What is a Key Performance Indicator (KPI)?
A key performance indicator (KPI) is a metric that is directly related to a specific business outcome or goal. In order to understand KPIs, let’s first discuss the difference between a metric and a KPI.
Simply put, a metric is a quantifiable piece of data. A business metric refers to a quantifiable piece of data that is relevant to the performance of the company. In the context of an app business, a few examples of metrics include:
Since a metric can be any quantifiable piece of data, there are countless metrics than an app business can keep track of. In order to deal with the overwhelming amount of data and metrics available, marketers need to identify which metrics are directly tied to their business goals—this is where KPIs come in.
A KPI is a performance-based metric that can be associated with a specific business objective. In the context of app businesses, this can include KPIs such as:
- Revenue growth
- Return-on-ad-spend (ROAS)
In short, every key performance indicator is itself a metric, although not all metrics are KPIs as they may not be directly relevant to a business outcome.
What are the uses of Key Performance Indicators?
The purpose of separating metrics and KPIs is to ensure your analytics and tracking efforts are aligned with the business’es overall goals. By determining which KPIs will help you achieve your targets, this enables marketers to simplify their analytics and only focus on metrics that are driving growth and scalability.
In order to define the KPs of a businessI, Klipflio suggests asking the following questions:
- What is your desired outcome?
- Why does this outcome matter?
- How are you going to measure progress?
- How can you influence the outcome?
For example, the goal of many app marketers is to maximize their return on investment. This can include more granular costs such as the return on ad spend (ROAS) or the ROAS of a particular campaign. If you’re performing a post-campaign analysis, you can use your KPIs as benchmarks to determine how the strategy performed relative to your goals. As discussed in our guide to campaign analytics:
That includes analyzing metrics that are generally channel-specific, so a multi-channel campaign that includes organic email outreach and paid mobile advertising will have multiple metrics for each of the included channels.
Since each channel will have it’s own key metrics, you’re able to summarize the campaign’s performance against the target KPIs and use that information to guide future campaigns.
In order to maximize the ROI on marketing efforts and hit target KPIs, app marketers need to know is exactly where an app install came from. This is often the first step in campaign analytics, although it is only a small part of mobile attribution. As discussed in our mobiles attribution report, in addition to measuring your KPIs across user acquisition and re-engagement channels, mobile attribution platforms should have the following capabilities:
- The ability to account for cross-platform interactions on mobile and non-mobile devices
- Create a seamless user experience and accurate tracking with deep links and deferred deep links
- Aggregate cost and campaign data across multiple platforms, media sources, and channels
- Combine attribution data with granular campaign data to uncover actionable insights that can improve profitability
With these capabilities in mind, Singular’s mobile attribution platform is able to help marketers hit their target KPIs and drive growth.
How Singular Improves KPI Tracking?
Regardless of the metrics or KPIs you’ve decided to track and measure, Singular provides the marketing analytics and dashboards needed to improve performance. In terms of marketing analytics, few of the core capabilities of the platform include:
- ROI insights: With ROI insights at both a high-level and more granular levels, marketers are able to optimize their budgets accordingly. In particular, this includes 8 layers of granularity that enables marketers to hit their target KPIs and maximize returns.
- Visualize ad creative insights: In addition to granular metric analytics, the platform allows you to improve your storytelling by visualizing each ad creative alongside its campaign performance. This information helps marketers understand how their creative assets are performing across campaigns and in relation to their KPIs.
- Custom analytics: Since each marketing campaign is unique, Singular allows you to create a tailored analytics solution including custom dimensions, custom metrics, and custom events.
- Ad monetization analytics: Finally, you’re able to automatically collect, combine, and normalize ad revenue across each platform into a single dashboard. In terms of tracking KPIs, this enables marketers to compare and contrast the performance of each ad revenue source against their benchmarks.
In summary, a mobile attribution provider like Singular enables app businesses to take a scientific approach to their analytics, KPI tracking, and growth strategy. By combining these capabilities into a single, unified view, marketers are able to uncover optimization opportunities and maximize their KPIs with granular performance insights.