KPI system for evaluating the effectiveness of marketing agency projects
“I need new customers and sales, and they are telling me only about likes and followers…” If you have decided on marketing outsourcing and find yourself thinking this way when talking to a potential contractor, then I would advise you to worry. Perhaps, that marketing agency lacks a proper KPI system, and that means it can be difficult to track the productivity of the contractor's work…
Let's start with the most important part. If this idea came to you at all, I think it happened for two reasons:
Let's start with the most important part. If this idea came to you at all, I think it happened for two reasons:
- The manager you negotiated with before you signed the contract simply isn't experienced or qualified enough to clearly explain to you the KPI structure of your future project.
- Or the marketing agency do not understand the goals of potential customers well enough and cannot "speak their language." The customer's goal is not to collect likes, not to outrun a competitor by followers, but to boost the number of clients, sales, and income. In the meantime brands, as a rule, also have a clear goal - to improve their brand awareness. Of course, there are some customers that do not need any clarification, but there are just a few of them.
Here is a tip: these two reasons are serious enough to consider whether or not to deal with such contractors. A good agency communicates results as specifically as possible and always translates metrics from the “social media language” to the customer's “money language”. For this, the agency requires a “source text” (a KPI system) and a "vocabulary" (an understanding the way business performance correlates with social media actions).
The performance indicators essential to evaluate depend on the project goal, the social media itself, and some other contextual factors. This is what a potential contractor should explain to you from the beginning. But, as a rule, there is a basic set of vital metrics:
The performance indicators essential to evaluate depend on the project goal, the social media itself, and some other contextual factors. This is what a potential contractor should explain to you from the beginning. But, as a rule, there is a basic set of vital metrics:
- We clearly measure ROI (Return on Investment), number of leads and CPL (Cost Per Lead), along with the related conversions and metrics that contribute to getting those leads.
- When setting up advertising campaigns, most often we use standard metrics: CTR (Click-Through Rate), CPC (Cost Per Click), COS (Cost Of Sale), LPO (Leads generated Per Offer) and others.
- If our goal is to focus on Instagram or Facebook promotion, we must measure the dynamics and growth rate of the followers, engagement indicators (ER - Engagement Rate, ERR - Engagement Rate by Reach, ERV - Engagement Rate by Views, and others), coverage, views, and activity indicators: mentions, comments, shares, likes (including organic likes), saves and others.
- When you deal with brands and your major goal is to increase brand awareness, most often you use the same indicators: impressions, coverage, views, number of followers, and engagement for measurement. In this case, indicators of audience engagement and activity are even more important. Is the content attractive, what are the comments like, are the followers active enough? We have a special team member for this - the project community manager.
- When you promote on TikTok, the focus shifts to other metrics. Followers are not that significant in this case. The most important thing is the views count for each video. We also track total monthly views and try to figure out why a particular video gets to the TOP, and then we try to shoot more such videos.
Here is a tip: a reliable marketing agency never lacks data, because it uploads everything that might be useful, and then performs a detailed analysis and report.
Ask about the process of data extraction and analysis in the company. Then find out about the reporting forms that the agency plans to provide. For example, apart from the daily monitoring, we create large weekly and monthly reports to track and show the progress and results of our work to the customer.
Also, be sure to ask the marketing agency to show you their cases. Experienced contractors always have their portfolios ready. But besides the results themselves, make sure you ask a few questions about the project details, because true professionalism is in the detail.
Ask about the process of data extraction and analysis in the company. Then find out about the reporting forms that the agency plans to provide. For example, apart from the daily monitoring, we create large weekly and monthly reports to track and show the progress and results of our work to the customer.
Also, be sure to ask the marketing agency to show you their cases. Experienced contractors always have their portfolios ready. But besides the results themselves, make sure you ask a few questions about the project details, because true professionalism is in the detail.
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