Marketo-DG2DA

PART IX: MEASUREMENT
METRICS
Back End Metrics
Back end metrics are generally more
complex than the front end metrics
because they track your
advertisement’s impact on revenue.
Often back end metrics are tracked
with the help of a marketing
automation platform, which enables
marketers to take the front end
metrics and track that activity all the
way through the customer lifecycle
to determine ROI.
Marketing automation allows
marketers to directly connect their
advertising activity and data to their
marketing automation platform. This
connection enables marketers to
effectively track customers from
awareness to engagement with your
advertisement all the way through
the sales funnel—from MQL and SQL
to pipeline and ultimately, revenue.
These metrics are important to
understand at both a digital
advertising program level and for the
individual advertising platforms.
This section goes into more detail on
what back end metrics you should
be tracking.
Return on Investment (ROI) and
Return on Ad Spend (ROAS):
Return on investment (ROI) and
return on ad spend (ROAS) are
essentially the same metric despite
the difference in terminology (this is
based on whether you are a B2B
(ROI) or B2C (ROAS) organization.)
These metrics measure how much
your advertising campaign generates
compared to the cost of running the
campaign. Essentially it’s the go-to
metric to measure effectiveness.
It’s usually shown as a percentage.
This simple measurement helps
advertisers calculate and adjust
their advertising in real-time, and in
the case of programmatic
advertising, this metric is used to
help optimize bids.
Pipeline Created: With First Touch
and Multi Touch Attribution
To become more strategic about
measuring financial metrics from
digital advertising, start by
recognizing that your buyer rarely
makes a purchase as a result of a
single campaign.
Conventional marketing wisdom
proposes that at least seven
successful cross-channel touches
(forms of engagement) are needed
in order to convert a cold prospect
into a buyer.
Sometimes companies attempt to tie
revenue to either a customer’s first
touch or his last. But, it’s important to
determine which strategy works best
for your organization. We’ll cover the
different attribution strategies in the
next section.
Lifetime Value of a Customer (LCV)
The lifetime value of a customer is a
prediction of the new profit attributed
to the entire future relationship with
the customer. In businesses where
the customer lifecycle is cyclical, with
repeat purchases, advocacy, and
referrals as a large part of revenue,
the LCV of customers coming in
from different advertising programs is
an important part of proving your
digital advertising’s value.
The formula is:
Revenue – Cost/Cost
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