Grow Your Business Blog


It's very hard to see the forest if you're busy looking at each tree.

With so many marketing options available today, many business owners and CEOs get caught up in tracking marketing data and performance indicators that they really don’t need to focus on.
I realize, of course, that this is partially the fault of us marketers. We love to share all the cool little data points that show our progress like keyword ranking improvements, traffic growth, lead source data, etc… because they’re fun to measure and track.

But your marketing performance isn’t a baseball game or some other leisurely past time. 

And unless you want to spend your personal down time analyzing information that doesn’t offer any practical use, you should know which statistics actually can. 

I will even go as far as to suggest that some of the most important data that we use as inbound marketers to adjust our campaigns like, cost of lead by source and cost of customer by source, don't necessarily need to be focused on by CEOs.  It’s marketing's job to drive these costs down.

So… which metrics should CEOs focus on?

The answer is simple - The ones that will help you steer your ship.

If you imagine your company as a battleship or carrier, you are the captain. And as the person in charge of successfully navigating your business in the ocean of commerce, you need high level mapping information that will help you plan your course, avoid seasonal storms, and pilot your vessel through dangerous territory.  

What you don’t need to understand is all the intricate workings of the engine room (your marketing department) like which gear or valve needs a small adjustment. You just need to know that the engines are working properly and will give you the power you need to meet any challenging situation.

Warning: Most businesses are simply not setup to generate the measurements CEOs need to track.

But by knowing which data points you actually need to measure, you'll be able to take the steps you need to setup the reports that contain this important information.

I’ve identified 6 metrics that CEOs and business owners need to focus on to grow their business. But don’t worry about committing them to memory, I’ve also created a free, convenient cheat sheet with the applicable formulas as a download, so that you can get your marketing team on it immediately.

1. Customer Acquisition Cost (CAC) 

This metric gauges the total average cost that your company spends in acquiring new customers. It is calculated by dividing the number of new customers you’ve gained in a specific time period, by the amount of sales and marketing investment you’ve made, during the same time.
This metric easily demonstrates your rate of return, and high CAC’s mean that you’ve got a problem with your sales or marketing efficiency.

2. Marketing Percentage of your Customer Acquisitions Cost (M%-CAC)

Just like the CAC, this metric indicates a return on your investment, but it focuses on the marketing aspect in relation to the CAC.

In other words, this percentage shows you how your marketing team’s performance and spending impact your customer acquisition cost. High percentages can illuminate poor sales performance, investment phases, or too much overhead in marketing.

3. Ratio of Customer Lifetime Value to Customer Acquisitions Cost (LTV:CAC)

This ratio helps you understand the value derived from each customer, in relation to how much the acquisition of the customer cost you.

Although you want to see healthy ratios here because it means that your slaes and marketing are delivering a good ROI, very high ratios indicate that company growth could be increased with a higher marketing investment.

4. Time to Pay back Customer Acquisition Cost

This metric is important because it demonstrates exactly how long it will take for your company to earn back the amount it spent acquiring a new customer

By dividing your CAC with your margin-adjusted revenue, you can calculate exactly when you’ll start gaining profit from your new customer.

5. Marketing Originated Cost Percentage

This metric indicates the percentage of new customers that were generated through your marketing in a given time period.

For instance, if you gained 10 new customers in June, and 6 of those began as marketing leads, your marketing was responsible for 60% of new customers that month. Your ideal percentage here will depend on your specific business model.

6. Marketing Influenced Customer Percentage

Similar to the MOC%, this percentage helps to gauge how successful your marketing is at generating, nurturing, and establishing customers from leads, and illuminates the overall impact your marketing has on your entire sales process.

Don’t lose sight of the big picture.

With so many different data points and marketing indicators available out there, it’s easy for CEOs to lose sight of the overall impact that marketing strategies are having on business success. But by focusing on these 6 metrics, you can eliminate distraction, visualize the big picture, and then make educated decisions that foster growth and efficiency in your company.

But don't forget to download our free "cheat sheet" to make it easy to get started today.    

marketing metrics for CEOS  

Topics: Business Growth, Marketing Metrics