John Wannamaker famously claimed he wasted 50% of his advertising budget but he didn’t know which 50% was wasted. Well, that might hold for traditional advertising, with few metrics to monitor performance, but it certainly isn’t true for digital marketing. Armed with better metrics to monitor your performance, you can maximize ROI (return on investment) by focusing on those tactics that produce the highest return on investment.
What is Marketing Analytics?
Market analytics involve comprehensive data gathering and study of various marketing strategies to evaluate the strengths and weaknesses of marketing initiatives. Of course, you maximize ROI by focusing on KPIs (key performance indicators) and using them to determine which tactics you should continue and which you should scrap. By gleaning insights from your data, you also maximize ROI by combining the best parts of your tactics together.
For instance, knowing that certain key phrases used in email subject lines help you craft new subject lines that use these phrases in unique and creative ways.
Below are some of the best ways to use marketing analytics to maximize ROI for your business:
1. Take a Look at the Bigger Picture in Marketing Campaigns
Marketing analytics encompasses digital marketing analytics, such as SEO analytics and behavioral analytics, or how customers interact with your business. More often than not, marketers make decisions depending on the data obtained from their website, social media, or other individual platforms. However, businesses might miss the true picture of market performance with this strategy.
It’s vital to go beyond single-channel analysis and take into account the totality and collective relationship of your online and offline marketing campaigns. This is when marketing analytics comes into play. In marketing analytics, business owners and marketers consider all marketing efforts in all channels to help them make sound business decisions.
2. Create Buyer Personas Based on Marketing Analytics Results
You can use customer relationship management (CRM) data to determine the behavior of your target audience and existing customers. By understanding customers and prospects on a deeper level, you can build better marketing strategies, including adapting messaging to the specific needs and “hot buttons” of your target market.
Check out this blank persona template for ideas about how you can build personas for your brand.
Here’s how you can create buyer personas to maximize ROI using CRM:
- Analyze CRM data to know your customers: A CRM software program helps boost your relationship with customers by knowing what makes them happy and unhappy. For instance, CRM can show you the favorite products your customers buy or their favorite web pages to visit on your website.
- Profiling and segmentation: When you know your customers well, it’s easier for you to create buyer personas for your ideal customers. This strategy involves profiling and segmenting your customers with the help of the best CRM software. By segmenting your market, you can develop specific campaigns designed to reach each segment. We call this positioning.
- Customize your sales and marketing: Once you know what your customers prefer, you can customize your sales and marketing process, capturing all touchpoints and gaining potential customers.
3. Create Better Content Marketing Tactics
Are you running a blog on your e-commerce website? If not, you should consider adding one as content marketing is an effective strategy to generate unpaid or organic traffic to your website. If yes, you can use marketing analytics to create better blog content by analyzing the performance of your content to determine which performs best.
When creating a content strategy, one of the most important considerations is to know your audience. If you know what visitors love to read on your web pages, then you can improve those pages or create similar articles to attract more people to your website. For instance, if a higher-than-average number of visitors access pages on a particular topic, or offer a similar style, crafting more pages in that vein should attract more visitors.
A more nuanced way to use analytics to maximize ROI is to segment your pages and performance based on customer groups. For instance, if younger adults convert at higher rates, create more content that attracts this younger audience.
Here are the relevant marketing metrics related to creating better content marketing strategies to maximize your ROI:
- Web traffic sources: This marketing metric helps you understand where traffic comes from. This allows you to focus content creation on those sites or, conversely, work to build traffic from another source that offers opportunities to maximize ROI.
- First visit metric: This metric helps you understand how online users find your website and how they engage during their first visit.
- Brand awareness metric: This metric tracks how people know your business or your branding on search engines through your website content or social media posts.
- Total visits: This marketing metric measures the number of people who visited your web page or website.
- Returning visitor metric: This metric shows the effectiveness of your website when it comes to building an audience directly influenced by your web content.
- Time on site: assesses the time visitors spend on your website during a visit. Obviously, the longer they spend reading your content, the better for SEO and the more likely they are to convert.
- Bounce rate: Assesses visitors who left after viewing a single page. Bounce rate effectively translates to “I came, I hated, I left”. Not only does a high bounce rate hurt SEO, but it also lowers your overall conversion rate since folks can make a purchase if they leave after viewing a single page.
4. Measure Relevant Business Metrics Accurately
Marketing analytics tools help you measure the most relevant marketing metrics applicable to your business. Every business has a unique niche, target audience, and goals. Therefore, not all businesses can rely on a single set of metrics to maximize ROI. By analyzing marketing metrics relevant to your brand, you create better business marketing strategies to improve your sales.
Marketers should use marketing analytics to check all marketing angles and metrics suitable for the type of business they support. Marketing metrics are broadly categorized into digital marketing metrics, email marketing metrics, social media metrics, and offline marketing metrics.
Here are some examples of marketing metrics:
- Customer Lifetime Value (LTV): LTV measures the amount of gross profit generated from customers the entire time they remain customers of your company.
- Funnel Conversion Rate: measures the rate at which your prospects move through the sales marketing funnel. A high conversion rate translates into a higher ROI.
- Marketing Originated Customers: This metric measures the total number of customers that come from your marketing efforts.
- Lead Conversion Rate: measures the number of prospects converted into sales.
5. Use Marketing Analytics to Become More Competitive
Data fuels the future of marketing with the use of marketing analytics. If you don’t want your business left behind, handle data using the right tools to develop good marketing intelligence. Without a consistent, well-organized plan to assess market performance, you remain in the dark, like John Wannamaker, not knowing which tactics generate the highest ROI.
By determining the relevant marketing metrics for your business, you know what you’re competing for, such as website traffic, content prospects, email leads, and online store sales. You improve your branding and partnerships with your stakeholders. Of course, marketing analytics enable you to conduct quality analysis, understand marketing technology, and optimize marketing campaign recommendations.
Optimize your marketing campaigns and become more competitive by choosing the right features and benefits of marketing analytics software, such as the following:
- Real-time analytics to promote fast, easy, and accurate data gathering
- Brand measurements capabilities to boost brand awareness
- Contextualized market and customer insights to help create buyer personas
You just learned the various ways to use marketing analytics to maximize ROI. Marketing gives you helpful insights about your audience, as well as the effectiveness of your marketing campaigns. When you know the relevant data of all your marketing campaigns, you can make concrete plans that return the highest ROI. Regularly monitoring your marketing efforts is the key to maintain steady high profits, given the right strategies.
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Hausman and Associates, the publisher of MKT Maven, is a full-service marketing agency operating at the intersection of marketing and digital media. Check out our full range of services.