How can you measure success in lead generation? Lead generation can be a complicated process, but it is essential for any company that relies on sales.
How do you know if your lead generation efforts are working? If you are not generating enough leads, it could be because your lead generation efforts are ineffective.
In this post, we will discuss how to measure the effectiveness of your lead generation campaign and what key metrics you should measure as part of your lead analytics system.
Measuring Your Lead Generation Campaign
How do you measure the effectiveness of your lead generation?
There are 10 lead generation metric factors that you should be measuring for your success:
1. Click-Through Rates.
Click through rates (CTR) measure how often your content is clicked on or viewed by visitors to a website. Lead generation companies can use CTR as an indicator for the effectiveness of their lead gen campaigns. It also indicates that there is interest in your company’s product/service because it shows engagement.
How To Get CTR
(Total Clicks) / (Total Impressions or views)x 100 = Click-Through Rate
What’s a Good Clickthrough Rate?
The Clickthrough Rate determines how often people who see your ad click on it. The CTR may be used to help you evaluate the quality of your photos, positioning, and keywords.
The CTR for a Google search ad is 1.91% across every industry, while the CTR for a display ad is 0.35%.
If you have a low CTR, that means that people are not interested in your content so you should focus on improving it. If the CTR is high it means that people are interested in what you’re writing about.
Using the CTR metric can help your lead generation campaign. It can help you adjust a strategy and come up with a better way to do it.
2. Conversion Rates.
The conversion rate is a more significant statistic than CTR since it indicates how many of those who clicked on your links and campaign channels convert into leads or sales.
The sort of conversion will be based on the type of business you have and where you’ll measure as a conversion point in the sales funnel.
Examples of Conversions:
- Attending a webinar
- Visiting a specific webpage
- completion of a survey form
- downloading an ebook, a guide, or other forms of content
- signing up for a newsletter subscription
- making a purchase
A high conversion rate means you are giving people the information they need. They’re easily convinced to contact you. People like your products and it is easy to get them!
A low conversion rate indicates that your site and landing page design are making it difficult or time-consuming for visitors to complete a certain task. Your offer is expensive or not relevant or valuable enough to your target audience)
How To Calculate Conversion Rate
Conversion Rate = Total number of conversions / Total number of unique visitors or leads * 100
What is a good conversion rate for lead generation?
A 12% conversion rate is considered good for lead generation landing page conversion rates. Getting a 10+ conversion rate from your landing pages generally allows you to surpass the norm.
3. The Time To Customer Conversion.
The time-to-customer conversion measures how long it takes until a lead converts into a sale.
This statistic will show you how quickly a specific consumer group responds and takes action to conversion for a given lead-generating campaign. Some may be slower, while others have quick response times, allowing you to see how effective your lead-generating content is – providing you with more opportunity to fine-tune your campaign.
How to Calculate
Take the total time spent by website visitors and divide it by the total number of leads.
4. Cost Per Lead.
If you want to get more saas leads for your business, then cost per lead is a vital metric you need to work out how to track.
The cost per lead (CPL) is the amount of money it takes to generate a new prospect for your sales team from your current marketing campaign. These leads are people who have seen your ad and clicked on it, giving us their contact information in exchange for an ebook, white paper, or further information about your product in order to keep your sales pipeline flowing.
CPL shows marketing teams if they’re devoting the correct amount of money on various lead-generating methods like Google Advertisements or Facebook Ads.
The higher the CPL, the less effective its marketing campaign is. On the other hand, a low CPL is good because it indicates you’re getting a lot of leads for less money, and are more likely to get a good return on your investment.
How to Calculate CPL
Divide the total amount of money you spent on a campaign during a given period and divide it by the total number of leads obtained through that campaign.
Total ad spent/total number of leads obtained= CPL
5. Customer Acquisition Cost (CAC).
Another key figure is Customer Acquisition Cost (CAC). CAC measures how much you spent for each lead before they became a paid customer or client. It won’t benefit your company if your leads don’t convert into customers, or if it takes a lot of money, that you lose revenue entirely to convert one lead into a consumer.
Business owners and digital marketers should keep in mind that the objective of lead generation isn’t just to produce leads. It’s also to create paying consumers at a price that will still leave you a profit.
How To Calculate CAC
You calculate the customer acquisition cost by dividing the total marketing costs by the number of customers acquired. CPA helps you understand how profitable your business and marketing are.
If your CPA is higher than the revenue that new customers bring in, then you are not profitable. However, if you are bringing in more money than the cost of new customers, then you are profitable.
6. Return on Ad Spend (ROAS).
The Return on Ad Spend (ROAS) metric helps marketers assess whether they will get their advertising expenditures back. It measures how much revenue you earn for every dollar you spend on ads.
If you track ROAS across your campaigns and ad platforms, it will allow you to evaluate, compare, and measure the effectiveness or performance of your advertising efforts.
This metric will also provide you with a bird’s eye view of which campaign is the most or least successful, so that you may make adjustments to your marketing budget as needed.
A positive ROA indicates that you make more money from your advertising than you spend. A negative ROA means you are spending more money on ads than you’re earning.
How To Calculate ROA
ROAS = Ad Revenue / Cost of ads
If you’re trying to figure out how much of a return on ad spend (ROAS) your company has, consider this example. If you invest $500 in an ad campaign and earn $1,500 in revenue from those ads, your ROAS is 3. It’s a winning situation for you.
7. Customer Lifetime Value (CLV).
The average revenue you may get from a customer throughout his or her account’s whole lifespan is known as Customer Lifetime Value (CLV or CLTV).
For example, if a customer signs up for your product for 6 months, the amount he will pay during that time period is his lifetime value.
Customer lifetime value (CLV) may be more advantageous to businesses with long-term customer relationships. The higher the CLV, the higher the company profit. On your CLV, you may discover that some customers cost more to acquire than others, or that there is a decrease in spending after a specific length of time.
Benefits of Tracking your CLV/CLTV:
- Evaluating your CLV allows you to assess your overall marketing approach and allocate budgets where they’re most needed.
- It aids in the decision of how much to spend on acquisition.
- You can use this information to better understand your customer behavior better.
8. Return on Investment (ROI).
ROI is the most important metric of a marketing campaign. ROI stands for return on investment and represents the percentage of profit relative to the amount invested.
It tells you if you are getting a good return on your marketing efforts or if it’s worth your time and investment. Measuring ROI helps you justify your marketing budget and spending.
How To Calculate ROI?
ROI = Net Profit / Cost of the investment * 100
The higher the ROI the better it is for your lead generation campaign.