Managing and measuring performance are the two main processes in modern entrepreneurship. While efficient management techniques allow you to implement the best strategies, organize and supervise the activity of your company, performance measuring techniques will help you set new objectives, achieve them and grow your business. This is true whether you are a traditional business, an online business, or a mix between the two.
“If management reflects the link between entity and performance (including the development and implementation of different training programs and strategies), then performance measuring is focused on identifying, tracking and communicating the results through performance indicators also known as KPIs” – say the specialists from iAgency.ro, Romania’s top online marketing and SEO agency.
Based on a complex debate with the specialists aboard this SEO agency (that has a large number of businesses with a strong online and offline presence in its portfolio), we will give you a few observations regarding the measurement of entrepreneurial success.
Firstly, what does KPI stand for?
- K (Key) – competitive advantage strongly connected to strategic objectives, directly impacting the wellbeing of the company;
- P (Performance) – performance measured directly, resulting in clear values that may be influenced by a set of known factors;
- I (Indicator) – a rule (or set of rules) that can shed light on the efficiency of a certain activity and be cross-checked without explaining past events.
What are KPIs and how do businesses apply them?
A Key Performance Indicator is a tool for performance evaluation that quantifies the progress to a certain business objective or goal. For an SEO agency, the number of transactions per 100 visits is a relevant indicator. In other words, KPIs point to the success or the failure in reaching certain business objectives that are part of a larger strategy. Thus, these indicators can help you find out the true answer for 3 essential questions:
- Where are you as a business?
- Where do you want to go?
- How can you get there?
Can any value or information be a relevant indicator?
In theory, KPIs become relevant when they can be measured precisely, have a strong impact on the business, are connected to the marketing objectives, help the business grow (by pointing out decisive actions that need to be taken), and can be analyzed for a long period of time (so that they can generate fundamental conclusions and smart decisions for the future of the company).
That being said, relevant KPIs are only set after reviewing the strategy and the objectives. Before setting the objectives, you must understand the field of activity and the business itself. Then, the objectives you set must be realistic. The iAgency.ro team can offer business consulting and analysis for all the clients.
What KPIs are relevant for a performance site from an SEO agency standpoint?
- The number of visitors;
- The number of new visitors;
- The number of sessions;
- The average session duration;
- The number of pages per session;
- The bounce rate;
- The conversion rate;
- The number of transactions;
- The total revenue.
Of course, every KPI is relevant for a certain objective or strategy, so this list can be a lot longer or even shorter, depending on your objectives and the timeframe that you choose.