WHAT IS A KPI
A KPI stands for "Key Performance Indicator."
It is a metric used to measure how effective your marketing campaigns are.
In this blog we are going to discuss how to use our KPI template that we operate from to see if a client's ad account is getting great results and how to improve it by testing and measuring.
first let's set up some kpi goals
The goals we are going to to set up are going to be measured by "Monthly" so that we can set up weekly goals to hit our monthly goals sounds fair?
1. Number of Clients Per Month
2. Number of Shows Per Month
3. Number of Appointments Per Month
4. Number of Leads Per Month
So for example my monthly goal is to get
1. 40 Clients
2. 100 Shows
3. 200 Appointments
4. 600 Leads
5. $5,000 Budget
These are my goals (for example). And this is what I am going to set up to go by.
Then I will break my monthly goals into weekly goals (measuring it as a 4 week month).
1. 10 clients per week
2. 25 shows per week
3. 50 Appointments per week
4. 150 Leads per week
5. $1,250 spend per week
Now that I have my goals set. I am going to have to measure my cost per acquisition very closely so that I can determine if it is going to make sense that I will hit my goals by the end of the week.
So my Cost Per Acquisition is the measurement of how much it's going to estimate to cost to acquire a goal. So if my spend is $5,000 a month. And the amount of leads I want to get at the end of the month is 600. Then I am willing to spend up to $8.33 to acquire a lead.
If I spend more than $8.33. I will likely not hit my goal of 600 leads at the end of the month if my budget is $5,000.
So my CPA goals are:
1. $125 Cost Per Client
2. $50 Cost Per Show
3. $25 Cost Per Appointment
4. $8.3 Cost Per Lead
5. $5,000 Budget
So my KPIs goals are set. Now I am going to have to use this as a baseline to know where I am at with hitting my goals.
If I am hitting my KPI goal of acquiring a $8 Lead. But my Cost Per Appointment is $50 per appointment (which is double).
That means my front end part (which is the ad, targeting, and the appointment setting area, etc.) is likely the area I want to focus on to improve my Cost Per Appointment. My goal is to get it cheaper and reduce my cost by half in order for me to hit my weekly targets.
Week 1: Cost Per Appointment: $50
WTD: Change targeting, and hire setters to call leads
Week 2: CPA: $22
So in the example above I have a $50 cost per appointment. It means it cost me $50 to get an appointment. And if my weekly goal is to get 50 appointments, at that rate I will only get about 25 appointments.
($1,250/$50 = 25 apts)
That means I will not hit my weekly goals. But at least I will be able to fix it in week 1 so that week 2 I will be able to catch up and hit my end of month goals "early."
So what I did was change the targeting and targeted more qualified people. Then I hired some setters who called leads and was able to close more leads into appointments therefore lowering my cost by half.
Results, gave me a $25 cost per appointment, allowing me to hit my goals at the end of week 2!
Having a KPI template, setting goals, and actually knowing what your numbers are is going to set you up for huge success in the future. You will be spending money more effectively and being able to not only make decisions faster but also be on top of your marketing agency in the event they are not producing results.
So you can download the marketing template below so that you can actually use this template to set yourself up! Hope it helps!
Free download kpi template