Performance indicators such as revenue, profitability, ROI, ROA, Increase in Sales to Digital Expenditure etc. can be used

According to a document issue by the Nielsen Company "Beyond Clicks and Impressions: Examining the Relationship Between Online Advertising and

Brand Building"  there is no statistical correlation between the Click-Through rate (CTR) and the sales lift. However, generally speaking, you could look at ad recall metrics and click stream analysis to see if they embed ways to measure the impact of digital marketing on economics.

You can use the following indicators : the rate of new customers , the rate of loyalty of existing customers and their impact on the value of the portfolio company's customers. It is necessary to thoroughly monitor the costs of this kind of marketing .

Digital marketing activities can improve marketing efficiency and marketing effectiveness, or using one construct they can improve "marketing performance" (market performance).

Efficiency can be understand as "doing things good", and effectiveness as "doing good things" (Drucker). So first one is more about delivering marketing programs at lowest possible cost. Second one is about producing the required results.

So to measure efficiency, you will mostly use ratios, like "cost per inquiry", "cost per lead", "cost per sale". You can measure for example efficiency of specific digital channel.

Efficiency in most cases will lead to marketing effectiveness. The measures of marketing effectiveness tent do be absolute numbers: numbers of inquiries, number of leads, number of sales. So, you can use some benchmarks to compare, industry data, or compare with your own data from past period. You can develop bunch of KPIs to measure, but all depends on your business and marketing goals. You can use some of the existing models like REAN or RACE, and depending on your goals, develop KPIs to measure for every phase.

Also, you should have in mind that some effects are mediating. Its easy to measure financial indicators, like profit, sales and cash flow, but its a bit harder to measure mediating effect of some non-financial measures, like market share, customer satisfaction, customer loyalty, brand equity, which all can have financial impact in long run.

I suggest you to read:  Bruce H. Clark (1999) "Marketing Performance Measures: History and Interrelationships", Journal of Marketing Management, 15, 711-732, and also Cult of Analytics: Driving online strategies using web analytics (Emarketing Essentials) from Steve Jackson.

Dear Kenan Mahmutovic, thank you very much for your contribution. It is really helpful.

While your target consumer may take a more holistic approach and measure KPI's as ROI or ROAS, the underlying KPI you should be focused on is conversion rate. Conversion rate is more easily measurable from a financial perspective than say a KPI such as CPM.

With that in mind, the name of the game becomes conversion rate optimization, which can be done by leveraging attribution modeling and multi-channel funneling to isolate and analyze specific subsets of a conversion segment.

This allows you to track exactly where the budget is allocated and how well each 'event' contributed to the flow of the conversion. Translate the analytical jargon into metrics you're customer understands and measure financial business growth in comparison to MoM/QoQ.

Does digital marketing effect business performance separately. Every management function effects the business performance so does marketing. Digital marketing is one of the items in the total basket of marketing. Until and unless all other factors are kept constant, Click-Through rate (CTR), ad recall metrics and click stream analysis will not give establish any logical relationship between digital marketing and business performance.

Marketing Indicators devised on the following

• Content
• Location based
• Re-market

http://www.regalix.com/by_regalix/insights/articles/7-trends-that-shaped-digital-marketing-in-2014/