KPI’S YOU SHOULD KNOW

Tested Digital Expert Ltd

Background:

Let’s begin with the definition of a KPI, the acronym stands for a Key Performance Indicator. KPI’s help evaluate the success of a specific activity an organisation partakes in, such as a Marketing strategy. An organisation would set a quantifiable measurement before a project and then measure the outcome against the KPI, thus illustrating the performance of the task. KPI’s are usually integrated in long term plans, such as executing a Digital Marketing strategy through a Gantt chart.

Types of KPI’s:

There are various examples of key performance indicators which are suitable to each type of organisation. However in this article we will explore 4 different Digital Marketing sections, which you can implement into your Marketing strategy to gain more insight about your follower base.

Sales KPI’s:

Sales Growth – is quite simply used to measure the rate at how much your sales revenue is increasing or decreasing. Sales form a major part of an organisations decision making strategy, therefore using such metrics will allow you to set goals to measure your current performance and improve your business’s profitability.

Sales Opportunities – are in essence the possibility and opportunity value of closing a sale.

Product Performance – as with any business, some products sell more than others. This performance metric ranks products based on their popularity. Products lower down in rankings means that they may need more R&D/ Marketing.

Sales Target – measures the number of sales made and compares this to a previous target figure. This is ideal for future sales projections and motivating employees to aim higher.

Average Purchase Value – this KPI is used to calculate the (average) value of each sale made. It’s also used to measure your consumers’ buying behaviour.

Sales KPI’s:

Sales by Contact Method – determines which contact methods (face-to-face/ telephone etc) are most successful at producing sales. A combination of sales methods may be used depending on the organisation, but the cost of such methods should also be considered when implementing a new strategy.

Sales Bookings – this KPI calculates the number and value of sales bookings in a specific period of time. A booking is essentially a sale where the purchase has been made official (approved).

Quote to Close Ratio – this metric measures how many quotes were sent out to potential customers against the number of deals made official.

Sales Per Rep – this particular metric is comparatively more in depth, as it measures the ability/productivity of each Sales Rep against one another. In order to increase sales by determining employee’s strengths and weaknesses.

Marketing KPI’s:

Return on Investment (ROI) – this KPI calculates the amount of capital a Marketing campaign generates against its cost. This is an essential KPI in Marketing as it allows you to monitor your strategy regularly and indicates whether you should continue with it.

Incremental Sales – calculates the contribution of your marketing expenditure regularly. Although this performance metric similar to ROI, it closely measures the relationship between Marketing and revenue.

Traffic Sources – measures where visitor traffic to your website comes from in detail by comparing their popularity (search/referral etc).

Purchase Funnel – analyses your customers buying behaviour in 5 steps (awareness, interest, consideration, preference and purchase). This KPI involves mapping a customers purchasing journey through measuring conversion paths.

Marketing KPI’s:

Goal Completion Rate – this indicates the amount of people who completed a goal (marketing objective) such as subscribing to a blog. This metric is related to the Purchase Funnel as it forms part of the interest and consideration stages.

Keyword Performance – calculates specific keyword rankings in search engines to indicate how successful any SEO efforts are at sending traffic to your website.

End Action Rate – this KPI measures the effectiveness of your marketing campaigns by monitoring the last action taken by your audience (e.g. bounce rates, purchases etc).

Cost Per Lead – assesses the effectiveness of your marketing campaigns in terms of generating “leads” for every pound (£) spent.

Email Marketing Engagement – measures how effective email campaigns are at engaging your audience through metrics such as click rates.

Social Interactions – calculates the level of interaction from your audience though social media campaigns.

Social Media KPI’s:

Key Social Metrics – assess the impact of your social media strategy on other marketing channels (conversions/website referrals).

Social Followers vs. Target – calculates the amount of followers you have attained on a social media channel (e.g. Twitter) in comparison to the target amount set, thus illustrating your progress.

Social Interactions – quite simply measures the level of engagement on a specific social platform (e.g. YouTube Subscribers), which informs you of your social media presence and how effective your campaigns are.

Social Events – monitors social “events” on a regular basis, such as the number of likes/mentions you have received. Each interaction will have a different value, for example a Facebook “share” will be more effective than a “like”.

Social Media KPI’s:

Social Traffic & Conversions – this KPI measures how successful a social media campaign is at generating goal conversions and website traffic.

Social Visits & Leads – calculates how effective your social media strategies are at sending visitors and leads (new prospects) to your website.

New Followers – measures the number of new followers you have achieved over a specific period of time.

Facebook Page Demographics – collects and analyses information about your followers; such as follower age, gender and location. In order to give you more understanding into whom your target market is primarily made up of.

SEO KPI’s: Keyword Opportunity – measures the opportunity of improving

your keyword search rankings by comparing them competitors’ current rankings and traffic volume in search engines (e.g. Google).

Keyword Click Through Rate – computes how frequently your website/ad listing is clicked compared to the number of people conducting a particular search.

Search Traffic Performance – this KPI measures the number of visits to your website that are either organic/paid search.

Keyword Ranking – calculates your ranking based on targeted keywords in search engines and then analyses their ranking over time. This KPI is essential in Search Engine Marketing (SEM).

Domain Authority – determines the “trust” factor if your website domain based on the number and authority of links to your domain. Using such a KPI can in effect, help increase the amount of trust that search engines place on your domain.

Conclusion:

Overall, Key Performance Indicators form a major part in providing vital information to measure and analyse an organisation’s strategic progress. These metrics also educate organisations regarding their; current position in the market, competitiveness, audience statistics and potential critical issues they should develop. Lastly, KPI’s promote implementing long term goals through regularly tracking and measuring the marketing strategy.

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References:

http://smallbusiness.chron.com/importance-kpi-4581.html