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Kpi Key Performance Indicators

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There was a time not too long ago when it was cool to have a web site. You didn't have to worry about issues such as usability, conversion, and flow because the web was not as competitive as it is today. If you had a website that looked nice, you were in business. Let's face it even if you had an ugly site you were still in business. If you got business from the site nice if not you were happy too. In the beginning most people didn't really believe they could make money on their website.

Today the web offers huge opportunities for business to grow and increase their revenue. Hence, the web has become fiercely competitive market place. In such competitive environment, you have to know what works and what doesn't. Without measuring KPIs (Key Performance Indicators) you are not giving your company a chance to understand your business.

Measuring performance of traditional marketing such as magazine or post card mailer advertising is very difficult. We can say it worked or it failed based on sales, but we don't know the details such as what part of the ad was effective. How often people looked at the ad and for how long?

With web analytics, we can get a greater understanding of where and how effectively we spend our advertising dollars. Web analytics plays a strategic role in measuring success and alerting companies to vulnerabilities within their online environments. The value of web analytics solutions is not in their ability to collect data, but to measure customer behavior that provides a basis for replicating success or driving change.

Among companies that utilize analytics in this way, 75 percent increased new visitors to their sites, 78 percent improved average visit duration and 65 percent improved returning visitors. Eighty-three percent increased page views per visit, 68 percent improved conversion rates and 64 percent improved the number of visits per existing customer.

The value of analytics is not just in the measurement of the data but also in the ability to act on the results. KPIs should drive action. Every KPI we measure should correspond to action. Creating an effective web analytics strategy requires more thought than money.

Digital marketing is impossible without KPIs. Without KPIs, you are spending on marketing because it feels good. With proper metrics, you spend money because it makes sense.

Web analytics is easy according to every company that sells web analytics solutions. Visit their websites and they'll tell you loud and clear that web analytics is a walk in the park. Web analytics is not easy.

KPIs have to be part of your strategy. It is not an isolated project within a company. Web analytics should be part of your business analytics efforts. Just like you measure your sales and your revenue, you should measure your web KPIs.

KPIs should be more about people and strategy than technology. Many marketers shy away from web analytics because it sounds like something an engineer would enjoy doing. Web analytics is about measuring consumer behavior. Web analytics is one of the most effective tools to grow your business.

Web analytics is turning raw data into actionable items. Many marketers build their own marketing programs based on information about other companies? marketing history. Don't make that mistake. What works for them is not necessarily going to work for your organization. General market research studies provide you general information when you need information specific to your business. Web analytics is the tool for that.

Kpi Key Performance Indicators

There might be a number of viewpoints on KPI, and this concept can be used on various level of organization. For instance, CEO might use KPI to measure and control business, also, some managers can design and use KPI for their department.

Does KPI approach work? Yes, in sense, it gives you a necessary information structured and represented in a certain way, but how good does it work? It depends on who have designed your KPI, who is gathering data to be inputted in KPI system, how do you analyze and use this data.

First, the most important is KPI design. Fill the difference between indicators that represent the total company profits per month, company profits segmented by regions and company profits segmented by region, customer education, customer social position. It's obvious that these tree metrics are good for different views only, for instance, CEO might be interested in total profit only, while regional manager need to know how other regions are performing.

Other sample of bad indicators set is when there are two indictors telling about the same thing from different viewpoints. For instance, it is bad idea to have "Profits by region" indicator and "Support requests by region". It seems that having two indicators will show something about the regional office, but actually it is not true, as both indicators depends on the regional characteristics, such as the number of potential customers and the number of leads. When designing key performance indicators one should consider factors to be connected with root indicator, but not with each other.

Even if you have a great KPI system, it will not work, if the incoming data won't be analyzed, sorted and represented correctly. It's important to make sure that the person who will be analyze and represent information for KPI also involved in KPI design process and know what is the goal of certain metrics and why it was used some metric and not the other one.

Working with well designed and prepared KPI system is an easy task. But still one should remember about limitation of KPI system. It is not designed to show your business in details, also, it just represents someone's viewpoint on how the business processes should be organized. It is important to keep KPI system up today, as what worked yesterday will not show anything today.

Finally, few words about tools that can help to design KPI system. There are some expensive business systems that allow to work with KPI, but still these systems will not help to design and keep updated KPI indicators. So, before purchasing expensive system consider designing a test version using some spreadsheet software, such as Excel. Give KPI concept a try, find out if it works for your business and in what way. Having requirements list you will be able to get what you really need.

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About Author

Both George Meszaros & Sam are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.

George Meszaros has sinced written about articles on various topics from Computers and The Internet, Affiliate Programs and Massage. . George Meszaros's top article generates over 368000 views. to your Favourites.

Sam has sinced written about articles on various topics from Software, Management and Nokia Phones. %author_bio%. Sam's top article generates over 49500 views. to your Favourites.

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