Why Marketing Metrics Aren't Enough
We all know the usual suspects when it comes to marketing metrics and KPI’s–Return on Ad Spend (ROAS), Conversion Rate, Cost per Conversion, Leads, Cost per Lead, and the list goes on. These metrics have been used for ages and are a good starting point for measuring success.
We all know how different they can be though, depending on your source. Internal revenue data doesn’t always match up with leads. Google Analytics doesn’t have the same look- back window as Adobe Analytics, Facebook, or AdWords. And, with the myriad of other reports now available (I’m looking at you conversion paths and cohort analysis), it can be confusing for many marketers to find out which metrics REALLY work for their business.
Common Issues with Marketing Metrics
But, let’s take a step back and talk about the source of the issue: Often, many do not know how these KPIs are derived, or why they are determined to be important.
For example, when your agency comes to you at the start of your partnership, and they ask “What are your primary and secondary KPI’s for this
But, don’t worry, I’m going to show you better ways to come up with your marketing goals involving data, people, and a little peek behind the Elite SEM curtain as to how we do things to help our clients.
Often times, when we start a new partnership with clients, they give one of two answers when we talk about KPI’s.
1. We don’t have goals, we just want to be as efficient as possible.
OR
2. We want an all in Paid Search ROAS of 4:1.
Let’s talk about the latter. Now, I want to be clear and state again that this happens to many of our clients, but our goal is to go DEEPER with you than just an ROAS target.
If 4:1 is your target, let’s discuss why. Does a 4:1 ratio mean a certain profitability to your business? Is that based off of past performance alone? Do you get a bonus if we hit 4:1? Many of you would say I think so?/Yes/No to those three questions. I’ve yet to meet a marketing VP or CMO that receives their bonus solely on ROAS.
So again, let’s go deeper…
Digging Into The Numbers
As Nigel Tufnal from This Is Spinal Tap might say, “These go to eleven”. How do we go deeper? How do we go to eleven with our KPI’s and get them beyond surface level? Here are a few suggestions:
People
- You’re going to need people to help you figure this one out. You could always just pull a number out of thin air, but this isn’t going to get you very far. To take your KPIs a step further, you need analysts (internal or external) that can help you crunch the numbers… You may discover it IS still using ROAS, but an analyst can help you look at it through the right (or a different) lens. Maybe non-brand Paid Search should be 1:1, and brand Paid Search should be 10:1, and prospecting Facebook should be 0.5:1, and retargeting display should be 2:1. Basically, you need people to help answer some of these questions. A report or a dashboard is only going to get you so far when looking at your historical numbers and understanding the details.
- What these people should ALSO be doing is making sure your historical numbers are accurate. We often start a relationship with clients who tell us their non-brand Paid Search ROAS is 6:1, and when we get under the hood we realize that unfortunately there are some major brand keywords lurking in those non-brand campaigns causing those AWESOME numbers. Not cool, and not uncommon.
Integration
- I recently had a conversation with a client of ours where we both agreed to this sentiment: Agencies work best as an extension of the client team — not some vendor-esque relationship. An agency should be a group of people that we know, where the client treats us as though they were sitting a few desks down. Same goals, same vision, walking in lockstep together. And communicating with each other with honesty, respect, and integrity.
- This type of agency/client relationship is HUGE. When our clients let us “in”, we get to learn their nomenclature, we get to learn what drives them, what makes them tick and what they truly care about. We often reach this level of agency/client utopia, but we also have clients that would rather keep us at arm’s length. Can you guess which ones have the best performance? And it’s not because we at Elite try harder with more integrated clients… It’s because those integrated clients give us more information that allows us to do our jobs better and in turn, perform better for their business.
Steps to Take
So, now what? You want this to happen, you might even feel like you need this to happen. Here are two key suggestions, based on what we’ve found to work here at Elite, that can help make this happen for you.
Step 1:
Let your agencies in – yes, there is some level of risk here. Whether that be consolidating agencies, giving analytics at least the valet keys to the kingdom, or simply telling folks about your vacation plans and how your kids play was this weekend… There’s risk to all of these. Some professional, some personal–but we’re all human beings and we thrive on connection. Become connected with your agency. It doesn’t mean that you can’t have tough conversations. It’s actually the opposite. You can have more of them because you know that everyone is moving in the same direction.
Step 2:
What we do for our clients is ask a lot of questions. Personal ones, KPI-related ones, analytics ones… Trying to get to know you, knowing your business inside and out, and helping you develop meaningful KPI’s in addition to your favorites. We’ve found that these questions allow us to work better and be better for your brand. And if at first, you want to be cautious, that’s 100% okay. We can take our time.
Most importantly, above all else, remember that this process won’t all be rainbows and sunshine. Expect some detours and bumps along the way. But set expectations up front. Know where you’re going, and work with your agency to get you there. Lockstep. Same vision. Same goals. Communication. When these things happen, any of the tough conversations can happen with respect and understanding that everyone has the same goal in mind.
Curious about what data trends we’re seeing with Search & Shopping? Check out our 2018 Retail Report to see aggregate data from 2016-2017 along with expert advice and analysis.
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