Essential KPIs You Should Track for Measuring Brand Performance
Every brand needs to know whether or not their marketing efforts are actually yielding viable results. The main reason is that the online market has become increasingly competitive and saturated. That said, investing time and resources in a marketing campaign needs to pay off.
Otherwise, your brand may be underperforming without you even realizing it. So how does someone measure their brand’s performance? This is where KPIs (Key Performance Indicators) come into play.
As their name suggests, KPIs are tied to the company’s or brand’s vital performance statistics, which usually represent every factor related to sales and revenue, as well as the outcomes of various marketing tactics and strategies.
Measuring essential KPIs is vital for a brand’s development and growth, and it should take priority when creating marketing strategies. With that in mind, here are a few of the essential KPIs you should track for measuring your brand’s performance.
Acquiring new customers isn’t easy, and it isn’t cheap either. Brands that wish to grow their customer base must be aware of these costs. If it costs too much for your brand to acquire a new customer, then it’s obvious that your marketing performance is lacking.
That’s why customer acquisition costs (CAC) KPI is essential to track. When you add the cost of sales to the costs of marketing and divide it by the number of new customers acquired, you can calculate how much it costs your brand to acquire a new customer.
When you manage to reduce these costs as much as possible, it means that your brand is spending or investing money more efficiently, which will ultimately benefit your profits and return on investment (ROI).
Customer Lifetime Value (CLV)
Another KPI tied directly to sales and profits is the CLV, or the customer lifetime value. This KPI portrays just how much revenue your brand generates from a single customer during their lifetime as a customer.
For example, if it costs your brand $300 to acquire a new customer but that customer purchases $500 worth of your products, you’ve actually made a profit and your brand’s performance is rather good.
Moreover, the longer you retain that customer, the more value you gain over time. The key is to not spend more on acquiring a new customer than you can profit from that very same customer. In other words, if the CAC costs exceed your CLV gains, you have a negative impact on your profits, and your brand is underperforming.
Website traffic is a KPI every brand should track. The main reason is that this KPI shows just how effective your marketing strategies are at encouraging leads to visit your website. However, website traffic is a broad term, and you’ll need to break it down before you can truly understand it and its importance.
That’s why it’s a good idea to opt for one of the efficient digital marketing reporting tools to help you better analyze your website traffic. That way, you can determine if your web traffic is organic or not. Furthermore, you can determine from which sources the traffic originates from.
For example, your traffic may be coming from social media and the backlinks you’ve placed in the content you’ve recently published. The more organic traffic you have, the better the performance of your brand is. In other words, your brand awareness is suitable, and your marketing efforts are generating qualified leads.
Boosting sales is one of the primary goals of every brand. You want to encourage as many target audience members as possible to convert into customers. That’s why the conversion rate KPI is very important to track.
As you may already know, brands acquire qualified leads with their marketing efforts. A lead is every person who shows even the slightest interest in your offers.
How well you can nurture those leads and lead them down your sales funnel until they ultimately decide to convert determines how well your brand performs in the market.
The higher conversion rate means your marketing tactics are actually working their magic. On the other hand, if your conversion rate is low, it means you’ll have to make some improvements to your marketing efforts.
Consumer engagement is a very important KPI. Based on how engaged your audience is will determine the likelihood of them converting in the end.
Therefore, it’s crucial that you keep your audience engaged at all times and measure your efforts in the process. For example, social media platforms are especially important for brands. The main reason is that brands establish their presence and relationships with their audience on those platforms.
That’s why it’s important to track how your audience responds to your efforts while maintaining a good reputation on social media. Consumer engagement varies based on which marketing channel you’re currently using. Here are a few examples to help you measure your audience’s engagement throughout various channels:
- Social media – Shares, likes, comments, brand mentions, brand sentiment, etc. However, it’s vital that brands don’t lose track of what’s really important for their performance by solely focusing on vanity metrics on social media.
- Email marketing – Click-through rate, open rate, deliverability, etc.
- Website and blog – Bounce rate, average session time, time spent on a page, total visits, etc.
- Content – Content views, shares, impressions and so on.
Tracking KPIs alongside relevant metrics is vital for evaluating a brand’s performance these days. As mentioned before, the market is crowded and highly competitive, which means that you need to know that your marketing efforts are not in vain. The key to brand success is in ensuring that your marketing is as effective as it can be.