Data data data. That’s all marketers seem to talk about these days. And KPI marketing seems to be on the tip of everyone’s tongue.
While data-driven marketing and KPI tracking is all the rage, 55% of marketers admit that data strategy is their biggest flaw.
And we get it, data can definitely be intimidating.
So let’s break it all down — let’s make it manageable, demystify the hit squad, and see if we can’t show you how you can use KPI marketing to drive results within your business’ growth team.
In this article we’ll identify the key metrics you should be tracking and the tools you’ll need to do it.
What is KPI marketing?
KPI stands for Key Performance Indicator. A KPI is a data point that can be used to measure (in part) the success or failure of a project or campaign.
A marketing KPI helps you determine how much a particular action has occurred. This could be the volume of organic traffic, sales, click, opens, and so on.
For example, when I was head of content at a tech startup a few years ago, our team’s KPI was “unique blog visitors.” Then, after noticing that traffic ≠ leads, we updated it to be “organic leads generated.”
But it can be anything: ad clicks, the number of customer referrals, the number of times your CEO yells at you in any given week…
The key idea is that a KPI helps you see, at a glance, if a strategy or change you’ve made to your business (whether marketing, sales, product, support, whatever) has had the effect you desired.
KPI marketing, therefore, is simply the use of KPIs to determine the direction of your marketing campaigns. It’s an integral part of a data-driven marketing strategy.
What’s the difference between a KPI and a marketing metric?
A marketing KPI is most often expressed as the number of times an action has occurred.
Your metrics are more often expressed as rates.
Your marketing KPI may be the volume of organic traffic, while your marketing metric may be the volume of organic traffic over six months. This would show the rate of website traffic in a given period.
How to use KPI marketing
Are you A/B testing a landing page, monitoring influencer engagement, or tracking pop-up conversions?
Whatever you’re measuring to calculate your success, you’ll need to build a strong digital marketing KPI strategy to recognize the leverage points of your target audience.
Here’s how you can do that.
#1 – Identify the right KPIs
You want to identify KPIs tied to your department goals.
For example, say you’re trying to increase engagement on an email marketing campaign. You may start by testing two different newsletter formats (one format to half your list and one format to the other half).
The KPIs of this A/B test may be:
- Email open-rate
- Email click-rate
- Demos booked per email
It’s far easier to monitor all your email marketing KPIs when they’re collated in a slick-looking analytics dashboard, of course…
With your KPIs neatly organized, you can quickly see which campaigns are leading the way.
Firstly, this makes it easier to spot hot trends among your audience: “Perfect. Let’s produce more content like this.”
Secondly, you can increase ROI by redirecting your resources from poor-performing campaigns to high-performing ones.
The KPIs you track should relate to the outcomes you want to achieve.
If you’re looking to boost lead generation, your KPI will be leads (that’s probably pretty apparent). But let’s focus a bit, because, like the emergency exits on a 747, the right digital marketing KPI (see my “traffic ≠ leads” anecdote above) may be behind you.
- To drive brand awareness through your blog, focus on unique visitors
- To drive brand growth through your blog, focus on low bounce rates
- To drive lead generation through your blog, focus on leads generated by each article
- To drive sales through your blog, focus on leads converted where source = blog
To wrap this point up, it’s about focusing on the KPIs that directly reflect the progress you’re making toward your marketing goals, not just the most apparent sign of success.
#2 – Set your metrics
Most often your metrics refer to a time-bound rate, such as the volume of sales per month.
You can pick metrics that are budget-bound too. These may be metrics such as the number of webinar registrants per $100 ad budget.
Draw on your marketing goals to shape your metrics by matching KPIs to your targets.
For your next marketing campaign, you may test different social media ad types to see which results in the highest number of subscribers.
In which case the metric you want to measure (and measure your success by) would cost-per-subscriber-per-ad-type. You’d compare each ad type by this metric to determine where you should invest.
#3 – Target marketing campaigns to KPIs
Once you have enough data to draw actionable conclusions, you should take action immediately.
For instance, let’s say you’ve tested seasonal advertisements against generic ads, with the general KPI of “checkout conversion rates,” and are confident that seasonal campaigns are a winning strategy for your business’ growth.
Don’t wait around. Target your next campaign at seasonal trends, measure by the same KPI, and prove the point.
For example, this online clothing retailer recently jumped on a weather trend, capitalizing on an upcoming heatwave.
Having noticed extra sales in summer clothing since the heatwave was announced, Missguided reacted instantly with promotional marketing personalized to this trend.
Vinnie La Barber, Founder of full-service agency, imForza, suggests setting KPI notifications:
“You can set up specific alerts on these meaningful KPIs so that you’re notified whenever there’s any type of unusual data. This helps you recognize and spot trends almost before they happen and plan for future ones more proactively.”
However, trend-spotting isn’t the only valuable result of KPI marketing.
KPIs can also help you decide which direction your marketing campaigns should take.
If you’re unsure about your branding, or which products customers would like, try A/B testing landing pages, emails, ads, and social media campaigns. Monitor the important KPIs to see which provide the best ROI.
Marketing KPI examples to track
Marketers have many balls up in the air.
You’re trying to generate engagement, nurture leads, convert sales, foster loyalty, and encourage referrals.
Those are enough KPIs to drown yourself in.
Narrow down your KPIs to specific campaigns and focus on targeting realistic metrics.
Here are a few KPIs to consider for your next marketing campaign.
#1 – Number of Instagram story impressions
A fifth of your Instagram impressions come from Instagram Stories, so test different Instagram Stories to see how your audience responds.
Monitor how many impressions you’re getting and compare this against the number of ‘swipe ups’ on each post. You can also look at taps back, taps forward, swipes away, and exits.
It’s hardly surprising, but top brands post Instagram Stories 30% more than the average brand. So, yes, quantity is important to increase your reach.Need a way to see all your Instagram Story data? Life’s easier for your team when you have a centralized social media tracker that collates everything in one place.
Organize your Instagram Story’s performance data so that your marketing team can see which type of Story content gets the best results.
#2 – Number of email click-throughs
Your email click-rate will tell you about how well your audience is engaging with your brand. Do they like your products enough to click to find out more?
Test different email templates and product offers. Monitor which formats, messaging, and designs convert best within their inbox as well once they hit your website.
Record and organize your email metrics so that your team can manage campaign results without hassle and pinpoint your best performing emails easily.
#3 – Churn rate
Churn rate refers to the pace at which you lose customers. The average churn rate hovers at around 6%.
A high churn rate means you need to invest lots of time and effort chasing new customers because your retention bucket is leaky as hell.
Consumers are 520% more likely to stay loyal to a brand that personalizes the buying experience. Tailor campaigns to subscriber preferences, like how Spotify personalizes the user experience with tailor-made playlists of recommended songs.
Users discover something new from the platform each week.
Equally, you’ll need to monitor customer satisfaction levels to keep churn rates low.
Measuring customer satisfaction KPIs helps you to proactively identify bottlenecks and pinpoint customer preferences.
#4 – Advertising and marketing ROI
Tracking advertising and marketing ROI will help you to allocate your budget to the ad campaigns with the best marketing performance.
To track this KPI, we recommend using monday.com’s Campaign Tracking, which looks like this, and (once customized) automatically calculates your ad’s return on investment:
You need to measure exactly what it is that drives your growth before you can make wise investment choices.
Use KPI marketing to see what makes your audience tick — and then double down. Monitor your KPIs to mold personalized marketing campaigns and sales funnels that your audience can’t resist.
Need help structuring your KPI marketing campaigns? Try starting with a comprehensive KPI marketing strategy template.