{"id":314,"date":"2019-07-03T14:51:55","date_gmt":"2019-07-03T14:51:55","guid":{"rendered":"https:\/\/courses.lumenlearning.com\/suny-hccc-marketingv2\/chapter\/reading-measuring-marketing-communication-effectiveness\/"},"modified":"2019-07-03T14:51:55","modified_gmt":"2019-07-03T14:51:55","slug":"reading-measuring-marketing-communication-effectiveness","status":"publish","type":"chapter","link":"https:\/\/courses.lumenlearning.com\/suny-hccc-marketing\/chapter\/reading-measuring-marketing-communication-effectiveness\/","title":{"raw":"Reading: Measuring Marketing Communication Effectiveness","rendered":"Reading: Measuring Marketing Communication Effectiveness"},"content":{"raw":"\n<h2>Why Measure?<\/h2>\n<a href=\"https:\/\/courses.candelalearning.com\/waymakerintromarketing1xmaster\/wp-content\/uploads\/sites\/903\/2016\/02\/8231264538_9b968130e7_o.jpg\" rel=\"attachment wp-att-6235\"><img class=\"alignright wp-image-6235\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images-archive-read-only\/wp-content\/uploads\/sites\/1505\/2016\/02\/04110224\/8231264538_9b968130e7_o.jpg\" alt=\"A compass\" width=\"250\" height=\"310\"><\/a>\n\nMeasurement is an important aspect&nbsp;of marketing campaigns and other marketing activity. Measurement makes some people very nervous because it brings&nbsp;accountability into marketing activity. In fact, this step can be one of a marketer's best friends.&nbsp;If you don't measure the impact of your marketing efforts, you'll have no idea whether what you are doing is effective or not. On the other hand, if you do measure the impact, it will help you understand what is working, and where and how to improve your efforts. By nature, marketing is a dynamic field because markets change and people change. What works beautifully this year may be a complete flop next year, and vice versa.\n\nMeasurement\u2013and the results or \"metrics\" this process collects\u2013are like a compass that helps marketers adjust course so they can reach&nbsp;their goals more quickly and effectively.\n<h2>Deciding&nbsp;What to Measure<\/h2>\nMeasuring just for the sake of having numbers misses the whole point. It's actually essential to determine the right things to measure first, if you want to get a relevant picture of what's happening. To do this, marketers typically go&nbsp;through a&nbsp;process of identifying <strong>key performance indicators<\/strong> (often called KPIs). A KPI is something measurable that indicates the progress an organization is making toward its business objectives. The KPI is not the same as the actual company goal or objective; instead it is something measurable that helps managers understand how well they are progressing toward the&nbsp;goal.\n\nTo understand the importance of KPIs, let's say you are a track coach who wants to capture data about the sprinters on your team. You could measure all sorts of things about the&nbsp;athletes: their shoe size, how many cups of sweat they produce during a typical workout, how fast their hearts beat during a race, and so on. Would all&nbsp;those measurements&nbsp;be key performance indicators? Maybe not. You might decide that the key performance indicators for sprinters are their best running times and their average running times (or something else).\n\nIn a&nbsp;company, KPIs can be determined for many different levels&nbsp;of the&nbsp;organization. These are described below:\n<ul>\n\t<li><strong>Company-level KPIs<\/strong> indicate the overall company performance on company-wide goals, in terms of&nbsp;total revenue, profitability, customer-satisfaction rating, market share, or percentage of growth in the customer base.<\/li>\n\t<li><strong>Department-level KPIs<\/strong> track performance at the department level. For the marketing department, it might be brand awareness, the number of qualified new leads generated, cost per lead generated, or the <em>conversion rate<\/em>: the percentage of leads who are converted into customers.<\/li>\n\t<li><strong>Team-level KPIs<\/strong> track the impact and effectiveness of a team's activities. A team focused on digital marketing, for example, might track KPIs such as email-marketing click rates, the number of Web-site visits, or SEO&nbsp;sales conversion rate: the percentage of individuals who&nbsp;come to the Web site&nbsp;via a search engine and&nbsp;result in a sale.<\/li>\n\t<li><strong>Campaign-level KPIs<\/strong> track the impact of individual campaigns. By tracking similar&nbsp;metrics across multiple campaigns, it is easy to see which ones are most effective with target audiences and then use this information to refine tactics and replicate successful approaches. Campaign-level KPIs are somewhat dependent on the campaign design; for example, campaigns typically track the \"open\" rate: i.e., how many people open an&nbsp;email message once it is delivered. If a campaign doesn't use email, the open rate doesn't exist. However, there are some \"common denominator\" campaign metrics marketers can track across IMC activities to determine impact and progress.&nbsp;Cost per impression, impressions per campaign, and conversion rate are metrics that can be tracked for virtually any campaign.<\/li>\n\t<li><strong>Marketing tactic-level KPIs<\/strong> track the effectiveness of individual marketing tactics and tools. For example, content-marketing KPIs track the effectiveness of individual content pieces used on a Web site and in IMC campaigns. These metrics, such as page views per article and number of social media shares provide insight for marketers about which types of content are most popular with target customers and which content pieces get&nbsp;little interest.<\/li>\n<\/ul>\nDifferent companies select different sets of KPIs, depending on what they are trying to accomplish and the strategies they are pursuing to reach their goals. At any given level, it is important to limit the total number of KPIs to those that are most essential and indicative of progress. If too many things are measured, managers have trouble prioritizing and homing in on what is most important.&nbsp;&nbsp;In addition to KPIs\u2013which represent key, strategic indicators of progress\u2013a company may also track a variety of other metrics to inform its operations.\n<h3>Alignment with Goals and Objectives<\/h3>\nFiguring out what to measure starts with considering the organization's overall goals and objectives, as well as the marketing team's goals and objectives. The highest-level KPIs should tell managers about how well marketing is doing at meeting its goals as a team, and how the team is contributing to the organization's overall performance. KPIs may&nbsp;reflect absolute figures, such as total market share. Or they may track progress toward a target, such as progress toward achieving 1,500 new customers over the course of a year. KPIs should&nbsp;provide information to guide managers in their decision making about what is working and where to adjust course.\n\nIt is helpful for an organization to define a standard set of KPIs for measuring the effectiveness of marketing campaigns and for the contributions made by different functions within the marketing organization: public relations, advertising, social media marketing, etc. When marketers define S.M.A.R.T. goals at the outset of a campaign, these goals may&nbsp;incorporate KPIs to confirm what the campaign aspires to achieve and how well it does at achieving these goals. KPIs for awareness-building campaigns, for example, should be focused on campaign reach, such as number of impressions or post-campaign brand awareness.\n\nManagers should be attentive to how many KPIs they are tracking to ensure that measurement remains a useful activity rather than a burden that cuts into the productivity and effectiveness of the broader team.&nbsp;Fortunately, as marketing becomes more data rich and technology driven, many KPI-type metrics are calculated automatically by systems that support the marketing function, making them readily available. Tools are also available that create dashboards for marketing managers and team members to help them easily monitor KPIs on an ongoing basis.\n\n<a href=\"https:\/\/courses.candelalearning.com\/waymakerintromarketing1xmaster\/wp-content\/uploads\/sites\/903\/2016\/02\/Sales_and_Marketing_Dashboards.jpg\" rel=\"attachment wp-att-6231\"><img class=\"aligncenter wp-image-6231\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images-archive-read-only\/wp-content\/uploads\/sites\/1505\/2016\/02\/04110227\/Sales_and_Marketing_Dashboards.jpg\" alt=\"Screenshot of a KPI dashboard showing three graphs: two on top, one on bottom. The top left graph is called Pipeline Projection by Close Date. It shows different-colored bars representing qualified lead, need analysis, validation, and proposal amounts for different months. The top right graph is called Pipeline Projection by Organization. It shows different-colored bars representing qualified lead, need analysis, validation, and proposal amounts for the categories Buy Sales, 3D Sales, Electro, Europe, and Spectrum. The bottom graph is called Pipeline by Market Segment (6 Month Outlook). It shows different-colored bars representing qualified lead, need analysis, validation, and pending numbers for Telecom, Datacom, Computer\/Peripherals, Industrial, Consumer, and Other categories. Below the graphs are options to view by geography, stage, or channel.\" width=\"701\" height=\"638\"><\/a>\n<h3>Defining the Metric<\/h3>\nEvery marketing metric or KPI requires some type of measurement, and it&nbsp;should be based on legitimate data. When marketers&nbsp;define a KPI, they should also define what data will be used to calculate the KPI, as well as the source of that data. At times, different people or teams might have different assumptions about how to calculate the metric, so it is wise to clarify this during the definitional stage.\n\nIt isn't uncommon for people to identify KPIs and then discover that&nbsp;they don't have ready access to the information needed for measurement. This can be a good motivator for defining a process to obtain that information. Or it can be a cue that perhaps a different KPI based on more readily available information would be a better option.\n<h3>When to Measure<\/h3>\nWhen to measure depends on what is readily available for marketers and managers to track and maintain. If it takes a lot of&nbsp;manual effort to generate a KPI report, or managers are spending hours per day or week compiling and reporting metrics, it could significantly cut into productive work time\u2014and it might be wise to investigate alternatives. Fortunately, CRM and other systems that build KPI dashboard reports into their regular, day-to-day functions are readily available. In these cases, systems automatically calculate KPIs, which makes them easy to monitor over time and adjust course as needed. Typically managers should monitor KPIs at least once per quarter, in order to gauge progress and learn what's working and how to improve.\n<h2>Video: Defining KPIs<\/h2>\nThe following video provides a concise overview of&nbsp;different types of key performance indicators and the process of defining them.\n\nhttps:\/\/youtu.be\/NCta6j5_FdM\n<h2>Examples of Key Performance Indicators<\/h2>\nAs suggested above, different types of KPIs focus on measuring progress and effectiveness in different areas related to marketing. In fact, hundred of possible KPIs exist, so marketing managers&nbsp;should figure out which ones matter most for achieving their goals and focus attention accordingly. The table below lists a variety of KPIs that apply to different aspects of marketing communications and the marketing function generally.\n<h3><strong>Sample KPIs: Marketing-Related Business Objectives<\/strong><\/h3>\n<table>\n<thead>\n<tr>\n<td><strong>Business Objective<\/strong><\/td>\n<td><strong>KPI Examples<\/strong><\/td>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td>Sales\/Revenue Generation<\/td>\n<td>\n\nTotal sales\/revenue\n\nNew\/incremental sales revenue\n\nProfitability\n\nAverage revenue per customer\n\nNew customer acquisition\n\nNumber of customers\n\nCustomer retention\n\nNumber of registrations\/sign-ups<\/td>\n<\/tr>\n<tr>\n<td>Market Share<\/td>\n<td>\n\nMarket share in category\n\nRelative market share (share relative to largest competitor)<\/td>\n<\/tr>\n<tr>\n<td>Lead Generation<\/td>\n<td>\n\nNumber of qualified leads\n\nCost per lead (by source\/platform)\n\nTraffic source breakdown<\/td>\n<\/tr>\n<tr>\n<td>Build Brand<\/td>\n<td>\n\nBrand awareness\n\nBrand equity\n\nPrice premium\n\nBrand valuation\n\nShare of voice: mentions of your brand\/mentions of others\n\nBrand community&nbsp;membership<\/td>\n<\/tr>\n<tr>\n<td>Foster Dialogue<\/td>\n<td>\n\nAudience engagement\n\nShare of voice: mentions of your brand\/mentions of others\n\nConversion reach<\/td>\n<\/tr>\n<tr>\n<td>Develop Customer Advocates<\/td>\n<td>\n\nActive advocates\n\nAdvocate influence\n\nAdvocacy impact\n\nOnline review ratings<\/td>\n<\/tr>\n<tr>\n<td>Customer Support<\/td>\n<td>\n\nResolution rate\n\nResolution time\n\nSatisfaction score\n\nNet Promoter Score (NPS)<\/td>\n<\/tr>\n<tr>\n<td>Innovation<\/td>\n<td>\n\nTopic Trends\n\nSentiment Ratio\n\nIdea Impact<strong><em>&nbsp;<\/em><\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<h3><strong>Sample KPIs: Marketing Communications Activity<\/strong><\/h3>\n<table>\n<thead>\n<tr>\n<td><strong>Marketing Activity\/Tool<\/strong><\/td>\n<td><strong>KPI Examples<\/strong><\/td>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td>\n\nReach:\n\nCampaigns, Owned Media, Earned Media, Social Media, Marketing Content<\/td>\n<td>\n\nImpressions\n\nPotential Reach: Followers, Fans, Subscribers\n\nConfirmed Reach: Views, Post\/Page Views, Video Views\n\nHits\/visits\/views\n\nRepeat Visits\n\nConversion rates (from visitor or buyer)\n\nBuzz indicators (web mentions)\n\nNet Promoter Score (NPS)\n\nCustomer acquisition cost<\/td>\n<\/tr>\n<tr>\n<td>\n\nEngagement:\n\nOwned Media, Earned Media, Social Media, Marketing Content<\/td>\n<td>\n\nLikes\/Stars\/Hearts\n\nComments\n\nShares\n\nRetweets\/Reposts\n\nPositive\/negative sentiment<\/td>\n<\/tr>\n<tr>\n<td>Paid Media (advertising)<\/td>\n<td>\n\nImpressions\n\nCost per click (CPC)\n\nCost per impression (CPM)\n\nClick-thru-rate (CTR)\n\nCustomer Retention Cost\n\nProfits per customer\n\nCustomer acquisition cost<\/td>\n<\/tr>\n<tr>\n<td>SEO\/Web site<\/td>\n<td>\n\nSEO keyword ranking\n\nSEO sales conversion rate\n\nNumber of unique visitors\n\nTotal sessions\/visits\n\nAverage time on site\/page<\/td>\n<\/tr>\n<tr>\n<td>Email Marketing<\/td>\n<td>\n\nOpen rate\n\nClick-thru-rate (CTR)\n\nBounce rate\n\nUnsubscribe rate<\/td>\n<\/tr>\n<tr>\n<td>Public Relations<\/td>\n<td>\n\nAdvertising value equivalency\n\nClip\/article counting\n\nBrand mentions<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<h2>Campaign Metrics&nbsp;Case Study: Citizen Watch<\/h2>\n<a href=\"https:\/\/courses.candelalearning.com\/waymakerintromarketing1xmaster\/wp-content\/uploads\/sites\/903\/2016\/02\/675px-Citizen_Attesa_Eco-Drive_ATV53-3023_02.jpeg\" rel=\"attachment wp-att-6233\"><img class=\"alignleft wp-image-6233\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images-archive-read-only\/wp-content\/uploads\/sites\/1505\/2016\/02\/04110229\/675px-Citizen_Attesa_Eco-Drive_ATV53-3023_02.jpeg\" alt=\"A wristwatch with several smaller measurement tools embedded within the clock.\" width=\"200\" height=\"266\"><\/a>\n\nCitizen,&nbsp;one of the world's largest makers of wristwatches, embarked on a digital marketing strategy to build its brand using social media, with a specific focus on expanding its presence on Facebook.&nbsp;The marketing team's goal for the first year was to gain 100,000 followers on Facebook. Their campaign strategy focused on offering engagement opportunities that pushed people to Facebook to interact with the brand. It incorporated a combination of tactics that included offline and online elements, such as&nbsp;a series of register-to-win contests like a \"Win Your Mum a Watch\" giveaway. It also offered related online engagement opportunities, like interactive&nbsp;photo&nbsp;galleries on the company Web site for people to browse, with&nbsp;new products to view and share on social media.\n\nTo help gauge their progress and understand how well different dimensions of the campaign were working, they tracked a variety of metrics, with one KPI being the number of Facebook followers. Over the course of the campaign, they had impressive results. In addition to blowing through their goal of getting&nbsp;100,000 followers, Citizen saw the following results from&nbsp;consumers&nbsp;who participated in campaign activities:\n<ul>\n\t<li>76 percent lead-submission rate<\/li>\n\t<li>82 percent app-completion rate<\/li>\n\t<li>26 percent social-share rate<\/li>\n<\/ul>\nBy tracking these metrics across different offers and campaigns, Citizen&nbsp;was able to gauge which activities were the best received and use this information to improve the effectiveness of future campaigns. &nbsp;The company has used these insights to expand promotional activities to other forms of social media and other types of engagement activities.[footnote]http:\/\/cdn.snapapp.com\/site\/images\/resources\/SnapApp-CaseStudy-CitizenWatch.pdf[\/footnote]\n<h2><strong>Check Your Understanding<\/strong><\/h2>\nAnswer the question(s) below to see how well you understand the topics covered in this outcome. This short quiz does&nbsp;<strong>not<\/strong>&nbsp;count toward your grade in the class, and you can retake it an unlimited number of times.\n\nUse this quiz to check your understanding and decide whether to (1) study the previous section further or (2) move on to the next section.\n\nhttps:\/\/assessments.lumenlearning.com\/assessments\/825\n","rendered":"<h2>Why Measure?<\/h2>\n<p><a href=\"https:\/\/courses.candelalearning.com\/waymakerintromarketing1xmaster\/wp-content\/uploads\/sites\/903\/2016\/02\/8231264538_9b968130e7_o.jpg\" rel=\"attachment wp-att-6235\"><img loading=\"lazy\" decoding=\"async\" class=\"alignright wp-image-6235\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images-archive-read-only\/wp-content\/uploads\/sites\/1505\/2016\/02\/04110224\/8231264538_9b968130e7_o.jpg\" alt=\"A compass\" width=\"250\" height=\"310\" \/><\/a><\/p>\n<p>Measurement is an important aspect&nbsp;of marketing campaigns and other marketing activity. Measurement makes some people very nervous because it brings&nbsp;accountability into marketing activity. In fact, this step can be one of a marketer&#8217;s best friends.&nbsp;If you don&#8217;t measure the impact of your marketing efforts, you&#8217;ll have no idea whether what you are doing is effective or not. On the other hand, if you do measure the impact, it will help you understand what is working, and where and how to improve your efforts. By nature, marketing is a dynamic field because markets change and people change. What works beautifully this year may be a complete flop next year, and vice versa.<\/p>\n<p>Measurement\u2013and the results or &#8220;metrics&#8221; this process collects\u2013are like a compass that helps marketers adjust course so they can reach&nbsp;their goals more quickly and effectively.<\/p>\n<h2>Deciding&nbsp;What to Measure<\/h2>\n<p>Measuring just for the sake of having numbers misses the whole point. It&#8217;s actually essential to determine the right things to measure first, if you want to get a relevant picture of what&#8217;s happening. To do this, marketers typically go&nbsp;through a&nbsp;process of identifying <strong>key performance indicators<\/strong> (often called KPIs). A KPI is something measurable that indicates the progress an organization is making toward its business objectives. The KPI is not the same as the actual company goal or objective; instead it is something measurable that helps managers understand how well they are progressing toward the&nbsp;goal.<\/p>\n<p>To understand the importance of KPIs, let&#8217;s say you are a track coach who wants to capture data about the sprinters on your team. You could measure all sorts of things about the&nbsp;athletes: their shoe size, how many cups of sweat they produce during a typical workout, how fast their hearts beat during a race, and so on. Would all&nbsp;those measurements&nbsp;be key performance indicators? Maybe not. You might decide that the key performance indicators for sprinters are their best running times and their average running times (or something else).<\/p>\n<p>In a&nbsp;company, KPIs can be determined for many different levels&nbsp;of the&nbsp;organization. These are described below:<\/p>\n<ul>\n<li><strong>Company-level KPIs<\/strong> indicate the overall company performance on company-wide goals, in terms of&nbsp;total revenue, profitability, customer-satisfaction rating, market share, or percentage of growth in the customer base.<\/li>\n<li><strong>Department-level KPIs<\/strong> track performance at the department level. For the marketing department, it might be brand awareness, the number of qualified new leads generated, cost per lead generated, or the <em>conversion rate<\/em>: the percentage of leads who are converted into customers.<\/li>\n<li><strong>Team-level KPIs<\/strong> track the impact and effectiveness of a team&#8217;s activities. A team focused on digital marketing, for example, might track KPIs such as email-marketing click rates, the number of Web-site visits, or SEO&nbsp;sales conversion rate: the percentage of individuals who&nbsp;come to the Web site&nbsp;via a search engine and&nbsp;result in a sale.<\/li>\n<li><strong>Campaign-level KPIs<\/strong> track the impact of individual campaigns. By tracking similar&nbsp;metrics across multiple campaigns, it is easy to see which ones are most effective with target audiences and then use this information to refine tactics and replicate successful approaches. Campaign-level KPIs are somewhat dependent on the campaign design; for example, campaigns typically track the &#8220;open&#8221; rate: i.e., how many people open an&nbsp;email message once it is delivered. If a campaign doesn&#8217;t use email, the open rate doesn&#8217;t exist. However, there are some &#8220;common denominator&#8221; campaign metrics marketers can track across IMC activities to determine impact and progress.&nbsp;Cost per impression, impressions per campaign, and conversion rate are metrics that can be tracked for virtually any campaign.<\/li>\n<li><strong>Marketing tactic-level KPIs<\/strong> track the effectiveness of individual marketing tactics and tools. For example, content-marketing KPIs track the effectiveness of individual content pieces used on a Web site and in IMC campaigns. These metrics, such as page views per article and number of social media shares provide insight for marketers about which types of content are most popular with target customers and which content pieces get&nbsp;little interest.<\/li>\n<\/ul>\n<p>Different companies select different sets of KPIs, depending on what they are trying to accomplish and the strategies they are pursuing to reach their goals. At any given level, it is important to limit the total number of KPIs to those that are most essential and indicative of progress. If too many things are measured, managers have trouble prioritizing and homing in on what is most important.&nbsp;&nbsp;In addition to KPIs\u2013which represent key, strategic indicators of progress\u2013a company may also track a variety of other metrics to inform its operations.<\/p>\n<h3>Alignment with Goals and Objectives<\/h3>\n<p>Figuring out what to measure starts with considering the organization&#8217;s overall goals and objectives, as well as the marketing team&#8217;s goals and objectives. The highest-level KPIs should tell managers about how well marketing is doing at meeting its goals as a team, and how the team is contributing to the organization&#8217;s overall performance. KPIs may&nbsp;reflect absolute figures, such as total market share. Or they may track progress toward a target, such as progress toward achieving 1,500 new customers over the course of a year. KPIs should&nbsp;provide information to guide managers in their decision making about what is working and where to adjust course.<\/p>\n<p>It is helpful for an organization to define a standard set of KPIs for measuring the effectiveness of marketing campaigns and for the contributions made by different functions within the marketing organization: public relations, advertising, social media marketing, etc. When marketers define S.M.A.R.T. goals at the outset of a campaign, these goals may&nbsp;incorporate KPIs to confirm what the campaign aspires to achieve and how well it does at achieving these goals. KPIs for awareness-building campaigns, for example, should be focused on campaign reach, such as number of impressions or post-campaign brand awareness.<\/p>\n<p>Managers should be attentive to how many KPIs they are tracking to ensure that measurement remains a useful activity rather than a burden that cuts into the productivity and effectiveness of the broader team.&nbsp;Fortunately, as marketing becomes more data rich and technology driven, many KPI-type metrics are calculated automatically by systems that support the marketing function, making them readily available. Tools are also available that create dashboards for marketing managers and team members to help them easily monitor KPIs on an ongoing basis.<\/p>\n<p><a href=\"https:\/\/courses.candelalearning.com\/waymakerintromarketing1xmaster\/wp-content\/uploads\/sites\/903\/2016\/02\/Sales_and_Marketing_Dashboards.jpg\" rel=\"attachment wp-att-6231\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-6231\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images-archive-read-only\/wp-content\/uploads\/sites\/1505\/2016\/02\/04110227\/Sales_and_Marketing_Dashboards.jpg\" alt=\"Screenshot of a KPI dashboard showing three graphs: two on top, one on bottom. The top left graph is called Pipeline Projection by Close Date. It shows different-colored bars representing qualified lead, need analysis, validation, and proposal amounts for different months. The top right graph is called Pipeline Projection by Organization. It shows different-colored bars representing qualified lead, need analysis, validation, and proposal amounts for the categories Buy Sales, 3D Sales, Electro, Europe, and Spectrum. The bottom graph is called Pipeline by Market Segment (6 Month Outlook). It shows different-colored bars representing qualified lead, need analysis, validation, and pending numbers for Telecom, Datacom, Computer\/Peripherals, Industrial, Consumer, and Other categories. Below the graphs are options to view by geography, stage, or channel.\" width=\"701\" height=\"638\" \/><\/a><\/p>\n<h3>Defining the Metric<\/h3>\n<p>Every marketing metric or KPI requires some type of measurement, and it&nbsp;should be based on legitimate data. When marketers&nbsp;define a KPI, they should also define what data will be used to calculate the KPI, as well as the source of that data. At times, different people or teams might have different assumptions about how to calculate the metric, so it is wise to clarify this during the definitional stage.<\/p>\n<p>It isn&#8217;t uncommon for people to identify KPIs and then discover that&nbsp;they don&#8217;t have ready access to the information needed for measurement. This can be a good motivator for defining a process to obtain that information. Or it can be a cue that perhaps a different KPI based on more readily available information would be a better option.<\/p>\n<h3>When to Measure<\/h3>\n<p>When to measure depends on what is readily available for marketers and managers to track and maintain. If it takes a lot of&nbsp;manual effort to generate a KPI report, or managers are spending hours per day or week compiling and reporting metrics, it could significantly cut into productive work time\u2014and it might be wise to investigate alternatives. Fortunately, CRM and other systems that build KPI dashboard reports into their regular, day-to-day functions are readily available. In these cases, systems automatically calculate KPIs, which makes them easy to monitor over time and adjust course as needed. Typically managers should monitor KPIs at least once per quarter, in order to gauge progress and learn what&#8217;s working and how to improve.<\/p>\n<h2>Video: Defining KPIs<\/h2>\n<p>The following video provides a concise overview of&nbsp;different types of key performance indicators and the process of defining them.<\/p>\n<p><iframe loading=\"lazy\" id=\"oembed-1\" title=\"How to Develop Key Performance Indicators (KPIs)\" width=\"500\" height=\"375\" src=\"https:\/\/www.youtube.com\/embed\/NCta6j5_FdM?feature=oembed&#38;rel=0\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<h2>Examples of Key Performance Indicators<\/h2>\n<p>As suggested above, different types of KPIs focus on measuring progress and effectiveness in different areas related to marketing. In fact, hundred of possible KPIs exist, so marketing managers&nbsp;should figure out which ones matter most for achieving their goals and focus attention accordingly. The table below lists a variety of KPIs that apply to different aspects of marketing communications and the marketing function generally.<\/p>\n<h3><strong>Sample KPIs: Marketing-Related Business Objectives<\/strong><\/h3>\n<table>\n<thead>\n<tr>\n<td><strong>Business Objective<\/strong><\/td>\n<td><strong>KPI Examples<\/strong><\/td>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td>Sales\/Revenue Generation<\/td>\n<td>\n<p>Total sales\/revenue<\/p>\n<p>New\/incremental sales revenue<\/p>\n<p>Profitability<\/p>\n<p>Average revenue per customer<\/p>\n<p>New customer acquisition<\/p>\n<p>Number of customers<\/p>\n<p>Customer retention<\/p>\n<p>Number of registrations\/sign-ups<\/td>\n<\/tr>\n<tr>\n<td>Market Share<\/td>\n<td>\n<p>Market share in category<\/p>\n<p>Relative market share (share relative to largest competitor)<\/td>\n<\/tr>\n<tr>\n<td>Lead Generation<\/td>\n<td>\n<p>Number of qualified leads<\/p>\n<p>Cost per lead (by source\/platform)<\/p>\n<p>Traffic source breakdown<\/td>\n<\/tr>\n<tr>\n<td>Build Brand<\/td>\n<td>\n<p>Brand awareness<\/p>\n<p>Brand equity<\/p>\n<p>Price premium<\/p>\n<p>Brand valuation<\/p>\n<p>Share of voice: mentions of your brand\/mentions of others<\/p>\n<p>Brand community&nbsp;membership<\/td>\n<\/tr>\n<tr>\n<td>Foster Dialogue<\/td>\n<td>\n<p>Audience engagement<\/p>\n<p>Share of voice: mentions of your brand\/mentions of others<\/p>\n<p>Conversion reach<\/td>\n<\/tr>\n<tr>\n<td>Develop Customer Advocates<\/td>\n<td>\n<p>Active advocates<\/p>\n<p>Advocate influence<\/p>\n<p>Advocacy impact<\/p>\n<p>Online review ratings<\/td>\n<\/tr>\n<tr>\n<td>Customer Support<\/td>\n<td>\n<p>Resolution rate<\/p>\n<p>Resolution time<\/p>\n<p>Satisfaction score<\/p>\n<p>Net Promoter Score (NPS)<\/td>\n<\/tr>\n<tr>\n<td>Innovation<\/td>\n<td>\n<p>Topic Trends<\/p>\n<p>Sentiment Ratio<\/p>\n<p>Idea Impact<strong><em>&nbsp;<\/em><\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<h3><strong>Sample KPIs: Marketing Communications Activity<\/strong><\/h3>\n<table>\n<thead>\n<tr>\n<td><strong>Marketing Activity\/Tool<\/strong><\/td>\n<td><strong>KPI Examples<\/strong><\/td>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td>\n<p>Reach:<\/p>\n<p>Campaigns, Owned Media, Earned Media, Social Media, Marketing Content<\/td>\n<td>\n<p>Impressions<\/p>\n<p>Potential Reach: Followers, Fans, Subscribers<\/p>\n<p>Confirmed Reach: Views, Post\/Page Views, Video Views<\/p>\n<p>Hits\/visits\/views<\/p>\n<p>Repeat Visits<\/p>\n<p>Conversion rates (from visitor or buyer)<\/p>\n<p>Buzz indicators (web mentions)<\/p>\n<p>Net Promoter Score (NPS)<\/p>\n<p>Customer acquisition cost<\/td>\n<\/tr>\n<tr>\n<td>\n<p>Engagement:<\/p>\n<p>Owned Media, Earned Media, Social Media, Marketing Content<\/td>\n<td>\n<p>Likes\/Stars\/Hearts<\/p>\n<p>Comments<\/p>\n<p>Shares<\/p>\n<p>Retweets\/Reposts<\/p>\n<p>Positive\/negative sentiment<\/td>\n<\/tr>\n<tr>\n<td>Paid Media (advertising)<\/td>\n<td>\n<p>Impressions<\/p>\n<p>Cost per click (CPC)<\/p>\n<p>Cost per impression (CPM)<\/p>\n<p>Click-thru-rate (CTR)<\/p>\n<p>Customer Retention Cost<\/p>\n<p>Profits per customer<\/p>\n<p>Customer acquisition cost<\/td>\n<\/tr>\n<tr>\n<td>SEO\/Web site<\/td>\n<td>\n<p>SEO keyword ranking<\/p>\n<p>SEO sales conversion rate<\/p>\n<p>Number of unique visitors<\/p>\n<p>Total sessions\/visits<\/p>\n<p>Average time on site\/page<\/td>\n<\/tr>\n<tr>\n<td>Email Marketing<\/td>\n<td>\n<p>Open rate<\/p>\n<p>Click-thru-rate (CTR)<\/p>\n<p>Bounce rate<\/p>\n<p>Unsubscribe rate<\/td>\n<\/tr>\n<tr>\n<td>Public Relations<\/td>\n<td>\n<p>Advertising value equivalency<\/p>\n<p>Clip\/article counting<\/p>\n<p>Brand mentions<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<h2>Campaign Metrics&nbsp;Case Study: Citizen Watch<\/h2>\n<p><a href=\"https:\/\/courses.candelalearning.com\/waymakerintromarketing1xmaster\/wp-content\/uploads\/sites\/903\/2016\/02\/675px-Citizen_Attesa_Eco-Drive_ATV53-3023_02.jpeg\" rel=\"attachment wp-att-6233\"><img loading=\"lazy\" decoding=\"async\" class=\"alignleft wp-image-6233\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images-archive-read-only\/wp-content\/uploads\/sites\/1505\/2016\/02\/04110229\/675px-Citizen_Attesa_Eco-Drive_ATV53-3023_02.jpeg\" alt=\"A wristwatch with several smaller measurement tools embedded within the clock.\" width=\"200\" height=\"266\" \/><\/a><\/p>\n<p>Citizen,&nbsp;one of the world&#8217;s largest makers of wristwatches, embarked on a digital marketing strategy to build its brand using social media, with a specific focus on expanding its presence on Facebook.&nbsp;The marketing team&#8217;s goal for the first year was to gain 100,000 followers on Facebook. Their campaign strategy focused on offering engagement opportunities that pushed people to Facebook to interact with the brand. It incorporated a combination of tactics that included offline and online elements, such as&nbsp;a series of register-to-win contests like a &#8220;Win Your Mum a Watch&#8221; giveaway. It also offered related online engagement opportunities, like interactive&nbsp;photo&nbsp;galleries on the company Web site for people to browse, with&nbsp;new products to view and share on social media.<\/p>\n<p>To help gauge their progress and understand how well different dimensions of the campaign were working, they tracked a variety of metrics, with one KPI being the number of Facebook followers. Over the course of the campaign, they had impressive results. In addition to blowing through their goal of getting&nbsp;100,000 followers, Citizen saw the following results from&nbsp;consumers&nbsp;who participated in campaign activities:<\/p>\n<ul>\n<li>76 percent lead-submission rate<\/li>\n<li>82 percent app-completion rate<\/li>\n<li>26 percent social-share rate<\/li>\n<\/ul>\n<p>By tracking these metrics across different offers and campaigns, Citizen&nbsp;was able to gauge which activities were the best received and use this information to improve the effectiveness of future campaigns. &nbsp;The company has used these insights to expand promotional activities to other forms of social media and other types of engagement activities.<a class=\"footnote\" title=\"http:\/\/cdn.snapapp.com\/site\/images\/resources\/SnapApp-CaseStudy-CitizenWatch.pdf\" id=\"return-footnote-314-1\" href=\"#footnote-314-1\" aria-label=\"Footnote 1\"><sup class=\"footnote\">[1]<\/sup><\/a><\/p>\n<h2><strong>Check Your Understanding<\/strong><\/h2>\n<p>Answer the question(s) below to see how well you understand the topics covered in this outcome. This short quiz does&nbsp;<strong>not<\/strong>&nbsp;count toward your grade in the class, and you can retake it an unlimited number of times.<\/p>\n<p>Use this quiz to check your understanding and decide whether to (1) study the previous section further or (2) move on to the next section.<\/p>\n<p>\t<iframe id=\"lumen_assessment_825\" class=\"resizable\" src=\"https:\/\/assessments.lumenlearning.com\/assessments\/load?assessment_id=825&#38;embed=1&#38;external_user_id=&#38;external_context_id=&#38;iframe_resize_id=lumen_assessment_825\" frameborder=\"0\" style=\"border:none;width:100%;height:100%;min-height:400px;\"><br \/>\n\t<\/iframe><\/p>\n\n\t\t\t <section class=\"citations-section\" role=\"contentinfo\">\n\t\t\t <h3>Candela Citations<\/h3>\n\t\t\t\t\t <div>\n\t\t\t\t\t\t <div id=\"citation-list-314\">\n\t\t\t\t\t\t\t <div class=\"licensing\"><div class=\"license-attribution-dropdown-subheading\">CC licensed content, Original<\/div><ul class=\"citation-list\"><li>Examples of Key Performance Indicators. <strong>Authored by<\/strong>: Melissa Barker. <strong>Provided by<\/strong>: Spokane Falls Community College. <strong>License<\/strong>: <em><a target=\"_blank\" rel=\"license\" href=\"https:\/\/creativecommons.org\/licenses\/by\/4.0\/\">CC BY: Attribution<\/a><\/em><\/li><li>Reading: Measuring Marketing Communication Effectiveness. <strong>Authored by<\/strong>: Lumen Learning. <strong>License<\/strong>: <em><a target=\"_blank\" rel=\"license\" href=\"https:\/\/creativecommons.org\/licenses\/by\/4.0\/\">CC BY: Attribution<\/a><\/em><\/li><\/ul><div class=\"license-attribution-dropdown-subheading\">CC licensed content, Shared previously<\/div><ul class=\"citation-list\"><li>Citizen Watch. <strong>Authored by<\/strong>: Kansai explorer. <strong>Located at<\/strong>: <a target=\"_blank\" href=\"https:\/\/commons.wikimedia.org\/wiki\/File:Citizen_Attesa_Eco-Drive_ATV53-3023_02.JPG\">https:\/\/commons.wikimedia.org\/wiki\/File:Citizen_Attesa_Eco-Drive_ATV53-3023_02.JPG<\/a>. <strong>License<\/strong>: <em><a target=\"_blank\" rel=\"license\" href=\"https:\/\/creativecommons.org\/licenses\/by-sa\/4.0\/\">CC BY-SA: Attribution-ShareAlike<\/a><\/em><\/li><li>Compass Illustration. <strong>Authored by<\/strong>: Alan Klim. <strong>Located at<\/strong>: <a target=\"_blank\" href=\"https:\/\/www.flickr.com\/photos\/igraph\/8231264538\/\">https:\/\/www.flickr.com\/photos\/igraph\/8231264538\/<\/a>. <strong>License<\/strong>: <em><a target=\"_blank\" rel=\"license\" href=\"https:\/\/creativecommons.org\/licenses\/by\/4.0\/\">CC BY: Attribution<\/a><\/em><\/li><\/ul><div class=\"license-attribution-dropdown-subheading\">All rights reserved content<\/div><ul class=\"citation-list\"><li>How to Develop Key Performance Indicators (KPIs). <strong>Authored by<\/strong>: virtualstrategist. <strong>Located at<\/strong>: <a target=\"_blank\" href=\"https:\/\/youtu.be\/NCta6j5_FdM\">https:\/\/youtu.be\/NCta6j5_FdM<\/a>. <strong>License<\/strong>: <em>All Rights Reserved<\/em>. <strong>License Terms<\/strong>: Standard YouTube license<\/li><\/ul><\/div>\n\t\t\t\t\t\t <\/div>\n\t\t\t\t\t <\/div>\n\t\t\t <\/section><hr class=\"before-footnotes clear\" \/><div class=\"footnotes\"><ol><li id=\"footnote-314-1\">http:\/\/cdn.snapapp.com\/site\/images\/resources\/SnapApp-CaseStudy-CitizenWatch.pdf <a href=\"#return-footnote-314-1\" class=\"return-footnote\" aria-label=\"Return to footnote 1\">&crarr;<\/a><\/li><\/ol><\/div>","protected":false},"author":141992,"menu_order":24,"template":"","meta":{"_candela_citation":"[{\"type\":\"original\",\"description\":\"Examples of Key Performance Indicators\",\"author\":\"Melissa Barker\",\"organization\":\"Spokane Falls Community 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