Tracking the results of marketing spending is an area that many manufacturing companies struggle with.
Failure to do so makes it hard for you to understand what's working, whether you are investing in the right marketing channels and generating a positive ROI, and hampers your ability to attract and convert new customers.
On the one hand, there are many 'vanity metrics' that might look good but do not translate into real revenue. Often, however, business leaders focus too much on these metrics.
The worst-case scenario is that these vanity metrics can steer you in the wrong direction, especially when critical decisions are made based on this data.
On the other hand, there are useful manufacturing metrics you should focus your energy on to analyze performance and optimize your marketing campaigns to yield the best results.
Manufacturing Metrics That Aren't As Important
These are metrics that you might want to know, but they aren't vital to your manufacturing company's marketing success.
Page views are important because they indicate the number of people visiting a page. But, they are insufficient as they do not give any meaningful feedback about the user. They do not tell whether the user enjoyed the content on the page and if they are likely to make purchasing decisions based on their experience. There is not much insight that can be derived from this metric.
Impressions only indicate that the content was delivered to the user, but it does not say whether the user interacted with it. Simply put, user impressions are counted, whether something was clicked or not.
Clicks may not be a good indicator that you are interacting with your target audience. Also, keep in mind that people often have to view multiple ads before deciding to commit and purchase. For that reason, one cannot rely on clicks alone.
Cost Per Thousand Impressions (CPM) is a long-used metric that refers to the cost of 1,000 advertisement impressions online. While CPM's have been used over the years to generate ad business, they are not the most impactful metric because again, they focus on how many times your ad was shown, but not anything that resulted from it.
Impression share—which is the number of impressions that a given advertisement receives divided by the number of impressions that it was eligible to receive—only appears relevant at the campaign level.
Advertising campaigns usually involve many variables like groups and keywords. This metric focuses on quantity over quality, and a higher impression rate may not always be an indicator of excellent marketing performance.
Time on site
The time that users spend on a site does not necessarily translate to a sale or conversion. As such, unless the visitor takes some action, this time is less meaningful to marketers.
Manufacturing Metrics To Track
These metrics provide a more valuable and insightful look into the marketing performance of a manufacturing company.
Click-through rates (CTR)
While impressions refer to the number of times an advertisement has been viewed, the CTR measures when it has been clicked. This metric informs you that the visitor took some form of action after seeing the ad. It can help you understand your target audience's behaviors and improve their experience on your site.
Traffic, whether paid or organic, provides significant insight into the performance of the marketing campaign. Page views inform the marketers of the number of users visiting the site. The user sessions are features of traffic that tell the duration that the visitor spent on any given page.
By understanding the user sessions, the marketer can have a better grasp of the user experience and journey, and find meaningful ways to optimize the experience further.
The traffic sources provide valuable insight into user journeys. There are many traffic sources, including email clicks, paid searches, social media, and referrals, among others.
For instance, direct traffic tells us that the user did not have a prior source where the click originated. Organic traffic is most preferred as it is generated through search engines, and it is free. A high rate of organic traffic usually indicate that marketing strategies like SEO are effectively implemented.
There are three main ways to track traffic sources:
- Conversion rate by traffic source - The value of each traffic source should be calculated in terms of costs and the customers converted.
- New users by traffic source - This measures the value of traffic sources to the customer acquisition strategies put in place.
- Revenue by traffic source - This metric measures the revenue contribution of each source of traffic.
Conversions rates (assisted conversions vs. final conversions)
It is crucial to track and calculate the conversion rate—that of visitors who take action and complete the desired objective like a purchase or filling out a contact or quote form.
Conversion rates should be examined by:
- Traffic source - Was the source of traffic paid or non-paid?
- Device type - The types of devices—mobile and non-mobile, will deepen the understanding of the consumers' behaviors.
- New vs. returning user - Tracking the new customers will help you understand the cost of acquisition, customer lifespan, and a general understanding of the value of the customer to the firm. A higher rate of repurchase justifies the ROI for the cost of client acquisition. Customers staying with the company for a longer time implies that they value the product, are appreciated and that the product handling was fast and efficient, among other reasons.
- Product - How do conversion rates differ among different categories of products on your website?
A high rate of shopping cart abandonment may indicate bad usability, and customers changing their minds regarding the product, among other reasons. You want to keep this outcome as low as possible by making necessary adjustments.
Customer lifetime value (CLV)
The customer lifetime value is the KPI that puts the others into perspective. It is essential to understand the total worth that a customer has over the period that they interact with your company.
Understanding this metric will inform the decision-makers of why customers stay longer or shorter periods. It also helps you to realign your customer acquisition and retention strategies. Mainly, your business should strive to make the CLV as long and valuable as possible.
Tracking Manufacturing Metrics To Optimize Your Marketing Efforts
Your marketing metrics are essential as they enable the collection of accurate and useful information to inform your decisions moving forward. From all of these insights, you can make informed choices regarding your marketing efforts and other organizational strategies.
Want to learn more about how to improve your process of measuring results?