"Is Our Marketing Even Working?" – The Question That Comes Up Every Quarter

You’re reviewing last quarter’s numbers when someone—usually from finance or leadership—asks, "So, how do we know this is actually working?"

Your gut reaction might be to talk about engagement, reach, and impressions. But let’s be honest, while those are nice to track, they don’t always translate to actual business growth. The real question isn’t whether your campaigns are getting attention—it’s whether they’re driving revenue, retaining customers, and contributing to the company’s bottom line.

That’s where these five essential marketing metrics come in. They give you tangible proof that your strategy is more than just a creative exercise—it’s a business growth engine.

1. Customer Acquisition Cost (CAC) – How Much Are You Paying to Get a New Customer?

Every marketing effort—whether it’s paid ads, email campaigns, social media, or SEO—comes with a price tag. Customer Acquisition Cost (CAC) helps you determine if that price is reasonable.

What It Is:

CAC measures the cost of acquiring a new customer, taking into account everything from ad spend to salaries of the marketing and sales teams.

How to Calculate It:

CAC= Total Marketing and Sales Expenses/Number of New Customers Acquired

Why It Matters:

• If CAC is too high, you're spending too much to acquire customers, eating into profits.

• If CAC is low, it means your acquisition strategy is efficient.

• To be sustainable, CAC should be lower than Customer Lifetime Value (CLV) (which we’ll get to shortly).

2. Marketing-Generated Revenue – Show the Direct Impact

It’s one thing to say marketing is “helping” the business. It’s another to prove how much revenue marketing efforts actually bring in.

What It Is:

This metric tracks the percentage of total company revenue that can be directly attributed to marketing activities, such as leads from paid ads, email campaigns, and organic traffic.

How to Calculate It:

Marketing Generated Revenue = Revenue from Marketing Leads/Total Company Revenue x 100

Why It Matters:

• Demonstrates the value of marketing in driving business growth.

• Helps justify marketing budgets (because let’s be honest, they’re always at risk of being cut).

• If this percentage is low, it may mean marketing needs to better align with sales or improve targeting.

3. Customer Lifetime Value (CLV) – How Much Are Your Customers Worth?

Acquiring a customer is one thing. But keeping them and maximising their value over time? That’s where the real growth happens.

What It Is:

CLV estimates the total revenue a business can expect from a single customer over their entire relationship with your brand.

How to Calculate It:

CLV = Average Purchase Value x Purchase Frequency x Customer Lifespan

Why It Matters:

• If CLV is higher than CAC, your business is on the right track.

• A low CLV suggests you need better retention strategies, upsells, or improved customer experience.

• Knowing CLV helps determine how much you can afford to spend on acquiring new customers.

Pro Tip: If you want to increase CLV, focus on retention, loyalty programs, and personalisation.

4. Conversion Rate – Are People Actually Taking Action?

Your website and marketing campaigns might be generating traffic, but if visitors aren’t converting, that traffic is just vanity.

What It Is:

The percentage of users who take a desired action—whether that’s making a purchase, signing up for a newsletter, or booking a demo.

How to Calculate It:

Conversion Rate = Conversions (Sales, Sign-ups etc) / Total Visitors x 100

Why It Matters:

• A low conversion rate means something is off—poor UX, unclear messaging, or weak CTAs.

• Small improvements in conversion rates can lead to big revenue jumps.

• Tracking conversion rates across different channels helps identify what’s working and what’s not.

5. Return on Marketing Investment (ROMI) – The Budget Justifier

This is the number executives care about most. It answers the golden question: For every dollar spent on marketing, how much do we get back?

What It Is:

ROMI measures how much revenue marketing efforts generate compared to how much is spent.

How to Calculate It:

ROMI = (Revenue from Marketing Campaigns - Marketing Cost) / Marketing Cost X 100

Why It Matters:

• Proves marketing’s role as a revenue driver, not just a cost.

• Helps make decisions on where to invest and what to cut.

• The higher the ROMI, the more efficient your marketing is.

Marketing Metrics That Actually Matter

Marketing isn’t about vanity metrics. The real proof of success lies in these five key numbers:

1. Are we spending wisely on customer acquisition?

2. Is marketing driving revenue or just creating noise?

3. Are we retaining customers long enough to profit?

4. Are our campaigns convincing people to take action?

5. Is our marketing ROI-positive?

   
   

Tracking these metrics will not only make your strategy more effective but will also help you confidently prove marketing’s value to the business.

Need help tracking and improving these metrics? Contact us.

Now, over to you: Which of these metrics are you tracking consistently? Let us know in the comments!