What are KPI’s?
KPI or Key Performance Indicators are measurements, metrics or scorecard to evaluate the success of an organization or of a particular activity.
KPI’s are quantifiable and measurable. We usually use between 5 and 8 key metrics for a company. KPI’s are not refutable because there are some concepts which are difficult to measure, like emotional issues related to the impact of a campaign.
Why do we use KPI?
Because without measurement it is impossible to know the improvement and it is not possible to know if the actions a company do are useful. The objective of the KPI’s is keep improving and learning.
KPI’s are tools to know what decisions to take in a company.
How do we use them?
To use a KPI we need to follow two phases. First, we need to set which are the right measurable objectives or actions we can measure. Secondly, we must define the most adequate KPI for each objective to track results. There are lots of KPI, but we need to focus on the KPI’s that are inherent to your business and goals.
Once you have KPI’s, it is very important to review them regularly, because KPI’s are not eternal and we may need to make changes or add some other, just in order to the current situation of the company.
What can we measure with KPI?
There are infinite KPI’s, and every business uses different because the issues which may help to improve are different in architecture than in marketing, for example. In addition, KPI’s are not eternal, and depending on the current situation we will change or add the KPI’s we use.
In marketing, the most popular issues to measure are the media exposure, attitudinal data, behavioural data, financial payback, social engagement and some many more.
Examples of KPI’s
There are infinite KPI’s but I am going to mention some I consider very important for the marketing business.
For media exposure we can count the visits a website has, or how many clicks inside the website, which may indicate that when we have a visitor, he considers relevant what he found and that he/she stays in it.
Related to attitudinal data, we say we can measure awareness with a cost per impression. We obtain this number dividing the cost of a campaign into the impressions it has had.
Having into account the behavioural data, a metric used are the sales conversion: how many sales we have of all the people who enters to a specific website. This number is given a percentage (sales/visits x100) and is one of the most important ratios for a company.
As a last example, the financial payback is very important in order to know what return do we have for the investment on marketing we have done. The ratio which tells this is the or ROMI (Return on Marketing Investment).
Sources:
http://www.marketing-branding.cl/2014/03/15/los-kpi-o-indicadores-de-gestion-en-marketing/
https://laculturadelmarketing.com/que-es-un-kpi-en-marketing/
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