“If you don’t track any metrics, you’re flying blind. But if you collect and focus on too many, they may end up obstructing your field of view.” – Scott M. Graffius.
Why do you need to analyze data, and why is digital analytics important, especially to digital marketing strategies?
Let’s say you’re investing $10,000 each month in Google Ads – which redirects your audience to your website’s homepage or one of the service pages.
Despite exhausting your advertising budget and attracting thousands of prospects/customers to your website via paid advertising, what if your conversion rate is a mere 2%?
Now, if your product’s gross margin is extremely high, chances are you’re profitable – considering that you can generate more than $10,000 monthly profit.
But if you are selling a low-ticket item and are subject to a disappointing 2% conversion rate, you must seriously optimize your marketing funnel.
Maybe, it’s something wrong with your ads. Or maybe, it’s your website.
Without tracking the right metrics using the right digital analytics tools, you’ll never be able to figure out what’s working and what’s not.
If you’re investing $10,000 monthly on paid ad campaigns and aren’t tracking the right metrics (and if you have a low conversion rate), you’ll have drained over $120,000 in one year.
So, let’s say you started tracking the right metrics–with the help of digital analytics tools–and discovered that 90% of your website visitors are bouncing off right from the homepage.
In that case, you can head over to the homepage and conduct a thorough audit – which will help you find the root cause.
Maybe, your website homepage is too cluttered. Or what if your homepage takes more than 7 seconds to load?
The possibilities are endless.
And you’ll only be able to find the root of the problem when you focus on tapping into the full potential of digital analytics.
Whether you’re running a Google Ads campaign or want to understand your target customers’ user behavior on your site or want to track the progress of your email marketing campaign, your marketing efforts must be data-driven.
This, in turn, will help you optimize your campaigns for the best possible results. But it’s not as easy as it sounds.
Tapping into the full potential of digital analytics is critical. But what’s more important is tracking the right metrics and extracting data insights.
When you log in to your Google Ads account, you’ll find yourself swarmed with different metrics.
When business owners, C-level executives, and marketers find their screens flooded with a world full of metrics, they choose not to track their campaigns’ progress.
They start downplaying the need for digital analytics. But what if I told you that you don’t necessarily need to track all of these metrics?
That’s right. Instead, depending on your goals, KPIs, and objectives, you need to track the right metrics that’ll help you gain insights into your progress.
Alongside this, you’ll also be able to figure out what’s working and not in your digital marketing.
When you know what’s working and what’s not, you’ll be better equipped to make data-driven decisions and further optimize your marketing efforts.
To help you understand how to use digital analytics to achieve better results strategically, we’ve put together the five steps you need to follow throughout your marketing journey.
We love to call it the “Measure to Optimize” flywheel.
Without further ado, let’s dive straight into it.
How to Strategically Use Digital Analytics to Make Data-Driven Decisions & Level Up Your Marketing & Advertising Efforts?
Using digital analytics to level up your marketing and advertising campaigns is not a 1-2-done type of task.
If you genuinely want to achieve outstanding results with the key insights that you get from your digital data from marketing campaigns, we’d advise you to follow the five steps we’ve listed below:
- Set Measurable Goals
- Measure
- Report
- Extract Insights
- Optimize
Let’s touch down on each of these steps one by one.
1. Set Measurable Goals
Businesses and marketers that set quarterly goals and objectives are 376% more successful than the ones that don’t.
If anything, a marketer must know that setting measurable goals is never to be overlooked in digital marketing.
Running a business, whether a traditional brick-and-mortar or an online business, without setting goals and objectives is like driving a car with your blindfolds. It’s all too risky!
Of the long list of benefits of goal setting, a few include:
- Provides direction and focus.
- Provides a better understanding of expectations.
- Gives clarity.
- Helps make powerful decisions.
- Helps clear a measurable roadmap to success.
- And more!
While some may be short-term goals and others may be long-term, the trick here is to break down these goals into objectives, which should further be broken down into measurable KPIs.
Key Performance Indicators, commonly referred to as KPIs, are critical indicators set by businesses to demonstrate how effective they are in achieving their key business objectives.
For example, if your goal is to increase the efficiency of your marketing department, then you can break down these goals into:
- Boost conversion rate
- Optimize cost per lead
Now a good example of turning these goals into measurable KPIs is:
- Boost conversion rate by 2% in this quarter.
- Bring the cost per lead down by 5% in this quarter.
- Increase organic website traffic by 10% this year.
While writing KPIs, we’d advise you to cover both:
- Lagging KPIs – Lagging KPIs look back at whether the intended outcomes were achieved. These include – gross margin, growth in annual sales, annual net income, and more.
- Leading KPIs – Leading KPIs look forward to future events and outcomes. These include a number of new website trials, a number of unique website views, and more.
2. Measure
You must write down your KPIs depending on your goals, objectives, marketing, and advertising campaigns.
Ensure that everyone within your organization can clearly understand the KPIs – which will help them steer the business’s digital marketing in the right direction.
But writing down your KPIs is only the first step in digital analytics!
Even though you know the key performance indicators you’d like to track, you need to have a plan to measure them.
When you log in to your Google Analytics, Facebook Analytics dashboard, or other dashboards within other social media channels, you often find yourself in front of a swarm of metrics.
This is normal regarding data integration but can also be overwhelming for some.
To avoid getting bogged down, prepare a strategic plan with the right metrics and KPIs side by side.
This will help you streamline the reporting process and make it easier for literally anyone within the organization to gain actionable insights into your marketing and advertising campaign’s performance.
3. Report
As mentioned above, working around getting overwhelmed with data is important. To do that, only pay attention to the ones that’ll help you track your KPIs.
Analytics is the process of putting systems into analyzing data or statistics. Choosing which ones to pay attention to and which to set aside is your first step to systematizing your data.
Rather than going down the long road, I’d advise you to take the smart route that’ll help you save valuable time and effort.
Upon logging in to the dashboard, keep your KPI tracking plan handy. This will help you or your colleagues/staff members catch the right metrics and build an easy-and-simple report that anyone can use.
Nothing productive can be taken out of digital analytics without reporting. That’s why everyone involved must make this phase as simple and basic as possible.
4. Extract Insights
Did you know that over 68% of teams have difficulty extracting data insights required to make strategic decisions? This is a serious issue for businesses today—and the reason why leveraging digital analytics tools is a must.
Raw data is completely useless unless you transform it into insights. From optimizing your operations to improving customer experience, insights can help you make better decisions and harness the complete potential of digital analytics.
Let’s say one of your goals was to boost your conversion rate by 5% this quarter.
If you fall short, look into the elements that contributed to you not reaching that goal. That’s why it’s advisable to set both lagging & leading KPIs.
Doing so will help you dive deeper into the past and look at the upcoming trends and patterns. Setting KPIs increases productivity and helps everyone redirect their actions when necessary.
Using the same example, if you couldn’t boost your website’s conversion rate, maybe the problem is with your company’s website.
If the problem is with the company’s website, you may need to look at your web analytics and extract relevant insights.
From tracking your website traffic to your buyers’ customer journeys to lead generation, you need to track the right metrics to determine the root of the problem.
Once you do this, you’ll be able to make informed decisions and help you understand which areas you need to focus on.
5. Optimize
After you extract insights, you’ll have better clarity about which areas need optimization the most.
For example, if you weren’t able to reach the quarter’s goal web conversion boost and, upon extracting insights, found out that your website visitors are bouncing off after heading over to your “Our Services” page, now you know what aspect of the site needs more work.
Another example: let’s say you’re running Facebook ads and can’t get decent traffic to your website. Maybe the problem is with your creatives. Or maybe you couldn’t establish a solid brief of your target audience.
In those cases, you need to track the extracted insights and understand the root of the problem. Once you’ve identified the problem, it’s time to optimize your campaign(s) or overall digital strategy.
Apply, test, and measure different strategies and try to find out which one helps you get closer to your KPIs. This will help you understand what’s working for you and what’s not.
FAQs
In Summary
It’s not just a five-step process. In my opinion, it’s a flywheel. Once you have identified the problem and optimized your campaigns, you need to set your goals, objectives, and measurable KPIs for the next quarter.
It’s designed to be an ongoing cycle to ensure you’re always on the right track.
If you really want to achieve the best possible results, digital analytics is your strongest weapon.
Brian Shelton is an entrepreneur, marketer, and life-long learner committed to helping businesses achieve impactful results. He founded Grow Predictably to provide tailored marketing strategies to generate predictable, profitable growth. With over a decade of experience in the industry, Brian has helped businesses, large and small. reach their goals and drive positive change in the world.