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Key performance indicator (KPI)
A key performance indicator (KPI) is a main measurement of performance used to track goals and quantify outcomes.
How to Measure KPIs
Without bench-marketing efforts, it’s harder to measure success. Follow these five steps to measure KPIs:
1. Set Business Goals
Before going through the process of collecting data and analyzing KPIs, you must have a plan to measure your performance by defining your business objectives. These can include growing brand awareness, increasing your social media presence or improving conversion rates.
2. Decide on a Marketing Strategy
Your marketing strategy and the techniques and tools used will not only help you achieve your goals, but influence the KPIs used to monitor performance. For example, if you want to use social media marketing as one of your channels, use the example KPIs listed below.
3. Select Key Performance Indicators
To avoid information overload, pick a certain number of KPIs to monitor and report. These KPIs will align with your business goals to help you understand if you are meeting your objectives.
4. Organize & Segment Your Data
Various analytics tools provide a way to segment the data to make it easier to gauge changes in KPIs and determine the causes. Examples of segments include devices/operating systems and characteristics of users.
5. Provide Targets for KPIs
Finally, decide on numbers for the goals you want to hit. Do you want to increase conversion rates by 7% in a quarter? Are you looking to grow your follower amount by 500 at the end of the month?
Pros of Measuring Key Performance Indicators
Here are the pros of measuring KPIs:
- Follow customer interactions throughout the buyer’s journey
- Enhance future measurement plans and campaigns
- Report on goals and outcomes
- Troubleshoot problem areas with site performance and more
Here are some examples of KPIs often tracked in digital marketing pillars:
Site performance/user experience (UX)
- New visitors vs. returning visitors
- Pages per visit
- Total page views
- Bounce rate
- Average session duration
Search engine optimization (SEO)
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- Click-through rate (CTR)
- Backlinks
- Organic search traffic
- Referral traffic
Social Media
- Likes
- Shares
- Comments
- Mentions
- Reach
Conversions
- Lead conversion rate
- Cost per lead
- Cost per acquisition
- Customer acquisition cost
- Lifetime customer value
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