Digital Marketing KPIs: What They Are & How to Choose
Importance of monitoring your digital marketing KPIs
Key performance indicators (KPIs) are quantifiable goals that companies use to track and evaluate the effectiveness of their digital marketing campaigns.
Developing and implementing a marketing campaign is not good enough; that’s a basic business practice in the 21st century. The difference comes in tracking performance and making decisions based on the values.
It’s easier to measure the success of digital campaigns with KPIs as compared to offline marketing techniques. The indicators range from short-term to long-term; these offer favorable options for challenging business environments (like a global pandemic).
Understanding how KPIs work, the different indicators, as well as how and when to employ them is crucial to the increasingly competitive business environment.
What to measure
Choosing what to measure is vital in the initial stages of setting up a digital campaign. Relevance and appropriateness of measurable values depend on your business goals or targets.
Typically, performance indicators focus on conversion. It’s more important to target conversion during a recession because it might be the only difference between success and financial mishaps.
However, conversions should not be vague. They should be well-defined, measurable and beneficial. Here are some tips:
- Only measure quantifiable metrics that match your business level, nature and goals that range from sales to leads. For a startup, it might be wise to measure reach and engagement rather than leads.
- Lead indicators are key measurable elements. Professional economists use these as a hint of the direction of the economy. These indicators determine whether the campaign has a positive impact on the target group. The end result can be simply the amount of time people spend on a business site or the number of clicks.
- There is no benefit in setting a KPI for things out of control of your company.
Channel specific KPIs
While the choice of indicators mainly depends on business goals, most companies need KPIs of multiple types to determine performance on specific channels and overall goals. It’s more effective to run the different channels separately, especially in big organizations.
However, a recession presents diverse challenges. For instance, it might be more effective to use smaller teams in a marketing mix since some parts may receive more attention than others. Therefore, planning should be flexible to allow the flow of marketing dynamics.
Setting priorities is key in successful digital marketing campaigns.
Unless it is a PPC (pay-per-click) campaign, tying KPIs solely to your budget is bad for business. Setting a digital campaign on such a basis leaves the results to fate, which beats the purpose of a marketing strategy.
Some companies engage a professional after determining the budget and KPIs, thus limiting them to the predetermined options.
Are your KPIs S.M.A.R.T.?
Developing KPIs should be a strategic process guided by not only goals but also ease of implementation. Clarity is key in KPIs to avoid conflicting interpretations that come with diverse perspectives. Ambiguous goals invite misinterpretations which in turn yields a higher likelihood of failure.
Therefore, KPIs should be:
The essence of S.M.A.R.T. is to avoid the assumption that every party perceives KPIs in the same way. Misinterpretation by department heads in a company may redirect your whole campaign.
Marketing is a dynamic science. You might be confident in your previous techniques of developing and implementing KPIs, but the business environment is constantly changing.
For example, most marketers may never have considered pandemic challenges in the previous campaigns, but it would be detrimental to ignore them now.
Therefore, flexibility to ideas and openness to discussion helps in formulating ideas. Rather than rigidly argue a campaign path and fail to meet a KPI, it would be better for the business to admit the challenge and uncertainty, and negotiate the conflicting perspectives to accommodate and come up with the best strategy.
In some cases, there is a need to add to the budget or engage more people to achieve the set KPI. Lowering the original KPI to match existing resources and time constraints is also a good option.
KPI boundaries and limitations
Set acceptable results before embarking on a digital campaign. Depending on the type of goals or how understanding company management is, 98 percent can be interpreted as close enough and then fail when the target is 100 percent.
Running a digital campaign with specific KPIs but without boundaries is risky for both you and your organization. Setting boundaries places your expectations in scope and protects your reputation on multiple fronts.
Startup business companies should not expect leads in the first few weeks; the scope should be on reach and engagement.
The SMART model ensures smooth tracking of digital campaigns.
Based on set goals, it’s possible to tell how well the campaign is flowing before the KPIs are due. Updating all parties involved avoids misunderstandings at the end of the campaign. Market fluctuations during a recession, for instance, should be identified earlier and handled because they directly affect finances.
Marketers work alongside web developers and graphic designers, and this might cause delays. Updating these parties on dynamics in the campaign helps in hitting the target. For instance, if web developers are limited with resources thus delaying implementation, it might be wise to suggest a re-calculation of the KPI to match the existing resources.
Setting up digital marketing KPIs calls for time, skill and financial resources. Even with the best skills, you can’t always get the KPIs right. However, keen tracking and measuring performance helps achieve your business goals.
Ready to talk more about setting your digital marketing KPIs? Reach out to one of our Atlanta digital marketing experts at Brown Bag Marketing today. We’re happy to help!