Three Lead Generation Metrics Every Business Needs to Track
If you own a business, there are key metrics that you need to keep track of to ensure that your lead generation efforts are working. Unfortunately, this task is often put on the back burner due to a lack of time.
Another common issue that causes problems with recording metrics is that in their zeal to collect as much information as possible, business owners are often overwhelmed when it comes time to decipher what all this information means or what they should focus on first.
Tracking lead generation metrics can be overwhelming to those with little experience in collecting or deciphering this type of information. If you are new to the world of data, it is best to start with the basics. What follows are the three key metrics to get you started:
- Conversion Rate: Your conversion rate tells you how many customers do what you want them to do. Of course, every business is different. Some may wish customers to make a purchase, others want them to provide their email addresses, and others may want them to subscribe to a newsletter. To calculate your conversion rate, take the number of people who did what you wanted them to do and divide by the number of people you asked to do it. Once you have calculated the conversion rate, you will be better able to tell if your lead generation strategy is working. If it isn’t, you will need to change your technique.
- Customer Acquisition Cost: Your customer acquisition cost (CAC) is the amount of money you need to spend to convert a customer. To calculate your CAC, divide how much money you spent on marketing in a specific period by the number of customers you acquired during that same period. Tracking your CAC will give you an idea of how you can make your marketing dollars work as efficiently as possible.
- Rate of Referral. This metric helps businesses understand customer satisfaction since unsatisfied customers are unlikely to refer friends and family. Referrals allow you to spend less money on CAC because your customers are doing your marketing and lead generation for you, free of charge. To track your referral rates, ask new customers how they heard about your business.
Tracking and evaluating the correct information is the key to successfully monitoring your lead generation efforts. Tracking the metrics listed above will put you on the road to success and allow you to move forward into more detailed data collection over time.