Digital marketing has been long regarded as a game changer for marketers because of the sheer number of resources it offers. With just a click of a button, virtually all key information about your business and competitors can become readily available to anyone. More importantly, a close analysis and evaluation of these data could provide insights on the spending habits and preferences of your target market. In fact, research reveals that businesses that utilize customer behavior data overtake their competitors by 85 percent in sales and over 25 percent in gross margin.
Obtaining a deeper understanding of the behavior of customers is one of the key motives companies spend time analyzing data. Analysis can come in various forms and magnitude that could include simple dashboards, comprehensive consumer profiles, and even segmented customer sources. Through these efforts, businesses can accurately put themselves in their consumers' position and proceed to seek ways to enhance the experience. A breakdown of customer behavioral analytics can improve a company's efforts in tweaking their campaigns to enrich customer approval and boost sales.
What behavioral metrics should you prioritize?
While it may vary depending on the industry and the goals of your business, there are metrics that zero in on the heart of what every company wants to know - what behavioral metrics influence your main business components? For the majority of companies, there are three business drivers that affect them the most. For e-commerce businesses, customer loyalty plays a key role. Meanwhile, SaaS companies focus on their active users. For both and for all types of companies, revenue is the main factor considered all the time. This article aims to help you figure out how to map behavioral metrics into your key business drivers.
1. Customer Loyalty
Every marketer knows that gaining a new client is five times more expensive compared to simply retaining existing consumers. Actually, simply boosting your client retention by merely 5 percent can offer you a 25 to almost 95 percent increase in profits. This is why businesses spend a lot of time and money to ensure that their customers will keep coming back to their site.
While there are many factors affecting brand loyalty, one simple way to determine your success here is to take a look at the purchase history of your customers. To be specific, focus on the repurchases and see if your consumers are coming back and buying again from your site. This is perhaps the most basic way to measure brand loyalty. If a consumer goes back to your site and purchase or avail of more products, then it means they enjoyed the experience enough to repeat it. In a nutshell, the higher number of purchases, the stronger the brand loyalty.
Apart from your records on the purchasing history of your customers, here is a repeat purchase rate formula:
Building customer loyalty is a crucial step in the success of your business. To inspire loyalty, efforts should be exerted to achieve targeted recommendations, well-timed offers, and tailored incentives. On top of these, however, a key factor in promoting brand loyalty among your customers is ease of use.
Studies show that rewards and other enticing offerings could not compare to this one thing that customers seek whenever they visit an e-commerce website. So before you bombard your customers with all these great promotions, answer this crucial question first: "Is your site easy to use?" This means that your site makes it easy for the customer to buy from you. In addition to that, make sure that it's easy to reach out to your team for solutions. Basically, you have to ensure that every contact with your user feels easy and uncomplicated.
2. Active Users
The first step to drive business to your site is to attract as many people as possible. With high volume of traffic going to your landing page, you'll have higher chances of making a sale. Needless to say, ranking on top of the SERPs would entice more users to click on your page. Hence, it's crucial that you do your best to optimize your landing page and improve your website. Always keep in mind that Google puts a premium on user experience when determining the rankings in the search results.
For SaaS companies, it's important to always have a healthy number of active users at any point in time. This means that the engagement rate of the visitors plays a crucial role in determining the success of your product or service. Although it's challenging to determine the exact number of active users on your page, there are key factors that could help guide you through the process.
Logins: This factor is popularly used by Facebook. For the social media giant, they are able to determine the number of active users by looking at the number of logins on their site. For them, a user is considered "active" even if he or she does not Like, Comment, or utilize any tool in the app. For a user to be marked as "inactive," he or she must not log in for at least 30 days. This basic way of determining the number of active users daily can be easily adapted to any SaaS business.
Length of sessions: This is also quite simple. A good measure of how active a user is on your site is the amount of time he or she spends there. Just take a look at how long a user is logged in. Clearly, someone who stayed on your site for 20 minutes is more engaged than a user who only logged in for a minute.
Customer engagement index (CEI): This is a useful tool in figuring out the level of activity on your site. All you need to do is allot a specific value to every user action available on your page. This would give you a clear picture of the general engagement rate of users on your site as well as a thorough understanding of the activities of particular users.
Aim to make your website fast and user-friendly to make the customer experience as pleasant as possible. Take advantage of various SaaS solutions that could help you optimize your site. Using behavior tracking, you can check out which parts of your site are users clicking away the most and which ones they like spending time on. These information will help you make the necessary adjustments to boost user experience and subsequently improve your SERP ranking.
It's fairly simple. The more you sell, the higher your revenue. Getting people to visit your site is not the final step. The ultimate goal is to push them to buy your products or avail of your services. So, it's necessary for you to attract more customers in order to increase your income and the first step to achieve this is to increase your conversion rate. The goal is to convert your visitors into paying customers.
This is why web design is such an important part of your page. Every marketer must aim to provide an amazing user experience to ensure that every lead is converted into a sale. As mentioned earlier, make sure that your site is as user-friendly as possible. That way, leads won't get turned off and leave without making any purchase.
A straightforward way to verify how your revenue and conversion rate are correlated is through this conversion and traffic calculator from Foremost Media.
It's easy to use. Simply input your average monthly visitors along with the percentage of converted leads and the average value for every conversion. This formula will help you determine the effect of your conversion rate on your revenue.
The digital marketing space can become overwhelming with the daily torrent of information in your dashboards. With various metrics that pertain to different aspects of your business, making marketing decisions could become extremely challenging if not downright confusing. Basically, every marketer's goal is to single out metrics that are worth the time and budget and determine which ones shouldn't be prioritized.