With Increased Digital Media Budgets Comes Increased Business Expectations
Digital ad spending has grown steadily over the last five years and it is expected to reach more than $520 billion in 2024. Marketers are under significant pressure to justify this expenditure with tangible results. As customer segments become increasingly fragmented, marketers must find a way to choose how much time and money is spent on each platform or channel. Conversion tracking can help modern marketing teams do that more effectively.
Conversion Tracking Defined
To simply define it, conversion tracking is measuring the impact of your digital marketing efforts, or in other words what happened after someone saw or clicked on your ad. Did they come to your website? Fill out a form? Make a purchase? Become a customer? Make a repeat purchase?
Conversion tracking is how advertisers monitor all of these customer actions. Once the goal of a campaign is decided, conversion tracking aids marketers in assessing whether their ads are effective in meeting those objectives.
Many businesses focus solely on immediate revenue or sale as the primary conversion event, overlooking upstream signals that can help maximize campaigns aimed at different stages of the funnel. Understanding the full picture helps you understand the full impact of your campaigns and maximize the ROI of your advertising investment.
How Businesses Measure Digital Marketing Success
Defining Your Business Goals is Still the Best Way to Start
The ultimate goal of most direct response marketing campaigns is to increase revenue and improve sales. As a result, some businesses choose to measure changes in business results after the beginning of an advertising campaign. However, advertisements are not always designed to directly increase sales. Some campaigns are designed to increase engagement with customers or improve brand awareness.
Marketers should always have clearly defined goals for a campaign, and these objectives should be communicated to internal stakeholders to manage expectations. Any metrics that are used to measure digital marketing success should be aligned with the intentions of the campaign.
Pro tip: Establish quarterly benchmarks as you embark on your journey, recognizing that results will take time. Anticipate more traction in Q4 compared to Q1, thus setting higher benchmarks for the latter. For instance, aim for 1,000 leads in Q1 and 8,000 in Q4.
Apply this benchmarking approach across all metrics, from traffic to new customers, enabling constant adjustments for improvement. If benchmarks aren't met, collaborate with your team for solutions.
The impending loss of third-party cookies in the Chrome browser by mid-2023, following the footsteps of Apple and Mozilla, signals a transformative shift for the industry. This change will significantly impact how return on investment (ROI) is tracked, as cookies, previously the primary method, will no longer be viable. The common reliance on tracking post-click and post-impression conversions was far from ideal and it will be increasingly challenging to link these metrics to sales in a post-cookie environment. Although the industry is exploring solutions like probabilistic algorithms, these can't fully replace the tracking capabilities provided by cookies.
In this scenario, the concept of "attention" emerges as a promising alternative. Originally seen as relevant to ad targeting, attention has gained recognition as a broader metric linked to verification, reporting, and attribution, and therefore tied to overall campaign effectiveness. Attention metrics can provide insight into ad effectiveness without the need for personal information, pushing advertisers to devise more engaging methods to capture user interest. Time-in-view, indicating the duration an ad is in view, has been shown to enhance brand uplift, thereby becoming a valuable metric. However, attention isn't a universal solution and its applicability will vary between campaigns. It's crucial for the industry to work collectively to define "attention", ensuring its attainability for all players, from small clients to major agencies.
Solutions Available to You for Tracking Actions
Analytics Platforms (Tools like Google Analytics, Matomo, Smartlook)
Google Analytics (GA) is a widely used tool for tracking website traffic, and it has many handy features. The setup process is simple, allowing immediate tracking of critical online metrics. GA's value increases with the time invested, as more data provides opportunities for optimization, idea generation, and understanding the interconnectivity within your business.
However GA does have limitations, which may push you to consider another analytics platform. These limitations include the need to manually set up event tracking and a lack of qualitative analysis, which in turn hinders your understanding user motivations. This can impact user experience (UX) and conversion rates. Furthermore, GA's GDPR compliance issues and complex learning curve often prompt the search for alternatives.
Tools like Matomo and Smartlook are designed to tackle GA's shortcomings. These competitors automatically record all user sessions and interactions on your website or app, enabling a deeper understanding of user behavior. By blending quantitative and qualitative data, these are powerful tools worth considering. However they leave something to be desired in that these are primarily reporting-only platforms, meaning you still have to take the insights found within these tools and apply them externally to your digital marketing initiatives.
Publisher Tools (Think TikTok, LinkedIn, Meta)
The vast majority (91%) of digital marketers use social media in their campaigns. These platforms often have conversion trackers built into their systems. Marketers can use these trackers to decide which of their advertisements are most effective in helping them reach their goals.
These trackers are free to use and can give marketers great insight into campaign performance. However, marketers must be careful to learn how each platform tracks conversions. For example, Google records a single conversion on a video ad even if the user plays the video twice. Meta, LinkedIn, and TikTok might track these actions differently. It can be frustrating and time consuming to try to navigate through the various conversions that are tracked on each platform and get a clear understanding of how your overall marketing efficiency ratio(MER) is performing.
Third Party Tools (MarinOne, Acquisio, Optmyzr to name a few)
While built-in publisher conversion trackers are extremely useful, many marketers prefer to use dedicated ad management software to measure and manage their campaigns across multiple channels at once. This is the best of both worlds as dedicated software allows marketers to consolidate metrics and measurements from every campaign across different social media platforms and websites.
In addition to consolidation, ad management software also gives marketers access to a suite of features that can help them be more efficient. Repetitive tasks can be automated and marketers can spend their time working on high-value activities such as planning and strategizing.
At Marin, we believe in our product enough to recognize that our competitors have good things going on. And we applaud any effort being made in the industry to reduce workloads, save money, and accelerate company growth. But what we can say for ourselves with complete confidence is that MarinOne is the most inclusive and comprehensive advertising campaign management software on the market.
We have the most publisher integrations, the most sophisticated automation, and the longest track record in the business. We've been creating automation features for digital advertisers for nearly 20 years, essentially since digital ads came into existence. Our team is full of consummate professionals, most of them with over 10 years of experience in digital marketing, who can work with you as a consultant or as a managed service provider.
We'll stop there with tooting our own horn, and get back to educating about conversion tracking, but suffice it to say if you want to hear more about making your advertising campaign management a lot easier…you know where to find us.
Creating a Framework to Support Conversion Tracking
Learn the True Cost of Customer Acquisition
Profitability is a major priority for every business. Marketers often struggle to justify the expenses associated with widespread ad campaigns or complex marketing activities. These costs should always be placed in context. Both marketers and executives can benefit from learning exactly how much it costs to acquire a single customer.
Adopt a More Agile Approach to Marketing
Evaluating and analyzing conversion gives marketers more flexibility in their approach to managing digital ad campaigns. Successful ad campaigns can be amplified responsively before customers lose interest, while poorly performing ads can be deprioritized to save or redirect funds where appropriate.
Pro tip: Don't forget to work brand awareness plays into your budget. Initially, especially if funds are tight, allocate 5% of your budget to brand awareness strategies like niche podcast ads or LinkedIn video ads, whatever suits your core audience. Over the following weeks, observe any changes in your organic search traffic, direct traffic, and customer acquisition. Even if it's challenging to directly link revenue to these efforts, they often boost other digital marketing channels indirectly, creating a "halo effect". You can also post a simple "how did you hear about us?" field on your website to help ascertain the actual value of your brand investments, which will help justify the cost over time, even if you can't prove a direct 1-to-1 acquisition metric.
Optimize Digital Marketing Spend Across Multiple Channels
Marketers are under significant pressure to choose the marketing channels that can generate the best results. Without effective conversion tracking, choosing the right channel becomes little more than guesswork. Conversion tracking gives marketers the data and insight they need to identify the most effective campaigns and placements to redirect marketing efforts where they do the most good. Therefore having a birds eye view of all your advertising channels is critical, which is where tools like MarinOne become invaluable.
Gain a Deeper Understanding of Customer Behavior
Understanding how a customer behaves on individual platforms can deliver greater insight to marketers to better plan and execute ad campaigns. Customers use social media and search engines as their gateway to the internet and understanding how this gateway is used empowers marketers to help customers find their brand in the most effective way possible.
Each platform serves a different purpose for customers and marketers. Conversion tracking can help marketers place the right information on the right platform. For example, a customer might use Facebook to search for recommendations on certain products, but might choose Google search to find a place to complete their purchase. Understanding these differences can help marketers place the right ad with the right conversion strategy to maximize campaign effectiveness across every channel and platform.
Pro tip: Start by identifying your top conversion paths. Marketers often overlook the customer journey leading to the final touchpoint. It's uncommon for visitors to perform the desired action upon landing on your site; they often explore your site, products, social media pages, or company videos first.
These micro-conversions are crucial for comprehending the entire conversion process and should be included in your tracking. Google Analytics' Top Conversions Path report, found under Conversions > Multi-Channel Funnels, lists each conversion path and their respective conversion counts.
By scrutinizing this data, you can refine attribution models and facilitate earlier customer engagement in the buying process.
Build a Stronger Customer Base for Retargeting
As much as we marketers would like to target, capture, and convert a prospect all in one clean, straightforward motion…the sad reality is not every customer is primed and ready to make a purchase right away. Recent research shows that almost half of customers that are targeted by marketers are not ready to make a purchase when they first see an ad. Naturally this means that retargeting plays a very important role in the customer journey.
Pro tip: Implement both onsite and offsite retargeting strategies. While offsite retargeting through social media and other websites is essential, don't overlook the power of onsite retargeting. This strategy involves presenting enticing offers to users on the verge of exiting your site, aiming to retain them. As stated by MonsterInsights.com, onsite remarketing could boost conversions by 2 – 4 percent.
What General Performance Metrics Should Marketers Track?
Session duration is a metric usually used to measure the effectiveness of marketing material hosted on a website or a blog. It refers to the amount of time spent on the website in each browsing session.
Session duration can give a business a clear indication of how effective their content and copy is at engaging the reader. If a business notices a reduction in session duration over time, it could be an indication to increase the frequency or quality of content published on the website.
Bounce rate refers to the percentage of people that visit a website and leave immediately. A bounce indicates that the viewer decided not to click on another link or visit a second page on the website. This metric is sometimes confused with exit rate but exit rate refers to the percentage of people that leave the website once they have visited a second page — or more.
Pages per Visit
In addition to bounce rates and exit rates, it is important for businesses to count the number of pages a user views when they visit a website. If this metric is not being directed by active marketing efforts, a high pages-per-visit metric could mean that visitors are not able to find the information they need in an effective way. A good rule of thumb is that every part of the website should be accessible within three clicks. On the other hand, a consistently low pages-per-visit metric could indicate that a website does not engage its customers effectively.
One metric that helps place the number of conversions an ad gets in context is called conversion rate. It involves dividing the number of conversions an ad gets by its total number of views and representing this as a percentage.
For example, if an ad is viewed by 1,000 users and 50 of them clicked on the CTA, the conversion rate would be 5%. This insight gives marketers a clear idea of how successful an ad is at engaging customers. This rate can be compared with rates achieved by a business’ competitors to gauge if an ad is as or more effective than other ads in the industry.
Number of Conversions
The most obvious metric for businesses to track is the number of conversions an ad has earned. This metric is often easy to track through basic conversion tracking tools that come built in on every social media platform. However, it is also important for businesses to put this number into context with additional metrics that go beyond simple conversions.
Cost per Acquisition
Cost per acquisition (CPA) is one of the most important metrics for marketers. As its name suggests, it refers to the amount of money spent on converting a single customer. The formula for determining CPA is the total marketing cost for a campaign divided by the number of conversions for a campaign.
Events, sometimes referred to as actions, are any interactions a user has on a website that go beyond a simple page loading. This type of tracking is a more comprehensive analysis of how a viewer interacts with a brand through its website. It can give marketers great insight into how effective a website is at managing and engaging visitors.
Conversion tracking is limited to tracking specific actions that marketers want to track but don’t include every action that a visitor can take on the website. Essentially, all conversion tracking is event tracking but not all event tracking is conversion tracking.
Competitive Analysis in Under a Minute: Take a look at the chart above. According to Insider Intelligence, conversion rates do vary somewhat by industry but are often between 5-15%, which is a good range to keep in mind as a quick "gut check" when looking at your campaign performance. Cost per lead, however, has a much broader range depending on your industry…spanning from $30 up to $130, which is significant variance when attempting to calculate budgets and return on investment. Take a quick look at your company's industry and see how your current CPL stacks up against category standards.
What Conversion Events, or Actions, Should Marketers Track?
Conversion events typically fall within one of three categories. These categories are:
- Sales: Such as making a purchase, adding to cart, initiating checkout, or subscribing to a service.
- Leads: Other website actions or local actions like submitting a lead form, booking an appointment, requesting a quote, or calling your business.
- Additional or Other: Options for unique conversion tracking situations, like page views or content downloads.
Let's get into specific examples of what you may want to track as a conversion event or action.
- Website Actions: This includes basic interactions on your website directly.
- Add to Cart
- Form Fill Submission
- Video Interaction
- Content Download
- Page View
- Phone Calls: Any call made to your business originating from your ads.
- App Installs and In-App Conversions: Relevant for businesses advertising an app, this tracks app downloads or in-app interactions.
- Imported or Offline Conversions: Actions originating from an ad but happening offline, imported via a CRM platform, like phone sales or in-person actions.
- Local Conversions: Actions tied to an advertiser’s physical location following an ad interaction. Examples include viewing a menu, requesting directions, or search engine queries with branded or "near me" terminology.
Analyzing Conversion Value
A conversion value is a numerical figure assigned to specific conversions, representing their business impact. It assists in tracking, optimizing, and reporting your return on ad spend (ROAS). By setting up conversion values, you can utilize a target ROAS bid strategy to maximize conversions, make informed decisions, and identify high or low ROI keywords, ad groups, and campaigns.
If you're doing this for Google Ads campaigns, creating conversion values can be done when setting up a conversion action or when adding a value to an existing conversion action. You can assign either "static" or "dynamic" values, reflecting uniform or transaction-specific values, respectively.
A static conversion value assigns the same value for each conversion. The conversion value increases with more conversions, enabling you to estimate your ROI by subtracting ad spend from total revenue.
Dynamic conversion value involves a more complex process requiring changes to your website's code. Select "Use different values for each conversion", then modify the code snippet on the post-conversion page of your website. This relays transaction information back to Google Ads, generating a dynamic ROAS. This process may require a web developer's assistance if you're not familiar with editing code.
Reasons Many Businesses Still Struggle With Conversion Tracking
The Wrong Data Is Tracked
The previous section showed the metrics that many marketers track — but each campaign and every marketing team has different needs. This means marketers have to adjust the metrics that they track and the amount of weight and importance given to each of them.
If the wrong data is tracked, it can lead to marketing teams either making incorrect decisions or failing to justify previous decisions with the right data. Tracking the wrong data can also make effective reporting incredibly challenging.
Pro tip: Keep in mind that depending on the platform you're looking at, conversion data can often take up to 24 hours to appear. If you still don't see conversions after this period, it's possible that no conversions have occurred yet. To verify this, you can simulate a conversion by clicking on your ad and performing the requisite action on your site. If the conversion doesn't register after another 24 hours, ensure the code has been correctly installed. This might involve adding extra plugins or relocating the code on the page.
Conversions Are Measured Without Consideration for the Customer Journey or Sales Cycle
Some marketers consider a full conversion the only relevant metric to track. However, some ads can be designed to target customers at a different stage of the sales cycle. An ad can fail to dramatically raise sales but still be a successful ad in other ways.
Conversions must be measured in the right context. If the goal of a campaign is to increase the awareness of a brand, measuring actions such as signing up for a newsletter might be inappropriate, since that step might be taken later in the customer journey.
Pro tip: Implementing an automated scoring system can facilitate the identification of qualified leads, reducing manual work. This kind of tracking enables businesses to optimize their marketing strategies and content, aiming to target potential customers more likely to convert.
Platform Discrepancies or Double Counting
Businesses often face discrepancies when comparing conversion data between platforms like Meta Ads versus website tools like Shopify and Google Analytics. These discrepancies can stem from various factors including differences in attribution windows, view-through conversions, tracking methodologies, time zones, data processing times, and data sampling. To navigate this issue, businesses need to understand and compare attribution windows, be consistent with including or excluding view-through conversions, consider factors like time zones and data sampling, and ensure accurate tracking implementation for every advertising channel you run.
Pro tip: Always ask yourself the simple question of, "does this data make sense?" For example, there would never be more 'purchase' events than 'add to cart' events as it is literally impossible for someone to make a purchase without first adding to cart.
The Future of Conversion Tracking
User Consent and Data Privacy Will Become Even More Important
In the past decade, data privacy has become incredibly important to customers, and businesses have had to change the way they collect, store, and manage customer data accordingly. About a third of internet users are actively worried about businesses misusing their personal data. Customers are happy to use their dollars to show businesses that they care about their privacy and will switch brands if they feel that a company does not.
In addition to customers, regulators are also concerned about how companies collect and use customer data. Businesses must ensure that the data they collect is fully compliant with the latest data protection laws in any region they serve. Conversion tracking, while still possible, might have to evolve to protect certain details that might make it easy to identify a person on the internet, and stick to data that highlights important demographic information instead.
Every Business Has to Become a Data Business
While businesses have to be more responsible with how they collect and manage customer data, it has never been more important to have a data-centric plan. The online marketplace has become increasingly saturated and businesses must use data to direct their resources in the best way possible. Marketers are under a lot of pressure to deliver business results as quickly as possible to justify additional expense for digital marketing.
Artificial Intelligence Will Plug the Gaps Left in a World Without Cookies
Third-party cookies are being phased out and marketers have had to find a different way of closing the information gaps left in their absence. However, the widespread adoption of machine learning has empowered businesses to fill any blanks in customer data without compromising privacy — while still ensuring that data remains accurate and insightful.
Machine learning can also be used to improve the effectiveness of existing and future campaigns. Existing campaigns can be automatically adjusted to meet predetermined conversion results. The data from past campaigns can also be used to predict the results for future ad campaigns.
How MarinOne Can Help Marketers Track Conversions More Effectively
MarinOne provides personalized, cross-channel suggestions aimed at boosting campaign performance. By scanning your account daily and analyzing historical data, MarinOne identifies areas where you can reduce unnecessary expenses and achieve higher volumes in high-performing segments. This helps improve the effectiveness of your campaigns and maximize returns on investment.
Our comprehensive tool streamlines data integration from various analytics and attribution sources, enabling businesses to gain a complete understanding of their purchase funnels. Additionally, businesses can access third-party revenue data, including customer LTV and Amazon attribution data, across multiple publishers and channels.
MarinOne simplifies the process by consolidating Search, Social, and E-commerce publishers, including smaller ones like Baidu, Snap, Criteo, and Reddit, all under one roof.
To learn more about how MarinOne can help you maximize results from your digital marketing efforts, schedule a personalized demo of our solution.