How to set KPIs and marketing objectives from business goals

In order for you to plan an effective marketing campaign and learn how to set KPIs, you need to know your business goals. Clearly defined business objectives will help you to understand which strategies work to grow your business and which ones require improvement.

Peacock Digital Marketing Kirsty Nelms

By Kirsty Nelms

The first step in setting good KPIs is identifying your objectives

To convert prospective buyers into customers in the future, you need to build brand awareness and positive perceptions today. Marketing seeks to connect the right people, with the right product, by showing them the right information at the right time.  

Start by asking yourself these questions: 

  1. What worries do you have about your business? 
  2. Where will business growth likely come from? 
  3. How does your business make money? 
  4. Who are your competitors and what are they doing well? 
  5. Where do you want your business to be in 5 years? 

You can use these answers to create your business goals. 

It might help to think of defining your goals in the way you think of your customer journey, also referred to as a sales funnel (sounds awful doesn’t it?)  

How to set KPIs in line with business objectives

At the top of your strategy, you have your business objectives; these are broad goals for your company, which usually focus on increasing revenue, profit margins, number of units sold etc.

When you set KPIs, be sure to identify the goal, change and time period for each objective. For example, ‘increase the number of monthly enquiries by 20% over the next 6 months’ or ‘increase sales of a certain product by 12% over the next 3 months.’

Profit: Marketing requires an investment, classified as a cost, which reduces profit. When companies need to tighten their belts, often the marketing budget is reduced or in extreme cases, axed altogether. However, well-managed, efficiently-budgeted marketing drives sales, with results in revenue and profit.

Revenue: A company can increase their sales by acquiring new customers or increasing how much existing customers spend.

Volume: Companies who wish to increase volume need to either decrease cost to drive more sales or use various tactics to drive more demand (such as a special offer).

Marketing objectives

These support the business objectives and can be split between the stages of the customer journey: awareness, consideration, purchase, loyalty. For example, you might have the following objectives:

Awareness

Increase brand awareness by 15% in the next 3 months. 

Consideration

Increase monthly enquiries by 50% by the end of the year. 

Purchase

Increase sales by 25% in the next 6 months.

Loyalty

Increase returning customers by 10% in the next 12 months.

Media objectives

These are the goals for each channel that you are using to meet your marketing objectives (for example, the goal of your Facebook campaign).

You might launch a Facebook campaign aimed at generating brand awareness, a LinkedIn campaign to encourage more leads by promoting an e-book or a Google Search advertising campaign to promote sales through an offer on your website.

Campaign metrics vs KPIs

When deciding how to set KPIs, people confuse metrics and Key Performance Indicators (KPIs). These are the individual metrics you use to measure the success of your media objectives.

While KPIs and metrics refer to quantifiable measurements, the term “KPI,” is a measure of success. The purpose of a KPI is that it’s clear, measurable, and it has a defined time. For example, you may have something like: ‘increase sales of children’s shoes by 10% over the next six months”.

Metrics are useful but there’s a lot of information which is not always relevant to what you are tracking. Here are some examples of key metrics:

Video metrics: Engagement rates, video views, complete views, cost-per-view, completion rates.

Search metrics: Click through rate, conversion rate, conversions, cost-per-action.

Social media metrics: Engagement rates, views, reach, frequency.

How to set KPIs with reasonable growth targets

How long has your company been established in the market you compete in? If you’ve been around for years and you have a strong customer base, then it makes sense that your growth targets would be fairly modest, as there is increasingly less room for you to grow at a rapid rate. Low growth for a large company may equal more profit than the double-digit growth of a small company. New companies, especially start-ups, should aim for more ambitious growth because they need to establish their reputation and brand presence within their market.

Effective marketing strategies and the customer journey

In order to make sales, you first need to earn trust. This is what Peacock Digital Marketing is all about. Sometimes companies just want marketers to push their products right away with a hard sell – and in an age of compassionate, human-centred marketing and brands, this tactic just doesn’t work.  

To convert prospective buyers into customers in the future, you need to build brand awareness and positive perceptions today. Marketing seeks to connect the right people, with the right product, by showing them the right information at the right time.  

Awareness

Use targeting and demographic data to show your ads to people who would be interested in your product. 

Consideration

This is where re-targeting, pixels and tags come in. Have you ever seen an ad when scrolling through Facebook, then seen the same ad on Instagram, and in a display ad at the side of an article you are reading online? Was that ad related to a subject you are interested in? A brand you follow? This form of advertising is designed to make people think about or show an interest in your brand. Content could be a video carrying a key message about the brand’s ethos, it could be an image displaying a great testimonial, or more information about the brand’s offering.

Purchase or Action

At this stage of your advertising strategy, you are targeting all the people who have shown a strong interest in your brand or product. This might be people who have purchased something in the past, people who have subscribed to a newsletter, people who have visited a particular product page on the website, people who have added a product to their basket. There would be a strong Call-to-Action (CTA) or an offer to help persuade them to buy.  

Loyalty

This form of advertising addresses current customers. It might be regular e-newsletters to their existing customer base, a special offer or sale for existing customers or membership exclusives, a chance to win a prize if they leave a review, or an invite to become a brand ambassador.  

An ad seen today can trigger sales in the near future, while also ensuring future sales to come. This is why I tell people that I am not the best fit for companies who want instant results with a limited budget. Effective marketing takes time. 

Conclusion

I hope this article has helped answer your questions about how to set KPIs. This will help you to form a great marketing plan. If you are searching for a trustworthy digital marketer with experience managing social media accounts and digital advertisements, pop me an email. 

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