Crafting Digital Marketing Strategies: Goals, Budgets, and KPIs

Let's see how to develop your digital marketing strategy. This includes identifying your top goals, establishing a budget, tracking key performance indicators (KPIs, and measuring your results.

In order to identify and prioritize goals, you must first understand your business objectives. And by that I mean the overarching organizational objectives, brand objectives. And your marketing goals must be aligned with these business objectives.

For example, if the overall objective is to increase brand market share, then you must have goals that are targeted towards generating new sales from new customers. Whereas if the organizational goal was to generate more revenue from existing customers, then your marketing campaigns would have to target repurchases from existing customers to reach that goal. When we set our goals, we want to use the SMART approach to set goals.

That's an acronym, S-M-A-R-T, and we'll break down the details of the SMART approach in the next slide. We want to identify our key performance indicators, KPIs. We want to prioritize goals based on their potential impact and the feasibility of reaching those goals.

We want to consider both short-term and long-term goals. And we also want to consider goals for each buyer persona. Remember, buyer personas represent different targeted markets.

We might have a different goal or a different set of goals for each targeted market. We want to review and refine these goals regularly. Now, let's dig into what the SMART approach means.

S, specific, M, measurable, A, achievable, R, realistic, and T, timely. Specific. You must clearly define what you want to achieve.

Instead of increased sales, try increasing sales from SCM campaigns by 20%. Put another behind it, percentage or unit, and be specific as to which channels you're using to achieve those goals. Measurable.

We need to incorporate metrics and key performance indicators to track our progress and know that we have succeeded. That might be tracking the number of new leads generated or an increase in website traffic. But occasionally, there are goals that are a little bit more difficult to track, like brand awareness and customer satisfaction.

So, we'll be discussing in a few moments how we track goals that might not be as obviously measurable. Goals must also be achievable and realistic. We want to set realistic goals that your team can actually accomplish with the available resource and within reasonable constraints.

So, you have to consider your team's capabilities as well as the current market and competitive landscape. And goals need to be time-bound. You need to establish clear deadlines or timeframes for achieving your goal to create both a sense of urgency and help maintain focus.

You don't want to commit to too long a period of time because that might not allow for cost correction when you realize things aren't going in the direction that you want them to go in. So, many organizations will set goals quarterly as opposed to annually to allow for that. There are numerous approaches to budgeting, and we'll briefly touch on three common methods.

The first, the percentage of revenue, is fairly straightforward. You allocate a certain percentage of your revenue to marketing. The percentage may be based on factors such as industry.

Some industries are more marketing-intensive. Company size, product growth stage, and products in early stages of growth usually generate less revenue and require a higher percentage to fuel that growth, as well as other factors. While simple, it might not always be specific enough for your current situation, especially for newer brands.

Next, we have the objective and task approach. This method focuses on allocating resources based on desired outcomes rather than arbitrary figures like percentage of revenue, and this ensures that the budget is tied directly to the achievement of business objectives. It is more detailed as you have to define your marketing objectives and then determine the tasks needed to achieve them, and finally, the budget required for those tasks.

This can be challenging to implement, particularly for brands without an established history or a clear understanding of the task involved to achieve desired objectives, but if you can execute this, it might be the most effective way of establishing your budget. Finally, competitive parity. This involves setting your marketing budget based on what your competitors are spending.

The downside here is that it might not allow you to gain a competitive advantage if you're simply matching what others are doing. Now, let's discuss some key campaign KPIs. Revenue, the total income generated from sales attributed to a marketing campaign.

Return on investment, ROI, a measure of the profitability of a marketing campaign calculated by dividing the net profit by the total cost of the campaign. It's essentially the bottom line. Conversion rate is the percentage of users who take a desired action out of the total number of users who visit a website or view an ad.

Now, that desired action is commonly a purchase or lead generation, but it could also include other goals, such as downloading a white paper, downloading an ad, or viewing a video. You define what the conversion or the action you want the customer to take on that particular website page, and then you determine what percentage of the visitors to that page actually take that action, and that's your conversion rate. Cost per acquisition, CPA, is the average cost to acquire a new customer or lead, calculated by dividing the total cost of a campaign by the number of acquisitions.

This could be a very important metric when you are comparing different marketing channels. One channel may generate more sales, but at a higher cost per acquisition, making the other channel actually more effective. The customer lifetime value, CLV, is the predicted net profit attributed to a customer over the entire duration of the relationship with a business.

This includes the amount of repurchases that customers may make, the average value of the purchases that customers may make, and it's a great metric for truly understanding which customers are the most valuable to your organization and which channels are bringing in the most valuable customers. Finally, customer churn rate is the percentage of customers who stop using a product or service. This indicates the level of customer satisfaction, retention, and loyalty.

Earlier, we discussed that there might be situations where a goal might be difficult to measure. We want to be able to measure our goals using a smart approach. An example of such a goal is brand awareness.

You can conduct marketing research to determine the overall audience for your brand's actual awareness of your brand or your product, but that could be costly and time-consuming. Sometimes, what we would do is set a proxy goal to represent brand awareness. In this case, the proxy goal is to gain a thousand followers in three months on social media or a particular social media platform.

If someone is following you on social media, then that indicates awareness. If you can get a thousand more people to follow you in a given period of time, then you've increased your awareness. If you generate a website visit from a campaign, well, if someone's visiting your website, they also are aware of you.

A great proxy for brand awareness can also be website visits. Finally, the key campaign objectives. These are objectives that are common to many marketing campaigns.

They include increased brand awareness, driving website traffic, generating leads and conversions, boosting engagement interactions on your social media, building and maturing online communities, enhancing customer support and satisfaction, and establishing authority and thought leadership. A lot of times, brands may use content marketing on a platform like LinkedIn to establish authority and thought leadership. How would you measure if authority and thought leadership are increasing? Well, you can determine by the number of people who have read the blog or the number of likes that you get for that blog.

The more you get, the more it might show a higher level of authority and thought leadership. Promote product or service launches, drive off sales and foot traffic using online campaigns to drive people to stores, sometimes with promo codes or gain customer feedback and insights.