As a small business, you might not have access to top business intelligence talent to analyze data to build better insights that lead to success. Here’s a beginner’s guide to digital marketing analytics to help you achieve your goals including key metrics and tools you need.
Introduction: In the digital age, data is the lifeblood of effective marketing strategies. Unlike the meager data available from traditional marketing campaigns, digital marketing analytics are robust and able to empower businesses to make informed decisions, optimize campaigns, and drive better results. However, beginners might find the world of digital marketing analytics overwhelming, with too much data that leads to analysis paralysis.
For instance, if you don’t know what you need for your analysis, looking at a screen capture from the Google Analytics dashboard is overwhelming. Even displayed with good data visualizations that make analysis easier, the sheer volume of information can quickly result in that glazed-over look that indicates you reach information overload where you can’t process the data to derive insights. In this guide, we’ll break down the essential key metrics and tools that every novice marketer should use to get the most from digital marketing analytics.
A guide to digital marketing analytics
The biggest piece of advice I can share with beginners and experts alike is that your first task is to determine which metrics you should focus on, which you should ignore, and how to determine which metrics you need for specific problem-solving. So, let’s start this guide to digital marketing analytics by looking at the analysis problem you face.
Effective strategies as a guide to digital marketing analytics
As portrayed in this Dilbert cartoon, data isn’t the solution to your digital marketing analytics. Instead, you must analyze accurate data to develop insights and then use those insights to guide decisions about the future if you want to achieve greater success. Here are some strategies to do that:
Set clear goals
Define specific and measurable objectives for your marketing campaigns to align your analytics efforts. These should consist of SMART goals that, as the acronym implies, are specific, measurable, achievable, relevant, and timely. An example of a SMART goal is to increase sales by 10% over the next 12 months.
Determine relevant metrics
Focus on metrics that directly contribute to your goals and provide actionable insights. Which metrics are relevant and actionable should flow naturally from your SMART goals. Later in this post, I share some examples of metrics worth assessing as they impact your performance.
Regularly review and analyze data
Dedicate time to analyze your data regularly and identify trends, patterns, and areas for improvement. That means it isn’t enough to simply collect data into reports. Analysis means you work to determine the impact of metrics on performance, how to improve your metrics, and translate that into concrete plans for the future.
You should monitor key metrics on a daily basis. Also, consider that employees might need different data to guide their actions. For instance, a CEO might need an overview of the organization’s performance, the supply chain manager might need data related to on-time delivery and inventory levels, the social media manager might need data on conversion rates by channel, and the email marketing manager might want data on clicks and conversion from various messages. Hence, you likely need multiple reports and each report should allow for interactions with the data. A CEO might want to break down data into divisions to assess the performance of each one while the brand manager might want to view the performance of individual products under his/her control.
Invest in learning and training
Stay updated with industry trends and enhance your skills through online courses, webinars, and industry publications. As you can see below, analytics is one of the most in-demand skills for digital marketers and the need for these skills increases over time. It may be impossible for brands, especially small businesses to hire the right people to manage their digital marketing analytics. So, training staff with an aptitude for analytics may be your best bet.
Marketing intelligence
Marketing intelligence [source]
is everyday data that is relevant to the marketing efforts of an organization. Once collected, this data can be analyzed and used to make informed decisions regarding competitor behaviors, products, consumer trends, and market opportunities.
With marketing intelligence, your first task is to determine which metrics to collect. Generally, we refer to metrics related to your success as KPIs or key performance indicators because it’s these metrics that translate into success or failure. An obvious KPI is sales since this is the ultimate measure of success. We call these terminal KPIs or, in Google Analytics, they’re called goals. Of course, sales don’t occur in a vacuum so you must also create KPIs that help by supporting sales. Some of these intermediate KPIs are:
The key to starting the analysis of marketing intelligence is to create interactive dashboards like the one shown earlier for Google Analytics, which you can customize any way you wish to show KPIs related to your website performance and, when connected, your ad performance (on Google Ads platforms only), and some social media and email marketing analytics. Thus, you create reports from the raw data, accomplishing the first two septs in building insights from your data as shown in the graphic above.
As you can imagine from the large list of KPIs shown above, you must choose a few (10-15) that match your goals and use a tool to create a dashboard that combines data from multiple sources. More on this later.
Market research
In contrast to marketing intelligence, which you use daily, market research is designed to address specific problems and starts with a hypothesis about how factors impact your success. In the old days, this meant creating expensive market research studies that required skilled designers and researchers or faced the disaster of making the wrong decision, such as in the Coke research that led to New Coke, now defunct.
Now, I can build custom analyses to address any issue I want using the data provided by my analysis tools. For instance, I might hypothesize that my product appeals to women more than men or that a certain demographic group represents and higher average order value. Below you can see a custom report from Google Analytics to assess visits from different demographic groups. The same analysis might include a better KPI such as conversion rate or AOV.
With market research, we’re entering that next stage in the analysis process shown earlier, the analysis stage. By evaluating the results from our segmentation of the data, for instance, we can gain insights such as whether we need to change our content to attract more visitors that fit with those we currently don’t attract well or focus our content on those we already resonate with.
We can also analyze the data shown in our reports to glean insights, as well. For instance, if we see a particular social media platform sending a lot of traffic to our website, we might decide to drop platforms that underperform or at least spend less on these platforms.
Using tools as a guide to digital marketing analytics
It should be obvious from my earlier discussion that you need tools to help collect data. Some tools also help you analyze the data and Google Analytics professes to provide insights from your data based on their AI but I will tell you the insights generated are pretty anemic, so I wouldn’t stop there. Some tools are available for free, others offer limited free tool features, and others are expensive. I list some of my favorites below.
Conclusion
Digital marketing analytics is a powerful tool that can revolutionize your marketing efforts and I hope this beginner’s guide to digital marketing analytics helped you get a good start on building a more intelligent strategy to improve firm performance. By understanding key metrics and utilizing the right analytics tools, you can make data-driven decisions, optimize campaigns, and drive better results. Remember to set clear goals, track relevant metrics, and consistently analyze your data to stay ahead in the dynamic digital marketing landscape.
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