Metrics and KPIs: What is the difference?
As a marketer, you want to know if your campaign is actually doing what you promised. In an increasingly data-driven industry, marketers can measure their success through KPIs and key metrics. Often, the terms KPIs and metrics are used interchangeably, but this is an error that can have a big impact on how you track your performance and success. So, what is the difference between the two – and which ones matter the most?
Metrics are simply measurements. They are cold, hard data that give you an indication of user behavior. KPIs (Key Performance Indicators), on the other hand, are measurable values that show you how effective you are at achieving your marketing (or business) objectives. Technically, KPI’s are also metrics, however, they are used in order to report progress and tell you how successful your strategies are. In other words, KPIs are metrics that have a target and relate to your business goals. With KPIs in place, businesses can set appropriate goals, develop strategies to reach them and evaluate their progress towards these goals. For instance, if you want to increase traffic to your website, you don’t simply look at any metric you have available. In order to see if you are achieving your results, you could examine the number of unique visitors on your website. Likewise, if you want to decrease the number of individuals from leaving your website, you look at retention rate or churn rate.
Knowing which KPIs to look at allows you to effectively see what is working and what is not with regards to your marketing strategy, and not waste time and money on ineffective marketing tactics. Metrics allow you to track thousands of different variables about your consumers; what platforms are they on, what did they see, when did they see it, where are they from, etc.? KPIs are the ones that are most useful, or ‘key’, to achieve your business goals and allow you to better understand the needs of consumers, creating effective marketing strategies accordingly.
These are some marketing KPIs you should know about. We have listed them here for you:
- Bounce rate (the percentage of people that visit your website and then quickly leave),
- Click through rate (the number of clicks on a particular campaign or element),
- Marketing Qualified Lead (MQL) (individuals who are engaged and have indicated they are more interested in your brand or product than other leads but are not yet fully committing),
- Conversion rate (the percentage of customers that complete the desired goal, a conversion, out of the total number of visitors),
- Retention rate (the percentage of customers you still have at the end of a period relative to the number you had when that period started),
- Churn rate (the percentage of customers who cancel or do not renew their subscription during a given time period).
Are you interested in learning more about KPIs and want to know which ones are best to track for your business? Take a look here and explore the wide range of KPIs in both the marketing industry and others.