nyman mediaA performance metric is an indicator of how things are trending and the efficiency with which you are hitting your targets. Whereas the strategy serves as the final destination you are trying to reach, your metrics and KPI’s will tell you how much progress you’re making on a day-to-day basis.

Which Metrics are Important?

As digital marketing becomes more measurable, many metrics have been introduced, and understanding the importance and meaning of each one has become a challenge in and of itself. It’s important to remember that the metrics rooted in revenue will remain the critical ones. Such are (obviously) cost-per-acquisition, revenue per user and conversion-rate.

It’s also important that you outline which ones you will be monitoring and optimizing towards before you begin a marketing campaign. Start with questions that you want to have answered on a daily basis…

  • Are my ads improving in quality?
  • Are we paying more per user or less?
  • Are the conversion rates of our site improving?

In early stage initiatives, you will have limited visibility and not a lot of data. You will have to ‘buy’ yourself some data to have something to optimize to begin with. During the early stages, you may have to rely more on softer metrics, like metrics pertaining to traffic acquisition — cost-per-visit, cost-per-new-unique user, bounce rate, and time on site. As you acquire more ‘hard’ performance data, you can rely more on hard metrics.

The North Star Metric

The North Star Metric is the single metric that best captures the core value that your product delivers to customers.

Businesses need the North Star Metric for their marketing efforts because it reduces complexity and confusion while helping you maintain focus.

Why is this necessary?

Because, with all the data and measurability comes a lot of clutter, and it’s easy to be tempted to optimize things that don’t matter.

What’s an example of a North Star metric? New unique users, sign-ups, basket additions, etc.

The North Star Metric is not always actual purchases. Sometimes the absolute numbers of purchases are so low that it’s hard to optimize directly. If you’re trying to optimize for a rarely occurring action, you’re latching onto very small numbers. If you choose a higher-level action, you have more of them (although they might not be quite as meaningful).

One mistake marketers often make is to think that they only need firm performance metrics when they are pursuing direct response marketing. This doesn’t matter if you’re pursuing brand-oriented marketing or more transactional, direct response-oriented marketing — you still need the North Star Metric to guide you and help you cut through the clutter.


Businesses often fail to address the timeline aspect of their marketing plans. Consequently, testing campaigns will stretch out into infinity, in the hopes that they one day hit their performance targets. Remember that goals, targets and objectives are meaningless unless you assign firm deadlines to them.

It also helps to clearly outline the time intervals with which you are going to be evaluating your metrics. In other words, with which frequency are you going to be monitoring these KPI’s? How long will it take for you to see outcomes when you make adjustments? This ties into how long it will take to optimize towards your key metrics.