KPI vs Metric: How To Report Your Clients’ Goal Progress

You simply can’t stay on track, measure success, or identify areas for improvement if you’re not properly implementing KPIs and metrics at your agency. After all, having this data available at your fingertips gives you actionable insights that benefit your clients. 

While there are a number of factors and business metrics that go into keeping clients happy, we can all agree that highlighting your value and how you positively impact a client’s bottom line is a surefire way to make your agency indispensable. 

So let’s dive into the various ways successful marketing agencies use KPIs and metrics to keep themselves and their clients ahead of the competition.

KPI vs. Metric: What Is the Difference?

Are KPIs the same as metrics? Everything you track in your client’s business is a metric, but only a few of these metrics are directly relevant to their main business goal, making them key performance indicators. 

In other words, all KPIs are metrics, but not all metrics are KPIs.

KPIs are specific measurements that are used to track progress toward specific goals. On the other hand, metrics can be any type of data collected as part of routine business operations.

KPIs allow us, as the agency, to demonstrate our value to the client. There are basic KPIs such as spend, clicks, impressions, ranking, etc., but the real KPIs every client wants to know are leads and/or sales. We like to include both in our monthly reports. Ultimately, what is their ROI from our efforts? When you can clearly demonstrate this month over month, it increases your retention rate and keeps clients paying you month after month.

–Jacob Hicks, Owner, Magnyfi

The most straightforward way to define the difference is that metrics are broad, and KPIs are focused. 

What Is a Metric?

To put it simply, a metric is a category of quantifiable data relevant to a company's performance. A metrics example would include page views and engagement data.

Metrics can be attached to almost every part of a client’s standard business processes. But one key difference between a KPI and a metric is that metrics don’t need to be tied directly to a strategic objective. 

Some examples of metrics that clients often want to see include: 

• Website sessions (including specific landing pages and blog posts) 

• Goal conversion rates (sales, form submissions, downloads, etc.) 

• Engagement with content (video views, comments, impressions, etc.) 

• Social media followers 

• PPC conversion rates 

However, since anything that can be measured can be considered a metric, this means that there are countless metrics that businesses keep track of, from website traffic to conversion rates, to Facebook shares, and the list goes on.

In theory, that sounds great. The more data, the better, right? In practice, though, this overwhelming amount of data overload can often become a distraction.

It’s easy to get so caught up in improving various metrics that you forget to ask yourself whether the changes will really affect your client’s bottom line. After all, is getting more likes on social media really that important?

If those likes aren’t converting to sales, then probably not. However, if one of the main goals for the quarter is to increase your client’s presence on certain social channels, it may be. 

Most people use statistics like a drunk man uses a lamppost; more for support than illumination.

― Andrew Lang

That’s why you need to identify which metrics are key performance indicators so that you can prioritize them. And they will not be the same for every client or quarter.

What Is a KPI?

A KPI, otherwise known as a key performance indicator, is a metric used to track and measure a company's or organization's progress toward specific, important goals.

Understanding the KPI meaning is essential to differentiate it from a simple metric, as KPIs, or Key Performance Indicators, focus on strategic objectives and directly impact organizational success, whereas metrics provide detailed insights into specific business operations.

Choosing the right KPIs is essential for any organization looking to improve business performance, such as sales revenue. However, simply selecting KPIs is not enough; they must also be tracked and analyzed regularly to identify trends and take corrective action if necessary. By measuring business performance using KPIs, companies improve their performance and achieve their goals.

Not everything that can be counted counts and not everything that counts can be counted. 

– Albert Einstein

If you prefer a fun quote:

All tequilas are mezcals, but not all mezcals are tequilas. 

– John McEvoy

Think of a KPI as a performance metric that is directly related to business objectives. This could be revenue growth, user acquisition, and so on, but the critical point is that the KPI is tied to a specific goal.

Some examples of KPIs that clients often want to see include:

• New client acquisitions per month

• Cost per acquisition

• Client retention rates 

• New leads from organic vs. paid search 

• Page domain/authority

• Monthly website traffic 

Here are a few other key differences between KPIs and metrics:

Ask yourself these questions when trying to separate a KPI from a metric: 

• Will a fundamental change in this metric impact the client’s business? 

• What results or dimensions of their business are you trying to measure? 

• How will you measure it? 

• What is the purpose of your measurements? 

• How will you know if you are successful? 

• How will you know what to change next time around? 

Here are some examples of the most common KPIs based on business types:  

As you can see, KPIs vary based on the business model and industry, although they all have a direct impact on a specific business objective.

Breaking Down KPIs and Metrics by Department

In any organization, each department has a unique role to play. These roles are often guided by strategic goals, measured by carefully selected KPIs and metrics. Whether it's a sales team hungry for revenue growth or marketing teams itching for brand visibility, KPI dashboards become the compass. They provide the much-needed direction to track progress and steer towards success. Let's look at key departments and their associated KPIs.

Sales KPIs

The sales team - they're the adrenaline junkies of the corporate world. Always on the hunt, chasing targets, and bringing in the dough. KPIs measure progress and ensure everyone's sprinting in the right direction.

Key sales KPIs include:

• Revenue Growth: The change in a company's sales when compared to a previous period.

• Gross Profit Margin: This tells how well sales cover direct costs and can shed light on operational improvement.

• Net Profit Margin: This metric provides insights into the company's overall profitability after all expenses.

Marketing KPIs

If the sales team are adrenaline junkies, marketing teams are the maestros, conducting the orchestra to produce a symphony of brand engagement. KPIs help monitor progress and ensure the melody hits all the right notes.

Some common marketing KPIs include:

• Social Media Engagement: This social media KPI measures the interactions on your social media channels.

• Email Open Rate: This shows the percentage of recipients who open a given email.

• Return on Marketing Investment (ROMI): This provides performance data on the effectiveness of marketing campaigns.

Finance KPIs

The finance team: they're the gatekeepers. They keep a keen eye on financial metrics, balancing risk factors, and driving profitability.

Strategic KPIs for finance can encompass:

• Operating Cash Flow: This checks if a company's core operations generate sufficient cash to maintain and grow the business.

• Current Ratio: This assesses the ability to cover short-term liabilities with short-term assets.

• Quick Ratio: This is a more conservative measure than the current ratio, excluding inventory from assets.

Customer Success KPIs

Customer Success teams are the superheroes of the corporate world, saving the day by ensuring customer retention and satisfaction.

Their KPIs often revolve around:

• Customer Satisfaction Score (CSAT): This measures how satisfied customers are with your service.

• Net Promoter Score (NPS): This gauges the loyalty of a firm's customer relationships.

• Customer Retention Rate: This tracks how well your company retains customers over a given period.

In conclusion, the KPI dashboard is a tool that transforms raw data into a story of performance measurement. It provides insights to steer strategic and operational improvement, regardless of the department. Just remember, KPIs are a guide, not a destination. The journey of business success is a continuous trek of learning and adapting.

And all of these KPIs should flow into some kind of central business objective. For example:

How KPIs and Metrics Work Together

A common mistake is not setting any KPIs at all and focusing solely on metrics! But without specific goals to aim for, it's difficult to know whether or not your agency is driving improvements that directly affect the client’s bottom line.

To track and improve your clients’ campaign performance effectively, you must align their KPIs and marketing metrics to ensure that both work together to improve their business.

Another common mistake is using the wrong metric to measure a KPI. Always ensure the metrics feed into the KPI. 

For example, if you’re trying to increase customer satisfaction, you might use customer reviews or NPS ratings as a metric and customer retention rate as a KPI. And if you're trying to increase your client’s revenue, you might use marketing-qualified leads as a metric, and sales-qualified leads as a KPI.

However, Facebook post likes on that funny meme are very unlikely to directly help support retention rate or client, so they would not be the right metric to align with either of those KPIs.

Benefits of Metrics and KPIs

When To Use KPIs or Metrics

There is no one-size-fits-all answer to this question, as the answer will vary depending on the client’s business and their specific situation. However, a few general guidelines help make the decision clearer:

1. Is the Client Looking For Overall Trends or Specific Details for Their Business?

KPIs may be more appropriate if they are looking for general trends. If they’re looking for specific details, metrics may be more appropriate.

For example, if your agency is trying to optimize a Google search ad campaign, the average cost per sale could be considered a KPI. However, if the client just launched a new blog post and wants to know how well they are ranking for a single keyword targeting a single page, that is more likely to fall under the metric umbrella. 

2. How Complex Is the Data?

If the data is complex, then metrics may be more appropriate. KPIs can be used for complex data but must be simplified to be effective.

For example, the overall SEO site health score of a client’s website would be an SEO KPI worth tracking, and the number of critical issues, errors, or warnings round would be the metrics. 

3. How Much Time and Effort Is the Client Willing To Contribute?

Do they love digging into their marketing data every month and are data-driven thinkers? Consider how much data your clients actually want to see before your agency dedicates billable hours to creating client reports. 

Metrics are quantitative measurements that track the results of marketing campaigns and activities, which means that all metrics should eventually feed into a KPI. 

For example, email deliverability may not be the KPI for your client, but the portion of those email recipients who convert to customers most likely will be. Your agency needs to understand and optimize that metric (deliverability rate) to achieve the KPI (email revenue).  

On the other hand, using KPIs promotes better decision-making, more accurate forecasting, and better allocation of resources. 

For example, understanding a client’s customer acquisition costs (CAC) helps your agency communicate exactly how much they’re spending on gaining new customers–and what strategies you’re implementing to lower that cost. 

Best Practices for Identifying & Monitoring KPIs and Metrics

As an agency owner, you want to help your clients’ businesses grow and retain them for the long run. To do this, identifying and monitoring their KPIs and metrics is essential to improve their campaign performance. 

We’ve made a list of 5 best practices to help your agency follow when identifying and monitoring your clients’ KPIs and metrics.

1. Choose Directional Metrics

Not all KPIs are created equal. Choosing the right metrics helps ensure your clients’ goals remain manageable and achievable.

Show your clients how your agency is tracking against goals with a KPI and metrics report. Automate the entire process to save your agency's time each month. Try AgencyAnalytics free for 14 days!

One important factor to consider when choosing KPIs is what stage of development your client’s business is in. If they’re relatively new to market, for example, they should focus on growth metrics such as revenue or user adoption rates. On the other hand, established businesses may want to track profitability or market share.

Another key consideration is the type of business your client has. If they’re in the service industry, they probably want to focus on customer satisfaction or net promoter score. Or, if they have a manufacturing business, they’ll want to track inventory turnover or return on assets.

Consider what services your client needs from your agency. For example, if their focus is building up blog content on their website, some great Google Analytics KPIs to focus on would be blog post views, website sessions, referrals from Google search results, or maybe keywords they’re ranking for. 

On the other hand, if your client is focussing on social media this quarter, follower growth may be a good measure of whether their activity is working or not. But you should also monitor engagement and clicks to show your client what content is actually resonating with their audience, pointing the marketing team in the direction of what to publish more of.

2. Ensure KPIs Are Measurable

To measure the success of your client’s business, the KPIs you track should be measurable. Although it sounds simple, if you’re not measuring something, how can it be improved or adjusted? 

Some common measurable KPIs include revenue, profit, customer satisfaction, and employee satisfaction. Make sure that the KPIs your client chooses are relevant to their business, your agency can realistically impact them, and can be clearly tracked.

3. Accurately Track KPIs and Metrics

To help your clients make informed business decisions, it’s crucial to use accurate data. This means ensuring that their KPIs and metrics are reliable. Unfortunately, there are many ways to manipulate data to present a false picture of success. 

One way to ensure the accuracy of your clients’ data is to present it in a professional client report or marketing dashboard. Using Excel or Google Sheets is valuable in many different ways but shouldn’t be used as your sole reporting tool.

The Google Sheets integration helps clients visualize their data into intuitive graphs and charts to easily show how their KPIs are performing month-over-month.

Ditch the screenshots, PowerPoints, and other time-consuming client reporting processes. Create clean, white-labeled reports in minutes that showcase your agency’s professionalism. Start your free 14-day trial today.

And check out the Google Sheets Export Extension: The easiest way to get your marketing data from over 75 top marketing platforms into Google Sheets for extra handling, validation and analysis.

Another way to ensure accuracy is to perform regular audits of client data. Compare actual results against targets or goals that you’ve set for them. Identify any discrepancies and investigate the causes.

Also, be aware of common pitfalls that can lead to inaccurate data. For example, using averages can hide fluctuations and give a false impression of stability.

4. Understand Leading vs. Lagging Indicators

Navigating the labyrinth of marketing KPIs requires a strong understanding of leading and lagging indicators. Let's break these concepts down.

What are Leading Indicators?

Leading indicators are real-time measures that provide insights into future events. For example, when a new content strategy causes an increase in website visits, these are leading indicators. They suggest a possible rise in future sales.

Leading KPIs, part of leading indicators, directly connect to key objectives. They're important for understanding the steps towards achieving a main goal.

What are Lagging Indicators?

Lagging indicators, on the other hand, are retrospective. They measure the outcomes of a project or campaign, showing its success or failure. For instance, after a content strategy has been running for a few months, changes in sales are your lagging indicators.

Lagging KPIs, similar to lagging indicators, provide solid measures of a strategy's performance. Leading and lagging indicators offer valuable insights into a marketing strategy's journey. The former offers a prediction of future performance, while the latter delivers a reflection of past outcomes. The key to successful marketing lies in balancing the insights from both types of indicators.

Each of these KPIs and their related indicators offers crucial insights. But, their significance may vary based on your individual business goals, specific client needs, and the nuances of each marketing campaign.

5. Provide Actionable Data

The best way to show agency value is to go beyond the metrics. Show your clients how their marketing data affects their bottom line and make useful recommendations to make decisions and improve operations. Without this level of analysis, they’re likely to get bogged down in data that is not beneficial to them. 

So, their KPIs and metrics should be aligned with a reasonable goal or target to aim for. Your agency needs to understand their industry, what’s important to them, and help them achieve their goals. Because without a target, whatever you’re measuring is not an indicator of success but simply just a metric. 

Why You Should Never Use a Single KPI to Measure Performance

Relying on a single KPI for your clients’ businesses is an extremely narrow approach. It doesn’t leave any flexibility for areas of improvement, and it leads to many other potential risks including: 

• The wrong measurement could take them in the wrong direction. For example, focusing exclusively on leads as an eCommerce KPI could tell a misleading data story if none of those leads are converting to paying customers. 

• It could also be an incomplete or inaccurate measurement. Maybe they haven’t been your client for very long, or the time frame you’ve started tracking hasn’t been sufficient to make critical decisions. 

• Using a single KPI ignores other options for business success. Perhaps revenue targets were missed that month, but the sales pipeline is chock full of opportunities that will close a couple of weeks down the line. Looking at a full, complete picture is always beneficial before making business decisions.

How To Use KPIs for Your Clients’ Business Goals 

Here is a three-step process to help you identify which KPIs to use for your clients’ businesses:

Step 1: Pick One Main Business Goal for the Year

When business owners discuss KPIs, they usually talk about strategic objectives that represent key business goals. Regardless of their goal, the first step is to clearly understand what your client wants to achieve.

However, instead of simply creating a long list of all their business goals, consider setting one specific business goal for the year to provide more clarity and help determine which KPIs to focus on.

Of course, your clients’ goals will depend on their situation, but here are a few helpful questions to ask them:

• Is the business already profitable? Set a revenue goal.

• Does the business barely break even? Set a profitability goal.

• Are they working with a venture-funded startup that you are helping turn into a $1 billion valuation? Set a user growth rate goal.

Step 2: Identify Which Metrics Have a Direct Impact on Your Clients’ Business Goals

Now that you understand your client’s set business goals for the year, it’s time to take a look at all the important metrics currently being tracked in their business.

All these multiple metrics are at least somewhat relevant to the performance of the company, but the reality is that the majority of them are not directly related to their primary business objective. 

This means that while you still want to keep an eye on them, these metrics don’t necessarily qualify as key performance indicators.

In this step, you need to ask yourself which metrics are the most valuable when evaluating the progress toward the overarching goal.

The KPI that matters most is the metric aligned with your goal, as it provides the clearest indication of progress. For example, if you have set an annual revenue goal, the most valuable KPI will be daily, weekly, monthly, and quarterly revenue. And–typically-the longer the period, the more important it is. For example, quarters matter more than months which matter more than weeks. 

The number of KPIs to choose will vary from client to client and the industry they’re in. However, they often increase as you drill into each individual campaign your agency is managing. 

For example, your paid search team could have three KPIs (cost, revenue, and cost of acquisition), and your SEO team could have its own set of KPIs (organic traffic, conversion rate, and revenue).  

Step 3: Create a Schedule for Reviewing KPIs To Ensure That You’re Progressing Towards Client Goals

Once you and your client have identified the KPIs to focus on, you’ll want to review them regularly.

In particular, it’s often best to review your KPIs at four intervals: weekly, monthly, quarterly, and annually.

This not only shows that your agency is staying on top of its goals but also helps identify any issues and make proactive adjustments or recommendations to take the appropriate correct course. Talk about showing agency value! 

Efficiently Tracking Your Clients’ Metrics and KPIs

There are a variety of online tools that can help you track your clients’ progress. Utilizing these tools gives your agency a better understanding of a client’s campaign performance and where their overall marketing strategies can be improved.

1. Managing Metrics and KPIs With a Dashboard

After determining what metrics and KPIs matter most to your clients, you’ll need to integrate their marketing platforms into a dashboard.

AgencyAnalytics has 75+ marketing integrations to choose from at no additional cost. 

Depending on what platforms your clients are currently using, dashboards will vary from client to client. However, we recommend covering the basics–PPC, SEO, social media, email, and call tracking. 

2. Use Goals and Annotations 

The next step is analyzing their data points and identifying which trends or patterns stand out. Once identifying any trends, create an executive summary based on them. Creating annotations and goals is a great way to highlight your agency’s progress toward achieving your clients’ KPIs. 

The KPIs our clients care about are leads, revenue generated, and Cost Per Acquisition. Their marketing dollars need to translate to top-line revenue, and so it's our job to help our clients connect the dots to that in our reporting.

–Lane Rizzardini, Co-owner, Marion Relationship Marketing 

3. Create a Report Schedule 

A great way to maintain constant and transparent communication with your clients is to regularly review their KPIs and metrics. Save your agency’s time by setting up an automated reporting schedule. 

Instead of wasting billable hours crating manual client reports every month, speed up your agency’s data retrieval and reporting workflow with the report scheduling feature. Choose to send out reports daily, weekly, or monthly basis and get notified before they’re sent out to make final comments, adjustments, or approvals. 

The Takeaway

As we’ve discussed, you can’t grow your clients’ businesses without having clarity on their goals.

In addition to making it clear for everyone on your team to know exactly what to focus on, understanding your clients’ business goals helps identify which data should be considered a metric and which should be considered a KPI.

To keep your clients on track, we suggest following these three steps:

1. Set a single annual goal for their business

2. Identify several KPIs to help your agency stay on track to hit that goal

3. Consistently review KPIs with clients on a weekly, monthly, or quarterly basis to make adjustments accordingly

This approach may sound overly simplistic, but one of the main benefits of differentiating between metrics and KPIs is to take the overwhelming amount of data at your fingertips and turn it into actionable insights that keep your client’s business on track.

Create marketing dashboards that show all of the work your agency is doing to help your clients’ businesses grow. Easy-to-understand reports make your client meetings easier, and with individual client permissions, you get to decide what you want your clients to see. 

Stop wasting your agency’s time switching between platforms. With 75+ marketing integrations, including PPC, SEO, social media, and more, you’ve got access to all of the different metrics your clients need under one roof. Get started with your free 14-day trial today!