Do you know what makes your marketing efforts successful? Any clue on what campaign is performing and what is not? If not, start here,
What is KPI in Marketing?
A Key Performance Indicator (KPI) is a measurable value of your marketing campaign. It indicates the progress of your campaign and helps you in measuring the effectiveness of your campaign.
Every marketer knows that you should track your marketing efforts accurately and see the results of your campaign. KPIs are as important as your marketing campaign, and it’s important to know what KPI to measure as well.
Understanding what works and what doesn’t work in marketing should be an integral part of the marketing plan.
KPI in marketing is different from marketing metrics. KPIs show performance of specific campaigns, whereas marketing metrics are numbers used to understand your status of marketing campaigns and to check if your KPIs are meeting your business goals.
Why is KPI Important?
Now that you know what does KPI mean, understand why KPIs in marketing is important – they define,
- Where you are going? What are your goals? What are your marketing objectives?
- What do you need to do to reach those goals? How to get there?
- Did your efforts produce desired outputs?
- What are the learnings that can help you get better results?
KPIs are the data that will help your management team and clients to understand your marketing efforts. You can use this report to illustrate your results and marketing ROI.
Marketing KPIs to Track
There are tons of Marketing KPIs, and you should define which KPI to track based on your campaign objective. After discussing with a lot of marketers, we have compiled top KPIs you should keep a check on,
1. Number of Conversions
Conversion is when a user takes a desired action. There are a variety of conversions like,
- Opening an email
- Clicking a link
- Filling out lead generation form
- Calling a phone number
- Making purchase
Based on your marketing objective, you decide what is a conversion.
2. Conversion Rate
Conversion rate is a percentage of a number of people interacting your ad and number of conversions you received.
Conversion Rate = Number of Conversions / Number of Views.
3. Cost Per Conversion
Cost Per Conversion is the average amount you spent to get one conversion.
Cost Per Conversion = Total Amount Spent / Number of Conversion
4. Number of Leads
A lead is when you get the contact information of your potential prospect through your marketing efforts. Usually, there are two types of leads,
- Marketing qualified leads (MQLs) – Customers who showed interest in a brand.
- Sales qualified leads (SQLs) – Customers who showed interest in purchasing your product/service.
5. Cost Per Lead
Cost Per Lead is the average amount you spent to get one lead.
Cost Per Lead = Total Amount Spent / Number of Leads.
6. Number of Demos
Number of Demos you presented to your potential clients during a specific period of time. You can also measure the number of demos that got converted.
7. New Customers
The number of new customers is a simple straight forward metric used to measure your marketing campaign.
8. Cost of Customer Acquisition
Cost Per Customer Acquisition is the average amount you spent to get one customer.
Cost of Customer Acquisition = Total Amount Spent / Number of Customers Acquired.
9. Sales Growth
Two metrics that define Sales Growth – change in the number of sales and change in the amount spent on your sale.
10. Search Ranking
One of the common metric measured by SEO professionals – it is to monitor the placement of your web page in the search engine results page.
11. Alexa Rank
Alexa Rank is another KPI which is similar to Search Ranking, which indicates the popularity of your site online.
12. Organic Site Traffic
Organic site traffic is the total traffic your website received from organic searches. You can also measure,
- Page per Session
- Average Session Duration
- Bounce Rate
13. Referral Site Traffic
Referral site traffic is the total traffic your website received from links on other websites.
14. Social Traffic
Social Traffic is the total traffic your website received from social media channels.
15. Social Shares
Socials shares are the number of times your content is shared to social media channels.
16. Number of Press Mentions
Press Mentions are part of your brand awareness KPI. They represent a number of times media houses referred about your brand.
17. Number of Inbound Links
Inbound links are a number of backlinks your website received from other websites or media houses.
18. Lifetime Value of a Customer (LTV)
Lifetime Value of a Customer is the total sales your average customer would generate through the course of your relationship.
LTV = Revenue x Gross Margin x Avg Repeat Purchases.
KPI in marketing is more than just a number. It helps you create a track record for your company’s performance and further, push growth forward. I hope helped you gain a brief over what is KPI in marketing and why is it important.
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