If you’re into digital marketing, you might have heard the terms metrics and KPIs. But what do they mean? We’re looking at the difference between the two.
Talk about metrics and KPIs is everywhere.
There is great technology and tools do something exceedingly well: they collect and organize data.
Business owners from medium to large enterprises who may be looking for a way to increase growth are wondering how to best improve their marketing strategy.
But how do they measure what they do and improve upon it?
That’s where using KPIs and metrics comes in.
In fact, part of our audience across the ocean has even been called “The United States of Metrics!”
The trend isn’t limited to the US. The whole world seems to be going crazy for metrics.
Bruce Feiler, a writer for the New York Times, explains:
“In the last few years, there has been a revolution so profound that it’s sometimes hard to miss its significance. We are awash in numbers. Data is everywhere”
For example: an SEO analysis can let you know how you stack up against your competition.
When compared against keywords and competitors, this raw data can be turned into a powerful management tool.
We’ve put together a number of ideas on how these analytics tools can best work for you. Unfortunately, even though KPIs and metrics are everywhere, they can still seem confusing.
So how metrics and KPIs Are Different
Metrics and KPIs both measure things. But they measure things very differently.
- Metrics are data.
- KPIs (Key Performance Indicators) are how you use that data to measure against your business objectives.
Metrics and KPIs Work Together
When metrics and KPIs work together they deliver results.
One college basketball team uses the metrics of point scored to find out if their KPI is made.
UCLA’s goal is to score 110 points per 100 possessions.
Why? It would put the team among the top offenses in the country.
If they strive to get over 110 points they win.
US News uses metrics and KPIs to determine the Best Colleges.
Insurance firms use metrics and KPIs to discover how obesity rates impact business.
There is an application for using metrics and using KPIs in every facet of life.
How can you know if you’re using the right ones?
Metrics Are Possibilities
Before you can get to the benefits of KPIs, you need to be confident in your metrics.
Metrics are simply data. But there’s a problem:
According to IBM, “a remarkable one-third of U.S. business leaders don’t trust their own data.”
If you don’t trust your metrics, your KPIs are meaningless.
Experts suggest determining “whether your data is more fiction than fact.”
“Commission a third-party customer analysis to check. If the results are different from what your own data is telling you, that’s a red flag.”
“Select a single source of true, comprehensive customer data before moving forward.”
KPIs Mean Results
If metrics are facial tissues, KPIs are Kleenex.
They’re the best ones you use. Ketchup versus Heinz.
Q-Tips versus cotton swabs.
Metrics tell you that there are 5,564 hospitals in the United States. KPIs tell you how long it takes to drive to the nearest emergency room.
KPIs help your business survive.
The difference between metrics and KPIs means the overall value and health of your marketing campaign and your business.
Luckily, with tools to measure nearly every number associated with your business can be measured. That means you can always set up the KPIs that will best serve you.
In “10 Challenges That Will Rock The Marketing World In 2016” Forbes predicted:
“Marketing-based revenue growth becomes a KPI.”
And it’s true. Take a look at a CEO’s dashboard of KPIs and marketing dollars tied to revenue is bound to appear. It’s part of the reason there’s been a surge in digital content spend.
We can track how big an impact marketing makes to your bottom line. And show you exactly where these dollars come from.
Once you know what works, why not do more of it? A lot more.
In the not-so-old days marketing was the semi-mystical practice that seemed impossible to measure. We knew visibility was good, knew who our target was, but it was nearly impossible to tie actual marketing dollars spent to direct revenue.
Metrics and KPIs have changed all that. We can directly measure the performance of our marketing strategies.
As long as we avoid the pitfalls.
Avoid Pitfalls With Metrics and KPIs
Don’t let your KPIs turn into metrics.
Meaning, if you don’t organize your metrics and KPIs properly they can blur and turn into a large jumble of data you can’t use.
When using KPIs, Dr. Rachad Baroudi PhD, Director of Strategy Advisory Services for Ernst and Young (EY) in the United Arab Emirates, warns:
“A large list of KPIs that does not have clear linkages to a business’s overall objectives may be a sign of a larger problem: a lack of strategic focus.”
Avoid pitfalls with this EY guide to good KPIs.
• Echo an organization’s objectives
• Create meaning at all levels
• Are based on legitimate data
• Establish a trend over time
• Are easy to understand
• Provide context
• Lead to action
He explains further:
“Once KPIs and their respective targets have been set and agreed, it is important, over the ensuing weeks and months, to monitor performance against them.”
“In order to do this, it is necessary to have well-studied and carefully set ranges for targets if an organization’s strategic plan is to be successful.”
A plan that includes using metrics and KPIs positively must include regular review and adjustment as business needs change. You will also want to verify the accuracy of your data.
Regular review of the performance of your KPIs will make them work for you.
Basically, you need KPIs for your KPIs.
Make Metrics and KPIs Work for You
You know now that metrics are all the data you can collect, or are collecting, with the help of web tools and technology.
But clearly, knowing how to set up success by limiting your view to the right KPI’s can sometimes be a challenge. CEOs struggle with pinning down the perfect metrics and KPIs.
The Internet offers information. Paying attention to the wrong information wastes you time takes you away from building true value.
Studying the wrong information hurts your business.
Digitalico is an innovative digital marketing agency offering a vast range of internet marketing services and web design.
Having the best analytics set-up can help your search engine marketing campaign. Our analytics services will allow your company to track the data you need.
We can take your KPI usage to the next level.
Don’t wait another day to get your campaign on track.
Get in touch and tell us about your project today.