Setting the right KPIs is essential to evaluate and improve the performance of your digital stocks. These indicators are used at all levels of a company. KPIs are structured and measure long-term objectives and monitor shorter-term daily objectives. So how do you set your KPIs? Our experts explain everything in the following paragraphs.
What is a key performance indicator?
KPIs, the acronym for Key Performance Indicator, are numerical indicators that measure the performance and impact of digital campaigns and marketing actions.
Marketing KPIs are thus information that helps in steering and decision-making. They will help you to more easily prove the return on investment of your marketing efforts and to set up campaigns and actions adapted to your company’s objectives.
These KPIs also allow you to analyse with great efficiency whether a company is achieving its business objectives or not.
How to set the right KPI’s?
– Start by defining a strategy:
Having a clear marketing strategy is the first step in setting the right KPIs. The goal is to identify precise and realistic objectives according to the company’s strategic directions in order to successfully achieve them. For successful KPIs, they must be easily understandable and measurable in order to drive decisions, not additional questions.
– Identify your needs :
In order to identify the subsets of strategic data needed to set the right KPIs, you need to ask the right questions that will help determine useful data.
What are the objectives of the current strategy? What are the measures to evaluate the success of the business? What are the variables that could influence the success of the action plan?
These are the questions that will help guide the strategy and inform decision making while identifying relevant indicators.
This means that the daily operational KPIs and the strategic KPIs must be aligned with the overall objective KPI of the business strategy.
– Evaluate existing data :
KPIs are derived from integrated data from IT services and systems.
It is therefore necessary to audit the existing data before any data collection is carried out. Then make sure that the data collection is fully aligned with your strategy and fully answers the questions asked later.
– Determine the right measurement method:
After collecting data, it is necessary to find the right measurement methodology to develop new KPIs or modify existing ones. The decision-maker must know how to use actionable data to generate value from an effective business intelligence system.
Staff must also be involved in the selection process to discuss the relevance of KPIs and evaluate them. The decision-maker can use brainstorming techniques or the affinity diagram (KJ method) to stimulate the production of ideas and structure proposals.
Using SMART criteria can help you to track your KPIs and ensure that they are relevant to your objectives, well thought out and met:
Specific – is your objective specific?
Measurable – is your progress towards this goal measurable?
Acceptable and Ambitious – is your goal achievable?
Realistic – is your goal relevant to your organization?
Time-bound – what is the timeframe for achieving this objective?
– Find the best way to communicate your KPIs:
The expert needs to think about the best way to communicate his or her KPIs. Knowledge sharing must be engaging and accessible so that everyone in the company benefits.
KPIs provide a clear understanding of strategic actions. This is why they are an essential component of the overall dashboard for monitoring the company’s performance. You can use tools such as Data Studio or Google Ads to track the performance of your actions and their impact on results in real time.
You need to communicate this through visuals that clearly illustrate trends and variations in the data. Your IT and business intelligence department can provide simple communication tools to make the data clear, accessible and actionable.
Test the performance of the indicators :
Once you have set your KPIs, you need to test their effectiveness.
KPIs are an indispensable tool for improving your company’s performance and gaining competitive advantage. However, some KPIs sometimes cease to fulfil their roles, which in turn hinders the company’s performance.
To do this, you must always examine the indicators to ensure that they are really useful by choosing the most consistent ones, to optimize them, while avoiding the “Vanity Metrics”, those misleading indicators that are certainly pleasant to look at, but not at all effective for strategy.
In order to help your company gain competitiveness, Eminence helps you to set relevant KPIs to improve the development of your business by tracking the gaps between forecast and reality.