What is a KPI and why do I need it?

 In Analytics, Marketing

What is a KPI? What’s with all these marketing acronyms!?! Do you speak “marketing metric-ese?”

Listening to marketing professionals talk, you may start to feel like you’re listening to two teenage girls with all of the confusing, shortened terms and acronyms that seem to change as quickly as their BFFs (best friends forevers) BFs (boyfriends).  Duh.

KPIs stands for Key Performance Indicators. Key Performance Indicators (KPIs) are simply quantifiable metrics that show how well your company achieves specific goals.

These goals can be anything from setting a quarterly sales revenue target, to the amount of blog traffic you want in a specific month, or perhaps a bit more advanced like do you want to hit a certain percentage return on a specific online ad spend.


If you want to maximize the value of your marketing budget, it’s crucial to set measurable goals and monitor the results over time. You may discover that you’ve been investing money on a marketing activity that could be tweaked to become twice as valuable to the bottom line of your business.

Some KPI examples:

  • BR: Bounce Rate
  • CAC: Customer Acquisition Cost
  • CLV (also called CLTV): Customer Lifetime Value
  • CPA: Cost-per-Action
  • CTR: Click Through Rate
  • CPC: Cost-per-Click
  • CPL: Cost-per-Lead
  • CR: Conversion Rate
  • ROI: Return on Investment

There are hundreds of KPIs and it can all seem a bit daunting at first—ROI, CAC, LTV??? Speak English, please! Take some time to learn the marketing terms below and you’ll be able to hang with the cool [marketing] kids in no time!

Here are two great resources to get you started: resource one and resource two.

It’s counter-productive to track all goals or KPIs, so it’s important to slow down your KPI band-wagon and determine those that are most relevant and important to the success of your business.

Do your homework, learn how to calculate KPIs and set up a process for tracking them (we’ll be sharing the tools we use to track KPIs in an upcoming blog post)…or hire an expert that knows how to do this for you.


It’s not rocket science, but it doesn’t hurt to think of yourself as a scientist. Set your goal (or hypothesis), track results, evaluate those results, make changes and tweaks, and measure the effectiveness of those changes.

A big part of marketing success is experimentation. So, it’s OK to fail but you better know what dials you can twist to turn things around in the right direction.

Now get out there and start using Key Performance Indicators today!

Recommended Posts

Leave a Comment

Contact Us

We're not around right now. But you can send us an email and we'll get back to you, asap.

Start typing and press Enter to search

old people playing video games