A KPI (an acronym for Key Performance Indicator) is an evaluation metric of the objective or target you set.
KPIs are the indicators that you use in order to determine the success, or otherwise, of your (business) performance.
In a different field, a doctor would might use your blood pressure, cholesterol level, heart rate and your body mass index as key indicators of your health.
Watch this short and valuable video on the subject.
(See KPIs in digital marketing)
Agreeing the campaign KPIs
- Ideally the marketing department, the sales department and the financial department should get together to agree on the campaign's KPIs, and check that they follow on from the hierarchy of objectives set.
With KPIs there are numerous options and possibilities. Here are some examples.
- Sales and Marketing departments should agree on the definitions within the KPIs.
For example, what exactly is a lead is, what is a converted sale is, what a repeat sale is, a customer, a prospect, etc.
- There should also be agreement on the KPI data sources.
Ultimately though, how the campaign will drive gross margin, or profit before tax are the two things that usually matter the most.
Keeping the focus on evaluation
- How will you ensure focus on evaluation throughout the campaign?
- Keep checking how you're doing against the marketing measures.
- What can be tested/done now to increase ROI?
- Measure the strategy not just the execution.
- Make sure you measure outcomes not outputs
Instead of awareness, coverage and cost per thousand, try to measure how the target audience's actions have changed.
- Measure it because it is important. Don't make it important by measuring it.
A good test with data is to use the 'so what' rule. If the business won't change for the better as a result of knowing that measure then it's probably just a 'nice to have' and has no real value.
- Measure what you are doing wrong and what you are doing right.
- Balance being 100% right with being 100% now.
Being 100% right takes testing and time.