The Differences between Metrics, KPIs and Targets
Web analytics is not for the faint of heart. It can be complicated and messy and overwhelming.
Still, understanding some of the basics of web analytics can be valuable for anyone involved in the marketing and advertising process.
To get you started, we have chosen three of the more general terms you will encounter: metrics, key performance indicators (KPIs), and targets.
To keep it simple, you can think of a metric as a number.
If you look at your analytics reporting, you probably come across many different numbers, such as Page Views, Bounce Rate, Time on Page, and so on.
Metrics are one of the cornerstones of web analytics.
Without the numbers, we have nothing to show for our efforts. We can’t see if one web page is visited more often than another. We are unable to detect if social media is sending traffic to our website.
We need these numbers (metrics) to know if what we are doing is working or not.
Key Performance Indicators (KPIs)
Another term you are probably familiar with is Key Performance Indicator, or KPI. The reason you need KPIs is to determine if you are meeting your business objectives.
For example, let’s say one of your main objectives is to generate more sales leads. In order to do so, you create a landing page where people can download a whitepaper in exchange for their contact information. How do you know if it’s working? You need a KPI, which in this case could be “Total Number of Downloads.”
The KPI will tell you how well – or not – you are accomplishing your objective by giving you something we already talked about – a metric.
Now that you are familiar with KPIs, you need to know if the metrics you are looking at are good or bad. The way to do that is to create a target for each KPI.
If we use the example of the whitepaper download, you might create a target of 1,000 downloads per week. When you look at your metrics, you may see that you are getting 900 downloads per week or you are only getting 100.
Targets help you achieve KPIs and meet your business objectives.
Now that you have a better understanding of metrics, KPIs and targets, what are some other web analytics terms you want to know more about?