Outputs vs. Outcomes: Finding the Right Marketing Metrics

Any small business owner who has dipped their toe in data analysis knows that some marketing metrics are more useful than others. To be successful in your marketing plan, you don’t just need a ton of likes, shares or follows on Facebook. Of course, this is a huge help in getting the word out, but it doesn’t equate to sales.

If you want to manage your own marketing efforts effectively, you must get acquainted with the difference between marketing outputs and marketing outcomes. There is a distinct difference, yet it is quite easy to mix up the two. Outputs are basically the methods you use to reach customers: this includes social media, email, radio or whatever avenues you prefer. The most modern outputs today include blogs, videos and other types of content marketing that customers encounter digitally. Outcomes, on the other hand, are what you want to be watching more closely.

Measuring outputs vs. outcomes

It is all too common for business owners to judge how well they are marketing by examining their outputs. However, you won’t have a genuine understanding of your effectiveness until you begin to observe your outcomes.

So how does one ensure they are measuring outcomes (the much more reliable area of focus) and not outputs?

Let’s say you create a marketing campaign through your website and your social media accounts. Customers can purchase a new product you just released. Your website and social media accounts are simply outputs or avenues; they don’t matter as much as the outcome: How many sales came in as a result of this campaign?

Related: How to Create Marketing Demand for Your Unknown Startup

With the popularity of free analytics on platforms like Facebook and WordPress, it’s tempting to obsessively measure your outputs because that is what gets highlighted. Social media measures success through likes, shares and follows. Email marketing platforms report back your subscriber lists and open rates. Website platforms tell you page visits and link clicks.

With this kind of data front and center, it’s no wonder business owners are confused about how to determine their marketing impact. The most obvious information provided is not really the most important information. These metrics are simply surface-level assessments that give you an idea of whether people are responding to your content or not. Useful, but outputs won’t provide the in-depth knowledge you need to strategically propel your business to the next level.

The metrics that matter

So what should you do instead? Essentially, you must begin to focus on metrics that are more closely related to sales. How close is a Twitter follow to a sale? Not that close. Anyone can click the follow button without any intention of becoming a customer. Now how close is an email subscriber to a sale? That’s a little closer because there is an opportunity for a more personal connection. And what about a campaign that brought several hundred people to your landing page, where they were directly pitched to buy your product? That’s even better. By examining this metric, you can see the direct relationship between the campaign you ran and the number of sales that it earned you.

The ideal metric looks at the direct outcome: From X behavior, we received Y result. In other words, you moved from point A (action) to point B (sale) as directly as possible.

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Set revenue goals

To avoid getting sucked into a whirlwind of numbers and figures that you can’t make sense of, first decide on your revenue goals. Before even glancing at any metrics, determine what you want to accomplish. Through particular marketing outputs, what outcomes would you like to see? Once you answer these specific questions, it becomes much easier to know whether you are hitting your goals or not. For example, if you know that your email list’s job is customer retention, you can go into your data and see if your email list is effective or not.

Once you get crystal clear about your revenue goals, your marketing strategy becomes a seamless endeavor. You no longer have to justify your budget because you already know what it is working toward.

If you’re still feeling uncertain about outputs and outcomes, here are a few ways to know you’re on the right track:

  • You budget according to impact, not random guessing. Strategies that work receive more funding, while strategies that have failed are cut off
  • Your team members understand what they are aiming for and what the underlying goal is
  • You look back and assess completed projects to figure out what went right and what went wrong

As a business owner, it’s crucial to remember your bottom line and use your marketing efforts to achieve it. Stay focused on the outcome of your efforts, not the performance of each individual output.

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