A KPI is a performance indicator that measures how a company such as Cape Coral Towing Service is performing at achieving a certain goal or objective. Every aspect of a business has KPIs to be looked at, whether it’s financial, sales, marketing, or operational. Essentially, KPIs are measurable metrics that gauge the overall performance over time. When analyzing a KPI report, one of the best ways to go about it is to create custom dashboards.
If you are running any marketing activity, here are some of the most important KPIs you can look at.
Customer Acquisition Cost (CAC)
Customer acquisition cost measures the amount it takes to convert a potential lead into a customer. This is an important metric that can be used to improve your marketing and helps to make important budgetary decisions. You would not want to spend too much money on acquiring a customer if it would not be profitable. This KPI is important in helping businesses decide how much money to spend on attracting customers.
Lifetime Value of a Customer
This is another important metric that helps in determining how much to spend on marketing. It is a metric that indicates the total amount of revenue a business can expect to make from a single customer. When looking at the Lifetime value of a customer metric, it is also important to compare it also with customer acquisition cost.
If your CAC is higher than LTV, then you are probably spending too much money acquiring customers.
Return on Investment
In marketing, the return on investment refers to the amount of money you gain compared to the marketing cost. To calculate ROI, you will subtract marketing expenses from sales growth and then divide that by the marketing cost to get the return on your investment. In marketing, it is important to keep in mind that it can be hard to have a direct relationship with sales growth to a marketing campaign. If that is is the case, you can subtract your average organic sales and marketing cost from your sales growth and then divide it by your marketing cost.
Return on Ads Spend
Popularity known as ROAS is a more specific KPI that you can use to determine the success of your ad campaign. It is a metric that measures the revenue generated as compared to every dollar you spend on an advertising campaign. It is usually a ratio.
Marketing Qualified Leads
Known as MQL, it is a lead that has engaged with your company and has the potential of becoming a more serious prospect if you go ahead and nurture that relationship. It can be a very great KPI to measure because it helps your marketing team understand how many leads they are bringing in.
As a marketer, one of the most important duties you will have is to manage your social media accounts for your company. if you work on the social media team, an important KPI to track is follower growth. Most likely, you will have one of the goals which include increasing brand awareness and interacting with your audience. A sure way to keep track of that metric is to measure your follower growth.