Entrepreneurs need to be aware of marketing agency “key performance indicators” (KPIs) to track customer success, agency success, and improve profitability. This article will help entrepreneurs understand what marketing agency KPIs are and how to track them.
What Are Marketing Agency KPIs and Why Are They Important to Track?
Marketing agency KPIs are important to track because they help entrepreneurs understand how well their marketing agency performs. By tracking marketing agency KPIs, entrepreneurs can ensure that their marketing agency is growing and improving in profitability. There are four main marketing agency KPIs: customer success, agency success, profitability, and growth.
Customer Success KPI
The customer success KPI measures how well the marketing agency performs regarding customer satisfaction. To track this KPI, entrepreneurs should ask their customers four questions:
- How likely will you be to recommend our marketing agency to a friend or colleague?
- How satisfied are you with our marketing agency’s performance?
- How likely are you to use our marketing agency again?
- How do you feel about your value from our marketing agency?
The answers to these questions will help entrepreneurs understand how well their marketing agency performs in customer satisfaction.
Agency Success KPI
The agency success KPI measures how well the marketing agency performs in terms of its success. To track this KPI, entrepreneurs should ask their marketing agency four questions:
- How well is our marketing agency doing in terms of meeting its goals?
- How well is our marketing agency doing regarding its financial performance?
- How well is our marketing agency doing in terms of its ability to attract and retain talent?
- How well is our marketing agency doing regarding its ability to innovate?
The answers to these questions will help entrepreneurs understand how well their marketing agency is performing in terms of its own success.
Profitability KPI
The profitability KPI measures how well the marketing agency performs in terms of its profitability. To track this KPI, entrepreneurs should ask their marketing agency four questions:
- How well is our marketing agency doing in terms of its revenue?
- How well is our marketing agency doing in terms of its costs?
- How well is our marketing agency doing regarding its profit margin?
- How well is our marketing agency doing regarding its cash flow?
The answers to these questions will help entrepreneurs understand how well their marketing agency performs regarding its profitability.
Growth KPI
The growth KPI measures how well the marketing agency performs in terms of its ability to grow. To track this KPI, entrepreneurs should ask their marketing agency four questions:
- How well is our marketing agency doing regarding its sales growth?
- How well is our marketing agency doing regarding its marketing growth?
- How well is our marketing agency doing regarding its product development?
- How well is our marketing agency doing regarding its people development growth?
The answers to these questions will help entrepreneurs understand how well their marketing agency is performing in terms of its ability to grow.
How Can You Improve Profitability for a Marketing Agency?
There are four main ways to improve profitability for a marketing agency:
- Increase revenue
- Decrease costs
- Increase profit margin
- Improve cash flow
Marketing agencies can improve their profitability by increasing revenue, decreasing costs, increasing profit margin, and improving cash flow.
What Are the Implications of Not Tracking Marketing Agency KPIs?
If marketing agencies do not track their KPIs, they will be unable to improve their profitability. In addition, marketing agencies that do not track their KPIs will be at a competitive disadvantage compared to marketing agencies that track them. As a result, it is important for marketing agencies to track their KPIs to improve their profitability.
Conclusion
Entrepreneurs need to be aware of marketing agency KPIs to track customer success, agency success, and improve profitability. By tracking marketing agency KPIs, entrepreneurs can ensure that their marketing agency is performing well and progressing towards its goals. Marketing agencies that do not track their KPIs will be at a competitive disadvantage compared to marketing agencies that do track them. As a result, it is important for marketing agencies to track their KPIs to improve their profitability.