All too often, we hear that clients who have worked with other digital marketing agencies either don’t get digital marketing reports or, if they do, there is so much industry-specific jargon that they don’t really get value out of the reports. As a result, any reports they get are ignored or tossed to the side. That kind of practice makes it very difficult for companies to see any return on their investment and reflects poorly on digital marketing agencies as a whole. We hate seeing clients sink money into marketing efforts that they can’t tie results to, especially since it is so easy to track marketing efforts online.
Whether you are currently running digital marketing with another agency or have given up on it in the past, we want to give you a basic understanding of common metrics, why they are used to communicate results, and how they tie into your greater business goals (or don’t). We hope that a better understanding of important metrics will empower you to ask the right questions when looking at your results and help you identify what’s working and what’s not so you can make impactful decisions.
Sessions, Users, and New Users
These are all top-level numbers that indicate how many people found your website. Google Analytics (the most common website analytic program) can identify if a single person has been to your website multiple times or if someone is new. In any given date range, you can see how many people (users) interacted with your website, how many of those people were new to your site (unique users) and the total number of times people visited your site, no matter if they were new or returning visitors (sessions).
Bounce Rate, Pages Per Session, Average Session Duration
These metrics start to drill down into not only how many people interacted with your website, but what they did once they were there. Bounce rate is how often someone landed on a page on your website, then left without doing anything else, expressed as a percent. There are always debates about what an ideal bounce rate is. After all, a 0% bounce rate is not realistic, but a 100% bounce rate means that people are not finding your website relevant at all and could be a red flag that something was wrong. In general, when you see a decrease in bounce rate, that is a good sign. Pages per session is an average of how many pages people visited on your site before leaving. Similarly, average session duration is how long people were on your website. Again, the ideal number for these metrics are going to be unique to the goals of your website. Ultimately, you want users to find what they need easily and stay on your website just long enough to convince them to take action (like make a purchase or fill out a contact form). It is good practice to establish these numbers early and get a benchmark to compare to later.
Conversions and Goals
Knowing that people are interacting with your website is certainly good information, but what does that really mean for your bottom line? This is when goals and conversions come in. A goal is a specific action that you want a user to take on your website. You can specify almost any action on your website, but you should only count something as a goal when it is directly tied to your revenue. A conversion is a count of the number of times the goal was completed.
The most obvious goal to track is purchases, but that only applies to websites that sell their product online. What if your company sells a service like lawn care or digital marketing (wink)? In that case, you will need to understand how many people called your business or filled out a contact form online. The best place to start when deciding which goals to set up is to ask yourself how your business generates revenue, then set up a goal to track ways for your customers to do that online.
Channels, Sources, and Mediums
Alright, now you know that people are finding and interacting with your website, and taking action that will contribute to revenue for your business — great! Now you need to know how the money you are spending on your advertising is contributing to that revenue. To do that, we need to look at how people found your site. A channel is a broad group of traffic sources. Some of the most common channels are as follows:
- Direct: someone typed your website into their browser window.
- Organic: someone clicked on a non-paid listing within a search engine such as Google, Bing, or Yahoo.
- Paid Search: someone clicked on a paid listing result from a search engine like Google, Bing, or Yahoo.
- Referral: a link from another website directed people to your website.
- Social: someone found a link to your website through a platform like Facebook, Twitter, or Pinterest.
Similarly, you can look at the source and medium. The source is a more specific look at the channels. For example, if someone found your website through an organic search, they could have found it through Google, Bing, Yahoo, or any number of other search engines. In that case, the channel would be Organic and the source could be Google.
Medium is the category of the source. Since the source and medium are listed together in Google Analytics, they can be used in place of the broader channel report. So rather than seeing that traffic came from Social as a channel, you can instead see that some traffic came specifically from Facebook / cpc (paid ads on Facebook) or Facebook / referral (a link to your website on a non-paid Facebook post).
One thing to note about the source/medium names is that much of that information comes from extra characters added on to your website’s URL called UTM parameters. It is case sensitive, and different agencies have different standards. For example, one agency may tag their ads with “cpc,” while others may utilize “paid.” If one ad is tagged in all capital letters (“CPC”) and another is in lowercase (“cpc”) they will show up as different mediums in the report, making it more difficult to read the results. This is why it is important that everyone involved in your online marketing is following the same standards.
CPC, CTR, CPA, and Other Paid Ads Terms
So many acronyms! For those of us in the industry, these make communications easier, but can seem very foreign to others. Aside from overall website metrics, paid advertising platforms have their own set of terms to know. Here is a quick breakdown of some of the most common terms:
- Cost: The amount charged to the ads account.
- Clicks: The number of times a user clicked on an ad.
- Impressions: The number of times an ad appeared.
- Click-through-rate (CTR): The percent of times an ad appeared compared to the number of clicks.
- Average cost-per-click (CPC): The average amount charged per click (found by dividing the cost by the number of clicks). A number of factors go into the exact cost of each click, so this is simply a calculation.
- Conversion rate: The percent of times a click resulted in a conversion.
- Cost per conversion: also sometimes called cost per acquisition, or CPA. This is an average of how much a conversion cost an advertiser. Again, the advertiser is not charged per conversion, but by click. So this number is also a calculation of cost divided by conversions.
Why do these matter?
Of course, your main focus is on growing your business and driving revenue. Why do you need to know all of these terms? The short answer is that it helps you understand what is going on with the money you are spending on digital marketing programs. If you are spending a lot of money on Instagram ads, but not generating revenue, you will need to either change your audience, change your message, or divert those funds to another tactic that is contributing to revenue. The more you know, the better your decisions will be, and the more your business will benefit.
Here at E/Power Marketing, we know that there are an overwhelming number of metrics to know and that can be one of the biggest obstacles to using digital marketing to grow your business. We don’t expect our clients to be experts in the field of digital marketing. That’s why agencies like us exist. It is our job to execute successful programs, make recommendations, and clearly communicate the results to our clients in plain language.
Do you have questions about your current marketing reports or want to talk data in more detail? Let’s talk!