Digital marketing technology lets you gather data on nearly every aspect of your local marketing strategy. However, without specific goals in place, it’s easy to get overwhelmed by all of this information.
This is why choosing the right marketing KPIs is important. These are the data sets you should be looking at to judge the performance of your local marketing strategy.
Here are the fifteen local marketing KPIs and metrics that we advise all small businesses to look at when determining the success of your strategies and how they contribute to your bottom-line.
- Lead Response Time
- Lead Sources
- CPL (cost per lead)
- MMR (Monthly Recurring Revenue)
- Customer Lifetime Value
- Leads to Appointments Ratio
- Appointments to Customers Ratio
- Conversion Rates
- Time to Conversion
- Online Reviews
- Avg. Star Rating
- Website Traffic & Sources
What Are Key Performance Indicators?
Marketing key performance indicators, or KPIs, are how you determine whether a marketing strategy is helping you achieve your business goals.
There are thousands of different metrics for your various campaigns you could monitor. However, your KPIs are the ones you’ve decided are most important for your business.
For example, if you run an online store, your KPIs might be website load time, pages viewed, and cart checkout rate. If you’re a home contractor, you might choose to monitor metrics related to conversions and lead response time.
15 Local Marketing KPIs and Metrics to Track
The importance of leads to a business is like sunlight to a plant—it’s what drives growth. The more leads you generate, the more opportunities you have to close a sale.
When measuring leads, you need to be aware of the differences between Marketing Qualified Leads (MQLs) and Sales Qualified Leads (SQLs).
MQLs are people who are receptive to your marketing and are likely to become customers. These are members of your target audience who have indicated interest, such as subscribing to your newsletter.
SQLs have identified themselves being a sales-ready contact. They are near the end of your purchase journey and are ready to make a decision. For instance, prospects who had a project assessment appointment with you and are now requesting a quote.
Tracking both types of leads is vital for understanding how well your business nurtures leads overall.
Lead Response Time
This metric lets you know how long it takes for you or your team to respond to leads. This is important to track because lead quality degrades over time. People are only willing to wait for so long before they move on to a competitor. For example, according to LeadResponseManagement.com:
“The odds of contacting a lead if called in 5 minutes versus 30 minutes drop 100 times. The odds of qualifying a lead if called in 5 minutes versus 30 minutes drop 21 times.”
Furthermore, their research found that after 20 hours, every additional attempt to contact the person actually hurts your ability to connect and qualify a lead.
You need to understand where your sales are coming from, especially when running a local marketing campaign on multiple channels. Don’t just focus on the traffic source that generates the most proven leads and sales for your business. Make sure to diversify your leads sources to minimize risk to your company. If a majority of your sales are coming from a single source, personal referrals, for example, you’ll be in trouble if that source fails or gets tapped out in your local market.
An important part of tracking marketing performance is how many customers a strategy generates for your business. Not just leads, but actual paying customers. You want to segment customers by how valuable they are to your business and analyze which marketing channels were most successful for reaching which group.
CPL (Cost Per Lead)
Your Cost Per Lead measures the average cost it takes for your business to generate a new lead. It’s a key metric to track for lead-generation businesses like home service providers, HVAC contractors, etc.
You want to break down your Cost Per Lead by channel. For example, say that you use both Nextdoor advertising and Google Ads. You calculate the CPL for each channel and it turns out that marketing on Nexdoor significantly outperforms Google Ads. You might want to adjust how you allocate your marketing spend between the two.
ROI (Return on Investment)
As Harvard Business Review succinctly puts it: “Marketing ROI is exactly what it sounds like: a way of measuring the return on investment from the amount a company spends on marketing.”
Basically, it’s what helps you know if your marketing is generating enough results to justify the expense.
It can be challenging to accurately track your ROI because marketing involves multiple consumer touchpoints across different channels over time. The money you spend in one period might not result in a sale until months later. Also, some marketing costs are recurring, such as pay-per-click ad spend, while other costs are a one-off expense.
You need to account for the incremental profits generated by your marketing in both short-term and long-term sales to get an accurate sense of your ROI.
MRR (Monthly Recurring Revenue)
When your business model revolves around the idea of small incremental payments rather than big, one-off sales, tracking your Monthly Recurring Revenue is key.
In a nutshell, MRR is calculated by multiplying your total number of customers by the average amount each customer pays you each month.
If you run a SaaS (software as a service) business or subscription-based business, MRR helps you to get a sense of how much revenue you’ll be generating each month.
An increase in MRR means you’re doing well in monetizing and retaining customers. A drop in MRR means that you need to look at where you’re losing subscribers.
Customer Lifetime Value (CLV)
This metric tells you how much revenue you can expect your average customer to generate throughout your business relationship. The longer a customer continues to purchase from your company, the greater their CLV becomes.
By measuring your CLV in relation to the cost of acquiring a customer, you can determine how long it takes to recoup the marketing and sales investment required to earn that customer.
You can also use CLV to help identify the customer segments that are the most valuable to your business. Furthermore, it is a barometer of how successful you are at engaging and developing long-term customer loyalty.
Leads to Appointments Ratio
This is another important metric for lead-generation businesses. Tracking the number of initial leads that turn into appointments gives you an idea of how effective the first stage of your customer journey is at bringing in prospective sales for your business.
For instance, a high Lead to Appointment Ratio indicates that your message is resonating with your target audience, that you’re creating touchpoints on the right channels, and that you have a compelling call-to-action for booking appointments.
Appointments to Customers Ratio
While a high number of appointments is a great indicator of initial interest, you ultimately want to see a large percentage of prospects moving from appointment to customer.
This is where the Appointment to Customer Ratio comes into play. Tracking this metric helps you to understand how effective your sales team is at converting prospects into closed deals.
It should be analyzed in conjunction with your Lead to Appointment ratio to help determine how effectively you’re able to transition a lead from marketing to sales. For instance, if you have a high Lead to Appointment Ratio and a low Appointment to Customer Ratio, it might be that you’re misqualifying marketing leads or your sales team is taking too long to connect with prospects.
In essence, the conversion rate tells you how many people are reaching the desired end goal of your marketing campaign. It’s the percentage of your leads that perform a specific action on a specific marketing channel.
Keep in mind, that conversions can be anything you choose. For example, your conversion goal could be something like subscribing to your newsletter, downloading a case study, submitting an interest form, or calling to schedule an appointment.
An effective marketing strategy to employ a mix of micro conversions (which are small steps towards becoming an MQL) and macro conversions (which indicate someone is a SQL).
Time to Conversion
Tracking the Time to Conversion for each part of your purchase journey allows you to get a clear idea of the length of your sales cycle.
Also, customers expect it to be easy for them to buy something or set up an appointment. If it takes too long, they’ll be deterred. For instance, the Baymard Institute found that 26% of customers abandon purchase carts because the checkout process was long and/or confusing.
Check how your Time to Conversion compares to industry benchmarks. A high rate indicates that you might be creating a negative customer experience that will lose you potential sales opportunities.
Online reviews are an important source of social proof for your business. In their 2019 Local Consumer Review Survey, BrightLocal found that 82% of consumers will first read up on what other people have to say about a local business.
Moreover, frequency matters. They found that 48% of consumers only pay attention to reviews written within the past two weeks. And 84% believe that reviews older than three months are no longer relevant.
Evaluating the frequency and content of online reviews will give you insight into your business from your customer’s point of view. This information helps you generate more reviews, manage your online reputation, and optimize customer service.
Avg. Star Rating
You also need to keep track of your average star ratings across key third-party review sites, such as Google, Yelp, Facebook and Nextdoor.
Much like online reviews, people almost always check a business’s star rating before they decide to investigate it further. And it can have a real impact on your bottom line. For example, according to Harvard Business Review, a one-star increase in Yelp rating leads to a 5-9 percent increase in revenue for small, independent restaurants.
Moreover, regardless of how much you invest in your marketing, a bad star rating will end up driving potential customers away. BrightLocal’s 2019 Local Consumer Review Survey found that only 53% of people would consider using a business with less than 4 stars.
Website Traffic & Sources
This is a collection of metrics related to learning who your website visitors are, where they’re from and what they did once they got to your site. For instance:
- Total Number of Sessions
- Average Session Duration
- Bounce Rate
- Traffic Source (Organic, Referral, Direct, Social, Paid, etc.)
Tracking these metrics helps you understand how people are interacting with your website. You’re able to determine if they are getting the information they want and if they are staying engaged in your purchase journey. By tracking website traffic sources, you can also figure out if your local SEO strategy is working to make your website discoverable in local searches.
How Local Marketing Software Helps to Make Tracking KPIs Easier
As you can see, there is a lot of information you need to keep track of to effectively manage and optimize your local marketing strategy. As a small business owner, you don’t have time to oversee everything manually.
By using the right integrated local marketing software you get:
- Visibility into the effectiveness of your marketing activities because everything is in one place.
- Artificial Intelligence and marketing automation tools to properly capture and record data.
- Easy-to-understand reports that provide the insights you need to grow your business.
- One central source of truth on your ROI.
An all-in-one platform is what will help you take your marketing to the next level.
Request a Demo of the Surefire Local Marketing Platform
Surefire Local has been in operation since 2011 and our innovative marketing software has been implemented by over 3,000 small businesses across North America.
The Surefire Local Marketing Platform makes it easy for you to take control of your online presence. With this all-in-one solution, you have all the tools and features you need to build and manage your local marketing strategy and measure your KPIs.
With full visibility into which channels and tactics are driving business, you never have to worry about wasting money on an ineffective marketing strategy again.