When running any type of business comes with risks, companies often turn to growth marketing to help mitigate those risks and increase revenue. Growth marketers employ new channels, products, services, and brand identities to accelerate revenue, attract new customers, and expand beyond current customer segments. They also use data and analytics to manage risks, track performance, and forecast future outcomes. Success for growth marketers is measured in many ways. Depending on the specific objectives and activities of your organization, you might track the number of new customers or partners you sign, the total revenue generated by new products or services, or the percentage increase in sales from one channel of distribution versus another. In addition to measuring quantitative metrics such as these, it can be helpful to keep track of qualitative metrics as well. These might include the names of new customers or partners, product usage data, or other insights gleaned from qualitative research or surveys.
The most basic way to measure success in growth marketing is to track the number of customers you sign. This can be accomplished by tracking the number of leads you generate, the number of new customers you sign, or the number of customers you retain. Each of these metrics can be calculated based on the number of new leads you generate, the number of new customers you sign, and the number of customers you retain. Tracking the number of customers you sign can help you forecast future revenue and determine if your marketing efforts are generating the desired ROI. In addition to tracking the number of customers you sign, it’s also important to track the value of those customers. The value of each customer is sometimes referred to as the “customer lifetime value” or “customer lifetime benefit” (often abbreviated as LTV or LBB). LTV is a measure of the total revenue generated from a customer over the course of their relationship with your organization. If you track how much each customer is worth and the value of your overall customer base, you can forecast future revenue and determine if your marketing efforts are generating the desired ROI.
Another key objective of growth marketing is to attract new partners. Depending on your specific marketing activities, you may want to track the number of new partners you sign, the revenue generated from each partner, or the percentage increase in revenue from partners compared to other marketing channels. For example, you may generate leads through online marketing initiatives, and then follow up with prospective customers with phone calls or emails. By tracking the number of leads you generate and the number of partners you sign, you can forecast future revenue by setting expectations around the new customer base and measuring the ROI of each partner channel. Similar to measuring the value of customers, it’s also important to track the value of partners. The value of each partner is sometimes referred to as the “partner lifetime value” or “partner lifetime benefit” (often abbreviated as P LTV or P LBB). P LTV is a measure of the total revenue generated from a partner over the course of their relationship with your organization. If you track how much each partner is worth and the value of your overall partner base, you can forecast future revenue and determine if your marketing efforts are generating the desired ROI.
If you’re focused on expanding from a current customer base, tracking the growth rate of each customer segment can be a useful metric to help you forecast future revenue. If you’re not focused on expansion at this point, you can still track growth rates to determine if your strategies are successful. Tracking the growth rate of each customer segment can help you determine if certain customer segments are growing faster than others, which can help you adapt future marketing strategies. If a particular customer segment is growing faster than others, you may want to increase marketing efforts in that segment to increase future revenue. If a customer segment is stagnant or declining, you may want to re-evaluate your marketing strategies in that segment to determine if adjustments are necessary. Tracking the growth rate of each customer segment can also help you forecast future revenue by setting expectations around the revenue of each segment and measuring the ROI of your marketing strategies.
If you’re focused on expanding from a single channel of distribution, tracking the percentage increase of each channel of distribution can be a useful metric to help you forecast future revenue. For example, if you generate leads through online marketing initiatives, you may want to follow up with prospective customers through a phone call or an email. Tracking the percentage increase of each channel of distribution can help you determine if your follow up efforts are successful. If the percentage increase of one channel is higher than another, you may want to increase marketing efforts in that channel to increase future revenue. If the percentage increase of one channel is lower than another, you may want to re-evaluate your marketing strategies in that channel to determine if adjustments are necessary. Tracking the percentage increase of each channel of distribution can also help you forecast future revenue by setting expectations around the percentage increase of each channel and measuring the ROI of your marketing strategies.
If your organization focuses on a product or service that customers can purchase on a recurring or continual basis, tracking the percentage increase of product usage can be a useful metric to help you forecast future revenue. If you sell a product or service that customers can use on an occasional basis, you may not want to track the percentage increase of product usage. For example, if you sell a vacation package to a particular destination, you may want to track the percentage increase of booking volume for that destination, but you may not want to track the percentage increase of booking volume for each specific day of the vacation. Tracking the percentage increase of product usage can help you determine if your strategies are successful. If the percentage increase of product usage is higher than another channel of distribution, you may want to increase marketing efforts in that channel to increase future revenue. If the percentage increase of product usage is lower than another channel of distribution, you may want to re-evaluate your marketing strategies in that channel to determine if adjustments are necessary.
Growth marketing is a strategic approach to increasing revenue by expanding from current customer segments, or launching new products and services at scale. Companies use growth marketing for a variety of reasons, including mitigating risks, accelerating growth, and meeting regulatory compliance requirements. Success for growth marketers is measured in many ways, including the number of new customers and partners, the percentage increase in sales from one channel of distribution versus another, and the percentage increase in product usage compared to a previous period. It’s important for growth marketers to track key metrics to monitor the effectiveness of their strategies, identify areas for improvement, and forecast future revenue.