“What gets measured gets managed.”
You’ve probably heard this quote countless times as a marketing agency professional. And it’s true – with so much data at your fingertips these days to track every aspect of your campaigns and clients’ businesses, measurement is critical.
However, the real challenge you face isn’t lack of data – it’s figuring out what metrics actually matter. You can easily get lost in a sea of numbers in analytics dashboards. Cut through the noise and zero in on the KPIs that will truly move the needle for your agency and your clients. Otherwise, you risk wasting precious time and resources chasing vanity metrics that don’t impact the bottom line.
What is a Metric?
Metrics are the quantifiable measures you use every day to track and assess the performance of your marketing campaigns and your clients’ businesses. Some common marketing metrics include:
- Website traffic
- Conversion rates
- Cost per acquisition
- Email open rates
- Social media engagement
These metrics provide the raw data that informs where you’re winning and where you need to improve. However, simply tracking metrics is only half the battle. The sheer volume of data can quickly become overwhelming if you don’t know how to derive actionable insights.
That’s where your value as a marketer comes in. Go beyond reporting the numbers and tell the story behind the data:
- What is driving the trends you’re seeing?
- What levers can you pull to improve performance?
- How do the metrics tie back to your clients’ overall business goals?
Metrics provide the “what” but it’s up to you to uncover the “why” and “how” to create impactful strategies.
What Are Key Performance Indicators (KPIs)
While metrics give you a broad picture of performance, KPIs are the specific metrics that are most critical to achieving your agency’s and clients’ objectives. They are the metrics that are directly tied to business goals and indicate whether you’re on track or need to course correct.
Choosing the right KPIs is both an art and science. Develop a deep understanding of each client’s unique business, their competitive landscape, and their strategic priorities. Cookie-cutter KPIs won’t cut it.
Examples of KPIs for different marketing objectives
Objective KPIs Brand awareness – Website traffic
- Social media followers
- PR media mentionsLead generation – Marketing qualified leads (MQLs)
- Sales qualified leads (SQLs)
- Conversion ratesCustomer acquisition – New customers acquired
- Cost per acquisition (CPA)
- Customer acquisition rate (CAR)Revenue growth – Monthly recurring revenue (MRR)
- Average order value (AOV)
- Customer lifetime value (LTV)
KPI vs. Metrics: What is the Difference?
While KPIs and metrics are related, they serve distinct purposes:
KPIs Metrics Laser-focused on key business objectives Provide overall performance insightsLimited in number – only the most important metrics Numerous – tracking many aspects of the businessConnected to business goals May or may not directly impact business outcomesUsed to make strategic decisions Used for diagnostic analysis and reportingReviewed frequently (weekly/monthly) Reviewed at various cadences (daily/weekly/monthly)
| KPIs | Metrics |
|---|---|
| KPIs are focused. | Metrics are not limited to one result or dimension. |
| KPIs can be more granular. | Metrics cover a broader range. |
| KPIs can be used over longer periods. | Metrics are usually shorter term. |
| KPIs focus on results | Metrics focus on processes and problems. |
| KPIs are often easier to understand | Needs interpretation |
| KPIs may be measured in a variety of ways | Metrics are usually tied to specific data. |
As an agency pro, it’s crucial to understand these distinctions so you can steer your clients in the right direction. Some may come to you with vague requests to “improve our digital marketing” without clearly defined KPIs. Take the opportunity to educate them on the difference between overall metrics and the specific KPIs you’ll use to measure success.
When to use KPI or Metrics?
Using KPIs or metrics isn’t an either/or proposition but rather a strategic choice based on your objectives:
When to focus on metrics
- Audit current performance to establish benchmarks
- Diagnose issues or identify opportunities
- Report details on campaign tactics
When to focus on KPIs
- Set strategic goals and objectives
- Measure progress towards business outcomes
- Make go/no-go decisions on initiatives
- Report to executive stakeholders
There will be times when a high-level, wide-angle view of metrics is appropriate to uncover potential issues or opportunities. Consider an initial audit of a new client’s digital marketing to understand current performance benchmarks.
However, when you move into strategy and execution mode, focus on the KPIs that will actually drive the results your client cares about. Avoid getting caught in the weeds of tracking metrics that are “nice to know” but don’t materially impact the business.
When to Use Metrics vs. KPIs
How KPIs and Metrics Complement Each Other
While distinct, KPIs and metrics work hand in hand to provide a complete picture of marketing performance. You need both the strategic altitude of KPIs and the on-the-ground detail of supporting metrics.
For example, let’s say your primary KPI for a client is to increase revenue by 20% this quarter. Metrics like website traffic, conversion rates, and average order value all provide diagnostic insight into how to hit that goal:
Metric Insight Website traffic up 50% More eyeballs on the site, but not translating to revenueConversion rates down 5% Need to optimize the sales funnel to convert more of the trafficAverage order value flat Customers are buying but not spending more per order
In this scenario, the metrics provide clues as to why you’re not hitting the revenue KPI. Consider driving more qualified traffic, improving the user experience to boost conversions, or implementing upsell/cross-sell tactics to increase order value. The KPI sets the destination, the metrics help plot the journey.
Why You Should Never Use a Single KPI to Measure Performance
One of the biggest mistakes I see agencies make is relying on a single “silver bullet” KPI. It’s a trap that can lead to unintended consequences and undermine actual business objectives.
The article provides a great example with Goodhart’s Law – when a measure becomes a target, it ceases to be a good measure. If you incentivize call center reps solely on call volume, they may churn through calls at the expense of customer satisfaction and issue resolution. The same applies to marketing KPIs.
Some real-life examples I’ve seen:
- Overemphasizing lead volume at the expense of lead quality
- Focusing on vanity metrics like social media followers instead of engagement
- Optimizing for short-term sales activation instead of long-term brand building
The antidote is a balanced KPI framework that incorporates multiple strategic objectives. A robust framework for an ecommerce client might look something like:
Objective KPIsSales – Monthly revenue
- Average order value
- Conversion rateCustomer acquisition – New customers acquired
- Customer acquisition cost
- Customer lifetime valueBrand – Aided/unaided brand awareness
- Brand sentiment
- Net promoter score (NPS)
Measure a balanced set of KPIs to get a holistic view of performance that avoids the pitfalls of over-optimization. This also forces strategic conversations with clients about how different objectives interrelate and sometimes require tradeoffs. Profitable growth is the goal, not just growth at all costs.
Best Practices for Identifying & Monitoring KPIs and Metrics
So how do you put this into practice? Here are some tried and true best practices for nailing your KPI and metric game:
1. Align metrics with business goals
Start every engagement by understanding the client’s business goals and selecting KPIs that directly support those objectives. Get input from the client’s leadership team, not just the marketing folks, to ensure organization-wide alignment. Every metric should ladder up to a KPI, every KPI should tie back to a goal.
2. Ensure KPIs are measurable
KPIs are only useful if you can actually measure them. Avoid vague or squishy metrics like “brand love” that can’t be quantified. For every KPI, identify the specific data sources, formulas, and tracking tools you’ll use. Establish clear benchmarks and targets so everyone knows what success looks like.
3. Verify data accuracy
Garbage in, garbage out. Audit your data collection processes to ensure accuracy and consistency. Watch out for common pitfalls like double-counting conversions, inconsistent UTM tagging, or cross-device tracking issues. When presenting KPIs to clients, be transparent about any caveats or limitations in the data.
4. Connect KPIs to action
Measurement without action is useless. For every KPI, identify the key levers you can pull to influence performance. Create an action plan that outlines the specific tactics and initiatives that will drive improvement. Use a testing roadmap to prioritize and track your optimization efforts over time.
5. Review on a regular cadence
KPIs aren’t “set it and forget it.” Schedule check-ins with your team and your client to review progress, discuss insights, and course correct as needed. A good cadence is:
- Weekly pulse checks on key metrics
- Monthly deep dives into KPI performance
- Quarterly business reviews to assess impact on client goals
Outside of these scheduled reviews, use real-time dashboards to keep tabs on performance and spot potential issues before they become full-blown crises. The beauty of digital marketing is the ability to learn and iterate quickly. Agility is key.
Conclusion
For agencies, KPIs are both an art and a science. It requires analytical rigor to select the right metrics, technical chops to capture accurate data, and strategic savvy to turn insights into growth-driving action. But most of all, it requires a relentless focus on client business outcomes.
Too often, agencies get caught up in the weeds of their own channel-specific metrics and lose sight of the bigger picture. Impressions, CTRs, open rates – these are all useful diagnostic tools but they’re not the end game. What clients really care about is how marketing is impacting their bottom line.
That’s where well-crafted KPIs come in. They are the bridge between marketing activity and business results. They’re how you demonstrate your value and build long-term client partnerships.
So if you take away one thing, let it be this: Always measure what matters. Not just what’s easy to measure or what makes your team look good. Measure what moves the needle for your clients.
It’s not easy. It requires hard conversations, complex data wrangling, and constant optimization. But that’s the job. And agencies that can deliver – agencies that can prove their impact on client objectives using data and KPIs – will be the ones on top.
Because at the end of the day, clients don’t care about marketing. They care about growth. And KPIs are how you show them the money.
