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I recently read a post on /r/bigseo that centered around what KPIs should be included for end-of-month reporting. I then discussed this article with an important person from a reputable agency and he told me that there is actually a very thin line when it comes to reporting. You can either show selected metrics that the client can understand easily and is therefore happy about the report or you can choose to show metrics that the client may not necessarily understand ( but is important ) and maybe disgruntle the client in the process. What's your take on the matter? How do you structure your monthly KPI reports? I'd love to make a case study on this issue quoting useful tips. Thanks!

  • JA

    Justin Adelson

    over 2 years ago #

    KPIs can change depending on the campaign goal and product/service being offered. For example, if you are running a Facebook advertising campaign and you are trying to determine what advertising creative drives the most clicks and views your primary KPIs are clicks, click-through rates, and cost per clicks. However, when you change your focus from creative testing to audience testing you are now driving your focus to mid- to late-funnel metrics such as leads and sales. Not to mention, not all KPIs are the end conversion - a KPI might be a mid-funnel step that connects marketing practices to sales practices (i.e. capturing a lead and having a sales representative contact said lead).

    Re: Reputable agency answer - As a marketing consultant, it is my job to do what I think is in the best interest of my client. I am not an intern nor am I a "yes" man. I have been hired to provide my expertise in marketing and report on the performance of my/their marketing practices. That being said, I somewhat disagree with the "important person" at the agency; it is my opinion that you show all of the data to your client, but you translate it in a way that they understand it. There is a lot of trust that goes into being hired as a consultant; if the client does not understand marketing and metrics it can be very easy to stretch the truth and provide numbers that are masking the real results of a campaign. I rather be completely transparent with my clients and show them all of the data and explain to them what is happening at the risk of disgruntling my client than getting caught obscuring the true results and gaining a bad reputation about my practices.

    I hope that helps!

    • SA

      Shoaib Ali

      over 2 years ago #

      Great insights Justin! I like the point that you made on being completely transparent about your results at the risk of disgruntling your client. But this transparency I believe does come with the extra overhead of explaining to the client how some metrics may seem dull now but have the potential to grow to the desired result. I think being honest is completely important but it does help if you are cogent.

      • JA

        Justin Adelson

        over 2 years ago #

        I do think there is a fine balance. The best account managers are storytellers - anyone can just deliver the data, but the best explain what is happening and why. You brought up a great point about "metrics may seem dull now, but have potential to grow...". When I am running creative testing my main focus is on top-funnel metrics (e.g. clicks, CPC, CTR, etc.) so I am not expecting many bottom-funnel conversions, which is not highlighted in my reporting at that phase. However, I do inform the client that we are setting up the campaign for the best chance at success by focusing at the top of the funnel and working out way down.
        But there is a line between telling the story and stretching the truth. I have been thankful that I have never witnessed nor been asked to cover up negative results while working at an agency or startups. What I have learned is how to show the positive along with the negative so even if a campaign is returning a negative ROI at least the client and I are learning something from the budget spent.

  • ES

    Eldad Sotnick-Yogev

    over 2 years ago #

    Agree with both Justin and Nick - you got to be transparent and it helps to master one vertical as an agency before moving into another. Yet, in regards to what KPIs from my experience the only real one it comes down to is CPA.

    While it is absolutely correct different campaigns, and even their stages, have a distinct focus - awareness, engage, capture, convert - you need to be ready to review the relevant KPIs. My quick list has always been:

    Awareness- Impressions
    Engage - CTR (Fans/Followers, Likes if it's Social Media focused could be more relevant here as it can be more difficult to get people to click out of FB, TW & YT)
    Capture - Clicks (email info, or for a Social campaign Shares, Comments likely to be more critical)
    Convert - Sales (possibly subscriptions if you're B2B or heavy content led)

    From working with companies from small individually owned to the largest car manufacturers in the world I've found this sort of focus helps translate the work you're doing in a clear manner. More importantly, it allows you to communicate direct to revenue for the CEO, Awareness & Customer journey for the CMO, and covers most conversations anyone wants to talk through when reviewing your agency's effectiveness.

    • SA

      Shoaib Ali

      over 2 years ago #

      Yes, I do believe CPA is probably the most important and relevant metric to look at in your reporting; at the end of the day, it all comes down to the number of paying customers acquired for your marketing spend.

      Also, compartmentalization of different KPIs into buckets ( Awareness, Engagement, etc ) is a good idea. These buckets can be utilized for each stage of growth I reckon.

      Also, come to think of it, does it make sense to discuss the funnel before commencing any campaign for the client? If it's an awareness campaign, maybe get involved with the CMO and discuss the KPIs you'd be focussing on before the campaign starts. If it's a direct revenue generation campaign, maybe get the CEO involved?

  • NL

    Nick Lock

    over 2 years ago #

    When I worked for a display ad agency supporting fortune 500s the most important metrics were CPA (cost per acquistion). Our clients cared most about this. We looked at things like impressions, clicks, viewability, etc. but honestly the only metric that mattered was CPA.

    The startup I'm at now is still very early stage so the only metric we focus on is email subscriptions and we optimize towards it.

    • SA

      Shoaib Ali

      over 2 years ago #

      Ah, makes sense. Different reports for different client needs as Justin pointed out.

      But does that leave room for an agency to maybe focus their business on a certain type of clients? Like maybe the display ad agency that you worked for only catered to Fortune 500s as it made more business sense in terms of report management and coherence from the team?

      • NL

        Nick Lock

        over 2 years ago #

        It actually makes more sense for an agency to focus on a specific industry (at least at first) to become the leader in that industry. You can expand into other verticals after you become an expert in one.

  • SS

    scott sharp

    over 2 years ago #

    Every business is different, so you need to identify your critical metric and work backwards from there.

    For example, if I'm running a SaaS company. My critical metric is monthly recurring revenue (MRR). MRR is a function of new customers added, existing customers retrained, and average subscription price, so my first set of derivative KPI's are new subscriptions, retention rate, and average subscription price. Influencing any of those metrics influences my critical metric. Then each one of those derivative KPI's will be a function of some other formula of derivative KPI's. Eventually, you'll find your way to the source. For example, the average subscription price won't need a lot of drill down, but new subscriptions absolutely will!

    Once you are measuring everything that has an influence on your critical metrics, you can begin prioritizing them and ultimately develop a dashboard or report that is extremely meaningful and logical.

    If you're doing client work, say running Facebook ad campaigns for a business, the client may only care about CPA -- but if I'm your client, I certainly want to know more, especially if you're not hitting CPA targets, because knowing why will determine if I continue to be a client of yours! In this case, the critical metric is CPA, which is a basic function of (clicks * cpc * click conversion rate). From there, you take your three derivative KPI's and drill them down more. Clicks might be a function of ad/message quality, so you'll want CTR and other metrics that indicate quality. On CPC, it might be a function of ad relevancy, too narrow of targeting, over-bidding, etc. so you'll need metrics that inform what's happening there. On conversion rate, you'll likely have a funnel of x-steps between click and conversion, so you'll want to know your funnel flow numbers.

    Again, once you have a system where you're systematically measuring what affects your critical metric, it's far easier to paint a simple, or complex, picture that's meaningful to yourself and your client.

    • SA

      Shoaib Ali

      over 2 years ago #

      Great opening statement Scott!

      The point about extrapolating metrics to reach the source/critical metric is quite interesting. It makes for a sublime way of showing your clients how tweaking a few nuts and bolts could lead to a higher performance.

      And I think it would be one of the better ways of having a great sense of clarity between the client and the agency.

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