The following blog post was written by Lacy Lyons at TechnologyAdvice.com.
As use of the internet and social media becomes more integrated into the daily lives of consumers, various sectors of the economy are debating the uses and merits of KPIs, or key performance indicators, to evaluate successes and areas of potential growth. The consensus among academic researchers and business people is that KPIs are useful tools, but only when they are combined with the needs of employees and customers. It is important to remember, too, that different workplaces and organizations should tailor their KPIs to fit the demands of their individual environments, rather than deciding on industry standards without taking the conditions in which the company operates into account.
Set KPIs to Measure Success
Saura, Sanchez, and Suarez write in Future Internet that “in the information age and the increasingly networked economy, electronic commerce (e-commerce) is seen as one of the main instruments to foster business growth, labour movement, and interpersonal relationships.” KPIs’ connection to direct marketing is that if a company does not choose accurate KPIs to measure the success of their efforts, even the best direct marketing campaign will not do as well as it otherwise would.
The authors recommend that the key performance indicators a company chooses are measurable data that can be evaluated by both employees and bosses. These KPIs should focus on what really matters to the company or association: member growth, client engagement, and social referrals are all KPIs that show how well a marketing or membership campaign works.
Make Them Achievable
The goals that those KPIs are built on must also be achievable to prevent underperformance and low morale among employees. “Staff want to do their best, but if they feel the goal can’t ever be achieved, then they won’t try - and you may not make the progress you want.”
This is particularly relevant in service-oriented settings like professional associations. When organizations set vague or unachievable KPIs, it can confuse and demotivate the employees and volunteers tasked with growing the association. Consider setting SMART goals such as:
- Grow membership numbers by 20 percent by EOY 2018
- Increase fee revenue by 10 percent by EOQ3 2018
- Increase social media followers to 2000 across all platforms by EOY 2018
Using SMART goals that are achievable, specific, and time-based will promote the formation of measurable KPIs that employees can track and complete.
Get the Net
The need for valuable measurement is present in every sector, not just professional associations. And marketing KPIs don’t have to be focused solely on revenue numbers, they can show member and lead engagement through social media and website use. Additional KPIs recommended by Future Internet for marketing campaigns include:
- The goals conversion rate (tracking completed activities)
- Types of website users (new versus returning visitors)
- The keywords used by customers when conducting successful searches for a company
- Rank on search engine results pages (SERPs)
These are only some of potential KPIs that can be used by businesses in the social media space, but social media today is evaluated in the same way television advertisements were a generation ago. “Research from the fields of neuroscience, advertising, and psychology strongly suggests that the more consumers like an ad, the more likely they are to notice it and remember the advertised brand.” This suggests that social media is not necessarily ephemeral; its data can be tracked, like any other medium. “If likeability drives noticeability, then the aggregate sum of favorites, likes, positive comments, retweets, and sharing can be used as a KPI for brand noticeability.”
Plan for Accurate Measurements
Marshall Lager of CRM Magazine wrote in October 2016 that:
“The problem with KPIs is that they only tell you about what they’re intended to measure. They don’t tell you why, at least not until you get into deeper analytical models. KPIs are intended to be simple, at-a-glance numbers that anybody can point to and say, ‘That needs to be higher,’ possibly with a checklist of next best actions to make those numbers change. The numbers are abstractions of what’s going on with people - your employees and your customers.”
Lager cites real-world scenarios in which KPIs can cause poor customer service, including the over-adherence to those metrics in fields like customer service call centers and the airlines. Many companies use a business intelligence software with highly-visible and easy to read dashboards to track their KPIs, but without well thought-out goals and measurable KPIs to track, these dashboards can carry the team off track quickly.
If businesses value KPIs over people, he suggests, KPIs could cause inadvertent harm. “We need our numbers; the KPI is not a shameful thing. All I’m saying is that we need to remember that there are people behind the numbers, and the people don’t like to be fitted into a spreadsheet.”
As businesses and associations consider the values and drawbacks of measuring success by KPIs, the research suggests that it is important to use common sense. It should be reassuring to note that as with many aspects of life, statistics alone will not solve problems. But when they are combined with practicality, they have potential to positively impact results.
Lacey Lyons is a writer for TechnologyAdvice.com. She is a freelance writer and editor based in Nashville, Tennessee. Her work has appeared on the blogs of Empower Tennessee, Disability Rights Tennessee, The Charlotte Viewpoint, and HealthLeaders Media. She can be reached at email@example.com.
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Lager, Marshall. “Customers versus KPIs: remember what’s more important to a business.” CRM Magazine. Information Today,
Inc., Oct. 2016. Web. 29 Apr. 2018.
“Leveraging KPIs to optimize patient-access performance: organizations that are committed to taking a data-driven approach
to monitoring patient access can elevate operations and set the stage for a robust, efficient, and productive revenue cycle.”
Healthcare Financial Management Association, Dec. 2014. Web. 29 Apr. 2018.
Palos-Sanchez, Pedro, Saura, Jose Ramon, and Suarez, Luis Manuel Cerda. “Understanding the Digital Marketing Environment
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