In today's highly competitive online marketplace, marketers need to use every advantage they can get. Typical web analytics are available to anyone who takes the time to look at them. Even so, a large number of marketers don't get real value from their data. After all, looking at data is only wasted time if it doesn't result in actionable insight.
That's where business intelligence (BI) software comes in. It can help you look at your data in new ways, and draw actionable insights that allow you to more effectively and efficiently allocate resources.
BI software can distill large amounts of data so you can implement successful strategies based on the information. By monitoring the right key performance indicators (KPIs), businesses can see trends that would otherwise be hidden.
Dashboards with the right key performance indicators can act like an alarm clock, notifying you when certain KPIs are under or over-performing. Additionally, they can help small businesses compete with larger ones, evening the playing field. Proper dashboards can give you insight into trends that can't be seen using other methods.
Key Performance Indicators: Are You Watching the Right Stuff?
Like many things in life, the information you retrieve from your business intelligence software is only as good as the data going in. Online marketers have certain indicators they should be monitoring on a continual basis.
Some fundamental KPIs to get you started are the total number of visitors on your website, the average amount of time visitors spent on your website, and the bounce rate of those visitors. This shows you how many visitors arrived at your site, how long they stayed, and how many immediately left.
Return On Investment
One of the most important KPIs for your company to monitor is return on investment. This shows you which campaigns are successfully contributing to the bottom line.
This metric shows how many of your marketing efforts actually lead to sales, demonstrating the effectiveness of each campaign. In order to access and monitor this KPI, first build a sales baseline and then monitor which sales channels vary based on your marketing changes. To calculate this, use the revenue from your marketing minus your baseline sales.
Conversions by Campaign
Conversions by campaign shows which campaigns have captured the highest number of leads and / or sales.
Cost per Lead
Cost per lead measures how many leads are generated per dollar spent. This will allow you to justify how much money is spent on every campaign.
Visitor to Buyer Ratio
A visitor to buyer ratio measures how many visitors that come to your site actually buy something.
Sales by Lead Source
While knowing how many visitors are converting is great, sales by lead source shows which leads are generating the most sales. Some examples may include search engine traffic, pay per click traffic, social media, referrals, and more. Knowing your most profitable sources of leads can reduce costs in future ad spending.
Is the time you spend on social media really paying off? By monitoring your social media interactions, you can get a good idea as to how effective your social media marketing efforts are to improving audience engagement. You can monitor things like the number of Facebook likes, Google +1s, retweets, and more. This metric shows you the number of valuable social media interactions over a period of time.
You probably spend a lot of time and money trying to improve your search engine rankings every month. First page results in search engines for the right keywords can be very profitable. Tracking your site's rankings for individual keywords can show you which search engine optimization campaigns are paying off.
Feeding your Sales Funnel
For many marketers, the number of leads being added to your sales funnel each month can be a very valuable metric. By visualizing your sales funnel with business intelligence software, you can get a good view of how your visitors move through the sales process from an initial lead to a sale. This can help you forecast sales for the future as well as potential revenue.
Finding Your True Customer
Your true customers make the difference. Using the proper KPIs can show you which customers are buying versus leaving without spending a cent. Do you know your true customers? Where are they coming from? Are they coming back for upsells in the future?
By knowing which sources of traffic are the most profitable over time, you can reduce your spending on less profitable campaigns. With this information, you can improve your metrics over time and grow your business.
Waking Up with Alerts
Having the right data displayed in a dashboard format can help your company be proactive instead of reactive. Too many marketers only see changes after it's too late. This is particularly true when it comes to sources of traffic. A great example would be a marketer who has all of his / her traffic coming from one source (i.e. organic traffic). When a search engine changes the rules (and we've all seen this happen), traffic disappears along with revenue.
A proper dashboard can alert you if too many of your leads, conversions, and sales are coming from a certain type of traffic. This can be a great reminder to diversify traffic sources before it is too late.
When it comes to business intelligence, it can make a world of difference for small businesses looking to even the playing field with large ones. There are a number of solutions for small businesses, but personally I've found Domo to be very helpful. You can set up dashboards that will show key performance indicators that matter to your business. This can range from simple data, to more advanced metrics which measure performance over time. These trends can show you seasonal changes from year to year as well as alert you when your market is about to change.
Wouldn't it be great to be proactive with your online marketing instead of reacting after it is too late? Get the jump on your competitors and improve your marketing with a proper business intelligence solution.