In the past, search marketing was about a brand gaining traffic to their website from search engines. Today, the word content spans everything from an article to a VR experience to a product page with a buy button on it, to a podcast, a newsfeed, an app or any type of information that’s online that the brand wants consumers to reach. Therefore, being able to get traffic to these assets and destinations from search engines should be part of their search marketing.

Let us take a hypothetical example where we are running a resort business “The A1 Resort Company” operating several resorts across various locations. And let’s say we have bought some keywords on Google AdWords that lead to some landing pages on our Website. What KPIs should we be tracking?

To answer that question, first off we need to be on common ground on the difference between a metric and a KPI.

Based on the above definition, the KPI is tied to objectives. But how are objectives for SEM defined? They are done based on the SEM funnel. Each stage of the funnel could have objectives tied to it.

Objectives

Let’s say our Search Marketing objectives for this quarter are as follows:

• Awareness Stage Objective: 5% increase in traffic from audiences who are exploring resorts (they use searches such as “Bahamas resorts”, “Key West resorts”). These are also called unbranded searches because they don’t refer to our A1 resorts brand.
• Research Stage Objective: 2% Increase in conversions (bookings) from users researching resort options (they use searches such as “A1 resort locations”, “top A1 resort deals”)
• Purchase Stage Objective: 1% Increase in efficiency of closing consumers who are ready for purchase (they use searches such as “Book A1 resort in key west”, “A1 resort Bahamas availability”)

For each of these objectives we can define the following KPIs to be measured within our quarterly time period.

Awareness Stage KPI

These KPIs are towards optimizing our search traffic. Here, we are looking at trying to get consumers aware of A1 Resorts, so the KPIs should be about bringing traffic into our Website.

• CTR (Click through rate): This is the ratio of the number of people clicked on the Ad (Clicks) to the number of people who saw the Ad (Impressions). This gives a measure of the effectiveness of the Ad.
• CPC (Cost per click) : This is how much the Search Engine (e.g. Google AdWords) charged per click.

Research Stage KPI

These KPIs are towards optimizing our conversion volume. Here, we are looking at consumers who are already interested in A1 Resorts and we are trying to get them to make bookings, so the KPIs should be about how we are converting their interest into bookings.

• Bookings: Number of bookings attributed to Search Marketing
• Revenue: Total revenue attributed to Search Marketing

Purchase Stage KPI

These KPIs are towards optimizing our conversion cost-efficiency. Here, we are looking at consumers who are ready for purchase, and trying to lead them to a purchase as efficiently as possible, so KPIs should be about cost-effectiveness and revenue per dollar spent.

• CPB (Cost per Booking) : Total spend on Search Marketing / Total number of bookings attributed to Search Marketing
• CPA (Cost per Action) : Total spend on Search Marketing / Total number of actions attributed to Search Marketing
• ROAS (Return on advertising spend): Total revenue attributed to Search Marketing / Total spend on Search marketing

Benchmarks

Finally, the we need to setup our KPIs against benchmarks. These could be benchmarks that we have previously achieved (a baseline) or could be industry averages. As an example the hospitality industry benchmark for CTR could be 20%. So our KPIs could be at that or a higher level of we are establishing them for the first time.

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