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Interpreting Digital Performance
Online advertising presents a whole new landscape for businesses who want to achieve growth and sales through digital impact. But how do you know if your digital activity is working? And / or how do you interpret the variety of numbers and data that you receive from the platforms you use?
In today’s quick read we will explore the digital marketing funnel and help you to learn how to navigate the complexity that numbers in metrics can present.
Let’s start with the metrics…welcome to a whole new world of acronyms! CTC, CPC, CPI, CR and BR. Below you will see some of the terms and items that may be discussed when reporting digital results.
Image: Infographic – Digital Advertising Results and Metrics
*There are a variety of others that are relevant to an individual platform, what follows below is a good usage guide on understanding how to use metrics for success.
The trick with these numbers is not just understanding what numbers are good but understanding which numbers you need to track. Welcome to the objectives of digital activity. What is it that you’re trying to achieve? If you’re looking for a purchase through an online store, there are some numbers that are more important than others (conversion rate being the number one). If you’re trying to create awareness then the click through rate, time on page and bounce rate may be the numbers you’re after.
Here you can see a standard marketing funnel in relation to the metrics at each level that may be relevant to your objectives.
The key is to understand that your consumer will be at different stages of the buyer journey. So, it is important that the marketing activities are aligned to encourage or incentivise consumers to move though their buyer journey to purchase. We call this a marketing funnel. At the top of the funnel, we focus our marketing activities on brand awareness outcomes. As we move through the funnel, we build brand consideration and eventually brand conversion or purchase. Each stage of the marketing funnel focuses on different marketing objectives and therefore different metrics.
Image: The Sales Funnel
That’s all great but how do you know if you’re doing well at this? The answer is BENCHMARKS, which are a number that indicates whether your numbers are any good. Different industries obviously have different benchmarks but if you look at the worldwide average across all industries from Google and Facebook, this is a good starting point to see how you’re tracking.
One thing to be aware of is our friend “VANITY”, who walks into the lunchroom spruiking her metrics. Vanity metrics can really throw off identifying if you have real performance. These are called vanity metrics as the numbers sound fantastic but really these metrics should be used to ensure that your campaign is setup correctly. They identify that your audience size is large enough to be effective and that your campaign is reaching your audience. For example, if you’ve been told you have 10,000 engagements but no sales, while the large number of engagements sounds fantastic. You still didn’t have a sale. It’s therefore crucial to not look at a single metric on its own.
A metric on its own will give little insight. It must be coupled with the data set for the entire journey to truly understand the performance of a campaign.
Let’s unpack this a little more for those at the back who have fallen asleep!
Below you will see a few scenarios and a possible problem point or indication of performance:
- High engagement rate plus a low click through rate EQUALS Call to action (CTA) issue / proposition issue.
- Good cost per click plus good click through rate plus high bounce rate EQUALS Landing page is not relevant to the ad / the CTA might be asking too much.
- Low impressions or low reach EQUALS Audience segment too small (over targeted)
- Good open rate plus high unsubscribe rate EQUALS Perceived as SPAM – Content issue
One key thing to then take away is that you can avoid complex problems by setting up the campaign correctly from the beginning.
Here are some steps that will set your campaign up to win from the start:
- Have a dedicated high converting landing page
- Ensure that your ads and your landing page content match and are highly relevant
- Ensure that your CTA is reasonable
- Know your audience and target effectively
- Deploy only what is necessary for a conversion – your money will go further
- Map data across the whole journey
- Monitor frequently
Jono Mueller – Manager Northern QLD
Erin Carroll – Agency Commercial Manager
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