Most end-user business softwares display, after logon, a dashboard with a concise summary of key performance indicators (KPIs). This is generally true for installed applications as well as for software-as-a-service (SaaS) platforms. Though useful for everyone who accesses the solution, it’s especially important for senior managers who want a quick up-to-the-minute update about the health of their business.
Marketing is no different. Not too many years ago we employed dedicated analysts to collect and massage data into nice graphical representations on paper. Today things are much different. With current tools we are:
- saving time and effort;
- making important results available sooner and more broadly;
- improving comprehension through better technology and design; and
- saving trees.
Our profession is visually oriented, so demonstrations of graphic-rich dashboards usually excite us. But implementing a meaningful dashboard is not a trivial process. If you don’t include critical metrics that tie the impact of marketing to corporate goals, people will ignore it regardless of its glitzy appeal. Or worse, you’ll confuse people by misleading them. You must define the appropriate measures for your business before embarking on a dashboard-building exercise.
The journey to a truly useful dashboard will present some technical challenges. You’ll need to factor in the cost of collecting and storing the required data if your solution doesn’t already do that for you. As well, you’ll need to choose a presentation technology or platform. The good news is that our industry is witnessing an innovation boom in that area. See, for example, Tableau Software and Domo.
Current or prospective users of marketing automation platforms often feel that a marketing dashboard ought to be part of the solution. This is fine for those who want to make the platform the system of record. But the required data is often located in other systems and marketing automation platforms typically don’t have strong data integration capabilities. This need may be addressed in the future through a “marketplace concept”.
The following is a description of popular KPIs often found on marketing dashboards.
- Conversion Metrics. This is a measure of campaign success. It’s defined typically as a ratio between the sum of reach-outs and visits to generated leads. In addition, the number of leads per channel can drive the allocation of resources to productive channels instead of ones that are not.
- Return on Investment (ROI). This campaign measure looks at success as a function of the overall investment. The formula is (Attributable Revenue – Campaign Investment) / (Campaign Investment) over a particular period of time.
- Incremental Sales. Each lead, win and failure has an impact on sales. The formula is Revenue Generated by Marketing Initiatives – Baseline Sales.
- Funnel. Marketers love this KPI because they can track the movement of prospects through different funnel stages (live, active, marketing qualified, sales accepted, sales rejected, closed sales). Other useful metrics can be tacked on to provide additional insights, e.g., time to move to the next funnel stage or percentage of leads leaving the funnel at each stage.
- Cost Per Lead. The formula is, very simply, Total Campaign Cost / Number of Leads Generated. Marketers use this to build a case for the expenditure of money and time. The overall goal is, of course, to minimize the cost per lead. If it’s too high, continuing the campaign cannot be justified.
- Engagement. This is a measure of campaign performance based on the number of unique opens, clicks and generated leads. Marketers use these metrics to optimize campaigns by adjusting content and call-to-actions (CTAs) to engender prospect responses.
- Social Media. This is the number of social media interactions over a period of time. Those interactions are defined as likes, retweets and +1s.
- Traffic Sources. This metric presents breakdowns of traffic by category and sources. A marketer is always interested in understanding the contribution from each source and the growth/decrease over a specific time period. This metric will drive marketers to probe deeply when needed and optimize as required.
- Organic Traffic. Instead of measuring organic traffic growth frequently, focus on the longer term picture, e.g., year-over-year (YOY) changes. This takes into account seasonality and provides a better overall measure of search engine optimization.
- Referral Traffic Growth. This metric should cover changes in referral traffic and referral traffic sources. A marketer should be able to use this to make decisions about optimizing inbound marketing sources, including third-party websites (other than search engines), social media platforms and partner websites.
- Cost-Per-Acquisition. This metric calculates CPA individually for each digital campaign and should reflect changes over the time period. This key metric for marketers is often used in management reporting to highlight the efficiency of marketing tactics.
The perfect marketing dashboard will be the one that represents your organization’s unique needs. Consider our ideas and others you find through research and conversation with peers. But before you implement anything, make sure that all stakeholders agree with your opinions about what to measure and display. Take extra care to ensure that your proposal aligns with corporate goals and objectives.