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KPIs - what are they and what do I need them for?

KPIs. You hear it all the time, you read it everywhere. And somehow it sounds a lot like corporate, controlling and spreadsheet hell. But for small companies, coaches, start-ups and vegan manufacturers, KPIs – - Key Performance Indicators – - are a real game changer. Why? Because you are finally no longer working into the blue, but have your goals in black and white.

Category

Marketing

Author

Katrin Tindler

KPI – what is that please?

KPI stands for Key Performance Indicator, so for a Important key figure, which you use to measure whether you are achieving your company goals. Sounds dry, but it's actually quite helpful. KPIs not only give you an overview of the current status, but also show you where your company is currently heading – or where it is currently travelling in circles. Entrepreneurs should know their KPIs like they know their own bank balance.

These numbers help you make informed decisions – and not just based on gut feeling. For example, if you know that 1 in 100 website visitors buys, you can calculate how many visitors you need to achieve your desired revenue. And that in turn determines your marketing budget – and not your goodwill.

KPIs briefly explained:

  • KPI = Key Performance Indicator

  • Shows you how well (or badly) you are achieving your goals

  • Makes your growth measurable – and controllable

Why KPIs make your team more focused

Many entrepreneurs make the mistake of setting themselves goals – but not measuring them. True to the motto: „I want to grow!“ – But where, how fast, with whom and why? This is exactly where KPIs help. They ensure that everyone in the team knows the same direction. Whether for the next social media campaign or website relaunch: KPIs show what is really important.

If everyone knows what is important – e.g. a lower bounce rate or more newsletter registrations – resources are no longer wasted, but used sensibly. KPIs are therefore not a control freak tool, but a real efficiency booster. And yes: they also help you prioritise – without getting bogged down.

KPIs bring focus because they ...

  • ... set clear priorities in the team

  • ... quickly visualise weak points

  • ... show what works well – and what doesn't

Goals and the associated KPIs

A goal without a KPI is like a compass without a needle. To help you understand the principle, here are a few typical goals with suitable KPIs. Important: Each KPI must measurable, relevant and regularly reviewed become – otherwise it won't do you any good.

  1. Target: 20 % more website visitors in six months
    → KPIs: Daily visitor numbers, traffic sources, CTR of the adverts, bounce rate

  2. Target: 10 % more sales in the next quarter
    → KPIs: Number of daily orders, conversion rate, shopping basket size

  3. Target: Increase conversion rate by 4 %
    → KPIs: Shopping basket cancellations, check-out duration, conversion per landing page

Typical KPI types at a glance:

  • Sales KPIs: Turnover, average shopping basket, repurchase rate

  • Marketing KPIs: Click rate, reach, engagement rate

  • Website KPIs: Bounce rate, dwell time, conversion rate

Why KPIs make growth visible and controllable

Growth does not happen by chance – but through strategy. And KPIs are your strategic torch in the digital tunnel. Whether you want to increase your turnover or simply work more efficiently: With the right KPIs, you can recognise where things are going wrong at an early stage. And you can take immediate countermeasures. This saves you nerves – and money.

If, for example, after a website relaunch you notice that the dwell time decreases and the bounce rate increases, you know: Something is wrong here. Maybe it takes too long to load or the texts are not to the point. Without KPIs, you would have noticed this much later – or not at all.

Typical use cases for KPIs:

  • New landing page? → How does it perform compared to the old one?

  • Social ads running? → How high is the return on ad spend?

  • Shop restructured? → Does the conversion rate change?

Conclusion

KPIs are not a trend, they are your navigation system. Whether you want to scale your vegan food start-up or set up your coaching business more efficiently – with the right KPIs, you can plan, analyse and optimise on a sound basis. And you'll immediately realise whether your measures are paying off or not. So: set KPIs, check them regularly – and move your business forward step by step.