14 Important Digital Marketing KPIs and Metrics You Should Know

14 Important Digital Marketing KPIs and Metrics You Should Know

Dear reader! You have hit the jackpot by finding this article. We’ll go through a few interesting algorithms to assist you in better understanding your marketing flow. It’s hard to believe, but people may be wrong about how they do the things they do daily.

Let’s look at some digital marketing agency KPIs and reflect on them today. You might uncover a crucial aspect of your methods that you were unaware of.

What differentiates metrics from KPIs?

A metric is something you can count, like events or actions, such as tapping the leave a message button, which is the meaningful difference between them. A metric is only a number, and it is up to you to decide how to interpret it.

What Makes These Digital Marketing Formulas So Crucial?

A Key Performance Indicator (KPI) provides insights. KPIs typically have normal values, and comparing the actual number to the average value might reveal information about your company. For example, there are typical email marketing open rates for several industries. Before establishing your own standards, check them.

You need to look at the stats to be sure your business is doing well.

  • Although rising graphs and cash flows make you feel good, they are frequently irrelevant to the expansion and development of your business.
  • Numbers are reliable. Nothing can evade analytics scrutiny if the computations are accurate.

You should concentrate on relevant info that reveals your digital marketing performance standards. Depending on your business and aims, there is a range of critical metrics for digital marketing that you should monitor. We will look at a few of them today that are relevant to most organizations.

  • Data collection should be done with care. Here are three considerations to bear in mind before beginning to use formulas.
  • Reduce the human factor by carefully and consistently gathering your data. To keep your business on track, carefully and routinely monitor your statistics.
  • Use Google Analytics to quickly collect and analyze your digital marketing data, create your first custom report, and expand your audience.
  • You’ll need to develop your abilities in Google Analytics to prevent sampling once you have enough data.

Sales and Marketing Performance Metrics

Conversion Rate (CR)

The simplest metric is conversion rate, but it’s still significant. The proportion of users who carry out the desired activity is the conversion rate (purchase, download an app, submit a contact form).

CR = Amount of conversions / Amount of visitors x 100%

You can see the overall number of visits and the conversion rate in Google Analytics.

Click-Through Rate (CTR)

This website metric is used. In some cases, clicks turn into sales. The ratio of users who click a link to all users who view it is known as the click-through rate.

CTR = Number of clicks / Number of impressions x 100%

CTR is frequently used to assess the effectiveness of internet ads. But it’s not the only metric used to assess the effectiveness of PPC ads.

Costs per Click (CPC)

This KPI reveals whether you can cut costs on sponsored advertising. The cost per click reveals what you pay each time your advertisement clicks. The cost-effectiveness of an advertising campaign is evaluated using CPC.

CPC = Ad Costs / # of Clicks

You can natively integrate Google Ads with Google Analytics and then use OWOX BI to finish the integration with other ad platforms.

Cost per action (CPA)

CPA is a metric that illustrates the expense of carrying out the intended action. You can use it to evaluate how well the digital marketing funnel is working. Which action you consider desirable—subscribing to a newsletter, asking for a callback, or doing something else—is entirely up to you.

CPA= Sa/NC   

CPA marketing, in which you are paid for each conversion that originates from an affiliate source, is based on this straightforward measure. However, this approach has the drawback that dishonest affiliates might try to trick you with traffic. 

Cost per Lead (CPL)

Compared to the prior KPI, this one is even more popular! Cost per lead is comparable to cost per action, except that you are paying for a potential customer’s contact information.

CPL = Cost of ads / Number of leads

To determine this measure, add up all your advertising expenses, such as those related to gated content registration, and divide the total by the number of leads attracted. This indicator will demonstrate whether or not your lead generation expenses are within your set limits. Remember that a lead is not even a devoted following; they are just halfway to becoming clients.

Customer Acquisition Costs (CAC)

Money spent on advertising and digital marketing is included in the cost of client acquisition. CAC is the price of persuading someone to purchase your good or service. It can be difficult, but it’s worth the effort to calculate the overall marketing expenditure. In addition, it can assist you in identifying the system bottleneck values.

Drop-Off Rate

Within call centers: Abandon rate = number of calls not answered / number of calls received x 100%

For retail stores: Abandon rate = number of shopping carts left empty/total number of transactions started x 100%

The optimal practice is continuously monitoring the abandon rate based on average industry values and audience cohorts.

Return on Ad Spending (ROAS)

This is one of the most crucial digital marketing indicators for gauging the effectiveness of advertisements because it is simple and clear. You can see the difference between successful and unsuccessful efforts if you use it as the primary statistic for each digital marketing campaign.

ROAS = Revenue from the ad / Cost of the ad

ROI (ROMI for marketing)

Even among individuals who have never heard of analytics, ROI reigns supreme among KPIs. Return on investment is a performance indicator used to assess a specific’s effectiveness.

ROI= ((Gain from Investment – Cost of Investment) / Cost of Investment) x 100 %

For virtually any procedure, ROI can be determined. However, ROI is typically standardized and must be greater than 100%. Therefore, locate the benchmarks for your specific instance before you begin your computations.

Average Revenue Per Account, User, or Client (ARPA, ARPU, ARPC)

You can see the average revenue from an account by looking at the average revenue per account (or per user or customer).

ARPA = Total Monthly Recurring Income / Total Number of Accounts

If you are preparing to boost pricing, check your ARPA right away. Then later, check it. The ARPA will decrease if the monthly recurring revenue does not rise, proving that boosting prices was a terrible move.

Time to pay back the CAC

This indicator illustrates how long it will take to recoup digital marketing expenses to acquire a customer. Time for repayment CAC metrics is particularly important for SaaS companies with lengthy sales funnels.

It’s time to repay Customer acquisition cost (CAC) is equal to the product of the average revenue per account (ARPA) and the gross profit.

Gross Profit = Sales – Cost of Goods/Services Sold

Recurring Monthly Revenue (MRR)

MRR is a statistic for recurring revenue parts of a subscription business, in basic terms. It enables businesses to forecast revenue and adjust their sales strategies.

MRR = Total monthly fees paid by customers


MRR = ARPA per month x the total number of customers per noninvestment

Share of Wallet (SOW)

This indicator displays the proportion of buyers’ sales dollars in their pockets. You can gather this information through focus groups or marketing investigations. Focus groups are a challenging yet fascinating approach to getting data since your participants will provide thoughts you would never have thought of! To meet them, merely take the first step.

SOW = (Total cost of purchases a customer has made from your company / Total cost of purchases a customer has made in the same product or service class) 100%

Let’s assume Ann spent $120 on cosmetics this month and $20 on your homemade products. 20/120 x 100% = 16.6% would be your SOW. Lower than expected!

Customers’ Lifetime Value (CLV)

Customer lifetime value can be based on the past (the total profits from a customer’s purchases) or the future (the total revenue your business expects from the relationship with this customer).

CLV = Average Gross Margin / (Customer Retention Rate / 1 + Discount Rate — Customer Retention Rate)

What makes CLV so crucial? Because your revenue will increase the longer consumers stay with your business.

Bottom Line-Beyond the Digital Marketing Metrics Waterfall

The KPIs and indicators discussed in this article are the tips of the measurement iceberg for your digital marketing activities. Getting to know them is important, so you won’t be as taken aback as the Titanic’s crew when you run into problems in the wide world of business.

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