Marketing KPIs for Startups and Why They Matter

Leilani Bruce

Published on Jan 11, 2019
6 min read

Marketing KPIs for Startups and Why They Matter

Don’t worry, this isn’t another blog with a long list of key performance indicators (KPIs) you MUST track now or your startup will fail. You’re busy and you need to get at the heart of the matter. That’s what KPIs are meant to track – the most important metrics that drive the success of your business.

Let’s talk about how a few well-chosen KPIs can help you answer the four big questions you have about your marketing strategy:

  • Is our marketing cost-effective?
  • How good are we at keeping customers?
  • Are we reaching enough people?
  • Are our marketing strategies leading to sales?

With the right marketing KPIs for startups in your dashboard, you’ll have more clarity on the state of your business and be able to confidently report back to investors.

Is our marketing cost-effective?

In other words, how much are we spending on marketing to acquire and keep customers? You want to know if you’re getting the most bang for your marketing buck. That’s called Customer Acquisition Cost.

To answer this question, you need to know:

  • How much you’re spending on marketing (across all channels)
  • How much one customer could be worth on average

Knowing your marketing spend is easy, but figuring out the value of one customer is a bit more tricky. This is often called Customer Lifetime Value. You’ll have to make some assumptions about buyer behavior. As a startup, you don’t have a lot of data yet. That’s why it’s so important to constantly revisit KPIs. It’s best to keep your Customer Lifetime Value conservative until you can prove your estimates are valid.

Once you have these numbers, divide how much you’re spending on marketing by what you’ve estimated as the average worth of one new customer. Now you have your Customer Acquisition Cost.

If you’re surprised by the number, that’s normal! Remember that certain marketing activities take longer to show results. Expect to fork out some marketing dollars up front to ramp up your awareness. It’s not going to pay off right away, but seeing the numbers move in a downward direction means you’re doing something right.

Add to your KPI Dashboard: Customer Acquisition Cost, Customer Lifetime Value


Marketing KPIs for Startups and Why They Matter

Calculating your Customer Acquisition Cost requires some assumptions. To make this KPI more accurate, startups should revisit their assumptions when they have more customer data.

How good are we at keeping customers?

Imagine your startup has a killer marketing plan. Everything is beautifully branded and perfectly aligned with your customer. People start signing up for your service in droves. But if you have terrible customer service, it’s a revolving door. Don’t let this sneak up on you. Customer Retention Rate is a critical metric to track, even when the money is flowing.

To answer this question, first, define a period of time. Then, gather these numbers:

  • How many customers did I have at the start of this period? (A)
  • How many customers did I have at the end of this period? (B)
  • How many new customers did I gain during this period? (C)

Now you can figure out your Customer Retention Rate. Subtract B from C and divide by A. Then multiply by 100 for the percentage.

Let’s use some numbers to make it more clear. If you started with 50 customers, gained 30, and ended with 70, your formula would look like this: 70 – 30 / 50 * 100 = 80%

Just keep in mind that averages can sometimes mask problems. If you have different types of customers, or customers who purchase different products and services, you can calculate Customer Retention Rate more specifically.

Add to Your KPI Dashboard: Customer Retention Rate

Are we reaching enough people?

Without enough reach, you can’t scale your startup. You want to keep a close eye on how far your message is spreading – and how fast. To answer this question, there are two places to look:

  • Google Analytics – As you probably know, there are a dizzying number of metrics you can view, but you’ll want to focus on Page Views to give you the most basic KPI to assess your marketing reach. It’s just a starting point, but keeping this on your dashboard will prompt you to look deeper if it’s going down or becoming stagnant.
  • Social Media Accounts – With a business account, all major social media platforms provide you with your reach per post and in aggregate. This is helpful, but you should also track shares. Shares are useful for the distribution of your content. You appear in front of more people, boosting your content’s reach.

Add to Your KPI Dashboard: Website Page Views, Social Media Reach, Social Media Shares

Marketing KPIs for Startups and Why They Matter

To monitor your startup’s marketing reach, head to Google Analytics. Page Views are a useful KPI. They’ll help you see if organic and paid marketing strategies have impacted website visibility over time.

Are our marketing strategies leading to sales?

The best way to evaluate and compare your marketing strategies is to track the Conversion Rate. This is one of the most important marketing KPIs for startups. A Conversion Rate measures the percentage of users who take a desired action. Conversion Rates by themselves won’t tell the whole story, just a status report. If you don’t like what you’re seeing, it’s time to dig into the data and find out what’s happening.

Let’s look at a few different kinds of Conversion Rates.


Conversion Rates on your website tell you how effective your various pages are at encouraging visitors to take an action. You can decide which actions on your website are most important – and deserve a spot as one of your KPIs.

  • A key conversion for an e-commerce site would be the number of people making purchases. If you made 100 sales last month, and 1,000 people visited your website, your conversion rate would be 100 / 1,000 = 10%.
  • A key conversion for a professional services firm would be the number of people requesting a consultation. You’d calculate this by the number of website visitors to the consultation page divided by the number of submitted forms.


When you send an email to a client, you’re not always looking for an immediate sale. It might be a lead nurturing email sequence, so you’re sending an offer or asking them to sign up for a webinar. These are equally important Conversion Rates. To measure this KPI, you just need to divide the number of people who completed the task by the number of emails sent and multiply that by 100 for a percentage. With the right email platform, you should be able to track the action and have it displayed in their analytics.

Online Advertising

Whether you’re using a social media platform like Facebook or a search engine like Google to purchase online ads, Conversion Rates are always clearly defined in their analytics. They’re usually called Cost Per Conversion. It’s basically telling you the Customer Acquisition Cost for that particular ad. You can see how well a specific ad is doing or zoom out to see if this platform is getting the results you want for the amount you’re spending.

Add to Your KPI Dashboard: Website Conversion Rates, Email Conversion Rates, Cost Per Conversion

By asking the bigger questions, the most important marketing KPIs for startups should fall into place. If you need help, Pacific54 can make sure your KPIs are steering your company in the right direction. Contact us for a consultation.