What is a KPI?
A key performance indicator is the number a campaign is accountable to: cost per acquisition, return on ad spend, qualified leads, incremental sales. It is the difference between activity and progress.
What makes a good KPI
- Tied to the business: it ladders up to revenue, margin or growth, something a CFO recognises.
- Decided before launch: chosen when the strategy is set, not picked afterwards to flatter the results.
- Matched to the stage: awareness work judged on awareness metrics, conversion work on conversion metrics. One campaign, one job, one number.
- Actionable: when it moves, somebody knows what to do about it.
KPIs versus metrics
Everything measurable is a metric; only the few that carry accountability are KPIs. Impressions, clicks and engagement rates are diagnostics: useful for explaining why the KPI moved, dangerous when they get promoted to goals. Vanity metrics are metrics that flatter without informing.
The honest view
Most reporting problems are KPI problems. Too many numbers, chosen too late, disconnected from the business. Pick few, pick them early, and build the reporting around decisions rather than around data availability. A dashboard that does not change a decision is decoration.
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