Ensure That You Measure What Matters On Your Marketing Dashboard
Everyone loves a marketing dashboard. Ready access to the key facts in an engaging format - what’s not to like?
Marketing dashboards should be action-oriented rather than something that looks pretty and makes you feel like part of NASA mission control.
A dashboard (or any report) should deliver the right information, at the right time to the right people so that they can improve a process.
However great your dashboard’s look and feel, it’s only as good as the metrics being reported and many metrics don’t actually help better decision-making.
Here we separate the wheat from the chaff or the vanity metrics from the essential metrics that will optimise your marketing performance.
These are metrics which give you comfort that your marketing is proving effective.
Unfortunately, the reality is that in isolation they mean very little and don’t give you any insight into what you should be doing more or less of.
Some examples of vanity metrics and why are:
- Likes - it might make you feel warm inside to know that someone likes your content. But did it have any measurable effect on their behaviour?
- Followers - in the same vein as Likes, who are your followers, are they the same as your customers and why are they following you?
- Open rate - what did people do once they had opened or what stopped them doing from anything?
- Awareness - so people are aware of your brand but what do they think of it and would they consider purchasing or using it?
These are the metrics that really give you a view on how your marketing is truly performing and, most importantly, what you should be doing if you see them improving or deteriorating.
The list isn’t prescriptive and you will find others that fit your marketing objectives better - but hopefully you will see the contrast with the vanity metrics.
We’ve grouped them into some categories for reasons that will become clear later in this blog.
- Sales or turnover - Of course, knowing what you sales are is critical. However if you don’t understand your costs to land the sale or deliver the product then it can be a pretty hollow KPI (even a vanity KPI).
- Profit - as mentioned above, Profit will give you a balanced view on how your business or campaign is really performing. Sales and costs are secondary levels that you can drill into.
- Income - in may not be practical or even feasible to always calculate profit. Income is a better proxy than Sales as it you will have a better understanding of underlying topline performance (for example, are a lot of your sales being promotionally driven at a discount?)
- Share of wallet (or throat, gut etc) - this is a critical one regardless of your product or service. It looks at how much of your customer's spend in your category that you are capturing
- Growth differential - how far ahead or behind you category are you growing?
- Net Promoter Score (NPS) - an incredibly simple but powerful metric if you capture it at every touch-point.
- Sales levers - this is actually three metrics that combine to give you a customer view of your performance. It consists of customer volumes, purchase frequency and transaction value.
- Average Revenue per User (ARPU) - critical if you have any sort of subscription offer.
- Engagement - this could be measured in many ways. Click through rate could be one - as we have said above, someone opening an email is only meaningful if they take some action.
- Return on Investment (ROI) - the sales or profit generated by a particular activity.
The 4-level metric pyramid
You will notice there are four levels to the Sanity metrics outlined above and this is how you should think about reporting them.
Start with your financial metrics - these are how your business will judge your marketing effectivess. And the other levels will then give you full visibility on the drivers of your financials and the levers that you have to pull.
Where to start?The choice of metrics will be specific to your business.
As always, start with your marketing objectives and the marketing plan that you have built. Then think about what will really tell you if you are delivering and what to do more/less of.