SMART targets and KPIs must be defined and aligned with an organizations business goals with its stakeholders for a campaign to obtain its strategic objectives and track / review its performance using technology, to better guide decision making and that all parties are working toward same outcomes.
Understanding the 2 Types of KPI is Important
- Visionary – reflecting what company is trying to achieve or the big hairy audacious goal (BHAG) per (Jackson, 2016). This KPI drives change or can help a company build a culture, and must be defined by leaders as part of their strategy (Jackson, 2016).
- Tactical – Reflective of the decided goals and objectives of the spokes on the hub and spokes model, that is derived using a workshop process and industry goals to achieve their goals and objectives (Jackson, 2016).
Furthermore, an understanding that KPIs have 4 distinct attributes defined by Digital Analytics Association (DAA), so as to standardize the definitions for all users as seen below:
- Count – basic unit of measure and a single number and generally a whole number ( 1111), but this is not absolute ($111.11)
- Ratio – generally a number (count) divided by another number (count), but can also be a ratio in the numerator / denominator; however, this ratio is not normally a whole number but depicted within the name such as “page views per page”, and the ratio definition will define the ratio and the metric too.
- KPI – Count or ratio but mostly ratio’s and generally related to a business strategy and may differ from site and process types.
- Dimension – describes a concept vs numbers. Data that can be defines related to segments or counts with representation on a dimension of visitor behavior or even site dynamics. Examples are event and referrer (Jackson, 2016). These can be either qualified or segmented and define a general class of metrics that will represent a class of data associated with each visitor. The REAN model represents four such conceptual dimensions (Jackson, 2016).
Metrics can additionally be classified further and be applied to three different categories:
- Aggregate – Total site traffic for a defined period of time.
- Segmented -Subset of traffic for defined period that is filtered in a way to gain greater analytical insight, such as campaign (PPC, affiliate, email’s), visitor type (new vs returning, repeat buyer, high value) or even referrer.
- Individual – Activity by single visitor on web that is defined by a period of time.
With this information, each company must define its own KPIs based on its goals, and each campaign’s strategic objectives that provide a clear focus of objectives, transparency for accountability, enable data driven informed decision-making by leaders, allows for revealing trends that may need attention, and keep employees motivated and on track to maximize improvements.
KPI should use SMART attributes (specific, measurable, achievable, relevant, and time bound) and here are some examples of KPI’s to use by department to optimize use of results:
Examples of KPI and how They can be Used
Conversion Rate to measure percentage of visitors that performed desired action and a higher rate is an indicator of successful engagement with target audience. Should be used to track customer journey to find bottlenecks that require corrections and a business can use this metric to better understand how changes can improve a desired action such as making a purchase or filling out a form (Gibson, 2024).
Cost per Lead (CPL) is marketing spend divided by lead generated, customer acquisition cost and establishes the total cost a business incurs to acquire a new customer (lead). Should be used for decision making to allocate budget, compare channels, offers data for optimization for pricing, incentives, etc., and must be sustained within profit model to sustain those lead generations (Kloefkorn, 2025)
(CAC) is marketing / sales expenses dived by new customers and helps to assess efficiency of marketing strategies and budget allocation by determining total expense required to turn a lead’s interest into a paying customer. Use of CAC when analyzing social media channels to determine which has lowest CAC to maximize ROI. (Customer Acquisition Cost (CAC), 2024)
Customer Lifetime Value (CLV) predicted revenue for customer over their entire brand relationship using cost per lead to personalize experiences and improve retention and focus on customers who have the highest CLV. Companies use a formula of average purchase value x purchase frequency * customer lifespan to achieve CLV and help support strategies to retain these customers as it costs on average of 5-25x more to acquire more, thus is is more profitable to increase retention (Marianantoni, 2025)
Bounce rate or percentage of visitors who leave website without interaction. This metric can analyze user experience (UX), navigation, and content, that causes visitors to leave a website. A business can use this to improve campaigns for SEO by improving content, landing page optimization, load speeds, traffic source analysis, improve images, to successfully engage with their audience to improve return on investment (ROI) and increase site traffic to improve and identify channels to bring more engaged visitors, thus improving standing in rankings (What Is Bounce Rate? – KPI Definition & Formula, n.d.).
Average session duration (ASD) is time users spend on website or engagement in a single visit and a metric used to to determine whether users are interacting with your stie meaningfully. Understanding of this metric allows a business to use it to determine if content is engaging and high quality with good user experience and can help determine between casual and engaged visitors. A business must use this metric and analyze by demographic, device, or channel to help tailor content to improve UX (Average Session Duration – KPI Definition, Formula & Tips, n.d.).
Content reach are number of unique users exposed to content to determine breadth and size of audience across all channels to gauge distributing and promotions. A business can use this metric over time to assess if content strategies are performing and includes segmenting by platform to see where content if performing best and can also be used to assess brand awareness, visibility, and even ROI. If this metric is low a business must immediately investigate its content quality and targeting across its distribution channels for correction (Content Reach – KPI Definition, Formula, & Benchmarks | KPI Depot, 2025).
Impressions are tracked for total number of times it was displayed and can be used to determine how content is being displayed despite whether it was clicked or engaged. A business must use this metric with a set of clear goals for brand awareness, lead generation, etc. This will determine metric assessment of feedback for corrections if benchmarks across channels within campaign and to determine which are performing best. Additionally, this KPI can be used with other metrics such as click through rates or conversions to determine relevance and spending efficiency on visibility (Gibson, 2024).
Click-through rates (CTR) are opened emails and clicks embedded into links and vital for assessing audience interest in campaign and their engagement and how well you are communicating with potential customers. This metric is critical for assessing online advertising campaigns and search engine results. A company will use CTR to help guide business decisions regarding optimizing campaigns and also to allocate budgets effectively. This helps identify which content is performing best and allocate more budget to that part of campaign for increased message resonance (Gibson, 2024).
Return on Marketing Investment (ROMI) equals revenue generated compared to spend as it measures marketing spend by calculating the revenue generated for every dollar invested, thus empowering decisions for budget allocation. An example would be a business running a digital advertising campaign for new product and spend $20,000 on paid ads and email marketing. $60,000 in sales is generated in relation to campaign. ROMI = 60,000 – 20,000 / 20,000 * 100 = 200% or for every dollar spent in marketing the campaign generated $2 in revenue and was profitable. Afterwards the company can compare this campaigns against others to further direct future marketing activity budgets.(Serhii, 2025).
Lead-to-customer conversion rate (LCCR) measures percentage of leads that have converted to paying customer within a sales or marketing funnel. Comprehensively used to evaluate effectiveness of lead qualifications through nurturing and handoff between marketing and sales (Rai, 2023). An example of this metric would be 1,000 leads in a month, they are scored and then filtered by marketing team, and then when filtered only 300 deemed (Marketing Qualified Leads or MQLs). Sales team then does further review by filtering on 200 as Sales Qualified Leads or SQLs. Lead-to-lead conversion (MQL to SQL) = (# of SQLs / Number of MQLs) x 100 (Lead Conversion Rate, 2026).
Return on Investment (ROI) per channel to analyze efficiency of resources allocated to provide insight into marketing initiatives. This metric analyzes the customers journey across the decision stage and communicate overall performance. A business must have clear goals when using this metric to properly align budget to maximize spending on higher-performing channels to ensure campaign delivers best financial returns of ROI = (net profit / total cost) x 100 = ROI on initial investment (Gibson, 2024).
References
Average Session Duration – KPI Definition, Formula & Tips. (n.d.). AgencyAnalytics. https://agencyanalytics.com/kpi-definitions/average-session-duration
Content Reach – KPI Definition, Formula, & Benchmarks | KPI Depot. (2025). Kpidepot.com. https://kpidepot.com/kpi/content-reach
Customer Acquisition Cost (CAC). (2024, September 17). Wall Street Prep. https://www.wallstreetprep.com/knowledge/customer-acquisition-cost-cac/
Gibson, K. (2024, February 1). 7 Marketing KPIs You Should Know & How to Measure Them. Harvard Business School. https://online.hbs.edu/blog/post/marketing-kpis
Kloefkorn, S. (2025, November 27). Lead Generation Metrics: Calculate Cost Per Lead & ROI. KEO Marketing -. https://keomarketing.com/lead-generation-metrics-cost-per-lead-roi/
Lead Conversion Rate. (2026). KPI Library. https://www.kpi.zone/library/kpis/lead-conversion-rate/
Marianantoni, A. (2025, June). Maximizing Customer Lifetime Value: Real-World Case Studies That Drive Success – M ACCELERATOR by M Studio. M Accelerator. https://maccelerator.la/en/blog/entrepreneurship/maximizing-customer-lifetime-value-real-world-case-studies-that-drive-success/
Serhii. (2025, May 8). Well Web Marketing. Well Web Marketing. https://wellweb.marketing/marketing-kpi-examples/
What Is Bounce Rate? – KPI Definition & Formula. (n.d.). AgencyAnalytics. https://agencyanalytics.com/kpi-definitions/bounce-rate