Whether you want to enhance your digital marketing skills with analytical knowledge or aim to become a dedicated digital marketing analyst, there are many paths to growth in this area of digital marketing. By understanding and applying digital marketing analytics, you can ensure your campaigns are as efficient and successful as possible, taking your business to the next level.
Key Takeaways
What is Digital Marketing Analytics?
In the world of digital marketing, a marketer needs to be creative, decisive, and intuitive about the needs of their business and audience. However, they don’t have to rely solely on instincts. The emergence of big data provides a significant opportunity for digital marketers to support their decision-making with concrete evidence.
Digital marketing analytics has significantly transformed the marketing landscape. It helps marketers evaluate campaign success, track customer behavior, and even inform new product development. And the best part? You don’t have to be a data analysis expert to benefit from digital marketing analytics.
So, what exactly is digital marketing analytics, and how can you use it to enhance your marketing practices? In this guide, we’ll cover everything you need to know about digital marketing analytics, including:
- Explanation of digital marketing analytics
- Importance of digital marketing analytics
- Key digital marketing metrics
- How to use digital marketing analytics in your strategy
Complete Explanation of Digital Marketing Analytics
Digital marketing analytics involves the measurement, collection, and analysis of data from various digital channels. This process provides insights into user behavior and how they interact with digital content. Relevant data can come from multiple sources, including websites, social media, search engines, and email—each digital channel can provide useful data in several ways.
The specific metrics analyzed vary widely, covering everything from website traffic to landing page performance, conversion rates, engagement levels, and more. These insights can come from dedicated data analysts or digital marketers with an analytical bent, and they can inform real-time strategies across almost every channel. By complementing natural intuition and creativity with concrete facts about what works, what doesn’t, and where to allocate budget and resources, digital marketing analytics has quickly become an indispensable tool for continuously improving marketing strategies.
Furthermore, the data collected from digital channels not only informs current strategies. By comparing the impact of past and present campaigns, marketers can optimize future campaigns. The result? Better ROI, less wasted resources, better targeting, and ultimately, more satisfied customers. In theory, this leads to increased revenue. Everyone benefits!
Why is Digital Marketing Analytics Important?
Digital marketing analytics is more than just crunching numbers. It’s an invaluable tool for understanding audiences, tactics, and assessing the effectiveness of overall digital marketing spending and strategy. Here are some specific reasons why digital marketing analytics is crucial:
Tracking Customer Behavior and Preferences
By tracking customer behavior in real-time, you can quickly identify the content that resonates most with your audience. Understanding their interests and issues helps you update content quickly, delivering the right message to your audience.
Assessing Campaign Performance with Granular Detail
Once a campaign is launched (and even during its run), digital marketing analytics helps you measure its effectiveness. More than just evaluating whether a campaign is successful or not, you can delve into specific elements like channels, timing, or targeting. You can make adjustments, even on successful campaigns, to further enhance certain aspects in the future.
Optimizing UX Design
UX design is at the heart of the customer experience. Proper analytics can help optimize websites, apps, and other customer touchpoints to improve the customer journey. For example, you can use customer feedback and website analytics to see which user paths are most popular, helping you prioritize which paths to optimize and which to remove.
Identifying Growth Areas
Before launching new products, services, or campaigns, digital marketing analytics can help identify emerging growth opportunities. For example, tracking popular keywords, trends, topics, or products—what’s good and what’s getting bad reviews—can help shape your product development and campaigns.
There are many other reasons why digital marketing analytics is necessary. The growing number of tools and their flexibility means no area of digital marketing is out of reach. Understanding how to use data effectively for every project you undertake can ensure your campaigns are as efficient and successful as possible.
Key Digital Marketing Metrics
We touched on some digital marketing metrics earlier, but which metrics are most important?
The answer depends on what you aim to achieve. Metrics used to evaluate the success of an e-commerce site, for example, will be very different from those used to measure the results of an email marketing campaign.
Here are some common digital marketing activities you might undertake and popular metrics you can use to measure them. While you might be familiar with some of these, we include explanations for clarity.
Metrics for Evaluating Content Marketing or Website
- Website Visits: Total number of visits to a website, usually measured over a specific period.
- Time Spent on Site: Total time (in minutes or seconds) that users spend on a website or webpage.
- Pages Viewed: Number of pages viewed by users during their visit.
- Returning Visitors: Percentage of users who have visited your website more than once.
- Bounce Rate: Percentage of visitors who leave your website after viewing only one page.
- Average Pages Viewed: Average number of pages viewed by users during a single visit to the website.
- New Visits: Percentage of first-time visitors to your site.
- Referral Source: Web sources directing traffic to your site, such as email, search engines, and other external links.
Metrics for Evaluating Social Media Campaigns
- Followers: Number of active users following your organization’s social media accounts.
- Engagements: Total number of likes, comments, and shares received by a post or ad.
- Reach: Number of unique users who see your post or ad.
- Impressions: Total number of times a post or ad is loaded on a page (one user can contribute multiple impressions).
- Click-Through Rate (CTR): Percentage of people who click on a link from a post or ad.
- Conversion Rate: Percentage of users who click on a link and then complete a desired action, such as making a purchase or sharing the link.
- Cost per Action (CPA): Cost associated with achieving a desired action (usually a function of the overall campaign cost and conversion rate).
Metrics for Evaluating Email Campaigns
- Open Rate: Percentage of emails opened from the total sent. Indicates the effectiveness of your subject lines and preview text.
- Click-Through Rate (CTR): Percentage of people who click on links or buttons in your email.
- Unsubscribe Rate: Number of people who unsubscribe from your mailing list after receiving your email.
- Email Bounce Rate: Percentage of emails that didn’t reach their intended recipients due to technical issues, such as firewalls or incorrect addresses.
- Conversion Rate: Percentage of users who complete a desired action after receiving your email, such as clicking a link or completing a survey.
Metrics for Evaluating E-Commerce Websites
- Revenue: Total amount of money generated from the sale of goods or services.
- Conversion Rate: Percentage of visitors who complete a product purchase, sign up for your newsletter, etc.
- Average Order Value: Average amount spent per purchase, either site-wide or per user.
- Number of Transactions: Total number of purchases made—could be site-wide, or investigating individual users.
- Average Items per Order: Average number of items bought per order.
Metrics for Evaluating Lead Generation
- Number of Leads: Percentage of people who have interacted with your company or brand in some way.
- Lead Conversion Rate: Percentage of leads converted into customers.
- Cost per Lead: Amount of money spent to generate one lead.
- Lead Quality Score: Measures the quality of leads generated, based on various other metrics like demographics, user interests, and activity. Determines how likely a lead is to convert into a customer.
- Return on Investment (ROI): ROI is a profitability measure, in this case, for a lead generation campaign. Measured by dividing the revenue generated from the campaign by the total campaign cost.
As can be seen, even for a few selected digital marketing activities, the measurable metrics are numerous. And this is just a fraction! Once you start delving into the data, you’ll soon find new things to measure, many of which you may not have realized until you started looking. This uncertainty is part of what makes digital marketing analytics such an exciting area to explore.
It’s important to remember that each digital marketing metric is just one piece of a larger puzzle. A comprehensive understanding of how your efforts are performing requires a holistic approach. Often, you also need to compare metrics across various channels simultaneously. Digital marketing is rarely neatly compartmentalized!
How to Use Digital Marketing Analytics in Your Strategy
Now that we know what digital marketing analytics is, what metrics you might want to track, and why all this is important… How can you implement this information?
This section is a step-by-step guide to incorporating digital marketing analytics into your strategy. We’ve deliberately kept it general because the specific steps you take will vary depending on the channel you’re working on and your goals. But the principles remain the same.
Step 1: Set Goals and Choose the Right Metrics
The first step in a data-driven digital marketing strategy is to have a solid understanding of what you’re trying to achieve and a set of relevant metrics. In short: set measurable goals.
Your metrics should be relevant to the project and broken down into smaller, achievable steps. As the foundation of your entire strategy, it’s essential not to rush this step.
For example, if you’re creating a new website, your goal might be to increase lead generation by 50% from the current level. Metrics you might need include lead conversion rates and website traffic metrics.
On the other hand, if you’re launching a new email marketing campaign, your goal might be to boost sales revenue for a particular product. Metrics like open rates and click-through rates can help you measure this. These are simple examples but give you an idea of the questions you need to consider.
Step 2: Choose the Right Tools
Once you’ve set goals, the next step is choosing the right digital marketing analytics tools to help you. These can include web analytics tools like Google Analytics, social media analytics tools like Sprout or Hootsuite, or email marketing tools like MailChimp or HubSpot.
The key is to choose the right tool for the right job. There are many digital marketing analytics tools offering broad data analysis, while others may offer more specific but targeted functionality.
It’s also important to realize that big providers promising everything may not always be the best option. If nothing else, you may have a limited budget, and these tools can be very expensive. Finding more specific offerings for your needs might be a better approach.
Step 3: Benchmark Current Conditions
After selecting goals, metrics, and appropriate tools, you must establish a baseline. Simply put, measure your current performance. Even if your existing campaigns aren’t performing well, measure the chosen metrics accurately so that you have something to compare future efforts to.
For example, if you’re launching a new website, you’ll want to track things like the number of pages viewed, click-through rates, and conversions on your existing site first. This will help you see if the new site performs better. Other metrics you might want to measure include bounce rates, time on site, and so forth.
Of course, if you’re trying something for the first time (e.g., creating a new social media presence), you can’t always measure existing performance. However, you can still make informed guesses. This might involve looking at your current activity on similar social media platforms, for example. Or it might mean measuring your performance in other channels that you expect to integrate with your new campaign.
Once you’ve set a baseline, you can start tracking and measuring progress over time.
Step 4: Collect and Analyze New Data
You’re now ready to implement your new campaign and collect data. Create reports using the chosen data analytics tools. More often than not, these digital marketing tools are specifically designed for non-technical users and come with built-in reporting functionality.
However, remember: analyzing data is more than just looking at automatically generated graphs and charts. You know your business and goals better than anyone else. Only you can evaluate how well your digital marketing efforts are performing. In short, tools can provide insights, but only you can make the right decisions based on those insights.
Your analysis should always be driven by the goals you set in the first step.
For example, if you’re running a PPC campaign, your analysis might involve looking at the click-through rate of your ads and the conversion rate of the landing pages they link to, to see how many users are dropping off along the way. This can help you determine if something is wrong with the landing page copy, for example.
Meanwhile, if you’re running a social media campaign to increase brand awareness, the most important metrics might be things like likes or shares, not conversion rates (as the former are more commonly associated with increasing awareness).
If you’re unsure which metrics to use, measure them all! It’s better to have more data than you need than to find yourself lacking.
Step 5: Monitor, Adjust, and Make Tough Decisions
Finally, the most crucial step of all: monitor and adjust your strategy. This is where the true power of digital marketing analytics lies. By continuously analyzing data and adjusting your approach, you can ensure your campaigns always perform optimally.
For example, if you’re running an SEO strategy, you might find that some keywords perform better than others. If so, what can you do to optimize these pages?
Meanwhile, if you’re running a social media campaign, you might find that video content gets more shares than static images. To boost shares further, you might choose to allocate more of your budget to video production in the future, maximizing engagement.
Whatever you’re working on, try to stay as emotionally detached as possible from what the data says. It can be challenging when you’ve poured your heart and soul into a campaign only to find it isn’t working. Similarly, when a strategy seems to be going well, it’s easy to get carried away and overlook potential areas for improvement. But in both cases, this is where digital marketing analytics comes in handy. It illuminates dark spots and helps you improve overall.
Conclusion and Next Steps
We hope this guide provides a comprehensive understanding of digital marketing analytics. In this guide, we’ve learned that:
- Digital marketing analytics involves measuring, collecting, and analyzing data to gain insights into user behavior and how customers interact with digital content.
- There are many digital marketing metrics you can measure, depending on the channel. Common ones include website traffic, social media followers, impressions, email click-through rates, and conversion rates.
- Digital marketing analytics is essential for tracking customer behavior, assessing campaign performance, optimizing UX design, identifying growth opportunities, and more.
- Implementing digital marketing analytics into your strategy involves setting clear goals, measuring current performance, collecting and analyzing new data, and monitoring and adjusting your approach as needed.
