It sounds a little cliche, but the old saying "you can't manage what you don't measure" always seems to ring true—especially for small business owners who are wearing 85 hats in their biz. And we get it, keeping track of progress can feel overwhelming and just like one more thing on your neverending to-do list. That’s why we are breaking down everything you need to know about Key Performance Indicators (KPIs) as it applies to small businesses (no fancy corporate jargon or 20-page reports required). 

We’re covering:

• What are KPIs?
• What are some kinds of KPIs?
• How can we choose the right things to track?
• How can we make it easier to track KPIs?

What Are KPIs?

Key Performance Indicators (KPIs) are just numbers that help you track what’s going on in your business. If you Google it, you’ll see a lot of fancy definitions but at the end of the day, that’s all they are. These numbers can serve as a navigational tool, helping you see what’s working and what’s not working, which in turn helps you make decisions better (and faster).

While here at Enji we typically talk a lot about marketing KPIs, we do want your whole business to be successful, so here are 4 categories you should consider tracking in your small business.

Financial KPIs

Financial KPIs are the numbers that help you track the financial health in your business. Here are some examples: 

• New revenue
• Monthly recurring revenue
• Profit 
• Average booking/transaction value

Marketing KPIs

Marketing KPIs are not just about Instagram impressions or likes on a reel. While there are certain metrics you’ll want to track that are platform-specific, you may also want to track:

• Cost per acquisition
• Conversion rate
• ROAS/Return on ad spend (if you’re running ads)
• Number of leads/new customers

Customer KPIs

Customer KPIs focus on your customer satisfaction and loyalty. Examples include:

• Customer retention rate/Churn rate
• Number of 5 star reviews
• Number of customer support inquiries
• Customer lifetime value

Operational KPIs

Lastly, Operational KPIs are the numbers that tell you how efficiently your business operates. Here are some examples:

• Order fulfillment time
• On-time delivery
• Project completion rate

How to Choose the Right KPIs

Choosing the right KPIs for your small business might seem daunting, but it doesn't have to be! We’re going to give you more advice on how to get started at the end of this post but the short version is: choose the KPIs that will help you track the progress toward your goals. While big corporations might find value in tracking absolutely everything under the sun, you don’t have that kind of capacity. Think about what metrics are really a priority right now and stick to those for now.

Here’s an example: if your customer satisfaction score is lower than you'd like, you can dig deeper to find out why and take steps to enhance your customer service. Or, if you feel like you’re seeing fewer purchases right now, maybe it’s time to dial in on your marketing key performance indicators.

Just to give you a little encouragement (and make getting started less intimidating), remember that choosing the right KPIs is a bit of a trial and error process. It's less important to start with the “perfect KPIs” and more important to just get started. And the best place to start is by looking at your business/marketing goals as well as your marketing channels (read: where you are doing your marketing). Because those are the two things that influence what KPIs "make most sense" for you to track.

Why It’s Important to Track KPIs

We know your to-do list is pretty full already, so if you’re not convinced to take this seriously yet, here are 3 reasons why it’s important to track KPIs (even if you’re a solopreneur or small business).

1. Measure Success

Duh, but by regularly tracking KPIs, you can see what’s working and what isn’t. And more reliably than your intuition will tell you. This means that you can make adjustments to your business quickly, and as a small business owner, that’s a big deal. You don’t have anything to waste (time or money) so noticing patterns faster can make a big difference in your business. 

2. Inform Decisions

Numbers are like toddlers–they don’t lie. Accurate data is the backbone of informed decision-making. Decision fatigue is so real as a small business owner and KPIs provide the evidence you need to support your strategic decisions. Whether you're considering a new marketing campaign or thinking about expanding your product line, KPIs give you facts to guide your choices (which means you can sleep a little easier at night).

Want to read more about how to use KPIs to inform decisions? Here's how to tell if your marketing strategy is working.

3. Accountability

KPIs also help foster accountability within your team (which, if you’re new to having a team, is going to make your life a lot easier). When everyone knows what metrics they are being judged on, it creates a sense of responsibility. It’s easier to hold team members accountable when there are clear, measurable goals to aim for. And if you don’t have a team yet, KPIs can help hold you accountable to yourself too.

4. Motivation

Saved the best for last. Staying motivated can be hard, especially for solopreneurs or small teams. KPIs can act as motivational tools because being a small business owner can be kind of thankless at times. Seeing tangible results from your hard work can be the push you need to stay motivated even when things are hard. 

How to Get Started Tracking Key Performance Indicators For Your Small Business

1. Start with a Few KPIs

As a small business owner, you’re already an overachiever. That’s why we need to tell you that if you’re going to start tracking KPIs, just start with a few. You don’t need to track ten things in every category to know what’s working (and to be honest, you don’t have the time). Choose 3-5 of your most important metrics, and just start tracking. We like to recommend making the 1st of your month your “KPI days”.

2. Add More Over Time

Once you’re comfortable with tracking a few KPIs, gradually expand your list. Once you get comfortable tracking data, you’ll get a better idea of the kinds of numbers that are helpful for you (and it’s OK to change your KPIs as your business priorities change too). Remove anything that’s not helping you make decisions or see progress towards a goal. 

For example, if you’re not seeing a pattern between Instagram impressions and the number of monthly sales (your goal), find a different Instagram metric to track (like link clicks or profile visits) and see if that gives you a better sense of how well your marketing is working. 

3. Use Tools Like Enji

Nobody gets excited looking at a Google spreadsheet, right? It’s not as easy to see patterns on one either (unless you’re super techy and want to spend hours setting up graphs and charts anyway). One of our favorite Enji features is our marketing dashboard, where we like to think we make tracking numbers fun again. 

Pro-tip: Enji makes it easy to track your KPIs with our integrations with Google Analytics, Facebook, and Instagram!

Getting Started With Key Performance Indicators

At the end of the day Key Performance Indicators (KPIs) are just numbers, but knowing them can make a big difference in your small business. By understanding and tracking the right KPIs, you can make informed decisions, foster accountability, and stay motivated. While the process might seem daunting at first, starting small and leveraging tools like Enji can make it easier and even enjoyable.

Ready to get started? Start your free trial on Enji today and start tracking.

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