Observations and Insights

What Are Key Performance Indicators?

Chuck Bankoff - Monday, April 02, 2012

How well your Internet marketing campaign is performing is most indicative of your Key Performance Indicators (KPI). These are the big things that make a noticeable difference.

Your “Bounce Rate” (where visitors view your website, but never move past the home or landing page), for example, is a big indication that there is a problem with the relevance of your landing page to the visitor that is viewing it.

There is no set standard KPI for every business. The objective depends on what your end results are. Say you are in a service related industry; a primary KPI would be the amount of phone calls your company received by its online efforts. As you investigate more, the length of every phone call would tell you even more than that. Shorter phone calls, under a minute, could tell you that no one actually answered the phone and never left a message. A longer phone call can tell you that your customer is being helped to solve any issues they may have had.

There are many different things that can indicate your KPI such as “Time on Site,” which tells you how appealing your website is and the “Pages Visited” can tell you whether your sales funnel is set up accurately. Sometimes the impact of your KPI is not always quite obvious and it can take a pinpoint strategy to understand what it all means.

Key Performance Indicators are typically unique to every different business as well as their individual objectives. Here are a few that I deem relevant to an assortment of businesses:

Common KPI Definitions

Visit– This is where a person visits one or more of your web pages under 30 minutes time in between page visits.

Visitor – A visitor is someone who visits your website. These people can be placed into three groups:

  1. New Visitor– A new visitor is only noted once and includes those who have never visited your site previously. This is different than a unique visit and is can be measured over certain amount of time.
  2. Repeat/Returning Visitor – A person that visits your website more than two times over a certain period of time. These types of visits are only recorded once in a given amount of time.
  3. Unique Visitor – The first time a person goes to your website during a particular amount of time, either daily, weekly, or monthly, is called a unique visitor.

Conversion – This is when a customer or visitor finishes the action you set up for them, such as completing a web form or purchasing something.

Key Performance Indicator Examples

General KPI

  • Average Time on Site –This is where a person who visits your website looks for certain phrases or keywords that have relevance to what they are looking for. In turn they will spend more time on that page than if they did not find what they were looking for in their search.
  • Page Views / Visit – The amount of times a visitor views your website is a page view or visit. Numerous visits will have an effect on the amount counted.
  • Page Views / Visitors – This is comparable to page views/visits, but it overlooks the number of visits that certain visitors make.
  • New Visitors / Visitors – This follows the number of people who are first time visitors. This is a great way to determine new prospective clients.
  • Repeat Visitors / Visitors – These are returning people that have previously come to your website. This shows that your website has the ability to attract visitors back to your site.

KPI is Important – Take your KPI to the Next Level

Measuring how well the strategies you use in your business to produce a positive effect starts with the  inclusion of the development of your KPI and reaching the Internet marketing goals you have set. Your KPI can give you warning signs early on and can help you figure out what works and what does not. As soon as you get the results from reviewing your KPI, you can adjust the parts of your business that are not as effective and boost those that are working positively.

A KPI does require more evaluation that you’d think. A professional digital marketing specialist is someone who can help you analyze a KPI with proficiency. Interpreting data and certain experimentation should be set up to gage cause and effects of incremental changes within your business. A Professional Digital Marketing consultant can even prepare a Competitive Analysis on the KPIs of direct competitors in your industry.

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