The sheer number of different web analytics metrics available for businesses can lead to “analysis paralysis” – becoming so overwhelmed by metrics that it’s hard to know which ones to focus on.
When it comes to website data analytics, it’s important to realize that some metrics are better than others. This is especially the case when you want to focus on website data analytics that track revenue-generating actions by consumers. Our recent blog on turning website analytics into action identify four common areas to measure and suggested actions to take.
This post offers some tips on what website data analytics you should monitor closely.
Avoid Vanity Metrics
The first step in moving past metrics that, while informative, don’t directly track actions that generate revenue. They include likes, followers, views, subscribers, open rates on emails and impressions on webpages. While these metrics offer insight into traffic and how well your content is connecting with visitors, they don’t directly indicate how well your site is generating revenue.
Just because you are doing well in these vanity metrics does not mean you are hitting your revenue goals. They are still important to track, as a Facebook “like” today can result in a lead conversion tomorrow. But other metrics are more important.
Set KPI With Revenue in Mind
A KPI (key performance indicator) is a measurable value that indicates how effectively a business is achieving goals. KPI differ depending whether they are overall metric milestones for the whole business or set for individual departments.
In digital marketing, KPI should be tied to measurable metrics that lead to revenue generation. To establish the best KPIs, it’s important to determine what actions by consumers indicate they are close to making a purchase.
These vary by industry and specific businesses, but typically include actions such as:
- Requesting a free trial
- Booking a demo
- Requesting pricing or quote
- Requesting a consultation or assessment
Out of this group, there is likely one customer action that best indicates they are close to making a purchase. Whatever that action is for your business, it is your most important KPI and should be tracked closely.
An LPI (lead performance indicator) is another measurable metric that indicates how well you are doing farther up the marketing and sales funnel. While they don’t directly indicate a customer is about to make a purchase, they do give an idea of how well you are attracting and moving potential customers toward becoming buyers.
This would include website data analytics such as funnel conversion rates, engagement with content that reflects evaluation and consideration, and actions such as downloading case studies, attending webinars, watching demos and visiting FAQ pages for specific products.
A TPI (tactical performance indicator) is where some of the vanity metrics mentioned above can come into play. TPI metrics give an accurate representation of how your various digital marketing tactics are performing. That includes content, social engagement, session duration of visitors to your site and the number of page views per session. Taking together, TPI indicate how well you are doing at the “top” of the marketing and sales funnel.
Setting Revenue Goals
There are other KPI to consider when it comes to generating revenue that provide a big picture view. These website data analytics metrics include:
- MQL – Marketing Qualified Leads
- SQL – Sales Qualified Leads
- Funnel Conversion Rates
- Marketing spend per customer
- LTV -Lifetime value of a customer
- CAC – Customer acquisition cost
They are important when setting revenue goals and provide a picture of the return on investment in marketing spend.
Keep these issues in mind when measuring the performance of your site. While vanity metrics are important in providing the overall picture of site performance, KPI tied to revenue generation give you a better idea of whether you are achieving the most important goals.
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