In any business that you might be interested in, there are always certain factors that will be responsible for the success of your firm. These key factors aka Key Performance Indicators or KPIs are the ones that w’ere talking about. On the other hand, there will also be factors that will be consequential for the losses that you will incur during the process of business handling.
What are KPIs?
Key performance indicators are a measurement tool that is most commonly used in the business setups to analyze some of these factors that are crucial in the increment in the commercial profits of the company as well as the losses that are incurred by it.
All the industries and sectors in the world use a definite metric system so that they can fix a standard measurement for their performances. Key performance indicators are an important part of such business metric systems that are very commonly called the KPI metrics.
Which KPIs to follow?
When talking about key performance indicators, many of the top marketing reporters from across the world have stated that the main focus should not be on those KPIs that help us in searching the newer opportunities but rather they should focus on analyzing the existing opportunity from which we are not able to draw enough revenue.
Best Marketing KPIs That You Must Track
These marketing metrics can be very tedious, to say the least, and when you have so much of information on the table, and you are unable to draw anything concrete out of it, then it all seems to be a waste of money. But if you can choose the right key performance indicators to follow, then this marketing reporting can be a very useful tool for you to increase the productivity of your business.
One of the most reliable key performance indicators (kpis) to measure the productivity of your marketing strategy is traffic. By traffic, we mean that you must be aware of the average number of customers who are contacting your firm for the product or the service in a year. After having information about the traffic, when you make a yearly assessment, then the rise or fall in the traffic that your company receives can be an indicator of the performance of the business in that particular year.
The measure of the traffic that your company is receiving should be fair enough. You should segregate the different types of traffic that your business sees. This should even include the paid traffic that you will have to procure to promote your firm. Otherwise, it can be organic traffic that comes to your firm genuinely, while on the other hand, it can be the referred traffic also, which has been directed to you by existing customers.
2. Sales Revenue
Sales revenue is an important key performance indicator of the marketing that you have done for your business. Ultimately, what you require from marketing is to enhance the sales that your company can make.
When it comes to KPIs, most of us already know the importance of sales revenues in profit analysis, but as a marketing indicator also, you should be knowing its importance because it will tell you about the strategies that you had made regarding the product which had worked and which had not thereby, letting you make a fair assessment for them as well.
3. Bounce Rate
When you have a business that mainly operates through websites and online platforms, then one of the key performance indicators that you should follow is the bounce rate.
Bounce rate refers to the number of people who visit your website and then leave it immediately without taking any action. When you know about the bounce rate of your website, then you can plan the marketing strategies such that you can target these people and attract them so that they stay longer on your website and are compelled to buy something or the other.
A lot of the marketing which is done today depends on the projection of the company through advertisements. It is a paid form of marketing that needs thorough analysis as well. One of the tools and key performance indicators that is meant for paid marketing is ROI. It helps you in knowing whether the amount that you are investing in the advertisements is returning to you in the form of profits or not.
If the amount which you are spending on advertisements is consistently more than the profit that you can reap from the sales of the company, then you should rethink the strategy. You can either stop giving these advertisements in public forums or seek alternatives so that the process of paid marketing becomes cheaper for you.
5. Cost Per 1000
Now, Cost per thousand is a part of the most important KPIs if you are assessing the paid or seo marketing that your company has to do. Cost per thousand, by definition, means the cost that you have to incur for making thousand advertisement pieces for the promotion of your business. Yearly, the cost per thousand should be reviewed about the profits that your business is making so that you can cut down on unnecessary expenses.
6. Conversion Rate
Among the essential marketing KPIs, is the one who tells you about the number of customers who were able to take any action that was desirable to your company. This key performance indicator is known as the conversion rate.
Just like we saw in the case of traffic, even the conversion rate can be broken down into several categories depending on the type of customer that your company is receiving.
7. Conversion Path
The process in which a visitor becomes a definite customer for your business is a conversion. All the actions and decisions that a visitor takes before he or she decides to spend money and become a customer for your business is also important for you to plan the marketing strategy in the future.
This key performance indicator that analyzes the path which a potential customer takes before they finally shell out some amount of money is called the conversion path. It also plays a major role in direct response marketing.
8. Leads Generated
There will always be people who will be showing interest in your business and the product that you are offering but will be reluctant to become definite customers. An important marketing strategy is to pin down these potential customers and make them invest in your business.
These people are called leads. When you can target these through your marketing strategy, then the key performance indicator that you will be used to assess the success of the strategy is called the leads generated.
9. Average Order Value
Now, if your company is selling multiple products at the same time, then the average value that a customer spends over buying the products of your company is an important indicator. Average Order Value is one of the KPIs that states the performance of the marketing that you have done for these products.
This key performance indicator is called the average order value. When you can increase the average order value of your company, then you will see an increment in the sales revenue automatically.
Also, from the prism of marketing strategy, enhancing the average order value will be easier than any other strategy because, in this, you will be targeting a person who is already a customer of yours. It is just that you have to gain more confidence in the customer for making them buy more of your goods.
Whatever the critics have to say about the products that your company is producing holds a very important place in that assessment of the marketing strategy.
If the reviews of your product are not good, then ultimately, the sales revenue will always decline. This marks for the implementation of a better marketing strategy so that your reviews can be better than they were earlier.
Cost-per-acquisition refers to the amount you will have to spend in the marketing of your products such that you can know the expenditure of this marketing strategy on a single customer. In this way, you will be able to identify the direct effects of marketing on sales revenue.
12. Customer Retention
Customer retention is a very important thing for any business to flourish. All experts in the field of marketing suggest that it is always difficult to convince new customers to buy your product rather than making the existing customers buy more of your goods. This is the loyalty of the customer, and since it requires a lesser expenditure on the part of the company.
Now, while it will help them reap benefits of the same magnitude, many of the companies are going for marketing strategies such as loyalty programs to increase their customer retention rate. Therefore customer retention is a very reliable key performance indicator of marketing.
Return of advertisement spend (ROAS) is a very similar key indicator of performance to the ones which have been discussed earlier. The amount of money which you are spending on advertising your company and your product should ideally can recover if any profit is not being made.
Therefore the state in which your company is not able to retrieve the amount of money it spends on a particular advertisement is an indication that the marketing strategy is not working well for your firm.
14. Article Views
If you are running a business on an online platform that deals with the posting of content, then the key performance indicator for your business, that you should follow in terms of marketing is the article views.
The number of views that each of your articles is gaining a KOI that will indicate whether you are marketing your website well or not. A low article views count will require you to revamp your marketing strategy completely.
15. Sessions and Average Session Duration
As we have discussed many KPIs for the digital platforms, when it comes to marketing, two of the most important key performance indicators are the sessions that the website is experiencing and the average duration of a session.
Both of them are very important indicators of the traffic that your website will see. If the sessions and the average time of a session on your website increase due to good marketing, then eventually your sales revenue will also increase.
All in All, these marketing KPIs are the most prevalent and popular ones. The KPIs that you follow must depend on the nature of your business and the kind of marketing strategy you have opted for. If you are willing to know that which are the key performance indicators that you must follow critically for the betterment of your business, then you must first have a clear idea about what are KPI’s.
You need to study about the different key performance indicators, and when you become aware of what is a KPI in-depth, then you can judge on your own and make out as to which of the KPI’s are the most important ones and which ones should you follow.