Key performance indicators (KPIs) are quantifiable benchmarks used to measure the progress of specific marketing goals. They are important because they define the endpoint or goal that a digital marketing strategy needs to achieve. The digital marketing strategy must be built around achieving the KPIs, and as such, the strategy should define how to meet the KPIs. For instance, if your KPI is to increase website visitors by 20% over the next year, your strategy might involve boosting SEO, investing in pay-per-click advertising, or ramping up content marketing to achieve that goal.
But what is a KPI in digital marketing, and how do digital marketing KPI metrics drive a digital marketing strategy? Let’s step into the world of KPIs and their integral role in shaping digital marketing strategies.
Choose a range of digital marketing KPI metrics
You need a diverse range of KPIs that cover the entire marketing funnel to monitor the effectiveness of digital marketing campaigns. Campaign objectives may vary, from those seeking shifts in reputation to those pursuing leads, so KPIs also need to vary based on those objectives. Depending on the specific needs and goals of each campaign, consider setting engagement KPIs for social activities, keyword ranking KPIs for SEO, or website traffic KPIs for paid media.
Beyond these standard metrics, the most valuable KPIs are those that link directly to business success. Conversion or sales KPIs, for example, allow you to directly link marketing activities to measurable business outcomes. In addition, consider metrics like cost per acquisition, customer lifetime value, traffic-to-lead value, and marketing revenue attribution. These KPIs provide in-depth insights into the cost-effectiveness and revenue generation of marketing strategies, ensuring comprehensive monitoring and campaign success.
Crafting powerful KPIs and setting SMART objectives in digital marketing
Digital marketing objectives should be SMART – specific, measurable, achievable, relevant, and time-bound. For example, increase leads generated on LinkedIn by 20% in 6 months.
To formulate KPIs and set SMART objectives, you need a thorough understanding of past performance, industry benchmarks, budget, and anticipated outcomes. Evaluating previous performance and industry benchmarks gives valuable insights into past successes and helps you understand what you could reasonably achieve. Budget considerations help set realistic targets, while anticipated outcomes guide the direction of the KPIs.
Formulating KPIs and setting SMART objectives form the foundation of a campaign, dictating its execution and providing a clear, well-defined roadmap for all subsequent activities. For example, if the goal is to increase downloads, every aspect of the campaign, from creative concepts to platform selection, should be tailored to fulfil this objective. In this context, KPIs act as signposts, ensuring all marketing activities align with and contribute towards achieving the ultimate goal. They guarantee that marketing efforts are purpose-driven, targeted, and aligned with the primary objective.
Driving digital marketing success with tailored KPIs
KPIs must be linked to digital marketing objectives by identifying metrics that tangibly reflect the impact of your activities. For instance, if the objective is to amplify brand awareness, the corresponding KPI could be reaching 1,000 new potential customers on social media channels within the quarter.
But your work with KPIs does not stop at defining them. KPIs serve as a benchmark to gauge the success of digital marketing campaigns. By consistently measuring activities, you can track progress, and optimise campaigns to better achieve KPIs. Where a campaign isn’t meeting its KPIs, enhancement strategies could include changes in targeting, prioritising paid media funds towards specific goals, or even altering the creative, messaging, or tactics to better drive the desired outcomes.
Embracing challenges and harnessing innovations in digital marketing
As our digital landscape continues to evolve, adaptation and innovation are indispensable. We may need to stop tracking certain KPIs and consider measuring new ones. For example, the challenge of a cookie-less future combined with regulation and consumer privacy concerns means the industry is shifting away from traditional tracking methods and instead nurturing customer relationships through opt-in first-party data.
By balancing innovation and performance, you can shape your KPIs and objectives for an increasingly complex digital world while helping your digital marketing strategy succeed.