{"id":4762,"date":"2016-06-23T16:00:37","date_gmt":"2016-06-23T14:00:37","guid":{"rendered":"https:\/\/chartmogul.com\/blog\/?p=4762"},"modified":"2023-08-10T12:11:05","modified_gmt":"2023-08-10T10:11:05","slug":"churn-marketing-channels","status":"publish","type":"post","link":"https:\/\/chartmogul.com\/blog\/churn-marketing-channels\/","title":{"rendered":"How to (effectively) analyze Marketing ROI using Churn Rate"},"content":{"rendered":"

The problem with measuring marketing ROI<\/h1>\n

You know all the standard marketing KPIs. Tracking traffic, leads, and conversions are all important. But they don\u2019t tell you the true ROI of your marketing efforts. What happens after the conversion to paying customer? Just like any other team, marketing\u2019s goal is to build and scale a sustainable business, and this requires loyal customers \u2014 customers who don\u2019t just purchase once but stay on board.<\/p>\n

That\u2019s why some sources, such as\u00a0HubSpot<\/a>, suggest marketing teams also look at company-wide performance metrics to measure success. Metrics like Customer LTV<\/a> and Churn rate<\/a> reflect the longer term value of acquired customers, thus justifying or calling into question the marketing team\u2019s efforts.<\/p>\n

But how much can you really learn about marketing efforts specifically, when you\u2019re looking at a global metric? At the point that an account cancels, that customer has had so many more touch points within the product and with other teams that it\u2019s hard to draw a clear, actionable correlation between the data and any single team\u2019s initiatives.<\/p>\n

The problem with global metrics<\/h1>\n

As a marketer, you need to know how these customers \u2014 the customers you\u2019ve acquired through strategic efforts and specific channels \u2014 stick to the product. Are any churning earlier than average? If so, where did those accounts come from?<\/p>\n

Without this knowledge,\u00a0you could be doubling down on efforts in a certain marketing channel that’s bringing you customers who consistently cancel after a few months. Which is to say, you’re increasing your marketing spend in an area that’s actually also increasing your company’s Churn rate.<\/p>\n

Looking at your overall Churn rate doesn\u2019t cut it. In the same way Ed explains about global LTV and CAC<\/a>, this blanket analytical approach misses a lot of the valuable nuance that is nestled in your data.<\/p>\n

The solution is Segmentation<\/h1>\n

Splicing your data by certain account attributes, otherwise known as user segmentation, unlocks a wealth of information about where you earn your money \u2014 and where you lose it. For marketing in particular, it can teach you where your money and effort are best spent \u2014 and where it\u2019s not worth the investment. Identifying your product\u2019s strong and weak marketing channels will change your whole strategy.<\/p>\n

So how to do it?<\/p>\n

Discover your most effective marketing channels with ChartMogul<\/h1>\n

1. Add marketing attributes\u00a0to existing customer data.<\/strong><\/h3>\n

There are a few ways to do this within ChartMogul:<\/p>\n