Key Performance Indicators Simplified: Part 1 Tutorial

1.2 Introduction

Hi, this is Avinash. And welcome to the next edition of our Web Analytics, videos. This one's on a topic that is near and dear to everyone's heart. And it's key performance indicators. I don't think that, you can go very far in web analytics without hearing the name KPIs. Brandished about in all of its excitement and glory. And yet, I think that for the most part, people are a bit confused about what KPIs are, how to select them, how to make them more actionable, what value do they add, and, and all of those other wonderful kinds of things. And so in this video, we're going to do two, two parts to this video. And it's going to be my attempt to start at the, sort of the ground floor and explain from the, from the very beginning what, what these things are, and, and how do you understand and study these animals called KPIs. [LAUGH] And how can you, how can you avoid some of the pitfalls that that befall many of the other people and get your own web analytics journey off to a flying start? So this is going to be a lot of fun, and regardless of what role you have, regardless of whether you work on the SEO side of things, or PPC, PR, online email marketing, just or traditional website analysis. I really think that these two videos are going to be very important and relevant to, pretty much any persona that touches your website. So I hope that you're going to have fun and let's get going.

1.3 What is a KPI?

The very first thing that I wanted to sort of cover is set a baseline for what a kpi is. And course, when in doubt, there's only one place we can all go and that's the great Wikipedia. [LAUGH] So, obviously Wikipedia has a wonderful entry for key performance indicator. And their definition of KPI is actually a good one. And, and it states that KPIs are financial and non-financial metrics used to help an organization define and measure progress towards an organizational goal. So, a bit, a bit high in my idea you know, and, and, and glorious perhaps but nonetheless, a really, really nice definition of what a KPI means, again, regardless of what channel you apply to it and regarding what person is going to end up using it. And, and to me I think that if, if we step back from the definition. I was joking with John Marshall that, you know, KPIs are like heartbeat is is a KPI that, that I can measure using a stethoscope. And it previews your heart and I can see if you're alive or dead. You know, the, the beating of the heart is, is the KPI that indicates something very critical about your body. You know another KPI is the temperature of your body that i could take using a thermometer and in this case, the KPI gives a different sort of read and it tells me if you're feeling well or you're running a temperature and if you're running a temperature how high is it. Is it and do we need to just take an Aspirin or call a fire brigade to put off, you know, your, 110 temperature. Or well at that temperature, you'll probably need other help but regardless. So in it's simplest terms I, I encourage you to think of KPI's as those kinds of indicators that sometimes tell you something is drastically wrong with the case of the heartbeat or other kinds can help us understand some interesting things about the process that you're measuring. And, of course, I had to sort of come up with my own definition, you know, and, and to me I, I hope that you'll agree that this is sort of a very simple, easy to understand metric and balances. Two very important things, and and the definition is KPIs are measures that help you understand how you're doing against your objectives. And then really these two things are very important. There's two words at the end, the very first one is measures and the other one is objectives. And, and I really do believe that objectives are very critical to understand before you go on a KPI hunting mission. So, so keep that in mind, you know, measures that help you understand how you are doing against your objectives are, are, is exactly what I think KPI's are key performance indicators. Let me give you a couple of examples. Let's have some fun and, and, understand Couple of KPI and not be on top of your mind. And, and further sort of make this concept more concrete, and here's, here's a great example. Of course there's a KPI library on the web, you know, surprise surprise. And then here's a really great KPI. A percent of nasocomial infections and the way that the KPI is defined I think is very much along the definition we've just proposed and it is. How many Inpatients acquire infections inside the hospital, you see there? It's, it's a measure very clearly defined and tied to an objective which is that people coming into the hospital with no infections of any kind should not get infected once they're in the hospital [LAUGH] also. Absolutely a glorious, wonderful example of what a KPI is. Now here's another one, we were doing a webinar and, and of course, much to my delight, there were a number of KPIs that I could see [LAUGH] in in the dashboard that was presented right here. And, and the one that I thought was the most beautiful and delightful was attentive, the percent of people who were on the webinar at that given moment in time who were paying attention to what I was saying. This is a very, very good metric. It's a clear measure tied to our objective that we're giving a webinar and everybody should be paying attention. It's a really wonderful metric. Again, another one that's not totally tied to our daily web jobs. But nonetheless, makes the concept concrete, and let me give you a last example of a KPI. And a lot of people don't think about this when they're measuring websites, but I really love it. This is a KPI that's actually used by blinds.com and Daniel is the CMO over there shared this data with me and his KPI is gross margin per visitor so he really measures this hardcore for people who come visit his website. And, and over time as you can see, over the course of nearly two years, the KP has gone up into the right again. Measuring the outcome, which is improving the gross margin for every single website visitor, clearly defined KPI that Daniel is measuring much to the success of blinds.com. So those are just three examples that hopefully help you make the definition more concrete. But let's actually before we dive too deep into other examples of KPIs that you could use and should be using for your web business. Let me walk you through four distinct attributes of a great KPI before we get into too many examples. And and this is sort of a test that I encourage you to apply every time you go out there and choose a KPI for your business.

1.4 Uncomplex

And the very first, very but very, very, very critical one is, I think, great KPIs are uncomplex. And let me help you understand that. I run into things all the time very I saw this KPI engagement. Quote unquote engagement KPI and essentially had seven variables. Some were multiplied divided by the other ones and some were to the power of something else. [00:00:27] And at the end of these six or seven variables and numbers Bid out and it was so complex that there's just no one except the creator of the KPI who could understand what it actually meant or what the number that got spit out meant. But worse then that the other problem with this KPI was that even if the number got spit out and you understood what the definition was there's just no way in god's green earth. [00:00:51] They can understand which of those variables or what the root cause was of things happening well or not happening well. In fact most of the time, some of the variables were of the other word down, the number that got spit out was essentially flat so you could wrongly assume that everything was great with the business when in reality that was not the case at all. [00:01:11] So I strongly encourage you when you pick KPIs to make them un-complex. Because if you're the only person as the creator who understands what the KPIs with definition of what it's measuring then it's highly unlikely in today's distributed complex organizations where we're trying to create data democracy that you'll succeed in your mission of making company data-driven and use that KPI. It is highly likely that complex KPIs essentially become auto-deleted when you send them out and nobody can understand or take action from them. So try not to be cute, at least initially, and create metrics that are uncomplex, because in the end what you're solving for. For is an organisation to use the KPI, to take action and not just you yourself, so it's a great first test that you should apply.

1.5 Relevant

And the second one is, KPI should be relevant. There is this, there is this belief today that best practices work for everyone. There even are books recommending KPI saying, oh here's a cookie cutter mechanism. If you are a, a, a seller of widgets, or you're a social network, or you're, you're, you're, you're you know, a blog, then here are the KPIs that you should use. And, and that's it, and you should not worry about anything. Don't hurt your pretty little brain. And just copy, paste these, and, and happy birthday to you. And, and this really is not true in my experience. I find that KPIs are very unique to each business and the objectives of each business. Remember our definition, measures is the first word, objectives is the last word. In fact, to me BestBuy and Circuit City make a great case where, essentially on the surface, both of these businesses are exactly the same. They sell electronics; pretty much exactly the same electronics. Look at the, look at the top navigation bar, [LAUGH] in fact for both of these businesses and they could essentially be a copy paste of each other and yet when you think about the objectives of what these businesses are solving for. They each have a extremely different business strategy online. Circuit city is heavily, heavily in to getting people to come to their stores. Look at, look at the free shipping on orders 25 and up or choose 24-minute in-store pickup. There, there's nothing about sort of store pickup right there in the header. So Circuit City's core strategy is drive people to the store. Best Buy's core strategy is let's get people to buy online, and yes. We do have an option to pick in store, but that's not really the core strategy, so go back and try and understand what your solving for your business. And it's okay to take inspiration from others, but if you simply copy paste metrics, then it is highly likely that they might not be relevant to you and you won't be able to make as much progress you your business as you could possibly want to have happen. So remember that KPI should be relevant to your business.

1.6 Timely

The third one is that the third awesome rule is they should be timely. Very, very important. I was doing a job interview with with a company a couple years ago, and, and I asked them, you know, how come your performance in the last quarter was actually spectacular, you made a ton of money? And what they said to me is, yes, yes. We would like to understand that. We've just executed the query, that will help us understand what's happening with that metric increase revenue and that query will return it results in two months. I'm not even joking. Admittedly, this is a big business but if the answer to your KPI takes two months to find, it's highly and likely that you would be able to take action in. And remember the web moves at a pace of light, and it's very important that the metrics you create, at least most of them, not all of them, but most of them are available in a timely fashion. So if you want to make decisions on a weekly basis, then creating KPIs that take a week to collect is, is highly unlikely that you would have time left to or to find insights and take actions. So remember to apply the tests that KPI should be available to you, be able to be computed and available to you in a timely fashion and in, in, and in time enough so you can then look at the KPI and then further spend some time understanding, analyzing, segmenting it so you can take action on it. So, timeliness is very important.

1.7 Instantly Useful

The last rule is they should be instantly useful. And this this rule is because I have seen so many KPIs they just want to make me cry because I they just it takes like 10 minutes to explain what they are. And, and then they and there's really no way that we can make everyone understand what the numbers are showing. And they're not really instantly useful, and here's a great example of what I mean by instantly useful. This is a report from ClickTracks, one of my favorite tools. And as soon as you look at this report, it's not a data puke of the top keywords that are driving traffic to my website. What it is showing me are the keywords that are statistically more significant now and are actually sending me more traffic over the time period I'm analyzing, or less traffic in the time period that I was analyzing. So, as soon as I look at this report, immediately I can take some action. And, this is really what I recommend that your KPIs be. On your dashboard, your senior decision maker should be able to look at your core KPIs, and, and just by looking at the numbers, whether up or down, or flat. They should be able to, sort of understand at least some semblance of, of, of what kind of success is being driven. From those KPIs, or, or lack thereof. So look for KPIs that are instantly useful rather than KPIs that show up on a dashboard. And, and then it takes you two and a half years to understand you know, if, if, if what, what, what the trends were, or, or, in order to make them more useful. So, so that's another, important rule that I have. So, let me give you an example of a KPI that sort of meets all four of these rules. And my, my hope is as you go about your own business, you'll apply these rules to the KPIs that you have.

1.8 Examples

So to close this video, I want to walk you through some examples of what I think are great KPIs, that I think have some universal appeal to some businesses that exist out there. But what I also want to do in this part, is actually encourage you to think beyond your standard click stream stuff. If you, if you've seen the other videos, or read my blog, or book, or anything that you read in Market Motive, I'm sure that you'll know that I'm a big fan of use of web analytics 2.0 concept and this idea of using multiple sources. And, and I think this is a big mistake people, analysts and marketers make on the web where we don't use multiple sources to create KPI. So, let's get going and let me see some, ideas in your mind that you can build on.

1.8 Examples

So to close this video, I want to walk you through some examples of what I think are great KPIs, that I think have some universal appeal to some businesses that exist out there. But what I also want to do in this part, is actually encourage you to think beyond your standard click stream stuff. If you, if you've seen the other videos, or read my blog, or book, or anything that you read in Market Motive, I'm sure that you'll know that I'm a big fan of use of web analytics 2.0 concept and this idea of using multiple sources. And, and I think this is a big mistake people, analysts and marketers make on the web where we don't use multiple sources to create KPI. So, let's get going and let me see some, ideas in your mind that you can build on.

1.9 Conversion Rate

And of course the world's most obvious KPI in the world, in the universe, is conversion rate. And it's highly like that it is [LAUGH] relevant for your business. And then you know, traditionally when we think of conversion rate is you know, e-commerce. They did, you know what's my conversion rate, that's the graph you see on the left here. It's 1.41% for this website and then you know am I making revenue, in this case 5,000 Euro. So very traditional metric, applies everywhere so you measure conversion rate look at the absolute value and it's very, very useful. But the other thing I want to tell you quickly before we go to the next one is, think of conversion rate as having many, many different, kinds of outcomes that you could measure. It could be leads submitted. It could be something that was viewed on your website. It could be, of course, e-commerce for a retailer. So think of conversion rate more broadly, but of course, for e-commerce websites, this is exactly what you want to measure.

1.9 Conversion Rate

And of course the world's most obvious KPI in the world, in the universe, is conversion rate. And it's highly like that it is [LAUGH] relevant for your business. And then you know, traditionally when we think of conversion rate is you know, e-commerce. They did, you know what's my conversion rate, that's the graph you see on the left here. It's 1.41% for this website and then you know am I making revenue, in this case 5,000 Euro. So very traditional metric, applies everywhere so you measure conversion rate look at the absolute value and it's very, very useful. But the other thing I want to tell you quickly before we go to the next one is, think of conversion rate as having many, many different, kinds of outcomes that you could measure. It could be leads submitted. It could be something that was viewed on your website. It could be, of course, e-commerce for a retailer. So think of conversion rate more broadly, but of course, for e-commerce websites, this is exactly what you want to measure.

1.10 Avg. Order Value

And the next one is, is one that I think is a hidden AKPI that I think that many, people don't measure which is called Average Order Value. And this is a wonderful, wonderful KPI. And in this particular ecommerce website you can see the average order value is $345. And this really a great KPI because it's great to know that you had 1.41 conversion rate. But, you know, over time measuring average older value could tell you if you're much better able to sell, products and services on your website. Or if you're merchandising and upselling and cross selling and promotional efforts that you have are having the kind of impact on, what people end up buying on your website. So, remember, you could have a 1.42% conversion rate for, for, for months and months, and your average order value could consistently be going down the toilet or keep increasing. So, another different way of understanding if as with each visitor who places an order on your website, are you doing a great job of upselling, cross selling promotions or, or, or helping people find the products and services they need? So, I love this KPI Average Order Value because it gives me another diagnostic measure for effectiveness of my website.

1.10 Avg. Order Value

And the next one is, is one that I think is a hidden AKPI that I think that many, people don't measure which is called Average Order Value. And this is a wonderful, wonderful KPI. And in this particular ecommerce website you can see the average order value is $345. And this really a great KPI because it's great to know that you had 1.41 conversion rate. But, you know, over time measuring average older value could tell you if you're much better able to sell, products and services on your website. Or if you're merchandising and upselling and cross selling and promotional efforts that you have are having the kind of impact on, what people end up buying on your website. So, remember, you could have a 1.42% conversion rate for, for, for months and months, and your average order value could consistently be going down the toilet or keep increasing. So, another different way of understanding if as with each visitor who places an order on your website, are you doing a great job of upselling, cross selling promotions or, or, or helping people find the products and services they need? So, I love this KPI Average Order Value because it gives me another diagnostic measure for effectiveness of my website.

1.11 Days to Purchase

And then these are two of my favorite measures also in the e-commerce realm, but it could be used for non e-commerce websites as well. And they are called days and visits to purchase. I'm sort of on the record as saying that most marketers and website experiences are created with this, the concept of one night stands in their mind, where, you know, you just come to my website and buy right away in this session. And it's, you know, nobody sleeps on the first date, and that's really not how the way it works either. People come to your website, explore it, have the dance, you know, maybe go out for dinner with you and, and put something to the cart and then go away, think some more, play hard to get, and maybe on the third time [LAUGH] they actually buy something on your website. So, days and visits to a purchase are great KPI, because they help you understand true customer behavior on your website. So in this case, on this website you'll notice about 45% of the people buy on the first visit. But then the rest of the people actually buy on subsequent visits. In fact, about four percent traffic buys after nine to 14 visits in. So this is a great way to understand customer behavior on your website, but then also help you understand and segment your data, so you can understand, okay what kinds of people do buy in the first visit. What products are they buying? And and what are these people taking multiple visits to go buy? What campaigns are driving them? What products do they buy? And, and, and why is it that they buy after many visits? It it gets you a great understanding of customer experience. But more than that, helps you evolve beyond the one night stand mindset that so many marketers unfortunately have on the web. And days to visits is the corollary of that. You know, you could have ten visits in one day, this sort of frames it up as how many days has it taken? This data is actually for a travel website, actual data for a travel website, and there is nothing more toxic you know, in terms of nuclear decay. Then airline tickets, they become expensive with every passing minute. And yet on this travel website that sells airline tickets. Only 60% of people bought on the same day. In fact almost 40% of the people this big block of people at the bottom, actually bought between eight days to 120 days later. That's astonishing so, these people were are were on a made a, no choice to pay a very expensive price for the ticket. Rather than buy it in the same day and save a ton of money. And it's very important that you understand, you know why do these people do this? And what destinations are they going to? and well, can I do something like, help these people save their itinaries or ping them, and send them an email reminder that the price just went up another ten bucks, so I can get them to come back sooner and buy from me. So, there's a great KPI that gives you a peek into the customer's mind, and gives you tons of actionable insight to improve your web site. Love, love these two metrics, days and visits to purchase. And here's a great place where I measured this particular metric. And in this case, I segmented by different kinds of acquisition strategy, pay per click, direct, as well as affiliates, and you'll notice the different people behave differently. So, people who come into pay per click actually take greater, a lot of them take greater than three click, three visits to buy. While my affiliate people, who I had actually though would need a lot more convincing to buy my website. Sixty-four percent of them buy on the first visit. And this is exactly what I meant by, by the power of this metric to give you great peek into the customer's mind, and then go back and optimize your affiliate marketing campaign. In this case actually because I did not think the affiliate marketers, marketing campaigns convert fast. My landing page did not have actually, so right away I do buttons and things. And right off, as soon as I got this, boom I put a lot of calls to action on that, those landing pages, so excellent action on my website, right away improvement in conversion rates, so very good KPI.

1.11 Days to Purchase

And then these are two of my favorite measures also in the e-commerce realm, but it could be used for non e-commerce websites as well. And they are called days and visits to purchase. I'm sort of on the record as saying that most marketers and website experiences are created with this, the concept of one night stands in their mind, where, you know, you just come to my website and buy right away in this session. And it's, you know, nobody sleeps on the first date, and that's really not how the way it works either. People come to your website, explore it, have the dance, you know, maybe go out for dinner with you and, and put something to the cart and then go away, think some more, play hard to get, and maybe on the third time [LAUGH] they actually buy something on your website. So, days and visits to a purchase are great KPI, because they help you understand true customer behavior on your website. So in this case, on this website you'll notice about 45% of the people buy on the first visit. But then the rest of the people actually buy on subsequent visits. In fact, about four percent traffic buys after nine to 14 visits in. So this is a great way to understand customer behavior on your website, but then also help you understand and segment your data, so you can understand, okay what kinds of people do buy in the first visit. What products are they buying? And and what are these people taking multiple visits to go buy? What campaigns are driving them? What products do they buy? And, and, and why is it that they buy after many visits? It it gets you a great understanding of customer experience. But more than that, helps you evolve beyond the one night stand mindset that so many marketers unfortunately have on the web. And days to visits is the corollary of that. You know, you could have ten visits in one day, this sort of frames it up as how many days has it taken? This data is actually for a travel website, actual data for a travel website, and there is nothing more toxic you know, in terms of nuclear decay. Then airline tickets, they become expensive with every passing minute. And yet on this travel website that sells airline tickets. Only 60% of people bought on the same day. In fact almost 40% of the people this big block of people at the bottom, actually bought between eight days to 120 days later. That's astonishing so, these people were are were on a made a, no choice to pay a very expensive price for the ticket. Rather than buy it in the same day and save a ton of money. And it's very important that you understand, you know why do these people do this? And what destinations are they going to? and well, can I do something like, help these people save their itinaries or ping them, and send them an email reminder that the price just went up another ten bucks, so I can get them to come back sooner and buy from me. So, there's a great KPI that gives you a peek into the customer's mind, and gives you tons of actionable insight to improve your web site. Love, love these two metrics, days and visits to purchase. And here's a great place where I measured this particular metric. And in this case, I segmented by different kinds of acquisition strategy, pay per click, direct, as well as affiliates, and you'll notice the different people behave differently. So, people who come into pay per click actually take greater, a lot of them take greater than three click, three visits to buy. While my affiliate people, who I had actually though would need a lot more convincing to buy my website. Sixty-four percent of them buy on the first visit. And this is exactly what I meant by, by the power of this metric to give you great peek into the customer's mind, and then go back and optimize your affiliate marketing campaign. In this case actually because I did not think the affiliate marketers, marketing campaigns convert fast. My landing page did not have actually, so right away I do buttons and things. And right off, as soon as I got this, boom I put a lot of calls to action on that, those landing pages, so excellent action on my website, right away improvement in conversion rates, so very good KPI.

1.12 Loyalty & Recency

And, two other KPIs, if your website is not e-commerce related is loyalty and recency. So, for example, I'm, I'll use the New York Times website, and let's assume for a second it has no ads, or the BBC website, which also has no ads. And, and it's pure content website, no e-commerce of any sort, no lead submissions, nothing, just content. And in that case, I like measuring visitor loyalty, which is how frequently do people visit our website. And it's not just measuring average visits to in a month, and that's really a, a average metric that really lies and and does not give you good data. Look at the distribution. Some KPIs you have to look distributions, and in this case I would go back to my CMO and say look, 39% of the people came once to my website. Even though in this case, average visits in a month were just two, but there were about another 30, 40% of the traffic right here at the very bottom that visited my content website between 9 and 200 times a month. It is amazing, this bucket of really loyal people to my website. They're coming again and again and again, every day, actually on the BZ website, this is me. I go there all day long again and again, being a political junkie. And you can understand these. You can you can create a goal around this to say month over month for our visitor loyalty distribution KPI, are we getting better or worse? In this case actually we got slightly wor, or worse in July because the number of people who only visited once went up from 61% to 64%. So, so that's a great way to measure success, by using metrics like visitor loyalty for non e-commerce websites. And here's another one called Visitor Recency. So let's say you're running a social networking application where the only purpose of your application is so people friend each other and send applications into superpuck and other annoying things. Nonetheless, you don't have an ecommerce model yet, or any advertising model to speak of. How do you measure success of this particular business? What major recency? Are you actually creating such a sticky and engaging website that people come to it every single day, they can't wait to get to it. And in this case what the metric and data showed is that 66% of the visitors to this particular social networking website actually visited less than zero days ago and it's phenomenal because they can just go back to their executives and say look our applications so sticky, so engaging, Microsoft, why don't you give us a $400 million investment for 1% stake in our company because we are so awesome. Well, they can use this metric to do that because, indeed, 66% of the traffic. These are the people who have nothing better to do than send their, spend their lives superpoking other people and sending them applications, are phenomenally actionable KPI for non e-commerce business that helps you measure the health of the business, and if they are successful in their strategies. So, really wonderful metric. And the next one I wanted to share with you comes from a survey based mechanism, and it's called task completion rate and I'm a big fan of this metric because in the early average website you probably have 2% conversion rate. What is everybody else doing? How do you measure success of the 98% of the people who are not converting on your website, and I really like this metric task completion rate. And essentially, it, it helps you understand get beyond your obsession of this thin blue line at the very bottom, you know that's your 2% conversion rate and help you understand what's happening, this big red, the 98% of the people. And if your website has delivered any value to them. And it's a great KPI measured using surveys, and essentially what it is is the answer to the question, were you able to complete the task on our website? Whatever task you were there for, you could be there for e-commerce, submitting lead, donating money to our presidential candidate, read the latest news, download a bio, apply for a job, look at Market Motive videos, be convinced of our greatness. Doesn't really matter why you came to the website. Task Completion rig gives the power of the customers when they leave, the power to the customers so when they leave the website at the end of the visit we can show them a short survey and say why were you here, that helps us understand primary purpose and the second question is were you able to complete your task. So in this case if I was running this website I know that 74% of the people were able to complete their task. Then my job is to figure out what the other 26% were doing and why they were not able to complete the task. So this is a great way to measure success of every single person who is on your web site and I mention in my past Market Motive videos that I've teamed up with I Perceptions to create this survey for free that anybody in the world can use, totally free, and on exit, when people exit your website it shows the survey and ask, helps you measure task completion rate across different primary purposes. And it's a very, very actionable metric. Because rather than you and me, John and Michael and I, sitting around arguing about what should we fix next on the Market Motive website. We can simply take the content of this survey, the answers from our questions. When they tell us what tasks they're not able to complete, and use that as an input to improve our website. So we're not only solving for our egoals inside the company, but we're solving for our customers on our website. It's a really great way to measure task completion rate using this free survey, and in turn improving customer satisfaction because if you were able to complete a task your satisfaction in this piece of data is 77. But if you were not able to complete a task your satisfaction dropped dramatically. And you can help influence and improve. And the four q's survey will help you understand why people are coming, here are the reasons in the blue and what each of those people's task completion rate is. So you can identify things you should be fixing. So in this case, clearly the people who were not able to complete their task, a bunch of them were there to buy and only 39 were able to complete the task which essentially is crime against humanity because this is an e-commerce website and everybody should be able to buy who is there to buy. So boom right away you understand why the conversion rate is 0.000001%, see that real actionable insights.

1.12 Loyalty & Recency

And, two other KPIs, if your website is not e-commerce related is loyalty and recency. So, for example, I'm, I'll use the New York Times website, and let's assume for a second it has no ads, or the BBC website, which also has no ads. And, and it's pure content website, no e-commerce of any sort, no lead submissions, nothing, just content. And in that case, I like measuring visitor loyalty, which is how frequently do people visit our website. And it's not just measuring average visits to in a month, and that's really a, a average metric that really lies and and does not give you good data. Look at the distribution. Some KPIs you have to look distributions, and in this case I would go back to my CMO and say look, 39% of the people came once to my website. Even though in this case, average visits in a month were just two, but there were about another 30, 40% of the traffic right here at the very bottom that visited my content website between 9 and 200 times a month. It is amazing, this bucket of really loyal people to my website. They're coming again and again and again, every day, actually on the BZ website, this is me. I go there all day long again and again, being a political junkie. And you can understand these. You can you can create a goal around this to say month over month for our visitor loyalty distribution KPI, are we getting better or worse? In this case actually we got slightly wor, or worse in July because the number of people who only visited once went up from 61% to 64%. So, so that's a great way to measure success, by using metrics like visitor loyalty for non e-commerce websites. And here's another one called Visitor Recency. So let's say you're running a social networking application where the only purpose of your application is so people friend each other and send applications into superpuck and other annoying things. Nonetheless, you don't have an ecommerce model yet, or any advertising model to speak of. How do you measure success of this particular business? What major recency? Are you actually creating such a sticky and engaging website that people come to it every single day, they can't wait to get to it. And in this case what the metric and data showed is that 66% of the visitors to this particular social networking website actually visited less than zero days ago and it's phenomenal because they can just go back to their executives and say look our applications so sticky, so engaging, Microsoft, why don't you give us a $400 million investment for 1% stake in our company because we are so awesome. Well, they can use this metric to do that because, indeed, 66% of the traffic. These are the people who have nothing better to do than send their, spend their lives superpoking other people and sending them applications, are phenomenally actionable KPI for non e-commerce business that helps you measure the health of the business, and if they are successful in their strategies. So, really wonderful metric. And the next one I wanted to share with you comes from a survey based mechanism, and it's called task completion rate and I'm a big fan of this metric because in the early average website you probably have 2% conversion rate. What is everybody else doing? How do you measure success of the 98% of the people who are not converting on your website, and I really like this metric task completion rate. And essentially, it, it helps you understand get beyond your obsession of this thin blue line at the very bottom, you know that's your 2% conversion rate and help you understand what's happening, this big red, the 98% of the people. And if your website has delivered any value to them. And it's a great KPI measured using surveys, and essentially what it is is the answer to the question, were you able to complete the task on our website? Whatever task you were there for, you could be there for e-commerce, submitting lead, donating money to our presidential candidate, read the latest news, download a bio, apply for a job, look at Market Motive videos, be convinced of our greatness. Doesn't really matter why you came to the website. Task Completion rig gives the power of the customers when they leave, the power to the customers so when they leave the website at the end of the visit we can show them a short survey and say why were you here, that helps us understand primary purpose and the second question is were you able to complete your task. So in this case if I was running this website I know that 74% of the people were able to complete their task. Then my job is to figure out what the other 26% were doing and why they were not able to complete the task. So this is a great way to measure success of every single person who is on your web site and I mention in my past Market Motive videos that I've teamed up with I Perceptions to create this survey for free that anybody in the world can use, totally free, and on exit, when people exit your website it shows the survey and ask, helps you measure task completion rate across different primary purposes. And it's a very, very actionable metric. Because rather than you and me, John and Michael and I, sitting around arguing about what should we fix next on the Market Motive website. We can simply take the content of this survey, the answers from our questions. When they tell us what tasks they're not able to complete, and use that as an input to improve our website. So we're not only solving for our egoals inside the company, but we're solving for our customers on our website. It's a really great way to measure task completion rate using this free survey, and in turn improving customer satisfaction because if you were able to complete a task your satisfaction in this piece of data is 77. But if you were not able to complete a task your satisfaction dropped dramatically. And you can help influence and improve. And the four q's survey will help you understand why people are coming, here are the reasons in the blue and what each of those people's task completion rate is. So you can identify things you should be fixing. So in this case, clearly the people who were not able to complete their task, a bunch of them were there to buy and only 39 were able to complete the task which essentially is crime against humanity because this is an e-commerce website and everybody should be able to buy who is there to buy. So boom right away you understand why the conversion rate is 0.000001%, see that real actionable insights.

1.13 Share of Search

And I believe this is the last example. I wanted to take you out of your website and help you understand your performance and context of your competitors. And my last, KPI uses competitive intelligence in order to understand your performance, and I love this metric called share of search. And it's essentially what like traditional marketers have been using, and they called it share of shelf. I mean Walmart, or I'm the Procter and Gamble brand manager, I really want to now my share of shelf is for Pantene shampoo in Walmart and Target, and all these other kinds of stores. Well, why not create such a metric for the ultimate shelf in the world which is the search engine essentially. Google, Microsoft, Yahoo that dominate acquisition strategies for most websites, and do how much share of that shelf do I have when people are looking for me. And you can use competitive intelligence tools to understand that. So, in this case, I can say, okay what are the top key websites that send me traffic? How much share do I have of search traffic? So, for Cingular, from Google, Yahoo, Microsoft, all these other engines, and in the case of Cingular, it's 9.33% traffic. They have share traffic from Google, while Verizon it's actually 10.6% from Google. So, Verizon gets a lot more traffic from Google then does Cingulars. In this context, Cingular would cry a little bit because as every percent of difference here on this report is hundreds and thousands of searchers, so really a Cingular can get, can create this KPI and track it. Not only track it as a point in time which is what you're seeing on your screen, but actually measure trends over time. And in this case, you'll notice Verizon is the blue line and Cingular is the orange line. And for some reason, Cingular has been on the right path for months and months, so their 9% traffic from Google is great because they keep increasing over time. While if you look at Verizon, they have started to make big mistakes and started to literally drop off the radar in this case for the last few months. A very, very troubling development if I was Verizon. And if I was Cingular, this KPI share of search would immediately give me a big bonus from my boss. It is a great way to measure success, by using a metric that's available externally. And as to give you another example of Google Insights for Search, I wanted to see how much brand impact I'm having, how much share of searches, top of mind I am in terms of my customers, when I look for laptops. So, I said I like ThinkPads a lot. I have an X61, which I am very, very fond of. And I wanted to know if Thinkpad, how Thinkpad the brand is doing over the last few years, compared to Latitude, which is the brand of Dell, Macbook Air, which is the brand of Apple of course, and Vaio, which is the brand of Sony. And try to use this KPI, which is the search, the number of queries that a search engine to measure if my brand dollars being spent online and offline are causing people to look for my laptop, my brand of laptop and unfortunately, what turns out is both Dell and ThinkPad have been going down over time and that's precipitously in some cases and that's very, very sad and what it shows is Macbook Air launch boom, ton of people, ton of interest. Totally beat the heck out of both, Latitude and ThinkPad. And yet now, it's sort of, Mr. Steve Jobs is coming down to Earth a little bit more, over the last few months. But, notice the green line. That's the Sony Vaio and they have done a marvelous job of having a nice upward slope over the last four years and consistently doing the kinds of things that are required to stay top of mind in customers and have lots and lots of search queries be generated and create a demand for their product. So again, a great KPI if I were Sony. Breyer's brand manager to show value that my ad dollars are creating in the general ecosystem. While everybody else is going down, I am going up. So, another wonderful KPI that you can create from competitive intelligence data. So, I hope that you've learned very actionable insights about what KPIs are what kind of rules and regulations or tests you could apply to find great KPIs for yourself. And I hope that I've inspired you with the examples of KPIs that are sort of not normal and not used by many people, to find your own interesting and innovative KPIs that will help you find actionable insights from your Web Analytics Data, your Competitive Intelligence data and your survey data. So, I wish you all the very best. Thank you.

1.13 Share of Search

And I believe this is the last example. I wanted to take you out of your website and help you understand your performance and context of your competitors. And my last, KPI uses competitive intelligence in order to understand your performance, and I love this metric called share of search. And it's essentially what like traditional marketers have been using, and they called it share of shelf. I mean Walmart, or I'm the Procter and Gamble brand manager, I really want to now my share of shelf is for Pantene shampoo in Walmart and Target, and all these other kinds of stores. Well, why not create such a metric for the ultimate shelf in the world which is the search engine essentially. Google, Microsoft, Yahoo that dominate acquisition strategies for most websites, and do how much share of that shelf do I have when people are looking for me. And you can use competitive intelligence tools to understand that. So, in this case, I can say, okay what are the top key websites that send me traffic? How much share do I have of search traffic? So, for Cingular, from Google, Yahoo, Microsoft, all these other engines, and in the case of Cingular, it's 9.33% traffic. They have share traffic from Google, while Verizon it's actually 10.6% from Google. So, Verizon gets a lot more traffic from Google then does Cingulars. In this context, Cingular would cry a little bit because as every percent of difference here on this report is hundreds and thousands of searchers, so really a Cingular can get, can create this KPI and track it. Not only track it as a point in time which is what you're seeing on your screen, but actually measure trends over time. And in this case, you'll notice Verizon is the blue line and Cingular is the orange line. And for some reason, Cingular has been on the right path for months and months, so their 9% traffic from Google is great because they keep increasing over time. While if you look at Verizon, they have started to make big mistakes and started to literally drop off the radar in this case for the last few months. A very, very troubling development if I was Verizon. And if I was Cingular, this KPI share of search would immediately give me a big bonus from my boss. It is a great way to measure success, by using a metric that's available externally. And as to give you another example of Google Insights for Search, I wanted to see how much brand impact I'm having, how much share of searches, top of mind I am in terms of my customers, when I look for laptops. So, I said I like ThinkPads a lot. I have an X61, which I am very, very fond of. And I wanted to know if Thinkpad, how Thinkpad the brand is doing over the last few years, compared to Latitude, which is the brand of Dell, Macbook Air, which is the brand of Apple of course, and Vaio, which is the brand of Sony. And try to use this KPI, which is the search, the number of queries that a search engine to measure if my brand dollars being spent online and offline are causing people to look for my laptop, my brand of laptop and unfortunately, what turns out is both Dell and ThinkPad have been going down over time and that's precipitously in some cases and that's very, very sad and what it shows is Macbook Air launch boom, ton of people, ton of interest. Totally beat the heck out of both, Latitude and ThinkPad. And yet now, it's sort of, Mr. Steve Jobs is coming down to Earth a little bit more, over the last few months. But, notice the green line. That's the Sony Vaio and they have done a marvelous job of having a nice upward slope over the last four years and consistently doing the kinds of things that are required to stay top of mind in customers and have lots and lots of search queries be generated and create a demand for their product. So again, a great KPI if I were Sony. Breyer's brand manager to show value that my ad dollars are creating in the general ecosystem. While everybody else is going down, I am going up. So, another wonderful KPI that you can create from competitive intelligence data. So, I hope that you've learned very actionable insights about what KPIs are what kind of rules and regulations or tests you could apply to find great KPIs for yourself. And I hope that I've inspired you with the examples of KPIs that are sort of not normal and not used by many people, to find your own interesting and innovative KPIs that will help you find actionable insights from your Web Analytics Data, your Competitive Intelligence data and your survey data. So, I wish you all the very best. Thank you.

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