KPI
key performance indicatorA KPI, key performance indicator, is the number by which progress towards a goal is tracked and managed. A good KPI ties to the business objective, can be measured reliably and responds to your own actions.
Good to know
KPI choice is a strategic decision, because the metric steers the work: if a team’s key metric is click price, you get cheap clicks, not sales. That is why the top metrics tie to euros, such as ROI and customer acquisition cost, with channel metrics serving them. Write down for every KPI who owns it, where it is measured and what decision it drives; a metric without a decision attached is decoration.
The working structure is a metric tree: 1–3 top-level KPIs for management, and per-channel drivers explaining the top level’s moves. When everything is measured, nothing is managed, so fewer metrics usually means better leadership.
IN PRACTICE
Marketing’s metric tree
Top level: euros
Revenue from marketing, customer acquisition cost, ROI. These are discussed with management.
Channel level: efficiency
CPA, ROAS, CPL and conversion rate per channel. These are optimised weekly.
Driver level: signals
CTR, engagement, open rate. These diagnose why channel metrics move.
PITFALLS
Two KPI mistakes
Vanity metrics lead
Followers, likes and impressions can rise for months without a euro of sales following. They are drivers to diagnose with, not key metrics to lead by.
Ten equal metrics
When everything is important, nothing is. Choose at most three top KPIs and subordinate the rest.
FREQUENTLY ASKED
Frequently asked questions
How many KPIs should marketing have?+
1–3 at the top, a few drivers per channel. Anything beyond that is reporting, not leadership.
What is the difference between a KPI and a metric?+
A metric is any measurable number, a KPI the chosen key one leadership ties to. All KPIs are metrics; few metrics earn KPI status.
How is a KPI target set?+
From your own history and the business goal: current level, growth target and a realistic improvement per quarter. Industry benchmarks are direction, not targets.
How often are KPIs reviewed?+
Channel metrics weekly, top metrics monthly and quarterly. Daily staring at dashboards produces reactions to random noise.
What is marketing’s most important KPI?+
For most, customer acquisition cost against customer value: it joins efficiency and growth in one ratio the whole company understands.
FOR YOUR BUSINESS
Want results, not just definitions?
We go through your goals and propose channels and a budget in 30 minutes, free of charge.
FOR STUDENTS AND NEWCOMERS
Learn the terms, then come and put them to work
The glossary is free study material. Go deeper in our training, and if you want to work in the field, our growing team is looking for people.
Maintained by the VSCY editorial team · Updated 6 Aug 2026 · Part of the marketing glossary (99 terms)
