Inbound marketing doesn’t have to be a wait-and-pray machine. Although the nature of inbound puts your leads in the driver’s seat, there are still some important metrics that you should be tracking to optimize the value of your inbound lead generation. Marketing professionals in particular need to know how to track progress and define success across channels, in order to craft an efficient and targeted marketing strategy.
Key Performance Indicators
Chuck McMahon of Vital lists 16 Key Performance Indicators (KPI) that all marketers should be measuring. This list is comprehensive, but there are a few key takeaways that are especially important for the inbound marketer:
- The Cost of Customer Acquisition is the cost associated in convincing a prospective customer to buy. While this cost includes most areas of running your business, marketing has the prime role in this equation, essentially the Total Marketing Investment divided by the Number of Customers Acquired. Your job is to decrease the numerator by finding the most efficient channel for your inbound strategy, while increasing the denominator by bringing in more qualified leads.
- Virtually all inbound tactics happen on the web, driving leads to your landing page, so your Landing Page Conversion Rate is important to determine success. Essentially this is the number of customers who act upon your call-to-action, over your total landing page visitors, and it can be improved byoptimizing your landing page.
- Although the conversion rate is a better indicator of lead generation success, measuring the volume of your Website Traffic is important for growth and can be easily tracked using Google Analytics. Unique page views tells you how well your content is performing. Average session duration lets you know whether or not your content is interesting enough to keep people on your website, and bounce and exit rates tell you how quickly your leads are leaving.
- Your Close Ratio or Sales Conversion Rate is the percentage of leads who becoming paying customers. Your sales and customer support teams are important factors in this ratio, but marketing should work to increase this ratio by bringing higher quality leads and by optimizing inbound content that frames a narrative straight to your product.
Ultimately, all of your marketing metrics should point towards sales growth. A simple funnel analysis is a great way to visualize how many qualified leads are making it through each step to the sales process, and the cost associated with each of these steps will help you advocate the value each marketing activity brings to your business.
In Chuck’s words, “There is NO EXCUSE for not knowing why your company’s marketing efforts are killing it or getting destroyed by the competition. Zero. Zilch. Nada.”
Common Inbound Results
According to Hubspot’s State of Inbound Marketing Report, inbound marketing has a 61% lower cost per lead than outbound. Small companies have an average cost per lead of $37 for inbound channels, while large companies average around $27.
At Socedo, we generate almost all of our leads from inbound channels, with social media marketing as the largest contributor, followed by SEO and organic search. We see that call-to-actions on our inbound channels have about a 30% click-through rate.
Hubspot also reports that social media marketing has had the greatest growth in importance for lead generation.
Measuring Social Media
While inbound marketing itself requires new ways to measure results, one of the quirkiest inbound channels is social media. Fortunately, social media pro Rebekah Rice has 6 actionable ways to measure the effectiveness of social media:
- Focus less on visibility from likes, shares, and comments, and more on the traffic coming through the entry points to your brand, such as a Facebook landing page. Use Google Analytics to see which content brings in the most leads.
- Identify and socialize the specific goals for your business. Just because a B2B tech company values click-through rates to their white papers, doesn’t mean your e-commerce business shouldn’t make unique page views a priority.
- Set measurable goals. Whether you’re using social media to generate leads, drive traffic, or improve brand reputation, create benchmarks in line with your overall business goals.
- Track where your leads are coming from, down to the granular level. Use link tracking and Google Analytics’ behavior flow to measure not only which site, but which collateral material is performing well all the way through the customer conversion process.
- Include social media costs (time and any tools used) in the lifetime value equation of each customer. Use historical data to predict costs of new social campaigns, and estimate based on your goals, revising when you have hard data.
- Pick the right tools to measure your results. At Socedo, we rely on our own product reports, as well as Google Analytics and Sprout Social Rebekah recommends Simply Measured for in-depth social media analytics. Domo is also a great tool for creating dynamic analytics dashboards across your marketing strategy, including social media.