Key Performance Indicator (KPI)

What is KPI?

A key performance indicator, or KPI, is a measurable value that shows how effective a company is in achieving its key business objectives. 

Companies use KPIs to evaluate their success at reaching their objectives. A good KPI helps a company to understand whether they’re taking the right path toward their strategic goals. 

In e-commerce, KPIs usually fall into one of the following categories:

• Manufacturing (for example: cycle time, overall labor effectiveness, yield)
• Marketing (for example: time on site, social media engagement, PPC traffic volume, email open rate)
• Sales (for example: total sales by month, average order size, gross profit, customer lifetime value)
• Customer service (for example: customer satisfaction score, active issues, first response time, average resolution time)
• Project management  (for example: hours worked, budget, return on investment).