficult to quantify. That’s why we use an ROI Model to calculate the budget and ROI of the marketing campaigns we create.

When you take a good hard look at your marketing investment as a whole, and you have clear goals for your marketing department, it’s actually not impossible to calculate your marketing ROI. And we’re going to show you how to do it, using an ROI Model. First, definitions!

What is Marketing ROI?

All spelled out, Marketing ROI stands for Marketing Return on Investment. That is, how much money you make off of your marketing campaigns, minus how much those marketing campaigns cost you. Check out an in-depth definition of ROI in this Digital Marketing Glossary.

What is an ROI Model?

If you want the textbook answer, “a Return on Investment Model is a comprehensive, customizable model that allows you to input your project assumptions and quickly understand potential returns.”

In English, an ROI Model is a method of calculating not only how much you need to spend to generate a certain amount of income, but also how much traffic, how many qualified leads, and how many sales you need to close on each month to reach that goal.

Your marketing ROI Model is a simple, 4-bullet point statement that outlines your company’s business goals, while also outlining specific goals for each your sales and marketing teams.

Your marketing ROI Model shows everyone exactly how your sales and marketing teams are going to complete your company’s overall growth goal. It clarifies expectation for both teams and helps you calculate exactly how much you need to spend on your marketing budget to achieve your projected goals.

Your superiors want to get the word out about your company, but they also want specific, measurable reports about how your marketing efforts are contributing to the bottom line. We get that.

This ROI Model will help you figure it out. It’s what we use to help our clients measure ROI and determine a marketing budget that can deliver legitimate growth. This is how it works, in 4 simple steps.

Step 1: Know Your Customer Lifetime Value and the Value of New Sales

How much does the average new client deliver your company in sales? 

This number is important because you can use it to figure out how much you’re spending to market to that person, relative to how much you’re making on them. That’s your marketing ROI right there. So, before you go any further, figure out on average how much revenue you make from a new client. Then figure out how much you make in the lifetime of your relationship with a customer.

When you know how much revenue you generate from each client, you can figure out a reasonable amount to spend on your marketing budget.

Step 2: Set Your Goals

Goal setting is the first step to actually developing a solid marketing budget. And when we talk about goal setting, we’re talking about the whole company.

What are your company’s goals for the next year? Do you want to grow by 10%? Do you want to close a certain number of leads each month?

It’s important to set these goals and make sure everyone in your company understands them. This way, everyone can work toward this singular goal, together. With an overarching company goal set, the rest of your sales and marketing team goals will fall into place.

Step 3: Use A Digital Marketing ROI Model

Alright. Now you know how much a new client makes you, and how much you need to make in the next year or month. Let’s get to the Digital Marketing ROI Model.

Ours functions like a funnel, starting with the traffic your site sees per month and moving down from there to determine the number of closed sales you need to reach your monthly revenue goal. Let’s use an example to help clarify this.

Acme Corp is a manufacturer of anvils, rockets, explosives, and magnets. Last year, Acme Corp made 22 million dollars, which was flat from the year before. Let’s take a look at the ROI model we’d use to calculate the best marketing budget for their goals.

First, we need to know what their goals are, and how much revenue a sale brings to their company:

Goals: Acme Corp wants to grow their company by 5-10% this year.

Value of a New Sale: $25,000

Average Customer Value: $200,000

With this information, we can figure out how much income Acme Corp needs to generate each month to reach that 5-10% growth goal. From there, we can work backward to determine exactly how much site traffic we need to drive to achieve that goal.

Given Acme Corp’s goals, we’ve determined that they need to generate $375,000 in new revenue a month.

With an average new client sale price of $25,000, that means they need to close on 15 new sales each month.

Now, Acme Corp has a strong sales team, who works to close on an average of 5% of their marketing qualified leads. If Acme Corp closes on 5% of their qualified leads a month, they need 300 leads to reach that 15 sales per month goal.

Let’s work back one more step to figure out how much traffic Acme Corp needs to bring in 300 leads per month.

They have an average traffic conversion rate of 3%.

That means they need to bring in 10,000 site visitors per month. Believe it or not, we’ve just figured out Acme Corp’s entire Marketing ROI Model. Here’s what it looks like all condensed into 4 simple bullets.

Acme Corp ROI Model

It might be only 4 bullet points, but it’s still a lot of info. We’ve just built out Acme Corp’s ROI Model to grow their business by 5-10% in the next year. This ROI model accounts not only for their marketing budget but also for their monthly marketing and sales goals.

The Acme Corp marketing team needs to bring in 10,000 visitors per month, and they need to convert 3% of those visitors into qualified leads.

The sales team is responsible for converting 5% of those leads into sales, to ultimately deliver on Acme Corp’s growth goal of 15 new sales or $375,000 in new revenue per month.

Finally, and perhaps most importantly for the purpose of this blog, Acme Corp is spending just 5% of their total gross income from new sales on marketing. That adds up to $18,750 per month or $225,000 a year.

To some, that might sound like a lot. It’s important to know that this is a fairly conservative marketing budget estimate.

In the grand scheme of things, 5% isn’t actually all that much to spend on your marketing budget, but that’s where your marketing strategy comes in, bringing us to the very last step:

Step 4: Invest Your Marketing Budget Wisely

You’ve completed your Marketing ROI Model. You know how much traffic you need to pull in, and how many leads you need to convert to meet your growth goal, and you know exactly how much you want to spend to do it.

It’s important to remember that while this ROI model can give you a good picture of how much you should be spending to get the right results, you have to be investing in the right marketing tactics to see actual results.

Where you allocate your marketing budget is what will make or break your ROI Model. Your marketing and sales teams have their goals, but if they don’t have the tools and training necessary to meet those goals, you won’t see your ROI Model realized, and you’ll probably end up spending more than the budget you allocated to reach your growth goal.

If you don’t have landing pages, are working with a website from 1995, or aren’t strategically targeting your paid advertising campaigns, you’re probably not going to see the results you want from what you’re spending on marketing.

That’s where the inbound marketing methodology and things like keyword research, buyer personas, and content calendars come in.

We hope this blog helps your sales and marketing teams align to reach your company’s growth goals, and gives you a good starting spot for determining a realistic marketing budget.

Marketing ROI, marketing budgets, and especially inbound marketing strategies are kind of our jam, so if you have any questions about anything we covered in this blog, please don’t hesitate to get in touch!

And if you want to grow your company by 20% in the next year, we can help. Growth marketing is kind of our thing, so if you’re interested, let’s chat.

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