Metrics tell the story behind your marketing efforts. No matter how well you think something is performing, there’s no better way to get the truth than to crunch the numbers. And when you’re a marketing agency, you have to look at the numbers in two ways - what they mean for your clients, and what they mean for you.
Get comfortable with these metrics, and you’ll also be able to use them to help pitch strategies that land you new clients. This article looks at five of the most important marketing metrics for agencies and explains how you can use each one to measure your agency’s success and help your clients.
Also note that we don’t include a lot of industry averages for these metrics, because we think people tend to overvalue industry averages. The best way to consider these metrics is in comparison to themselves over time - that is, measure them now, and work on improving them as you go. Industry averages have very little impact on what you as an agency are capable of.
If you’re not measuring a customer’s lifetime value, you’re doing it wrong. This number represents the overall amount of revenue you receive from a customer over time, and it’s one of the absolute most important metrics you can have.Tracking the overall lifetime value of your customers helps you get a clear picture of your business’s real revenue stream and is vital for calculating marketing budgets and advertising spendsLifetime value is calculated by adding up all of the revenue you’ve ever received from a customer. Calculate this value for a substantial sample size, and you can get a general sense of the average lifetime value of your customers. Of course, sometimes you need to get a lot more detailed than just a general sense. If you’re ready to take a deeper dive into calculating lifetime value, we suggest starting with this article.
Are your clients on retainers, or paying per project? Are you getting repeat business, or are most of them one and done? Are your clients sending referrals your way, generating even more revenue for your company?These are just a few of the questions you’ll answer when calculating the lifetime value of your clients. You’ll find that, no matter how you slice the numbers, the biggest indicator of client lifetime value is longevity. The more times a client comes back to you for a project or renews a retainer contract, the higher their value.It’s really all about trust. The more a client trusts you to deliver on your promises, the more likely they are to keep coming back with more work. Make sure your agency goes out of its way to keep clients happy and to meet their needs consistently.
If you’re working with a SaaS or subscription service, try encouraging annual subscriptions over monthly contracts for their customers. You could even potentially work with them to calculate an expected lifetime value for their customers, then offer a campaign promoting lifetime subscriptions based around that number.For retail operations, you’ll need to work to keep customers coming back to make more purchases? Hone your follow-up and referral campaigns, and take a long-term view of your clients’ relationships with their customers. Encourage brand loyalty with rewards programs, sales, and other incentives. Offer discounted rates on annual subscriptions. Make sure you take advantage of upsell opportunities whenever possible.One more tip for improving lifetime value - be sure your customer service team is second to none. Good customer service can be one of the biggest motivators in keeping customers coming back time and time again.
Cost-per-blank metrics are popular, but it’s easy to let them get way too granular, cluttering up your analytics instead of helping to provide clarity. That’s why we primarily focus on the biggest and most important of them all: Cost Per Acquisition, or the overall cost associated with acquiring a new customer.This metric looks at the advertising costs, marketing campaigns, social media promotion, events, and other expenses aimed at acquiring new customers, compared to the number of sales acquisitions you make. If you compare this number against the Lifetime Value of a customer, you’ll be able to get a pretty good idea of your overall profitability. Ideally, you want a 3:1 ratio of Lifetime Value to Cost Per Acquisition. That is, you’re getting three dollars in revenue for every dollar you spend acquiring new customers. If you’re in a high-growth mode, you can lower that ratio down to 2:1 or further. Just make sure you’re getting more in lifetime value than you’re spending on acquisition!
How much are you spending on bringing in new clients? Consider total costs - not just advertising spends. If you’re spending office hours on proposals or putting together elaborate pitches for prospective clients, that counts towards your acquisition costs. Keep your costs low by focusing on building your organic search traffic, and by encouraging satisfied clients to send referrals your way. Let your work speak for itself - the more successful you help your clients to become, the more you’ll find new customers coming to you for help.
Lowering acquisition costs is one of the most important services you can provide for your clients. Basically it means making your marketing more effective, which is really your primary job as an agency - and involves way more strategy and technique than a single blog post can handle. In general though, make sure you’re running A/B tests on your clients’ materials whenever possible, and keep track of what works best. You should look to become more efficient with every campaign you run.
Do you really still need to care about how many names you have on your mailing list?Yes. You. Do. Your mailing list is one of the most important assets available to you. Email is more widely used than social media, across all age groups. And, ideally, if someone signs up for your email list it means that they’re interested in hearing from you, which means they’re more likely to make a purchase. Make sure you’re taking advantage of your mailing list, too - a regular newsletter can be a huge source of traffic and a great source of sales. Just don’t overdo it, as you want to make sure your subscribers aren’t burned out from receiving too many emails.
Your agency’s mailing list should include past, current, and prospective customers. We suggest using it primarily to circulate a high-value newsletter - tout what’s going on in the marketing world, what the latest advertising trends are, and any important news related to your agency. You might be surprised at how many past clients will reach out when you let them know there’s a hot new marketing trend they’re missing out on...
For both yourself and your clients, always make sure it’s easy for people to sign up for the list. Call it out on your website, and in multiple places. Visitors who want to sign up for your emails should never have to work hard or search for long to get on the list.Also, consider how much information you really need to collect when soliciting email signups. The fewer fields you ask for, the easier it is for people to sign up. Asking for just an email address is more effective than asking for full names and other information - and you can pull most of that information from the email address anyway.Offering incentives like discount codes or exclusive content can help boost signup rates as well. You’ll see a lot of content that’s gated behind the need for an email address, and for good reason. The value of adding names to your list far outweighs the time and effort spent in creating gated content.
How many sites are using your content as a reference?Inbound links are a great way to measure the value of your content and the reach of your brand. The more other sites are linking to you, the more effective your content strategy is proving itself to be. Google and other search engines know this too, which is why they use inbound links as a part of their equation in determining SEO rankings. So not only are you getting traffic from the links themselves, but you’re getting a bump in your SEO rankings. This brings in even more traffic, which helps boost your reach, which can lead to more inbound links, and creating a positive feedback loop that helps you find a bigger audience.
The easiest way to measure your number of inbound links is to use a tool, like the one offered by Moz. You’ll get the added benefit of seeing a few other numbers that help you get a sense of your site’s overall level of authority.Getting people to link to you is no easy task. One of the best strategies is to be deliberate in your content creation and to write articles that other people will actually want to reference. After all, if you’re not providing good content, who in their right mind would share it?You should also reach out to other sites and discuss backlinking possibilities. Letting an author know that you reference them in a particular blog post, for example, could get that author to link to you from their own site. All of that helps build your inbound link portfolio.
Are you running content strategy for your clients? If not, it’s probably worth having the conversation with them about how important a content marketing strategy can be.There’s no magic bullet for good content marketing, even if you create quality content it doesn’t guarantee people will find it. But we suggest treating your clients’ content with the same care and consideration you give your own. Make great content, follow all the SEO best practices, and make sure you’re using their mailing lists to bring in views.
Where do your customers come from? Are they finding you on Google, or coming to you from an ad campaign? Or is most of your traffic coming from that one lucky social post that went viral?Tracking your traffic sources is absolutely essential for understanding the overall effectiveness of your marketing. If you don’t know where your current customers are coming from, there’s no way you’ll you know where to find more potential customers.In general, you should look at your traffic as fitting into one of three categories:
Google Analytics and similar tools make it easy for you to tell where traffic comes from. In order to get a clearer picture of you overall traffic flow, you may want to start tracking visitors and segmenting out new, repeat, and other groups.
Knowing where your agency’s web traffic comes from will help you understand where to focus your own marketing efforts. Tying this back into Cost Per Acquisition, you’ll be able to cut down on acquisition spend through more effective targeting.Pay particular attention to your organic traffic - the stuff you’re not paying to boost. Besides obviously being more cost-effective for your company, it also presents a clearer picture of just how much of a presence your agency has carved for itself online.
Unlike the other metrics in this article, your clients’ traffic sources aren’t really a single number that can be improved through your efforts. You have to consider each source separately, and how each source fits into the overall marketing plan.For example, you may find most of a client’s traffic comes through paid search advertising. There’s nothing inherently wrong with this, but it’s up to your team to decide whether to focus on driving that number even higher, or to try boosting organic traffic instead.As you research traffic sources, you’ll pick up strategies and techniques that will help you and your clients to form the most effective plan for managing traffic.
While we think that these five marketing metrics should form the backbone of every business’s marketing strategies, the truth is that no two companies are exactly alike. As you dig into the math behind your marketing, you’re sure to find numbers that are particularly useful to you. The trick is to identify what’s important and focus on that, so you don’t get bogged down in a sea of detail. We think the metrics above will let you do just that.
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