What are KPIs? KPI is an abbreviation for Key Performance Indicator. It’s a way to measure success in the eyes of many big businesses and companies throughout the globe and it is usually regarded as a numerical or quantifiable measure.
But is it?
Numbers could be a good indicator for sale volumes, for product demand, for market share.
They, however, can never replace caring and engagement. They can show you how many customers purchased a product, but they cannot show you how satisfied customers are with your product, how they like your support level, what they think about your brand.
This is why measuring “likes” on your company’s Facebook page has no real value, for example. The number of fans or followers cannot tell you about your real customers, about satisfied customers who actually like your brand vs. unsatisfied customers who would never buy from you again (which is something you should know about and deal with).
We, at the The Engagement Strategy Group, are into community building and management. It’s no exact science and it’s not easy to implement. As with every other business that deals with people, it is hard to predict the length of the community building process. It’s even harder to predict how many active community members the process will yield.
Our KPI, therefore (which is very hard to predict), is called “engagement”. Even your company’s Facebook page can count it. On Facebook, it is called “People talking about this” which can be seen on the same place as your Facebook likes count. This is the number of people who are engaged in activity on your company’s Facebook page. The real number you should care about for the long run, and even this one is not always accurate.
Additional KPI’s we measure are: reputation, sentiment, thought leadership and general growth.
I’m not saying the numbers are wrong, I’m just saying, know what to count. Counting a buying customer is important, but not as important as counting a satisfied customer, which is harder but worth the effort.
Why is it worth it?
To answer this questions, let’s work with an example:
Let’s say you’re a mattresses salesperson. In the last month, you’ve managed to sell 1500 new mattresses, which is 30% more than in the month before. Looking at the numerical KPIs, you have a success story. But you never bothered to build your customers a community. You have no direct communication channel with your customers and you customer support is not doing a great job, but you don’t know about it.
Here’s what happens next: about 20% of your new clients did not like your mattress. About 20% more of your new clients were not satisfied of the delivery. Finally, 20% more of your new clients were not satisfied with your customer service. But you do not know anything about it, you have no direct communication with your community of clients.
So, you may have sold more mattresses this month (30% growth), but you actually caused more damage to your brand than you’ll ever imagine (60% dissatisfaction) and, for the long run, clients will keep their distance from you when buying a new mattress.
This example shows the true power of communities. A short peek at your company’s Facebook page while having an active community management and you learn about your own product from the point of view of customers who are actually using it. They can tell you what they like, they can tell you what they don’t like and help you improve your product and promise better market fit. They can provide valuable feedback on the delivery process. They can explain what is wrong with your customer support team. All you should do is listen to them.
That is of course after you build an active community and manage it correctly.
These are all KPIs but they’re not numbers set in stone. They’re harder to measure but they pay more (literally).