This document is for Media Buyers, Brand Marketing Directors, and Brand Owners that are analyzing new lead ROI and are not sure if their performance is acceptable.
Why You Need This
ROI, LTV, and revenue are numbers that are critical to your business - and they are also very relative to your business. One business might be overjoyed with a $500,000 month and another business might be distraught at only making $500,000/month.
Marketing attribution data based on your business, in your industry, based on your price point, and the goal of the marketing campaign is also extremely relative to your business based on how long a campaign has been running, and the correct attribution model being applied to evaluate the campaign.
If you are making 25% ROI after 14 days of a campaign that acquires new leads, is that good? Time to scale? Time to kill the campaign? Or maybe chill out and give it time to generate more revenue?
The way to answer those questions is by comparing your campaign performance by the attribution model that matches the campaign goal against all your other campaign's performance by the same attribution model after the same amount of time has elapsed.
This is not a trivial task to setup and perform. Fortunately, we do all this for you with our campaign benchmark feature.
Common Marketing Optimization Scenarios that New Lead ROI Benchmarks can Solve
- Can I scale my budget on this high ROI campaign?
- Can I keep spending on these leads that haven't bought at positive ROI yet?
- Can I keep spending on this campaign that had high ROI that has slowly been dropping over time?
- Should I kill this campaign that has negative ROI but has been trending up?
- How much do my campaigns generate on average at a point in time?
How to use the ROI Benchmarks with New Lead Attribution
ROI Benchmarks snapshot your marketing campaign performance and compare them against all your other campaigns after the same amount of time using the attribution model you have selected.
This article assumes you understand https://help.wickedreports.com/how-to-use-the-roi-report and New Lead First Optin attribution https://help.wickedreports.com/new-lead-first-optin-roi.
Access the benchmarks for any marketing campaign by selecting Benchmarks from the Wicked Tools menu on that campaign's row from the ROI report.
This will open up and load the Benchmarked metrics for this campaign below the ROI row.
When looking at benchmarks, the first factor to keep in mind is time. The proper perspective on time can be a great edge for you. Either your campaigns get a lot stronger ROI over time as the leads buy, or the campaigns fizzle out after an initial burst of revenue.
Benchmarks are calculated from the very first tracked click for the campaign. So the benchmark data will not match the ROI campaign data unless your ROI time filter begins at the first tracked click date of the campaign.
New Lead First Optin attribution is built to measure the lifetime value vs. the costs of new lead acquisition. Let's look at all 4 benchmark tabs and see what we can learn. First, the Clicks tab:
Here are the analysis questions we look to answer from the above:
1. How expensive are clicks in this campaign vs. my usual price? In this campaign, CPC is $1.08, which is 108% more expensive than the average.
2. Are the clicks turning into revenue? We see EPC (earnings per click) is $1.30, which is 12% higher than normal EPC after 63 days.
3. Am I getting more or less traffic than normal? 14,238 clicks is 162% higher than the average amount of clicks after 63 days for a campaign.
You always want to see higher Earnings per Click than Cost per click - else you are losing money! When the traffic costs more than average, you want the earnings to also be more than average, ideally in the same proportion. It is not in the same proportion here.
Next, the Leads tab :
Note - the image is interactive, clicking on data points will hide/show them.
For new lead benchmarks, analyze the following on the above screen:
- How is my CPL vs. my benchmark? The current CPL is $92.22, which is 1,095% higher than the average CPL of $8.37 after 62 days. Not good! These leads are way, way more expensive than usual.
- How is my EPL vs. my benchmark? The current EPL is $110.83, which is 546% higher than the average EPL of $23. Really good. These leads are more valuable than usual.
- Compare CPL to EPL. Leads are costing $92.22 and after 63 days are worth $110.83 - not bad, but not amazing.
- New Lead count - 100 New leads generated is 62% lower than the average new lead amount after 62 days.
Now we click on the Sales Tab
For new lead sales benchmarks, analyze the following on the above screen:
1. Are sales & revenue better than my average benchmarks? Revenue is showing at 193% above benchmark, and sales are 93, which is 174% above benchmark. Seems great so far...
2. How is ROI on the investment to acquire the new leads? Turns out, not great, the 20% ROI is 83% lower than the average ROI on new lead ad spend after 63 days.
The last benchmark screen for us to check is the customers tab:
Look at the spike in customers from day 30 to day 60. The new leads from this campaign certainly take time to buy. Let's analyze:
1. What is the campaign CAC vs benchmark? At the 63 day mark of this campaign, CAC is now $177.02, which is 106% higher than average CAC.
2. LTV vs. benchmark? LTV is $212.73, which is 53% higher than benchmark after 63 days.
3. CAC vs. LTV? Customers are being acquired cheaper than their value. Keep in mind this is before product costs.
Marketing Optimization Tips
When ROI is higher than your average benchmark, and the time to reach that higher ROI is acceptable, increase your budget for this campaign.
If LTV is trending higher and is above CAC, and CAC is lowering or leveling off, keep campaign running. If the LTV to CAC spread is high enough, and happens in an acceptable timeframe, increase your budget for this campaign.
When ROI is lower than your average benchmark, and is not trending up, time to kill the campaign and allocate budget elsewhere.
Notice in the charts above, there was a great change in the data between days 30 & 60. Consider a longer time frame to evaluate success of your top of the funnel campaigns. New leads take time to buy.
- The stats in the benchmarks do not match the stats on the ROI campaign report unless the start and end date of the ROI report match the start and end date of the campaign. Use this to your benefit, you can see near-term ROI performance vs overall campaign performance over time from the benchmark to spot trends.
- If the benchmark section seems to advanced, simply focus on ROI based on the attribution model that maps to the campaign goal.
- If you are doing spray and pray marketing, that's ok, use full impact or linear attribution models.