How do you track how well your marketing campaigns are performing?
You can likely write a long list of all the channels and metrics you monitor, record and report on - but ask yourself - are they all true KPIs (key performance indicators) for your particular campaign’s end goal?
Goals like lead generation, brand awareness, revenue generation, are typically tracked via differing KPIs. To keep campaigns focussed and progressing toward a particular goal, it’s wise to refine the metrics you monitor, unique to your campaign priorities.
Each of the below metrics plays an important part when monitoring the success of SaaS marketing campaigns - though the priority placed on them may depend on the overall highest priority campaign goal.
7 SaaS Metrics To Monitor To Track Success
1. Qualified marketing traffic
At the top of the funnel, you need to be attracting the right visitors to your site that will convert into high value/quality opportunities. Having a high traffic volume is no use if that traffic is unlikely to convert on your content, or sign up/in. To ensure you’re attracting the right traffic to your site, firstly, make sure you’re producing relevant, quality TOFU (Awareness) content. Secondly, when tracking metrics at this stage, be aware of return visits. Being able to differentiate between new and return visitors will help you provide more accurate success metrics. If your traffic is a poor fit or low volume, or you’re struggling to get visitors to convert, consider what can be done to optimise your conversion rate).
2. Leads by lifecycle stage
Quality lead generation and lead nurture are common marketing goals. To ensure your campaign is on track to deliver quality customers at the bottom of the funnel, you need to monitor the level of leads you’re converting through the top and middle. Regularly tracking how many quality leads/ MQLs/ SQLs/ opportunities/ customers you have, is a good indicator of how effective your nurture activities and content are and can highlight where leads may be getting stuck in the funnel. Doing this will help identify stumbling blocks in your marketing process, enabling you to adjust and streamline processes.
3. Lead-to-customer rate
This is an important metric to monitor, giving insight into how well you’re generating quality leads and how effective your nurture process is in converting them to good-fit customers. Your lead to customer rate can be calculated by taking your total customers for a month, dividing that by the total number of leads, and multiplying that by 100.
Good closed loop reporting will help you collate and track data on successful activities, provide a clearer view on how to adapt tactics, plus develop your understanding of behavioural patterns - so you can see why particular opportunities closed (or didn’t).
4. Customer lifetime value
If revenue is a prime goal, you want to keep tabs on how much the customers you’re converting are worth over the course of their lifetime with you (CLV). For SaaS businesses - who tend to use subscription-based models - you need to consider this source of recurring revenue as a benchmark for forecasts, and (linked to monthly recurring revenue) as an indicator of growth.
5. Monthly recurring revenue
As mentioned above, most SaaS businesses are based on a subscription basis (typically per-month, or per-year) so recurring revenue comes from renewed clients as well as new revenue from new business. Identifying the recurring revenue you can expect to see on a month-by-month basis (as well as total monthly revenue) is important to establish that you’re sustainable and growing - particularly after you factor in churn rate.
Following on from above, accounting for churn is essential. While renewals are what you want, it’s a fact of life that some clients will leave. Therefore, it’s essential that you firstly track your churn rate (monthly or quarterly), and secondly identify the reasons behind lost business to minimise future issues. Be sure to look at the persona profiles of churned cases; budget, industry, plus any other information that can help you refine what makes a good or poor-fit customer in future.
7. Customer acquisition cost / Cost per acquisition
Understanding how much it costs to acquire customers is an important metric for any business - you need to know that your marketing channels are cost-effective.
To calculate CAC, take all marketing and sales costs into account (including headcount), and divide this by the number of customers acquired. CAC per campaign can also be calculated (though to do this you’ll need to track exactly what actions and spend occurred within a specific campaign), which can help you see which campaigns and activities gave the best results.
Note that this metric is influenced by the quality of traffic and leads you’re generating in the first place. After all, if the leads you’re generating are mostly a good-fit they’re more likely to close. Over time, this will reduce your CAC.
Tracking Campaign Performance
Calculating SaaS success metrics is an ongoing process - you should regularly review your campaigns against monthly and quarterly goals (and against historical performance) to check you’re on track to your end target. No single metric can determine success, but combined, the above are good base indicators of growth and progress.