Join Drew Boyd for an in-depth discussion in this video Measuring key performance indicators (KPIs), part of Marketing Foundations.
Before you launch your marketing campaign you want to set up key performance indicators, or KPIs for short. Key performance indicators help you keep track of your overall strategy and your individual marketing programs. They alert you when it's time to intervene. And take action to get things back on track. Without KPIs, you're flying blind so to speak, and you run the risk of falling short of your overall goal. To be most effective, each KPI should be quantifiable and measurable.
You can have as many as you want. But don't measure a KPI just because you have the data. If you're not going to use, don't bother. It's a waste of time. Measure something only if you plan to take action from it. That's why we set thresholds around each one. Each KPI should have a target of what you expect to happen. Plus a high and low number around that target. For those thresholds, you and your planning team should agree in advance what action you'll take if those thresholds are exceeded.
Here's an example. Assume you create a KPI around the number of new customers acquired each month. You set your target at 500. And also specify a high and low threshold of 600 and 400, respectively. If your actual customers per month is more than 600, you might consider taking action such as reducing advertising spending. On the low end, if you're below 400, you could consider increasing sales incentives.
Now, each KPI should be linked to the key parts of your marketing plan, including your goal, segmentation, targeting, positioning, and marketing tactics. For the goal, you might have KPIs around the timing of revenues. The type of customers you're converting,. And whether you're taking customers from the right competitor. For segmentation, targeting and positioning, you want to measure changes and customer beliefs, such as importance and perception. You may also want to measure their behaviors. Such as, purchase habits, customer attrition and retention profile. You need to carefully monitor whether you're achieving the market positioning that you had hoped for. For marketing tactics, you could create a KPI for each of the four Ps, if needed. For example, you might have measures around communications objectives, sales force effectiveness. Distributor activity, store promotions, search engine ratios, social media activity. Pricing and discounting rates, product performance, waiting times, and service complaints. Good marketers not only reach their financial goals. But they also know whether those goals were achieved the way they expected them to be achieved. They also take immediate action when they detect something is going in the wrong direction. KPIs help you and your marketing team stay aligned, and do what's needed to succeed
You'll also learn to address tactical challenges and present the plan to get buy-in throughout an organization, from the C-suite to the sales team, as well as use the marketing plan to guide outside agencies and vendors. Finally, you'll learn how to launch the campaign and measure its performance.
- Marketing in an organization
- Assembling the team
- Creating the marketing plan
- Analyzing your products, customers, and market
- Segmenting customers
- Creating a value proposition
- Developing a strategy
- Setting goals
- Setting prices
- Using social media
- Presenting your plan to leadership
- Budgeting your plan
- Measuring success