What is a KPI? Overview, Tips, and Examples [2020]

A key performance indicator or KPI must sound like an alien word to you or other newbie marketers.

That is because properly defining your brand’s KPI can sometimes be tricky business.

Do you simply go with industry-related KPIs, or do you write KPIs of your own?

Luckily, we are here to help you out!

Meaningful KPIs can help your business turn your goals into reality.

This means you can work towards your objectives with actual, measurable results.

Are you ready?

Let’s get started!

Defining KPIs

A Key Performance Indicator (KPI) is a measurement that helps you understand your marketing performance in accordance with your goals and objectives.

A KPI can show whether a company is succeeding or failing, and it can also tell you if you are on track or not.

KPIs can help simplify the complicated process of a business’ marketing performance. It does this by focusing on the main key indicators that provide insights and data.

The information presented by KPIs can then facilitate in the brand’s overall strategy. It can also help with decision making.

And since KPIs can help business owners adjust their strategy according to their strengths and weaknesses, it can improve the company’s long-term performance.

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The Importance of KPIs

There are various KPIs you can use, and selecting the appropriate ones are entirely up to you.

Now more than ever, it is crucial for marketers to be able to make better decisions, improve marketing performance, and adjust their strategies according to what works and what doesn’t.

The importance of KPIs can be found in the company’s business objectives. That’s because KPIs ensure that these objectives are properly communicated within the company.

This, in turn, allows people to formulate KPIs within their respective departments that are in sync with the business’ primary goals.

This way, everyone contributes toward achieving those goals.

Without KPIs, marketers walk around aimlessly without giving much regard to their destination.

What are SMART KPIs?

In our B2B Social Media article, we talked about how essential it is to define your goals.

And not just ordinary goals, but SMART goals.

SMART stands for Specific, Measurable, Attainable, Relevant, and Time-bound.

So, if there are SMART goals, there are also SMART KPIs.

When you define KPIs in this manner, the end result is either a success or a failure.

Let’s say one of your company’s goals is to increase sales by 30 percent at the end of the year.

From there, each department will create their own objectives to support the company’s primary goal.

When every department has an objective in mind, you can now formulate a SMART KPI.

Here are some examples of SMART KPIs:

  • 5 percent increase in organic search traffic by the end of the month
  • 15 percent boost in conversion rates during the first quarter of the year
  • 10,000 new followers on social media after three months 

Writing a KPI

In the writing or development process of a KPI, there are a couple things you need to consider.

For instance, how does a specific key performance indicator connect with your outcomes and objectives?

Keep in mind that KPIs must be tailor-fit for your business. It will be deemed useless if it cannot help you materialize your goals.

Here are a few things to remember when writing a KPI:

  • Write clear objectives. This is self-explanatory and has been reiterated several times throughout this article. KPIs must be connected with your key business objectives for it to do its job.
  • Share it with your stakeholders. Your employees also need to be aware of what you want to achieve. How are they going to help materialize your vision if they don’t know what your vision is? By sharing your KPIs with your stakeholders, all of you in the team have a clear view of where your company is heading.
  • Review and update them regularly. All things require maintenance, including your KPIs. By periodically reviewing them, there is constant room for adjustment. You can also decide to scrap KPIs that aren’t successful.
  • Make sure they fit the changing needs of your business. Your business objectives are always subject to change, so make sure you update your KPIs as needed.

Examples of Marketing KPIs

What you measure and track will entirely depend on what your company wants to attain.

Remember that different brands have a different set of KPIs. You have to consider how you are able to measure your progress towards your goals.

Hypothetically speaking, let’s say you manage a digital marketing agency, and you are relatively new to the industry.

The first thing you want to do is establish authority and get your name out there.

Your KPIs can be any of the following:

For SEO:

  • Increased traffic to 1,000 visits per month for the first 3 months.
  • Increased traffic to 3,000 visits per month after 6 months.
  • Land on the first page of Google search results for the keyword “affordable digital marketing agency” by the end of March

For Social Media:

  • Obtain 3,000 followers in 3 months on Facebook, Twitter, and Instagram
  • Obtain 450 engagements on Facebook, Twitter, and Instagram after 3 months
  • Make 100 new connections on LinkedIn after 3 months

For Video Marketing:

  • Reach 5,000 subscribers on YouTube after 3 months
  • Produce 30 videos in 6 months
  • Obtain 50,000 total views on your channel after 10 months
  • Rank on the first page of YouTube’s search results by the end of the year

If you are still having a tough time, we recommend using a KPI Dashboard to make the iterative process simpler for you.

Dashboards can give you an extra hand by bringing all your KPIs in one place.

This way, you can see your performance on various metrics all at the same time.

Conclusion

That’s everything you need to know about KPIs!

Now that you know which key indicators must be tracked, you are one step closer to achieving your company goals!

Do you have anything else you want to add?

Let’s talk in the comments section! You know we love hearing from you .

References

Klipfolio (n.d). What is a KPI? Definition, best-practices, and examples. Retrieved from https://www.klipfolio.com/resources/articles/what-is-a-key-performance-indicator

Kononenko, Kevin (2019 June 25). Databox. What is a KPI? A comprehensive guide with tips and examples. Retrieved from https://databox.com/what-is-a-kpi#measure

Marr, Bernard (n.d). Bernard Marr & Co. What is a KPI? Retrieved from https://www.bernardmarr.com/default.asp?contentID=762

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