Introduction to Key Performance Indicators

KPI's are merely the quantitative measurements which reflect critical success criteria as defined by the stakeholders of a website. KPI's, if used correctly, will often act as the critical bridge connecting the abundant data and reports that web analytics tools generate with the ability to succinctly evaluate the performance of the web site, business process or marketing campaign that is being evaluated. Without KPI's it can be an overwhelming task to share relevant and actionable data with various stakeholders within an organization. When working with clients, I almost always recommend the creation of KPI dashboards that present views of the web analytics data at the following levels:

  • Executive Level
  • Management level
  • Function area stakeholders (marketing, merchandising, content owners etc)

By following this process, each of the respective parties can be provided with a fully customized view only of the metrics that are truly relevant to them in their role within the organization. In each case, the goal is to distill the data into a handful of truly actionable metrics that provide insight into the success or failure of either the entire site or a particular section or process on the site.


How KPI's can enable taking action on Web Analytics Data
One of the most important functions that KPI's can perform for an organization is enabling action to be taken on the data that is generated from web analytics tools. In my experience with clients, this manifests itself in the following three ways:

  1. Establishment of baseline measures: Once the initial KPI's are defined there is often the opportunity to conduct a historical analysis of existing data to establish baseline measures with which to evaluate the future success of the website, business processes, and marketing campaigns. Additionally, establishing a baseline measure for each KPI is critical in providing a relevant context to the KPI dashboards as most KPI's are best evaluated against their historical measures. For example, knowing that the conversion rate for a process is 3% higher when compared to the prior month is more actionable than merely having the knowledge that the conversion rate for the month is 6.9%.
  2. Enablement of A/B and Multivariable Testing & Scenario Analysis: One of the most powerful ways to take action on web analytics data is to leverage the combination of scenario analysis and testing to identify areas in key processes that can be optimized, define hypotheses, and ultimately test those hypotheses. In Stratigent's recent research study, "Web Analytics: The Evolution of Sophistication" we observed that the utilization of KPI's enabled more advanced techniques across the base of participants. The charts below highlight the role KPI's play in increasing the likelihood of an organization's ability to leverage advanced techniques such as A/B and multivariable testing and scenario analysis.



Usage Testing SegmentedUsage of  Scenario Analysis


Exhibit 1 illustrates the percent of research participants who utilize testing (a/b or multivariable) segmented by the amount of time that the organization has been using KPI's. Similarly, Exhibit 2 shows respondents who utilize scenario analysis also segmented by the amount of time that the organization has been using KPI's. In both cases there is a dramatic increase in the likelihood of the use of a/b and multivariable testing and scenario analysis the longer that an organization has been using KPI's.


3. Usage of KPI's to Enable Prioritization of Future Plans: The critical role that KPI usage plays in the process of prioritizing and planning future marketing, business process, and site design changes should not be underestimated. The very act of defining KPI's and then establishing baseline measures for them allows an organization to more appropriately allocate their future resources. Additionally, this process allows for an organization to set specific goals for the improvement of specific KPI's and correlate them to specific projects. Organizations can use this data to select the projects with the highest potential return on investment.


Common Examples of KPI's by site business model

Online Commerce:

  • Average order value
  • Overall site conversion
  • Shopping cart conversion
  • Revenue dollars generated / dollars spent on marketing

Lead Generation:

  • Form completions conversion rate
  • Percentage returning visits
  • Average pages per visit
  • Offline lead close rate

Customer Service:

  • Call center volume (Offline, Multi-Channel)
  • Average visit duration
  • Percent of visitors using knowledge base or FAQ
  • Process conversion rates
  • Average depth of visit
  • Page stickiness


  • Average pages per visit
  • Average revenue per visit
  • Percentage new visitors
  • Percentage of visitors who visit respective content area
  • Average ad impressions per visit



By Bill Bruno
About the Author:

Bill Bruno is the CEO - North America, Ebiquity.

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