Here at Helix House, we work to leverage digital platforms to expand our clients’ businesses. It’s what we do – through Facebook, AdWords, SEO, social management, email marketing. Any of our services, really. In doing this for our clients, a key factor in achieving success is in determining Key Performance Indicators (KPIs). Marketing KPIs are critical to have and understand for both client and agency.
If you have a business or manage a department – you know what KPIs are. They are the number or marker that when attained mean you’ve done it, succeeded, passed the finish line!
With a good KPI you will have a measure not only of success at the end of a certain timeframe (such as annual, end of the quarter, what have you) you have guidelines for the journey. Every choice, every step, and iteration of the process can be measured against the KPI for assessment.
For some companies that’s a financial point. ‘In 2018, we want to make a million dollars in profit.’ Perfect, there is now a clear, defined, quantifiable goal that applies to the overall goals of the company (in this case, ‘be successful’) This KPI works more than just a finish line, it’s a North Star by which each department, employee, and strategy can orient themselves to guide everything.
By comparing the KPI and the strategy or choice you can be more assured that you are taking steps in the proper direction. ‘Will this, get us there?’
If so, huzzah! The business can take that step, make that choice and feel relatively safe that that KPI will be reached. If not, if the step doesn’t work with or for that KPI then you know that whatever benefit it may be giving you (and surely there is some benefit else why would you make the plan in the first place) it is not going to help you hit that KPI.
That is putting it amazingly simply, sure, but that’s the idea of this blog. It gives you a guiding light in the darkness of uncertainty. How do we find them and how can a business find their own KPIs?
Working together with our client, we look to find the KPIs that signify a specific type of success that will grow their business. Here are just a few of the questions we use to find those.
What are your top three objectives for the first quarter of 2018?
What are your top three objectives to achieve by the end of 2018?
Obviously, these two questions are asking for clear goals, both short term and long term. But they are not necessarily a KPI. These three objectives are the finish line, so how do we get there?
If the objective is ‘Make $XX’ or ‘XX New Customers’ then the KPIs will tie to that. They will be the smaller targets that advertising can achieve.
If the business’s site makes $1k off of 1000 visits to their site, and the goal is to make a total of $10k, then the goal for digital marketers is to increase the traffic to the site, the number of visits, tenfold.
In this case, that KPI for us, the agency: visits. If visits go up, then profits should as well, all things in the funnel work as they properly. If not, well that’s when we explore the science of campaign optimization and identifying where the leaks are, but that’s another topic.
How much does it typically cost, on average, for you to acquire a lead, subscriber, or registrant?
We ask this one because it can offer us a guideline for spending in the digital marketplace. Google and Facebook ads come with a cost per click and if we can drive that cost down, the same budget can see more clicks, more visits, more profit etc.
We can spend $100 to earn you a lead, but if that lead only spends $80 then no matter how you slice it you’re not making the profits you need to hit your targets.
By knowing your original, average cost for leads, we are able to build around that and ensure our efforts are multiplying your success, not dividing it.
Here you can see that we have a Target KPI for a CPC (cost per click) Campaign. With that KPI in place, we were able to run several test campaigns around it and measure the successes. As you can see, the first week everything was on track, though Test C was edging close to the most CPC. As the weeks went on, both A and C went over the limit of 4.5 while Test B stayed below, making it the better campaign. We had a clear KPI, strategized around it, and delivered the most successful result.
So, all of that said, how do KPIs work when it comes to what we at Helix House do? Digital marketing is like any other department in a business. We have KPIs that measure our success and how that can lead to our clients’ success. Let’s take a look at some of the important KPIs for our field.
Customer Acquisition Cost (CAC): Total acquisition costs/number of new customers = CAC Boom. With this, we can adequately measure up the performance and cost-effectiveness of the campaigns.
Number Of New Vs. Repeat Site Visits: Simple: comparing new traffic vs. total can be a way to measure the campaign effectiveness. Want to get a nice round percent? Take New Visits divide by the total number of visits and abracadabra! You have the percentage of New Website Visits. A great KPI
Calls: Measuring the number of calls coming in is imperative for most businesses. Most the time, more calls equal more business. Call tracking can be installed and allow for marketers and business owners to see where those calls originate.
Email Opt-Ins: Looking to build an email list? Then tracking email opt-ins is the KPI for you.
Email Opens: Opt-Ins are meaningless if no one is actually opening them! This KPI will let you know how effective your emails are, specifically the subject lines, the frequency of distribution etc. You want the opens to be as high as possible, obviously.
Sales: We don’t need to spell this one out for you do we? $$$ is the goal. Measuring sales from quarter to quarter, month to month will demonstrate whether you are on track. If not, then the campaigns aren’t working the way they should, and changes need to be made.
As an agency, KPIs let us know if our campaigns are working. When we have an established KPI, a known goal that is tied to hard data that we can then turn over to you, we know we are meeting our goals and delivering exactly what you expect. We cover this topic in more depth in our blog on transparency.