As a marketer, one of the biggest challenges is not knowing where your marketing budget is having the biggest impact. It’s common to be overwhelmed by a lot of metrics and not knowing how to accurately measure performance and optimize spending.
The problem, which I discovered, was a focus on too many metrics instead of the one or two most important key performance indicators (KPIs). So, it's crucial to define the one or two KPIs that indicate marketing success specifically for your business goals and objectives.
For example, for an e-commerce company focused on growth, the core KPIs may include:
A CAC of $100 may be viable for a $1,000 product but too high for a $50 product. In such a situation, a high CAC may be acceptable only for high LTV customers. Therefore, you need to define indicators of success based on your objectives.
With a tight focus on the 1-2 metrics that matter most, you can now start applying attribution models which can be very powerful. These models provide a way to methodically track how much credit to assign different marketing channels for driving your core KPIs.
Let’s look at how to implement attribution to take the guesswork out of marketing measurement.
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Former Global Performance Marketing & Website Lead
Lindt & Sprüngli