When it comes to running a business, it becomes important to know whether your marketing budget distribution is reaping dividends, that is, whether every marketing tactic you’ve implemented is generating a positive ROI. Generally, when businesses draw up their marketing budget, they do so with the assumption that every marketing dollar spent within that budget will be an investment rather than an expense. This is to say that every dollar spent should contribute, in the end, to your business’ bottom-line, instead of draining your business’ resources.

What Does Marketing ROI Entail?

At its most basic definition, ROI is dependent on two factors: cost and the final profit. These two variables can help you determine the returns generated by a particular aspect of your business. So, to calculate the basic ROI on a given marketing effort, you subtract the marketing cost from the total sales generated, and divide it by the marketing cost, again.

Read: 5 Ways to Get the Best ROI from Your Lead Generation Strategy

What Constitutes a Good ROI?

Ideally, you want your ROI to be over 3, at the least, while a ROI of over 7 is excellent. So, a sales growth of $75 with a marketing spend of $20 – which gives you a ROI of 3 – means that your marketing effort is doing considerably well. But, a sales growth of $160 with the same marketing spend – giving you an ROI of 7- implies a higher rate of success with that campaign.


The above calculation isn’t, however, accurate, since it assumes that your entire sales process hinges on the success of a single marketing campaign. A more accurate ROI involves a much more complex formula that factors in a number of variables and customer-data. You’ll need to ascertain a number of factors such as:

  • The number of visitors your website receives each month
  • The number of leads generated per month
  • The source of each lead generated
  • The number of leads successfully converted into customers with your marketing efforts
  • The impact of your efforts on your customers
  • The extent of change in your impact if you adjust your budget

The values derived from each of the above factors will allow you to tweak your marketing strategy to be more effective, with a higher optimized ROI. These measurable values or metrics, along with the cost and final profits, that determine your ROI, and therefore, the success of your business, are known as key performance indicators (KPIs).

Choosing the Right KPIs for Growth

Choosing Marketing Metrics, KPIs, Marketing ROI

Choosing the right metrics or KPIs to determine your ROI can be tricky, especially as there is an overwhelmingly large number of metrics to choose from! How does one identify the right metrics without getting lost under a pile of data? How does one determine which metrics are better indicators of success than others? The solution is to segment your KPIs – especially in content marketing – in a way that it reflects your conversion funnel; i.e. metrics that determine the:

  • Reach of your marketing efforts
  • The rate of Engagement your content or brand generates with your customers
  • The extent to which your marketing efforts effected a successful lead Conversion

In this article, we’ll look at some metrics that fall under each segmentation category.


The metrics that fall under Reach determine, in essence, the visibility of your content; it determines the extent to which users are aware of your content and your brand. The higher your reach, the higher the number of potential leads can be generated.

The metrics that fall under Reach include:

  • ImpressionsPage impressions tell you how many times your page has been loaded and viewed. Page impressions, on their own, can give you an idea of whether people are able to find the content.
  • Traffic: This is the number of overall visitors who visit your website within a given period of time.
  • Subscriber/audience size: This metric tells you what percentage of your website traffic are potential customers: i.e. what percentage of those visitors is your content actually targeted at. This metric is far more useful in determining the success of your content marketing strategy than traffic.
  • Share of Voice: This metric determines your website’s or content’s reach or visibility in comparison with your competitors within a particular market or channel. In digital marketing terms, a higher ranking and CTR for a group of pertinent keywords could indicate a higher share of voice.
  • Audience Penetration: This metric determines how much of a given market or channel your audience takes.

To achieve a higher reach with your target audience, you need to ensure your content is tailored to their requirements; you can do this by creating buyer personas: hypothetical customers who will benefit from your product or brand.


Engagement metrics determine the extent to which customers are attracted to your content. Engagement rates determine how much your customers trust you as a source of relevant information over your competitors. Some engagement metrics include:

  • Time on site: This KPI determines how much time your customers are spending on your website or interacting with your brand.
  • Bounce rate: This tells you how many viewers are leaving your website after viewing just one page. The higher your bounce rate, the less engaging is your content.
  • Page views: This metric determines what pages your viewers have visited after coming to your website. The more the number of pages visitors view within a single visit, the more engaged are your visitors with your content and brand.
  • Return visits: This self-explanatory metric tells you how many visitors return to a given web-page or website, indicating a level of interest in your content or brand.
  • Referrals: This tells you how many new visitors an existing user or subscriber brings to your website. Analytic tools like Google Analytics allow you to track referral paths which indicate the sources from where this traffic comes from: whether it’s through a social share like a Tweet or FB post made by a user or a link in a blog post. This metric can, therefore, help you identify top influencers and promoters in your audience.
  • Social Shares and Interactions: This indicates the channels where your content is being shared and the extent of interaction on each of those channels.


Conversion metrics are the most crucial metrics that need to be tracked by a business; these metrics are an indication of customer’s readiness to do business with you. Unfortunately, these are often overlooked in favor of vanity metrics like CTR or number of registered/subscribed users, which are specific to an individual offer or message. Whereas, conversion metrics, or actionable metrics, measure the overall, long-term changes in users’ behavior and engagement with your brand.

  • Brand lift: This indicates whether your brand marketing efforts are generating enough awareness among your customers, and if your current message is resonating and memorable with customers. While it may seem like an impossibility to measure such abstract concepts, there are ways to obtain quantifiable data through tools like Google AdWords Brand Lift Surveys.
  • Perception/attitudinal changes: This metric gives you an idea as to the way your audience currently perceives your brand. When customers start exploring your brand more and seeking more information about your brand, you can ascertain their level of trust and readiness for a sale.
  • Behavioral conversions: This metric tracks a user’s behavior across your site: whether they click to a different part of your website, search for more information within your website or fill in a form to become a lead or subscriber.
  • Lead conversions: This tells you how many leads your efforts are generating; whether they’re newsletter subscriptions, coupon or special offer downloads, or signups for webinars. Based on the type of marketing they’re engaging with, you can also determine the quality of that lead.
  • Sales Lift: This metric determines the increase or decrease in sales generated over a period of time.


There are multiple paths that a user can take from acquisition to conversion; each of these users will need a number of nurturing tactics along the way, before they’re finally ready to do business with you. Not all visitors will turn into customers, though; you’ll lose a number of leads at various stages down the funnel. At the end, only your most qualified leads will turn into customers. So, segmenting your marketing KPIs to reflect the conversion funnel makes the most sense; this will allow you to track the relevant data with which you can inform your marketing strategies to become more effective.

Read: Using and Understanding Big Data to Optimize Your Online Strategy

Now, that you know what data you should be tracking, your next step involves presenting and organizing this data into comprehensive reports. Once, you have all your data organized, you can calculate your ROI of your overall marketing efforts.