Building a startup from scratch is no easy task. If you are among those that have done this, you understand that every process from developing your product to marketing to consumer satisfaction can be tricky.
Startups function a lot differently from an already established company. The types of marketing strategies utilized, the way they are conducted, and how the results are measured all differ.
When setting up your business, you need to ask yourself:
Do I know and understand what my business’s Key Performance Indicators (KPIs) are? How much understanding do I possess about the startup processes? How do I measure a small business’s marketing success?
There are different metrics to consider, but let’s focus on the important ones.
An office and technology needed to keep track of business performance. | Photo Credit: Alesia Kazantceva on Unsplash.
Startup Marketing Campaign Metrics and KPIs
To ensure a startup business runs at an optimal level, there are many metrics and KPIs that need to be taken into account. Simply put, your business metrics are, by definition, the various means of measurement used to acquire accurate information about different business processes.
The key metrics for marketing campaigns can be used to:
With the information obtained, you can easily track the success or failure of all the strategies that the startup uses.
Having said that, let us examine some of the key metrics startups can use to track the success of their marketing campaigns.
In measuring the success of your startup’s marketing efforts, you have to consider marketing ROI. Marketing ROI refers to the return on investment that is made from any marketing campaign.
When you know the marketing return on investment, it becomes easy for you to determine whether the marketing strategy is a success or not. It is also a good way of comparing marketing campaigns to determine which was the most effective. One way to test multiple campaigns for success is through A/B testing.
Marketing Return on Investment for startups can take different forms and they include:
In the digital world that we live and do business in today, social media plays a vital role. It is not just a tool that is used for social interaction, but can also be used to market products and services that are being offered by a startup.
If social media ads are one of the marketing strategies that you employ for your startup, then one key metric of measuring success is ROI on social media ads. To achieve this, you have to carefully analyze how much is spent to run these ads and compare it to the return on sales it brings to the startup. For example, you spend $200 on social media ads on Facebook. If that ad gets 500 clicks with 10% conversion rate, that means 50 people are buying your product. If that product is sold at $10, total sales recorded will be $500. You ROI on $200 spent for that ad is $500. You’re making $2.50 on each $1 you invest into social media ads. A better way to measure ROI is to also look at the payback period – this is particularly useful in subscription based services or products that drive repeat purchases.
Social media marketing tool. | Photo Credit: Alexander Shatov on Unsplash.
A common marketing strategy among many businesses, both small and large, is SEO and Content Marketing.
SEO is Search Engine Optimization and refers to all the efforts put in place to rank high (the goal is always to be on the first page) on search engines like Google. These efforts can include web optimization, content optimization, and keyword placement in articles, among others.
Content marketing, on the other hand, refers to the act of using content to attract sales. This type of content is usually written to inform prospects and existing customers about a particular product or service offered by a startup. The end goal is so that after reading information on the startups website or elsewhere on the web, users can engage with the startup through a call to action provided in the content.
If you use SEO or content marketing for your startup, then you can also measure the return on investment this marketing effort is bringing to the startup.
Search Engine Marketing is a combination of search engine optimization and paid search ads. The aim of this marketing campaign is to draw more customers to your startup while still retaining existing ones.
Paid SEM makes it possible for people who are searching specific keywords relating to your startup to find you. To drive sales using paid SEM, the focus is on choosing the right keywords to connect your startup to its customers.Utilizing a paid service to find the right keywords can save you time and marketing efforts. While you can do this yourself, it can be quite labor intensive; this job can be outsourced with a dramatic ROI in sales when done properly.
In measuring the ROI on paid SEM, you have to look at its impact on the ranking of your startup in organic search results. You also have to pay attention to how many new customers are finding and engaging with your startup online. The higher the number of new customers your startup records from organic searches, the more effective paying someone to conduct keyword research and SEM is.
Paid ads help rank you higher, but are not organic search results in nature. Once you stop paying for the ads, your ranking will fall. Organic search results tend to have long lasting rankings once you get to the first page.
Traditional media ads include television, print, radio, billboards, etc., and they can still be used by startups to market their products and services to prospects. However, it is important to mention that tracking the ROI on traditional media ads and its effectiveness can be very difficult.
To determine the success of traditional means of advertising, you can conduct a brand survey asking people how they heard about your business. You can also pay attention to social mentions immediately when the campaign is launched or promoted on traditional media to know what people are saying about it.
Sales metrics are data points for measuring the performance of a startup. These metrics help to track a business’ performance based on its goals and identifies the strengths and weaknesses of such performance.
This metric of measuring marketing efforts is vital and must be treated as such. Sales metrics are typically measured over days, weeks, months, and yearly can tell you whether or not customers are interested in your products or services.
Some examples of sales metrics include:
Opportunity-to-win Ratio: Sometimes referred to as win rate, this ratio is used to measure the success of sales recorded when there is an opportunity. This is particularly useful for B2B startups and businesses.
Average Deal Size: Average deal size, as it relates to business sales, gives you an idea of how much you are making on an average per deal. It’s difficult to increase sales without knowing your average Deal size.
Churn Rate: Churn rate refers to how good you are at keeping existing clients. Churn rate is a good sales metric because how well you can retain customers determines how much sale you can make over a specific period. This is particularly useful in cases where repeat purchases are expected such as subscription based businesses.
Conversion rate, as a key metric for measuring the success of your startup’s success, refers to the total number of visitors who have carried out certain tasks on your business website. When there is a high conversion rate compared to what was previously recorded, that’s an indication of a successful marketing campaign. In determining conversion rate, several factors must be considered such as the number of visits, interactions per visit, and the value per visit.
There are numerous metrics used to monitor the success of your startups. The few outlined above will serve you well to ensure your startup retains or acquires the new potential to reach greater heights.
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This content was originally published here.