KPI
Definition
Key Performance Indicator. A measurable value that shows how effectively you're achieving your main business objectives.
What is a KPI?
KPI stands for Key Performance Indicator. It's a specific, measurable value that tells you whether you're hitting your business goals. The emphasis is on "key" – not every metric is a KPI.
For example, page views is a metric. But if your goal is lead generation, then form submissions or qualified leads are your KPIs.
Why KPIs Matter
Without KPIs, you're measuring activity without measuring success. You might be busy – lots of traffic, lots of social posts, lots of email opens – but is any of it driving business results?
KPIs force focus on outcomes, not just outputs.
Choosing the Right KPIs
Align with Business Goals
If you want more customers, track customer acquisition cost and conversion rate. If you want brand awareness, track reach and engagement. Match KPIs to what you're actually trying to achieve.
Make Them Measurable
"Better customer experience" isn't a KPI. "Net Promoter Score above 50" or "support response time under 4 hours" are KPIs.
Keep Them Few
Three to five KPIs per goal is plenty. More than that and you lose focus.
Common Marketing KPIs
| Goal | Typical KPIs |
|---|---|
| Lead generation | Cost per lead, conversion rate, qualified leads |
| E-commerce | Revenue, average order value, cart abandonment rate |
| Brand awareness | Reach, impressions, share of voice |
| Customer retention | Churn rate, repeat purchase rate, lifetime value |
The Danger of Vanity Metrics
Follower counts, page views, and email list size look impressive but don't necessarily mean business success. Focus on metrics that connect to revenue and growth.