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The 6 Marketing Metrics Your Boss Really Cares About

Posted by Julie Kiffmeyer on Dec 6, 2014 7:06:48 AM

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With studies that show 73% of executives don’t believe that marketing drives awareness and revenue, we have to make sure that we can prove the ROI of our marketing efforts.Marketing_Metrics_Blog_Post_112314

Do you know which key marketing metrics your boss cares about?

  1. Customer Acquisition Cost (CAC)

  2. Marketing % of Customer Acquistion Cost (M%-CAC)

  3. Ratio of Customer Lifetime Value to CAC (LTV:CAC)

  4. Time to Payback CAC

  5. Marketing Originated Customer %

  6. Marketing Influenced Customer %

I recognize these might not be metrics you generally use when reporting performance to your boss, but they will begin to focus your measurement on Customer Driven behavior and in the end will help justify marketing spend based on true business growth through conversion of leads to customers. 

In this blogpost series, I will walk through each of thes marketing metrics examples.  If you prefer, you can download the ebook now to begin to learn more about these metrics in totality.

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So let's take a look at one fo the first important marketing metrics: Customer Acquisition Cost (CAC)

Do you know how much it actually costs for your business to acuqire a new customer? 

It is important to understand the average Customer Acquistion Cost in order to determine the efficiency and effectiveness of your sales and marketing activities.  Ideally, you are looking for a low CAC.  If you begin to see increases in CAC, this means you are spending comparitively more for each new customer and you may want to revisit your sales and marketing activites and make appropriate adjustments.

The calculation is straightforward.  You will want to take your total sales and marketing spend for a specrfic time period and divide it by the number of new customers per that time period.

Sales and Marketing Cost / New Customers = CAC

Once you set the baseline for your CAC, you can work through the additional metrics to determine how to adjust your sales and marketing activities to lower your average CAC.

In my next blog post, I will cover Marketing % of Customer Acquistion Cost (M%-CAC).  In the meantime, feel free to download the complete eBook.

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Topics: Metrics