This page contracts measures used to steer a marketing-mix lever; it does not define the plan’s global objectives.
This page contracts measures used to steer a marketing-mix lever; it does not define the plan’s global objectives. A KPI links a decision, formula, population, window, source and action on deviation. A dashboard placing ROAS, traffic, awareness and sales side by side without a reading contract enables contradictory narratives. The useful hierarchy separates economic outcome, causal or incremental indicator, mechanism diagnostic, guardrail and invested means.
Decision and method.
Use a primary KPI only when it triggers a defined action and is interpreted with diagnostics and guardrails that prevent local optimisation. Write the choice, owner, frequency, exposed amount and reversibility, then select the outcome closest to that decision rather than the easiest measure. Document formula, source, grain, delay, window, correction rules and minimum quality; version every change. Link means, diagnostics, incremental effect, economic result and guardrails without averaging measurements that answer different questions. Define investigation and stop thresholds, uncertainty level and permitted action; revise the contract when product, channel or collection method changes.
Worked example.
A campaign spends €100,000 and claims €340,000 revenue, ROAS 3.4. Return rate is 18%. After returns revenue is €278,800, product cost €167,280, logistics €28,000 and support €12,000. Contribution is 278,800 − 167,280 − 28,000 − 12,000 − 100,000 = −€28,480. ROAS includes neither incrementality, product cost nor service. It remains a journey diagnostic, not an allocation KPI; the primary contract becomes incremental contribution after returns, with return and service-quality guardrails.
Checks and limits.
The KPI names decision, owner and cadence; formula, exclusions, source and window are versioned; an attributed measure is not presented as causal without evidence; guardrails explicitly limit primary action. A well-defined KPI can still be badly estimated with insufficient data. Thresholds evolve with margin, risk and strategy. A measurement hierarchy does not replace a causal counterfactual.
Resources and sources.
Download the marketing KPI contract. Related: measure incremental effect, check source quality, triangulate results. Sources: Farris et al. (2010); Kaplan and Norton (1992); Keeney (1992).