For most marketers, aligning marketing KPIs with business KPIs may be a daunting and even confusing task. Marketing is more technologically dependent than ever before, and with the wealth of metrics at your fingertips it’s not always easy to know which data is vital and which should be excluded.
Though periodical reporting of relevant metrics to executives is vital to your role as a marketer, it shouldn’t be keeping you up at night.
More than just a marketer
Making sense of data is a challenge for many marketing executives today. But it’s important that you recognize your central role in the company. You are your company’s money generator, able to benefit from the insight your data can provide you with if you connect your marketing KPIs to your company’s business KPIs.
Connecting KPIs is much like a connect-the-dots puzzle that upon completion will give you, and your management, a clear picture of the effectiveness of your marketing campaigns and how they directly affect the company’s bottom line.
Every organization has their favorite KPIs. Here are a few that we suggest, simply because they’re vital to company growth:
When a marketing executive is able to speak about sales as a KPI, he’s making a loud and very bold statement. By reporting on the number of sales a marketing campaign has generated, this same marketing executive is expressing his view of himself as an intrinsic part of the organization – both in success and failure, and holding himself accountable for both. Being thus empowered, marketers in today’s complex and data-driven world are constantly furthering sales in all campaigns, understanding that many other metrics are not half as important.
By tying marketing campaigns to revenue impact, marketers are able to understand the overall success of any campaign. Marketers who keep revenue in mind when planning their marketing campaigns have the ability to make them more successful. In addition, they will be able to prove the way in which their marketing results are aligned with business KPIs, making their results more relevant to upper management.
Arguably the most important metric, ROI is the most relevant metric for marketers. As marketing efforts become more driven by data, ROI becomes easier to extract. If a marketer can prove the ROI of various marketing campaigns, their positive contributions as well as the success of the marketer become unequivocal.
- Customer Acquisition Cost (CAC)
Measuring CAC is a more difficult metric to calculate than CPA (cost per acquisition); but it is a much more valuable metric. CAC can be regarded as the scenic route of KPIs, representing the more attractive and interesting dimension that provides marketers with a broader understanding and more accurate picture of their marketing performance. CAC also allows marketers to align results with business performance KPIs and optimize overall costs, making it a vital metric.
- Qualified leads + Cost per Qualified Leads
Leads are important, but they’re meaningless if they don’t take into account your funnel numbers. If leads drive you to your customer’s street, qualified leads drive you to your customer’s doorstep. Measuring qualified leads as part of your KPIs, will help you build your campaigns more strategically, as well as help you understand how your marketing efforts are affecting your company’s bottom line.
By aligning your marketing KPIs with the organization’s business goals, you’ll ultimately make better decisions for your overall business performance – and that’s when you’ll start to love KPIs instead of incessantly worrying about them.
Learn more about KPIs by reading Datorama’s “How to Guide” on What Your CEO Expects from Your Year Marketing Report.