If we didn’t have sales, we wouldn’t have much of a company. These metrics will help you measure your sales and the impact of your digital marketing efforts. There are a number of sales metrics you could use and you likely have some custom in-house ones. We’ve identified several standard sales metrics to help evaluate your digital marketing efforts.
# of Unique Customers
For some organizations, the number of unique customers is a key indicator to how well they are performing. You can measure this using your sales management tool or your site shopping cart.
Gross sales will always be an important metric. It doesn’t tell the whole story, but you need to have gross sales to continue operating as a viable business. You can measure this metric using your sales management tool or shopping cart.
Sales by Web Source
How do people find your website and buy products or services? Sales by web source shows all of the sources, or referrals, and how much money they generate. This is a metric that can be generated using Google Analytics. We recommend implementing the ecommerce tracking mechanism within Google Analytics to provide a much deeper look into your site’s sales performance.
Average Revenue Per Customer
How much money are you generating for each customer? The average revenue per customer shows how much money, on average, you can expect from each customer. You can increase your revenue by finding new customers, or by increasing your overall revenue. This will help you design improved up-sell and cross-sell techniques.
To calculate average revenue per customer, take your total revenue and divide it by the total number of customers in that time period. For example, if you generated $12,500 with 500 customers in one month, you would have an average revenue per customer of $25. If, in the following month, you generated $16,000 with 580 customers, your average revenue per customer will have risen to $27.59.
Acquisition Cost Per Customer
When I am consulting with an organization and ask for their acquisition cost per customer, I’m surprised at the number of organizations who don’t know. They’ve never calculated the acquisition cost per customer. The acquisition cost per customer is the total spend required to attract new customers, divided by the number of customers added to the file. So, if you calculate you spend $13,000 to find 324 new customers, you are spending $40.12 to acquire each new customer.
This is an important metric because it provides insight into your ability to acquire new customers and increase your sales base.
Revenue Per Email Subscriber
This is a simple calculation, but a great metric to show the health of your email file. Email marketing still produces a great return for many firms. Calculate revenue per email subscriber by divider the total revenue in a month by the total number of email subscribers you have on file.
Net ROI from Advertising
Your net return on investment (ROI) from your advertising measures the effectiveness of your ad spend. This metric is your total spend on advertising subtracted from your total revenue, and then divided back into your ad spend.
$12,500 (total revenue)
– 8,000 (advertising)
$ 4,500 (net profit after advertising)
$4,500 / $8,000= 56% Net ROI
You can also calculate your net ROI from different types of advertising to determine their effectiveness. For example, if you invested $1,200 into Adwords and it resulted in $4,000 in sales and you invested $1,100 into remarketing and it returned $3,900 in sales, which is the better advertising medium? Adwords was a 233% return while remarketing returned 254% on the investment. Though the actual dollar amount was lower (as was the ad spend), remarketing had a larger ROI.
This is an important metric to decide where to best invest your digital marketing dollars.
Percentage New Customers
This metric shows how many new customers are finding your site – and how many repeat customers you have. There’s an old saying, ‘the best customer you can acquire is an existing one’ – this will help describe how well you are retaining your customers. Compared against the raw orders amount will show whether or not you are growing with new customers as well.
To calculate this metric, take your total number of new customers and divide it by the total number of customers ordering product in a given month. So, if you have 854 total customers placing orders and 232 of them are new, your percentage new customers is: 232/854 = 27.2%.
Advocacy is an entirely different level of engagement with a customer. An advocate is someone who is positively promoting your brand, products, services, or organization to his networks. Ultimately, you want a lot of advocates for your brand – all sources of word of mouth advertising that will move your brand forward in a social environment. These metrics help measure the impact advocates have in the digital marketing environment.
The number of tweets that you send out that are then rebroadcast. A retweet is in effect a vote in favor of your message. We use a third party social media publishing system which reports retweets, but you can also find somewhat accurate data from a site such as http://www.retweetrank.com/.
How many people are sharing your pages and content into their social networks? A share on Facebook exposes your posts and content to the networks of your advocates. You can measure shares of your Facebook posts using the insights data we highlighted in the Facebook Likes section above. The pro version of seoMoz includes access to http://www.opensiteexplorer.org/ that will show you Facebook shares for your website content.
Do people mention your organization in social media? A mention also exposes your brand to the networks of your advocates. This metric is important to see how and if people are talking about you. Hootsuite, a free tool, let’s you monitor keywords to watch discussions of your brand or products.
Another free tool is socialmention, a keyword social media search engine. Enter a keyword or profile name and you will see a number of stats.
Incoming Links to Website
The number of incoming links is an important SEO measurement. The more incoming links you have and the better quality they are will mean a higher ranking in search engines. You can measure the number of incoming links to your website using http://www.opensiteexplorer.org. We recommend pursuing a link building strategy to go after valuable, high quality links to increase your value to search engines.
On Open Site Explorer, you can see the total number of incoming links on the Compare Link Metrics tab. In the example above, you see there are 334,324 incoming links to learnthat.com.
What other metrics are important to measure success for your digital marketing efforts?