KPI is an abbreviation for key performance indicators, what does a KPI mean and how is it relevant in marketing? So, a KPI is basically a tool that is used to assess the performance of a task that is being measured.
So, it is basically a metric for determining the success or workability of the goal to be achieved.
When we consider marketing KPIs, these will be parameters that will help us understand the effectiveness and reach of our marketing.
1. What is a KPI in Marketing?
So, a KPI in marketing will tell you about the marketing and advertising performance of the company.
How well did your campaigns perform, how does the fund need to be relocated, or should there be other tweaks to be made?
Since these can be tracked so easily, year-on-year comparisons can also be done; so let us now see what are the different KPIs in marketing.
1.1. Conversion Rate
The term is self-explanatory and means that what is the conversion from the campaign or what activity you had conducted?
So, if you conducted a new campaign on social media what was your outcome?
What kind of engagement did you receive and since it is a rate it is basically the percentage of people you tapped using your marketing.
The higher the percentage, the better the persuasion, and more customers might purchase your product. It is almost the most important KPI in marketing.
1.2. Cost per Lead
What is the cost of getting a consumer, is basically the meaning of cost per lead so when you are putting out any money on marketing activities, you calculate the money that is being spent on any potential consumer of your product/service.
This value needs to be less, the lesser the value better the consumer conversion, and the higher the profits.
Also implies that you do not need to spend a lot on marketing to get consumers or that the money spent is well paid off.
1.3. Social Media Engagement
All social media activities that are done for marketing your product or service, can be analyzed to check their reach and progress.
Any campaign’s success can be assessed by checking for likes, shares, and clicks.
The higher the engagement, the better the reach and people are more aware or interested based on what marketing content is being analyzed.
This analysis can also help you to tweak in few little edits for better engagements. This nowadays is the most relevant KPI in marketing.
1.4. Customer Lifetime Value
Customer lifetime value is basically the amount of money that a customer can generate for a company over the span when he/she is associated with them as a customer.
This is one of the most important KPIs in marketing when we consider the customer-building process because this retention requires more engagement and better marketing.
So to keep the customers interested in the long run, marketing campaigns have to be designed in accordance with those requirements.
1.5. Return on Investment
Basically, just a comparison of what you are spending and what you are earning is known as a return on investment.
So, given you are spending a certain amount of money on marketing and getting a good return on it.
It implies that the money spent on marketing is actually paying off which in turn means that you can keep that up, even in your future projects.
If the difference is very huge it means that the expenditure needs to be thought about again. Economics-wise, or financially it is the most important KPI in marketing.
1.6. Search Engine Rankings
The rankings on the search engine optimization process actually speak about the online presence and reach of the company.
This KPI in marketing is like a leader KPI when we’re talking about all online products/services.
When a customer is looking for something through their search engine they type in some keywords, and the websites which are falling in that category are displayed.
The ones that are visited most are those that are viewed higher on the list. So, to get a better ranking you need a strategic use and placement of the keywords.
1.7. Brand Awareness
The success of your company or basically the online success of your company is measured by analyzing the reach of your website, social media, and all digital marketing activities.
This KPI in marketing is basically an analysis of how people are engaged and involved in your brand.
The different factors to figure this out include brand mentions, consumer reach, and searches.
This can also be assessed by looking at the kind of engagement by influencers and similar social media people.
1.8. Referral Traffic
A measure of the number of customers who are visiting a company’s website not directly but through referrals from other websites is called referral traffic.
This helps you to understand what is the success of your relationship marketing strategies and how good is your sponsorship management.
Looks a little less efficient but this KPI in marketing really shows the relationship-building system’s strength.
1.9. Email Subscribers
This is the list of people who get your emails and have agreed to get the same in the future for newer updates or product launches.
These metrics basically tell you the efficiency of your email marketing campaigns and in turn the reach of your brand.
It also tells if your content is good enough and keeps your target audience engaged or not.
2. Final Thoughts – KPI in Marketing
We have seen the different KPIs in marketing in the article above and understand how these affect your overall brand and marketing.
So, based on all the data above now we are in a place to make informed decisions about our marketing activities.