• Amish Patel

Why your KPIs mean absolutely nothing

Key Performance Indicators, also known as KPIs are almost always meaningless. Not the fact that they exist, but because the ones chosen by businesses are often internally focussed and do not link to a real objective.

Let's look at an example


If we take email marketing, history tells us to send the email to as many people as we are legally allowed to. So we either have our own database, use a third-party, or both. Blast that message out and boom, we have sent an email to 20k people, we got an average open-rate (OR) and an ok click-through-rate (CTR).


Hmmm, who are those 20k people? Are they important to our business? After clicking through to somewhere, did they complete the task? Did they attempt to, but actually at that point, they were stopped because they don't qualify?


Do we ask any of the above questions? Maybe, but we probably don't have enough time to do anything about it because the high pressure business that we work for see a fantastic reach of 20k and that we are hitting industry benchmarks in the basic email measures. Phew, pressures off because we have nailed 'digital marketing' and there are plenty of other things to be getting on with.


What is the email recipient thinking?


Following the above example through, let's say 75% of that list had no relevance to what was sent to them and this was the second or third email they've received that falls into this category. They're probably thinking that this company offers nothing for them, even though they might, just in a different area. If they can muster up the effort, they will either unsubscribe or just tag the sender as junk, losing all future opportunities to engage in this way.


What is the lesson?


A key point at the heart of KPI setting is defining your objectives, as well as the targeting - they go hand in hand.


Whilst we use OR and CTR as benchmark measures for the email channel, each email may have different target measures depending on its purpose. For example; in an information-only email we would look at OR and for an action-based email we would look at the number of those actions taken, like clicking through and completing a website transaction.


Ultimately what we want to understand is, does the user who engaged with the email do what we wanted them to?


Check out my free resources to validate your KPIs against your objectives.