Digital Marketing: Key Metrics with Jill Quick & Dave Chaffey
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Transcript of Digital Marketing: Key Metrics with Jill Quick & Dave Chaffey
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Digital Marketing Priorities 2016 Brought to you by:
Digital Marketing: Key Metrics
Jill QuickData Driven Digital MarketingConsultant and Trainer
Break down the jargon, and understand the concepts needed for a solid data driven approach for your marketing. Learn how to build a KPI dashboard with the right metrics, with insights from key industry influencers, for you to find nuggets of insights that drive your business in a profitable direction.
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Recommended resourcesfor Expert members
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Coming soon…Google Analytics API – Google Sheets dashboard for Expert members
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We need to get better at this data-drive-metrics-malarkey
A framework for your digital metric planning:RACE What key metrics should you use? The good, bad, lagging, leading and casual metrics Why is this hard work? Where to go from here, next steps and tips to
create your KPI dashboard
Agenda
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About Me Digital Marketing Consultant and Trainer Data Driven Approach supporting established
brands, start ups and small businesses to make the most out of digital
Lead Instructor at General Assembly Author for Smart Insights Loves finding that ‘aha moment’ that drives growth
@jillquickhttps://uk.linkedin.com/in/jillquick01 [email protected] www.quick-marketing.co.uk
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You are not the colouring in department
The ability to track ROI gives marketing respect Finding insights backed up by data gives you a
competitive edge
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Stages of Accountability
Denial marketing is an art not a
science
Fear what if my marketing
doesn't impact revenue?
Self promotion
hey come see all my chartsConfusion
i know i should measure, i just don't know how
Accountabilityrevenue starts
withmarketing
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What stage are you?Where would you say you are in terms of your stage of marketing accountability?
1 – Denial2 – Fear3 – Confusion4 – Self-Promotion5 – Full AccountabilityNOTE: There is one answer only per vote
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The Lingo A metric is a number that gives you information
about an aspect if your business. Dimensions are attributes that give context to
what your metrics are measuring. More formally: dimensions are qualitative characteristics, identifying the who, where, and when of a particular metric
Dimensions
Metrics
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What is a KPI?A KPI is a “promoted
metrics” unique to your business
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What are you trying to achieve?CurationMe Content SaaS Business
Business Objectives
Sell more online subscriptions
Keep more customers
Up sell basic users to next package
Goal More Sales Reduce churn by 20%
Upgrade packages
KPI MMR Churn Rate Purchased Upgrades
Best Case Worst Case
£20,000£10,000
25%15%
50 accounts p/m20 accounts p/m
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Micro Goals Share content via social media Subscribe to newsletter Watch video Play game Use calculators Livechat Customise a product Add product to cart View special content Store location Property search
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Are you tracking everything?RACE Macro & Micro Goals Tracking/Goal Type
Tracking
Reach Scroll Read Event Tracking Bounce Rate Dimension in GA
Act Read Blog Dimensions in GA Watch Video Event Tracking
Live Chat Event Tracking Social Share Event Tracking
Convert Create Account Destination URL Goal
Activate Account Destination URL Goal Free Trial Destination URL Goal
Engage Buy Subscriptions Destination URL Goal Repeat Purchase Destination URL Goal Upgrade Package Event Tracking
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What do these guys say?
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If you could take 5 to the board?
Customer Lifetime Value Cost of Customer Acquisition Churn/Retention Rate by Cohort Growth Rate (of customers and revenue) Traffic & Customer Acquisition by Channel
Rand Fishkin Wizard of Moz
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Metric Overview
CUSTOMER LIFETIME
In marketing, customer lifetime value (CLV or often CLTV), lifetime customer value (LCV), or life-time value (LTV) is a prediction of the net profit attributed to the entire future relationship with a customer.
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Metric Overview
LIFETIME VALUE (LTV)
Roughly defined, LTV is the projected revenue that a customer will generate during their lifetime. This is just looking at Simple LTV
Annual profit contribution per customer x average number of years that they remain a customer - the cost of customer acquisition.
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Metric OverviewEXAMPLE
Average subscriber is 14 months based on your churn rate
CPA is £50
They spend £14.96
Your lifetime value is
14.96 * 14 = £209.44 - cost to acquire £50 = £159.44
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If you could take 5 to the board?
Commitment / Brand Love Share of wallet Channel preference Spend/Frequency Coverage (what proportion of spend the top x% of
customers account for)
Edwina DunnCEO Startcount
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Metric OverviewHow do you calculate Purchase Frequency?
You can work out your purchase frequency by using this simple calculation. You can define your time periods to one that best fits with your business model, here I have just gone ahead with a 1 year period.
This metric is going to tell you the average number of times that your customers are making a purchase with you over your chosen time period.
Your Total Orders (365 days) / Unique customers (365 days) = Purchase Frequency
If you want to understand the time between your customers purchased use this formula to see how long a typical customer takes before making a repeat purchase.
365 days / purchase frequency = time between purchases
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If you could take 5 to the board?
Sales Made Cost of Acquisition Monthly Recurring Revenue Church Value in £ and # of clients Sales Pipeline / Forecast with Dates
Tink TaylorFounder Dot Mailer
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Metric Overview
How quickly are your customers leaving you. It is cheaper and easier to retain customers than it is to get new ones. Monitor churn to understand how good you are at keeping your customers.
Customers Lost during x period/starting customers = churn rate %
CHURN
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If you could take 5 to the board?
Increased Revenue Lowered Costs Improved Customer Satisfaction (NPS) Increased Capabilities
Jim SterneFounder eMetrics Summit & Digital Analytics Association
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Metric Overview
The NPS system gives you a percentage, based on the classification that respondents fall into—from Detractors to Promoters.
NET PROMOTOR SCORE
https://www.netpromoter.com/
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Metric OverviewNET PROMOTOR SCORE
So to calculate the percentage, follow these steps:
Enter all of the survey responses into an Excel spreadsheet.
Now, break down the responses by Detractors, Passives, and Promoters.
Add up the total responses from each group.
To get the percentage, take the group total and divide it by the total number of survey responses.
Now, subtract the percentage total of Detractors from the percentage total of Promoters—this is your NPS score.
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Metric OverviewNET PROMOTOR SCORE(Number of Promoters — Number of Detractors) / (Number of Respondents) x 100
Example: If you received 100 responses to your survey:
10 responses were in the 0–6 range (Detractors)
20 responses were in the 7–8 range (Passives)
70 responses were in the 9–10 range (Promoters)
When you calculate the percentages for each group, you get 10%, 20%, and 70% respectively.
To finish up, subtract 10% (Detractors) from 70% (Promoters),
www.npscalculator.com/en
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If you could take 5 to the board?
Ratio of Daily Average Users: Monthly Average Users (DAU:MAU)
CPA: Cost Per Acquisition CLT: Customer Lifetime Value Customer Referral Rate Customer Churn
Matthew EisnerGlobal Marketing Manager at Startup Bootcamp
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Metric OverviewVIRAL GROWTH FACTOR: KHow likely are your users to send on to a friend/ referrals ?
I = number of invites sent by each customer
C = the percent conversion of each invite
K = I*C
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Metric OverviewWHAT IS VIRAL?
Situation 1
1250 users send 2000 invites (2000/1250) = 1.6
580 convert as customers (580/2000) = 0.29
1.6*0.29 = 0.464
Situation 2
1250 users send 2000 invites (2000/1250) = 1.6
1250 convert as customers (580/2000) = 0.625
1.6*0.625 = 1
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Good and Bad Metrics
VANITY METRICS
Feel good measurements to justify marketing spend Facebook likes Number of names gathered at a trade show
When metrics go wrong…
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Good and Bad Metrics
FOCUS ON QUANTITY,
NOT QUALITY
We have a database of 50,000 people
We created 1 million leads, yadayadayada…..
When metrics go wrong…
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Good and Bad Metrics
ACTIVITY, NOT RESULTS
Activity is easy to see and measure.
Your boss may see this as just costs going out of the
door.
When metrics go wrong… FINANCE
METRICS
Revenue metrics
Incremental contributions of
individual marketing programmes.
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Good and Bad Metrics
LAGGING VS LEADING
Lagging metrics: Historical, shows you how you are doing, its like reporting the news, its happened. E.g. sales this month
Leading metrics: Forward looking, number today that predicts tomorrow.
EG pipeline
When metrics go right…
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Correlated and Casual MetricsCorrelated: Two Variables that are related - but may be dependent on something else.
E.g. Ice cream and drowning
Causal: An independent variable that directly impacts a dependent one.E.g. summertime and drowning
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Find a leading, casual metric…
…Find Your Superpower
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Paired Metrics
Consider matching your KPI with a paired metric
Eg if your KPI is to shorten time on customer enquiries you should pair this with customer satisfaction.
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Remember…
If it won’t change how you behave, it’s a bad metric.
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What To DoFILL OUT RACE FOR MACRO AND MICRO
GOALS
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What To DoWHERE ARE YOU GETTING YOUR DATA FROM?
ARE YOU TRACKING THE METRICS YOU NEED TO DO THE MATH?
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What To DoWHO ARE YOU REPORTING TO, WHAT DO THEY WANT TO SEE?
Your VP of marketing may want…
Reach = Events per sessionAct = Number of Free TrialsConvert = Return on InvestmentEngage = Churn Rate
Your CFO may want…
Reach = Cost per VisitorAct = Cost per AcquisitionConvert = Return on InvestmentEngage = Monthly Recurring Revenue
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What To Do…
GET FAMILIAR WITH METRICS AND HOW TO WORK THEM OUT
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