A Deep Dive into KPIs

In the final episode of season three of 1000 Ways to Market Your Business, Samantha Scott, APR, is joined by Paige Johnson, Digital Operations Coordinator at Pushing the Envelope.

The two dive deep into the world of Key Performance Indicators (KPIs), breaking down the ins and outs of creating meaningful KPIs, aligning them with business goals, and using actionable insights to refine marketing efforts for better outcomes. The discussion covers various types of KPIs, including website metrics, social media engagement, email, advertising, and sales.

Have a question or feedback to share? Visit www.getpushing.com or one of our many social media channels. We look forward to hearing from you.

#marketing #business #communication #strategy

Transcript

Samantha: 0:05

Hi, welcome to another episode, the final episode of season three, of 1000 Ways to Market Your Business, a podcast brought to you by Pushing the Envelope. I am Samantha Scott, and I am so happy to be joined today by Paige, our Digital Operations Coordinator, as we talk about KPIs, all the ins and outs, and breaking it down so that you can track your marketing efforts, not just your outputs, with success, to grow your business. This is my passion if you listen to any of our podcasts, but of course it's also Paige's. Paige, I'll let you introduce yourself.

Paige: 0:34

Yeah, so I'm Paige. As Samantha said, I'm our Digital Operations Coordinator and within my role I take care of the reports and looking at the outcomes of our marketing efforts and kind of translate those numbers and our efforts and outcomes into insights so that our team can make smarter decisions and more just strategic decisions and inform future campaigns and so on.

Samantha: 0:55

Super, super, super important. And for those of you who aren't familiar, KPIs are key performance indicators. There's lots of different terms for that, but basically it's data. And Paige, I love the way that you brought that up of actionable insights. So how do we create key performance indicators, metrics, that matter, that are meaningful for the business, that tie to the bottom line. How do we track them over time? How do we set them up well? And then how do we use the information that we're getting from those to do better work to create better outcomes? Really fantastic. And I think sometimes people get caught up. They, you know, set up Google Analytics for example, or they have different tracking in place, but they're not tracking the right information. So tell us, how do we get started with this?

Paige: 1:36

Yeah. So I think aligning your KPIs with your broader business goals and setting those goals in advance. A lot of times I think businesses want to be data-driven and a lot of times numbers look really good, like, oh, we got a hundred likes on a post, or a thousand impressions on a post. But tying those back to your business goals and overall goals for the year or over the lifetime of your business and really looking deeper than just the surface of a number looks good. It can be a little bit misleading, so really understanding what those numbers that you're tracking mean and having a measurable goal to work towards so you know what elements of your strategy you need to refine.

Samantha: 2:15

Absolutely. Best example I can give that ties to that is, we were working with a company that had a different digital agency doing their work for them, and they said, you know, we get these reports and we don't really know what this information means, but the agency will say, oh look, you got a hundred thousand impressions on this post. Well, this particular company was a remodeling business that worked only in one region, a few counties within a state. And when we looked into the data, some of those impressions were from Idaho, Washington, other states that they did not work in. That was meaningless, right? But the company was selling it as something that was valuable, saying, hey, look, you got all these impressions. But to your point, it has to tie back to the business's goals. So from the very, very beginning, get really clear about what you're measuring and why. So if you wanna increase revenue by 5% or you want more reservations, get really specific about that and make sure that your KPIs are set up, those metrics are measuring things that tie back to that. I mentioned at the beginning, it's outcomes not outputs. So it's not how much volume can we put out, how many ads, how many posts, how many releases, all those kind of things. But it's really more what's coming out of that, and that's where the KPIs come into play and knowing how to look at that data and understand what it's telling you, or use tools to help educate you if you don't have that knowledge on your own.

Paige: 3:32

Yeah, I completely agree. And I think that's a main reason why KPIs might get overlooked or misinterpreted. A lack of understanding of the importance of them and also maybe not sure how to measure towards a specific goal or they don't have the right resource. To your point, I think always revenue and sales look and sound good. But if your marketing efforts aren't behind that and you're hyperfocusing on sales and not looking at all the other elements like are we driving people to the right webpage? Does our webpage have strong call to actions? Is our load time on our page lagging and that's why people are clicking off? And we have 5,000 followers and we've gained a hundred in the last month, but what does that really mean to the goals of our business? I think a main thing that happens is that there's a hyperfocus on an overarching KPI and it's important to remember that it, more often than not I would pretty confidently say a hundred percent of the time there is all sorts of other metrics that you need to look at and strategies behind the scenes. Putting those KPIs in place, though, help you, you know, set a goal and work towards that direction effectively.

Samantha: 4:38

Absolutely. So there's the master KPIs. I would say kinda the really big picture, how is this tying back to the bottom line? But then you also have to have other KPIs in place. So for example, if you're doing video, say you have a thousand views, great. Well, are they watching the whole thing or are they dropping out? If engagement and audience growth is important to you, okay, great. But then what's it ultimately doing? Are they engaging and then going and taking the action you want? Or on the other side if it's followers and growing your audience. You know, we once had a client that said, I wanna have 10,000 followers. That's my goal. Okay. Why? Well, because that's what the competitor has. That is a popularity contest that does nothing for you, right? You're not gonna win prom king or prom queen, that doesn't matter. It's really, ultimately, are those people going to engage and or buy from your business. So yeah, there's different layers of KPIs and I would say don't be intimidated. Make sure you're setting up right so you know what's working, what's not, that you can refine your marketing efforts continually. So you set them up and you don't wait until the end of the year or the end of the campaign. You're checking in real time and then making sure that you're improving your ROI. So why don't we break down some of the common marketing KPIs? You know, there's a lot of different things in there that we can talk about from video to website conversions to social media engagement. But kind of let's break that down for people that are listening and thinking about how they can use KPIs to grow their business.

Paige: 5:56

Sure. Yeah, and I'll say as we go through these, there's a lot of different things that you should measure. Select like between three and five as your main goals and then all those other metrics can support this main KPI. You don't wanna get so focused on having 10 different things that are of utmost importance. So as we go through these, I just wanna, you know, reiterate, yes, maybe website traffic is important to sales, but if you hyper focus on one of these other metrics, you can't really work towards, you know, a fundamental like three to five KPIs.

Samantha: 6:26

You're right. I like to say it's like you can either move a few things forward a mile or a bunch of things forward an inch. You wanna make sure that you're moving the most important things forward, that that's where your focus is, and you prioritize that versus just measuring for the sake of measuring, which does nothing.

Paige: 6:40

Right. So getting started with website metrics, as I said, is how many people are visiting your website? Are they first time visitors? How long are they staying on the page? That correlates with the bounce rate. So it's good to check, is your website SEO friendly? Are your images loading? Can they find what they're looking for? So yes, bounce rate and traffic might be an important measurement for your business. It might be a KPI, but there's these fundamentals of SEO and website design and construction that will impact that KPI directly.

Samantha: 7:11

I would also say conversion goals, right? So for those of you who aren't familiar with that, that is someone taking a desired action. But you have to set that up within your Google Analytics from the very beginning. Otherwise, it's not tracked. So if you want people to sign up for your newsletter, or click to call, or complete a contact form, those would all be considered conversions. That's someone taking the desired action that you want. You can always leverage that if they don't, by remarketing to them, but that's a different conversation. But making sure you have those metrics in place is really, really important and a fundamental at the very beginning to make sure you're looking at the right stuff.

Paige: 7:43

Absolutely. And if you have those conversions set up from the start, you can use those efforts, link to that landing page, focus on that conversion location within your organic social media and your paid social media, and link to it in your email. So on that note, going into social media metrics, looking at your engagement rate, your follow growth. But remember, followers don't always mean more conversions. I, myself was thinking about this this morning, I follow plenty of accounts because I kind of like the type of content they produce, but I'm not a paying customer. Maybe I engage with videos or just find things that they have to say interesting, but I've never gone to their website before. So follower growth are not conversions, but it might be something that you look at. The click-through rate on your post. How many people are actually taking action after they see your post or ad. And then as Samantha mentioned earlier, watch time, if people are dropping off after the two second point in the video, what's happening at that point in the video? You can look at posting times. What time are you publishing? Are people trying to go to bed? Are they at work? Are they on their lunch break? So all those things, again, intertwined to see where your strategy can be refined.

Samantha: 8:44

Yeah, and just because you see something not performing the way that you want, don't think you have to cut it, right? So there are opportunities to improve that. Sometimes this data will tell you, hey, just bail on this. This is not connecting with your audience. But other times it's just, maybe I need to make a tweak. To your point, if people are dropping out two seconds in, well, maybe you didn't capture their attention, so change your intro versus just cutting out video altogether.

Paige: 9:05

Absolutely. Yeah. And another example that comes to mind, like let's say you're a e-commerce brand and you have a marketing team who's super focused on the social media engagement. And your overall objective as an e-commerce brand, your main KPI is going to be sales. But if you have this marketing strategy, the social media strategy, and this marketing team is celebrating when a post goes viral, but sales are stagnant. How are you gonna adjust from the backend of like, what in the campaign do people like, and are we directing people to the right place? What are the demographics of the people that we're reaching? Using these different tools on Google Analytics and even in your business suite within each social media platform to inform what you're gonna do next, to actually convert those into a meaningful metric.

Samantha: 9:46

Yeah, that also gives me another point or another idea rather, is that it'll also tell you if you're reaching the right people or if maybe there's an audience that you haven't realized yet.

Paige: 9:55

Right.

Samantha: 9:56

Those folks who might have engaged with that, you know, fictitious story you just mentioned about a post going viral, maybe that's an audience that you never thought to market to before. So I would say, you know, you wanna look at the data in your KPIs to see are we getting closer to reaching the target that we have set for our goals? But secondly is, are there things that I could learn from this? So, oh, wow, I never thought we could do this, but when we did this post, you know, this audience was engaged with it. Or we didn't think that this would be our target audience, but we're seeing a lot of people visit our site that fit this demographic criteria or engage with our content on social. So keep that in mind as well.

Paige: 10:31

Yeah, absolutely. And KPIs can always change. So, maybe you're a newer business and, of course you wanna eventually start making sales, but as you are establishing your accounts on social media, maybe you start by wanting to increase engagements and profile visits and getting people to the website to increase awareness, and then you can adjust your KPIs as you move forward once you get that foundation.

Samantha: 10:53

Absolutely. So another area of KPIs, still in the digital space, would be email, which is more of an owned audience versus, you know, some of the other ones. What are some of the KPIs related to that?

Paige: 11:04

Yeah, so the main ones are gonna be the open rate and the click rate. The open rate is dependent a lot on a subject line. Best practice with this is to AB test and try different subject lines to see what resonates best with your audience. And then the click-through rate is gonna be who's clicking on the links in the elements in your email. Do you have clear CTAs? Are you directing people to links that have a purpose? Are you telling them what to do next effectively? And if your click-through rate is really low, people are opening it, but they're not taking any next steps. You want to really assess if that's a wasted effort at that point.

Samantha: 11:37

Great point. So a couple of things there. One is that you're linking to the right stuff, right? You wanna make it as easy as possible for people to take the action that you're looking for. So don't link to your homepage, link to the menu or the special landing page you have for the campaign, or, you know, fill in the blank. You wanna make sure you're directing them to exactly the place that they can go to get more information about what they want. You know, we used to do work for Harley-Davidson dealers and they often sent out newsletters. It was, you know, to their whole audience. There was some segmentation, but generally the newsletter went to everybody. And we would have a few sections in it, and it blew their mind when I told them, hey, we could have a section about new inventory, another about used inventory, another about merch, and then maybe about an event, and that we could directly hand over warm leads to their sales team. This was a KPI for them. Sales was everything, right? They're in retail. So I could tell them, hey, these 50 people clicked on the new inventory. Your salespeople, match this up with your CRM or your database, should contact them and say, hey Joe, I saw you clicked on the new inventory link. Would you like to come in and check out, you know, the new Fat Boy that we just got? Or somebody clicked on the used inventory, they can follow up and say, hey, I saw you were interested in the Low Rider, you know, we've got it. Do you wanna come in and check it out? Or the events, they could contact them and say, hey, do you wanna come out? Do you wanna register or send a follow up email to that effect. So there's tons that could be done with the data and actually looking at how people are engaging with your content. Because to your point Paige, the open rate is one thing. People can accidentally open an email on their phone. Those numbers can be kind of misleading, especially if you see somebody opened it seven times, it's probably just that they were reading other emails and it auto opened, you know? But the click-through rate is really where the rubber meets the road. No pun intended since I just gave a Harley reference. But this is really where we see people taking action. And that's what you should be really looking at is are people engaging with your content and then taking the action. And then secondly, how can you leverage that to ultimately serve your business goals in like the example I gave you.

Paige: 13:26

Right, as I said earlier, not hyper focusing on multiple KPIs, but understanding the connectivity of all of them. So let's say I get a email promoting brunch, and then I click on the website and it goes to the homepage. Maybe I don't know where to navigate to find the brunch menu and so then the website analytics are gonna be impacted. Go into Google Analytics and my engagement time is two seconds for this email.

Samantha: 13:51

And your bounce rate's gonna be horrible, right? Because people are gonna go there and they're gonna say, oh, I can't find it. I'm gonna leave.

Paige: 13:55

So then maybe you're doing your reporting and you're like why is our bounce rate so high? And why is our drop off time so quick? You need to be able to look backwards and have effective tracking in place to see that this is from an email campaign. Nobody can figure out where to go. So now we're gonna refine and improve it by making sure we send them to the exact place they wanna see the brunch menu and they know where to go and they don't need to look or use their brain to navigate the website that they haven't been to.

Samantha: 14:20

Exactly. As consumers, we are inherently lazy, me included, and the average attention span is less than three seconds, so you gotta make it easy for people. So, advertising KPIs also. There are those. I think sometimes people think of traditional advertising as passé or you can't measure it. You know, there's obviously digital advertising too, but there's a number of ways that we can effectively implement KPIs and measure advertising.

Paige: 14:44

Yeah, and I can speak to the digital element of advertising. Most prominently I'm looking at the cost per click. And this relates kind of to what we were just discussing with emails. Are your landing page and click destinations valuable and do they have a clear call to action? And then your return on ad spend. Refining your audience if it's too high, checking your campaign optimization goals, your bid strategies, and then your conversion rates, of course, the percentage of ad viewers who become customers.

Samantha: 15:11

Yeah, and from a traditional perspective, there's lots of ways you can do that too, if you have a custom URL or a QR code or something that you're using in your advertising, or even getting the viewership data. So if you're running an ad in an online publication, for example. That publication should give you the readership of that. So if it's in their newsletter, for example, you know how many will receive that. But then secondly, how many people clicked on that so you can actually track that back. Same thing is if you have that custom URL, even if it's in a printed program for an event you sponsored, or in a traditional actual tactile publication, they do still exist. Magazines are real. You can actually track that if you're looking at you know, maybe it's a shortened URL in the QR code that's specific to that publication. Don't use the same URL, that's a little tip there, on every single thing that you do, because then you have no idea where people are actually coming from.

Paige: 15:58

Absolutely.

Samantha: 15:58

Create, you know, if it's a getpushing.com/gulfshorelife or something that I know specifically where they came from. So just keep those things in mind as well, because everything you do should be tested and measured. And I will say it until I am six feet under, but KPIs and measurement, you can do it any which way. So the last one I think we should talk about is leads and sales. We talked about this kind of across the board with all the things here, but just as a reminder. So we're looking at the customer acquisition cost. How much did it cost to get that person through the door, not, did I get the horse to the water, did the horse drink? So this is kind of a multi-level KPI. So we're looking at how many eyeballs, how much attention did I get? Then did they go to the website or call or do whatever action I wanted? But then ultimately, did they convert? So you're looking at that from two views is did I get them to water? Okay, now how do I get them to close? And if you're having an issue with the close, then you need to look at, well, what's the call to action? What does that part of the funnel look like to refine that. That's super important because if you have all of those things lined up, you can track back. Just like you said, looking at email performance, looking backwards. Well, if our sales went up 5% this month, what did we do differently? How can I track that back to determine what the cost per acquisition was and then which channels or strategies are working. But we can also look at the lifetime value. So this is something, you know, when we get into how much can a customer bring in over the course of the relationship. So, you know, loyalty members, repeat visitors, things like that. That could be a KPI, if that's relevant for your business. And then the conversion rate. So ultimately, how many people are converting. You know, if you have a hundred thousand people visit your website and only 50 of them are converting, that's a really, really small number. How can you create more of that? And there's a lot of technical ways you can do that, but just keeping that in mind from the very beginning. So kind of wrapping up that part of this conversation, it's not a one size fits all KPI approach. Make sure that you have the right things that you're measuring for your business so that they can help your business grow. So how do we choose the right ones then, Paige? We've talked about a variety of them from digital to traditional. If I'm new to planning KPIs for marketing for my business, what would you suggest?

Paige: 18:08

Yeah, so I kind of said earlier, these aren't static. You can adjust these over time, but in general think of like a hierarchy of what's important. So if brand awareness is the most important thing, maybe you're starting off a new brand. Website traffic, social media engagement, those metrics that give you an indication that people are seeing you and they're interacting with your content. If you're looking to increase conversions, it's important to look at your click-through rates and your landing page conversions. Don't get leads mixed up with sales because people might be taking a specific action that you would like them to take but aren't actually converting. And then revenue growth looking at the return on ad spend, as I said earlier, and your customer acquisition costs. The lifetime value. So like a overarching, if you want awareness, you know, sales, engagement, and then kind of tune into like what marketing efforts are behind that, that you can measure those metrics specifically. As I said earlier, I would probably narrow it down to like three or five based on your overarching goal.

Samantha: 19:07

I think you can summarize that by saying your KPIs should be directly correlated to your business objectives. So get super clear about that. What are we trying to accomplish? What does success look like at the end of the road from a business perspective? Is that an increase in number of clients? Is that increasing the turnover in terms of how many table seats I can get per night? Is that increasing revenue by a percentage? What are those? Get super clear about that. And then your KPIs should directly measure the efforts and the outcomes of those efforts as it relates to those bottom line functions. Absolutely.

Paige: 19:40

Yeah, and make sure that you're measuring them over time. Know where you started. Start with like a baseline report and measure over time. Be willing to adjust. Don't focus too much on the big metrics. Look at everything that is involved in getting to where your goal is, and then just keep in mind that growth comes from consistently optimizing based on the data and what your audience is telling you.

Samantha: 20:01

Yes, yes, yes, yes. Times a thousand percent. Because if you're looking at just a moment in time, you only have a teeny tiny piece. It's like having one piece of a puzzle. You don't have the rest of it for context. So making sure you were measuring over time is absolutely critically important. And then, yes, I said it before, it's not a set it and forget it. You can't just put these things in place and then expect that, you know, six months or a year down the road, they're still gonna be relevant. Or that it's gonna have worked out the right way. Make sure you're optimizing that. Use the data, the actionable insights from what you're learning, to improve on those marketing efforts and the KPIs as a result. So those are two really key"make sure you do those" things. But are there any key suggestions in terms of what not to do that you'd recommend?

Paige: 20:42

Yeah, biggest thing is not focusing on vanity metrics. As we kind of mentioned earlier, vanity metrics are these metrics that sound really good and look really good, and maybe they're improving or have some change over time. But if you hyperfocus on these numbers, like followers and likes on posts, they're not a priority because they're not leading you to the actual conversion goal aligned with your business. So if you really understand the importance of your KPI when selecting it, not focusing on what looks good and sounds good, but understanding genuinely the importance and how to measure it, you'll have a better direction for getting towards your goal. Additionally, you need to set benchmarks, measure over time. Track the progress towards your goal and the marketing efforts behind it. Another good thing to do when you're setting these benchmarks and making changes over time is to do a competitor comparison with the available data that you have, whether this is monthly, quarterly, annually. Of course you're not gonna be able to see their sales, but you know what are they doing? Don't replicate what they're doing, but you should always be aware of what's working for them, if you have a similar product or service.

Samantha: 21:48

Or what's not, and avoid doing that.

Paige: 21:50

Yeah. And even like, you know, you can see with Meta Ad Library, anyone can access any of the ads that are currently running. So are they running ads at all? Maybe if they are, what kind of call to actions are they using? You can view it, you can't see like the outcomes, but you can see what their ad creative looks like.

Samantha: 22:05

Great tip.

Paige: 22:06

So yeah, use that resource. It's free and it's there, and their audience may have some overlap with yours. And then of course, don't ignore the full picture. Looking at one KPI in isolation can be misleading, as I said before, and I can't stress that enough. Pick the biggest, most important KPIs, but don't ignore all the other things that go into it. So if website sessions skyrocket, look at the user tracking and your UTM codes to see what social media posts or ad primarily caused that. And then refine your social media strategy. Maybe you do a campaign focused on whatever was discussed in that post because your audience responded really well to it. Then lastly, I'll say chasing the wrong numbers. If your business doesn't rely on website traffic or social media engagement, don't stress about it. Focus on what moves the needle for you.

Samantha: 22:57

Really good tips. So wrapping this very juicy conversation up all about KPIs and metrics. Just some key takeaways here. If you didn't get this, KPIs are not just numbers. They're really meant to be a guide to help you make better decisions, improve your business, grow your business, improve the outcomes of your marketing efforts. And then different KPIs matter for different business goals. So make sure you have them customized to your business, to your goals. It's not a one size fits all. And then make sure that you're tracking regularly. We can't emphasize that enough. You know, in real time, but also monthly, quarterly, semi-annually, annually. However it works best for you. But make sure that you're not just in a vacuum or a moment in time that you're really looking at it, how it changes over time. So thank you so much for sharing your knowledge, Paige. She's our data nerd. We love her. All the reports and data, really good stuff. I appreciate it and I hope that this has been valuable for everybody that's watching or listening. Thank you for tuning into 1000 Ways to Market Your Business, a podcast brought to you by Pushing the Envelope and our final episode of season three. Take care.