As marketing professionals, we’re always aiming to improve our strategies. Let’s break the ice. First things first, what should all marketers know about? KPIs! For those of you who are unsure of what KPIs are, they stand for “Key Performance Indicators.” KPIs are used to measure and track how well marketers and organizations overall are doing with reaching their marketing goals. 

Why does my organization need to use KPIs?

If you or your organization wants to measure its success or work on areas that need improvement to achieve goals, then KPIs are for you. For instance, say that the make-believe company Ramen Co. has set a broad goal of wanting to increase their online engagement. While this goal is a great start and is perceived as motivating, the absence of KPIs will make the tracking process very difficult. If Ramen Co. were to make their goal more specific, which is the “S” in SMART Goals, they could aim to increase their followers across social media platforms, including Instagram, X, Facebook, and TikTok, by 150, within a one-month time frame.

Three great KPIs for us to stay on track with this goal may include:

1. Measuring the number of new followers across all social media platforms we get each week.
2. Checking the sentiment of our business using sentiment analysis tools, like Sprout Social, to see if our weekly sentiment has been positive, negative, or neutral. 
3. Measuring the weekly changes in direct messages, comments, likes, and shares of new followers on social media platforms. 

Tracking KPIs with Metrics

Another way for your organization to track KPIs is through metrics. Additionally, the co-founder of Revive Real Estate and business leader suggests that other effective ways for organizations to track and measure their KPIs concerning metrics include, but are not limited to: 

• Website Traffic Volume
• Bounce Rate Percentage
• Social Media Follower Counts
• Newsletter Signups  

10 More Reasons KPIs Matter 

To end our example on a strong note, it’s worth considering these ten vital reasons why KPIs should not be ignored: 

1. Helps businesses measure progress and success.
2. Provides insight into business performance. 
3. Enables businesses to make data-driven decisions. 
4. Helps identify strengths and weaknesses.
5. Allows businesses to set and track goals. 
6. Improves communication and collaboration. 
7. Provides a basis for performance evaluations. 
8. Facilitates continuous improvement. 
9. Helps businesses stay competitive. 
10. Provides a clear understanding of customer needs. 

When Should I Start Creating My KPIs?

As soon as your business or organization has come to a consensus on one or more specific goals, then it is appropriate to begin creating your KPIs. 

A realistic approach to creating KPIs is as follows: 

1. Be sure that you have created a goal that is SMART (specific, measurable, achievable, relevant, and time-bound) and that closely aligns with your campaign or project’s overall goal.
2. Make a list of however many CSFs (critical success factors) your business or organization will need to aid in achieving your goal.
3. Ensuing the creation of your CSFs, you may begin determining your KPIs.
4. Once your KPIs have been set, investigate additional ways to monitor your progress with the KPIs you’ve chosen.

The four steps outlined form a strong foundation for creating successful KPIs.  

What Are the Consequences of Not Using KPIs?

Up until this point, as we have learned how significant KPIs are to the success of any business’s goals, it is evident how devastating it could be if we are not to use KPIs at all. 

Performance measure specialist Stacey Barr highlights several shortfalls of not using KPIs within your business or organization. In her list, the consequences of not having KPIs include: 

1. Guessing and giving up control over performance.
2. Not knowing if our efforts are making a difference.
3. Settling for mediocrity, making excellence unattainable.
4. The inability to anticipate and mitigate future problems. 
5. No consensus on what success looks like. 
6. No way to objectively prioritize.
7. Uncertainty and lack of self-efficacy prevail. 
8. Data use becomes trivial, leading to misinterpretation and misuse. 

Closing Remarks

Whether or not you take advantage of KPIs is totally up to you. Just remember, KPIs are a surefire way to see if you or your organization are making progress toward your overall goals. 

Author: Sam Cuellar

Digital Marketing graduate from DePaul University, social media marketing intern at the National Institute for Social Media, and professional bass player with a passion for music, traveling, and weightlifting.