Why KPIs are essential for your marketing strategy
It goes without saying that it’s imperative to be measuring the success of your marketing efforts. Here is where Key Performance Indicators (KPIs) come into play.
What is a KPI?
KPIs are specific, quantifiable goals that allow you to track and measure the success of your marketing efforts.
KPIs are distinct from your standard marketing metrics, they should be tied to progress, and be based on customer actions that have a direct impact on the business.
For example, the number of leads generated each month would be a good KPI, whereas the number of visitors to your site would not. While it may be important to track site visits more broadly, they are not a key measure of success.
Why KPIs are important
Key Performance Indicators (KPIs), are essential in developing an effective marketing strategy.
Not only do they ensure the strategy has a clear target to aim for, but they also ensure that all stakeholders – those in the agency you’re working with as well as within your own company – have a defined metric against which to measure success.
A good KPI can help your agency to understand your goals, figure out how to get there, and demonstrate when you have achieved them.
KPIs also act as a consistent barometer to assess and optimise the performance of a marketing strategy. While site visits, page rankings or ad impressions may fluctuate from month to month according to a range of external factors, a well-defined KPI will clearly demonstrate to your agency that the strategy is performing well, or if it needs to be improved.
What makes a good KPI?
A good KPI should be the following:
Simple – it should be easy to understand, so that your agency has absolute clarity on the target, as well as ensuring senior stakeholders can easily gauge progress from a top-level report.
Measurable – it should be specific and quantifiable. The best KPIs are the ones that your agency can measure percentage improvement against each month.
Actionable – it should be clear what the results of a KPI mean for your business, and empower you to make decisions based on the results.
Time-bound – it should be reported against at regular intervals, and progress compared against similar time-periods. This ensures that you are receiving progress updates in enough time to make informed decisions, as well as ensuring that progress is measured in a consistent way.
Hopefully, this blog post has helped demonstrate the importance of KPIs, and why you should ensure that those you set are aligned to the needs of your business.
Above all though, one thing to remember is that they are key performance indicators. While it can be tempting to define 5 or more KPIs and measure everything under the sun, the most effective marketing strategies will be defined by 1 – 3 key targets against which to measure success, with smaller, less important tracked metrics that sit beneath these.