What’s the Impact on Sales? 5 Marketing KPIs to Track
At it’s core, the point of your marketing is most likely to drive sales. Yes, achieving that fundamental goal involves setting other goals around reaching your audience, influencing their research decisions, changing their perceptions and so on. But in the end, your advertising should translate into sales in clear, measurable ways.
There are many metrics that can be tracked to determine the success of a particular tactic or channel to various degrees, but we’ve collected five marketing KPIs that can help reveal the impact your marketing has on sales and growth.
1. Sales Revenue (with Marketing in Mind)
This may seem obvious—every business should be tracking their sales revenue, right? However, you should be tracking your sales revenue in conjunction with your marketing activity during specific periods of time.
By analyzing revenue and comparing it closely with your marketing campaigns, you can pinpoint the direct influence of special promotions and action campaigns, as well as the growing impact of brand awareness campaigns. While your marketing will not be the only influence on sales, this is a first (and important) step to identify trends and opportunities within your marketing strategy.
2. New vs. Repeat Customers
Understanding whether sales are driven by new or repeat customers can give you perspective on what’s working and what’s not. If most of your sales are from repeat customers, you may need to focus on expanding your reach and appealing to new audience segments—perhaps with radio advertising, paid search, event marketing, or (more likely) a combination of tactics. If sales are entirely from new customers, then you may not be doing enough to keep your current customers satisfied. Of course, you’ll need a balance of both to help your business continue to grow and stay strong.
3. Sales by Lead Source
You may recognize that your online leads help drive sales, but where exactly do those leads come from? How many website visitors type in your URL (direct traffic), find you by searching for solutions (organic search), click on your ads (PPC), or come across your brand on social media, through your ads or your posts?
It’s important to track marketing results with attribution in mind, so you can see what platforms drive conversions and what ones aren’t worth it. For the sake of example, perhaps you get a lot of web traffic and sales via social media, but those sales are primarily one-time purchases—worth only a fraction of the sales that come in through customer referrals. That may mean you need to alter your social media approach, or you need to put a greater focus on encouraging customer referrals (or some of both). Identifying the channels with the most qualified leads helps you align your strategy and budget to your business goals.
4. Lead-to-Customer Ratio
This is closely related to the last KPI. Just looking at the sales you can attribute to a particular marketing channel isn’t enough. While a channel might bring in a few sales, that doesn’t mean it didn’t also bring in a lot of leads that never converted into customers. Examine how many leads become customers per channel, then identify where the breakdown in the path to purchase occurs. If it’s early in the sales funnel, it may be due to your marketing efforts. For example, maybe your advertising creative is effective, but you’re appealing to the wrong audience or not showing up in the right places.
When looking at your lead-to-customer ratio, remember that marketing isn’t the only thing that has an impact on close rates. A channel may bring in numerous leads that are qualified, yet the conversions aren’t happening. If that’s the case, the problem might be a breakdown in the hand-off from marketing to sales, or challenges within your sales team.
5. Time Spent Selling
How much time is your sales team spending on nurturing leads before they close a deal? Some industries have longer sales cycles than others, and every customer will have different needs. Look closely at your buyer’s journey and take time to understand the average time spent selling—for your industry and your company. Perhaps there are opportunities for greater efficiency, including refining your marketing messages and content strategy to bring in truly qualified leads that your sales team can close. Additional marketing touches—like educational, problem-focused content, contextual advertising, and personalized email marketing—can help make leads more ready to buy.
There are other metrics that marketers can and should track, but the ones discussed above can help keep the focus on the bottom line: your customers and sales. Knowing these numbers means you understand whether your marketing efforts are impacting your business in a positive way and, if not, what needs to change.