Marketing Strategy, Part 2 (Ep. 04)
Choosing the appropriate KPIs that will monitor and measure the effectiveness of your digital marketing tactics can be overwhelming at first. But don't worry, we are here to help!
KPI is an abbreviation for Key Performance Indicators. The purpose of KPIs are to provide insight for making business decisions and when creating and developing your marketing strategy. A good way to think of KPIs are as progress reports for how well your marketing tactics are working towards your business objectives.
Selecting your KPIs
KPIs are selected based on your business objectives and desired outcomes.
When formulating this section of your marketing strategy, ask yourself questions such as:
What is the desired outcome or what business objective do I want to achieve?
Why is this outcome or objective important?
How will/can I measure the progress of this outcome?
How often will I review this progress?
How will I know when the outcome/objective has been successfully achieved?
The first stage is identifying your business objectives, once this has been done you can then select the relevant KPIs to measure the success of the actions you will take to achieve this objective.
You will need to review not only the data provided by the KPI on a regular basis, but also the KPIs themselves. As your business changes and grows, you will need to reassess which KPIs are important and suitable for your business needs.
KPI & Business Objective Examples
Business Objective: Increase Brand Awareness
Brand awareness is how recognisable your brand is to your customers. Therefore to focus on increasing brand awareness is to focus on increasing both the exposure of your brand to customers as well as to improve their familiarity with your brand and business.
The volume of social conversation and reach can be monitored though social listening. If you are wanting to increase brand awareness, you would then monitor the volume of conversation and expect the resulting data to show an increase in discussions or mentions of your brand.
2. Increasing Engagement
Increasing engagement means to increase your customer's interaction with your brand's content through comments, shares, likes, etc.
The KPI to monitor whether you are effectively increasing engagement on your digital marketing platforms, would be the average percentage of your community/audience/followers that are interacting with your content.
An example to illustrate this is if you have 1000 followers, but only 200 users on average are engaging with your content, then your content engagement is 20%. This is because only 20% of your total audience are interacting with the content you are supplying.
Once you have implemented and performed your marketing tactics to increase engagement, you will then monitor this percentage and expect an increase.
3. Improving Customer Support
Improving customer or client support is an essential business objective for achieving customer retention and growing your business.
If issues are taking too long to be resolved this can effect the efficiency but also the reputation of your business. Once you have identified "improving customer support" as your business objective, you will then select and perform the actions that will work towards improving customer support.
Time/duration of issue resolution - When measuring the average time it takes to resolve issues raised by your customers, you will be aiming to have the issues resolved faster. Your desired outcome will be not only happy customers, but also increased efficiency in problem resolution.
2. The quantity of issues resolved vs. unresolved - This KPI is best measured by percentages. You will monitor how many unresolved cases there are during a week vs how many are resolved within the timeframe. For example, if you have a week where there are 10 unresolved issues, and then two are solved, then 20% of cases were resolved in this week. The following week you have only six unresolved issues, but two are resolved, then 30% of cases were resolved this week. So although the quantity of cases differed, the focus is on the percentages of resolved vs unresolved cases.
In brief, your metrics, in this example, are showing that you are improving customer support and thus achieving your business objective.
A key point to remember, however, is that KPIs are what measure the success of an action; they don't stipulate what that action should be. Rather the data from KPIs provides insight into how successful or effective your actions are in achieving your business objectives.
Simplifying the Process: Categories
It can be overwhelming when you search for KPIs and find an endless list of metrics. It helps to allocate KPIs into different categories for different sections of your business.
Some category examples are:
- Marketing KPIs
- Content KPIs
- Customer Satisfaction KPIs
- Brand Awareness KPIs
When you break down the masses of KPIs into categories you can then select from those categories the KPIs that apply directly to your specified business goals.
- Monitor sales revenue
Customer Satisfaction KPIs
- Monitor customer retention
- Monitor the number of subscribers/followers
Resist the urge to try to monitor too many KPIs per business objective. At CMM, we recommend around 2-3 KPIs per business objective. This way you will have sufficient data to inform your business and marketing decisions.
Websites, whether e-commerce or general, usually provide the owner with a dashboard that provides insights into different performance indicators. Different website hosts will offer differing insights, but some of the most common are: unique website visitors, duration of stay on website, quantity of returning visitors, etc.
Social media platforms also offer similar insights. They will often provide indicators such as how many followers you have gained or lost over a period of time, which posts or content are performing well, and give an overall view on metrics relating to engagement and reach.
Once you familiarise yourself with the insights and data that are provided, you can use this information to direct and inform business decisions and to continuously develop your overall marketing strategy.
- Don't let your self be overwhelmed. Break KPIs down into categories. Then find the one's relevant to your business goals.
- Only use 2-3 KPIs per business goal. These provide sufficient data to inform strategy decisions.
Why not listen to our podcast Digital Marketing, the Fundamentals!
Connolly Media & Marketing