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What Should My KPIs Be?

Writer's picture: Kevin WassongKevin Wassong
What Should My KPIs Be?

Many marketers struggle to determine which Key Performance Indicators (KPIs) they should be tracking. With an overwhelming number of metrics available, it’s easy to focus on the wrong data points or neglect critical indicators of success. Understanding what truly matters and how to benchmark performance against industry standards can make the difference between an optimized marketing strategy and wasted budget.


Marketers Don't Know Their KPIs

The biggest challenge marketers face isn't a lack of data but rather an excess of it. With so many reporting dashboards and analytics tools available, identifying which KPIs are truly meaningful can be daunting. Many marketers default to surface-level metrics like impressions and likes, which don't necessarily indicate business impact.

As marketing expert Neil Patel puts it, "Marketing without data is like driving with your eyes closed." Identifying the right KPIs is essential for aligning marketing efforts with business objectives and proving ROI.


The Essential KPIs Every Marketer Should Track

1. Return on Investment (ROI)

ROI is the most fundamental metric, indicating whether a marketing initiative is profitable. It is calculated as:

A positive ROI signifies effective spending, whereas a negative ROI suggests the need for adjustments. According to a Nielsen study, marketers who use ROI-driven analytics improve campaign performance by up to 25%.

Benchmark:

  • eCommerce: Average ROI of 450%.

  • Technology & SaaS: Average ROI of 320%.

  • Healthcare: Average ROI of 250%.

  • Financial Services: Average ROI of 280%.

  • Retail: Average ROI of 350%. (matrixmarketinggroup.com)


2. Customer Acquisition Cost (CAC)

CAC calculates the average expense of acquiring a new customer, including marketing and sales costs. Lower CAC indicates an efficient customer acquisition strategy.

Benchmark:

  • SaaS (B2B): Average CAC is approximately $239.

  • Fintech: Average CAC is around $1,450.

  • eCommerce: Average CAC is about $274.

  • Medtech: Average CAC is approximately $921.

  • Education: Average CAC is around $806. (firstpagesage.com)


3. Customer Lifetime Value (CLV) to CAC Ratio

CLV estimates the total revenue a business can expect from a single customer over their lifetime.

Benchmark:

  • Commercial Insurance: CLV to CAC ratio of 5:1, with an average CLV of $2,975 and a CAC of $595.

  • SaaS (B2B): CLV to CAC ratio of 4:1, with an average CLV of $956 and a CAC of $239.

  • Entertainment: CLV to CAC ratio of 2.5:1, with an average CLV of $823 and a CAC of $329. (firstpagesage.com)


4. Conversion Rate

Conversion rate measures the percentage of users who take a desired action, such as making a purchase, signing up for a newsletter, or downloading a resource.

Benchmark:

  • All Industries (Average): Approximately 2.9%.

  • Real Estate: Average conversion rate of 2%, with top performers achieving 5% or higher. (ruleranalytics.com)


5. Engagement Metrics (CTR, Time on Page, Social Shares)

  • Click-Through Rate (CTR): Measures the percentage of users who click on an ad or link. Benchmark:

    • Google Ads Search Network: Average CTR is 3.17%, with higher performance in Dating & Personals (6.05%) and lower in B2B (2.41%).

    • Google Ads Display Network: Average CTR is 0.46%, with Real Estate performing higher at 1.08%. (wordstream.com)

    • Email Marketing: Average CTR is 2.3%, with Education at 4.4% and Advertising & Marketing at 1.8%. (campaignmonitor.com)

  • Time on Page: Indicates how long users engage with content before leaving. Benchmark:

    • Overall Average: Approximately 52 seconds.

    • B2B Websites: Higher engagement, averaging 82 seconds. (metrichq.org)

  • Social Shares & Comments: Show the virality and emotional impact of creative content. While benchmarks vary widely, tracking trends over time provides insights into engagement and audience sentiment.


6. Brand Awareness & Sentiment Analysis

Brand awareness measures how well audiences recognize and recall a brand, while sentiment analysis examines public perception through social listening tools like Brandwatch and Sprout Social. Metrics include:

  • Branded search volume

  • Social media mentions

  • Net Promoter Score (NPS)


Common Pitfalls When Setting KPIs

Tracking Too Many Metrics

Many marketers try to track everything, which leads to data overload and decision paralysis. Focus on a few high-impact KPIs that align with your business goals.

Ignoring Qualitative Data

Numbers tell part of the story, but qualitative insights—like customer feedback and brand sentiment—can provide a more complete picture of marketing effectiveness.

Failing to Adapt Over Time

What worked a year ago might not work today. Regularly review and refine KPIs to ensure they remain relevant to evolving market conditions and business objectives.


Beyond the Metrics: How to Define Your KPIs

Using Data to Identify the Right KPIs

Determining the right KPIs requires analyzing past performance and identifying patterns. Platforms like mktg.ai can help by assessing historical marketing data and recommending KPIs that align with past successes and industry benchmarks.


Align with Business Goals

Your KPIs should directly support your company’s objectives. If revenue growth is a priority, focus on ROI, CAC, and CLV. If brand awareness is the goal, track social mentions and search volume.


Avoid Vanity Metrics

Metrics like social media likes and impressions may look impressive but often fail to indicate true business impact. Focus on KPIs that drive revenue and customer retention.


Set Realistic Benchmarks

Understanding industry standards helps set realistic goals. Comparing your data against benchmarks ensures that your performance assessments are accurate and actionable.


Regularly Review & Optimize

KPIs should evolve as business needs change. Continuous analysis and A/B testing will help refine strategies and improve performance over time.


Final Thoughts: Define & Optimize Your KPIs

By focusing on essential metrics and comparing performance against industry benchmarks, marketers can build a clear roadmap for success. Instead of relying on assumptions, leveraging data-driven insights ensures marketing efforts are measurable, impactful, and aligned with business goals.


"What gets measured, gets managed." – Peter Drucker


Marketers who embrace measurement will be best positioned to drive success in an increasingly data-driven world.

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