KPI
Key Performance Indicator
KPI (key performance indicator) is a measurable metric used to assess how successfully work is progressing toward a set goal. In high-risk verticals, KPIs are needed to control traffic, conversion and money.
What is KPI (Key Performance Indicator)?
KPI (Key Performance Indicator) is a quantitative metric that shows whether a business or a specific process is moving toward its goal. A good KPI is always tied to a specific result, has a clear formula, a data source and a measurement frequency. The metric alone says little: what matters is what it is compared against and what decision is made based on its value.
## How it works
A KPI is built on the scheme "goal — metric — threshold — action". For example, the goal is campaign profitability, the metric is ROI, the threshold is the minimum acceptable value, and the action is pausing the campaign or reallocating budget. In gambling and betting, typical KPIs include FTD, retention, ARPU and GGR. In crypto and fintech, they include conversion to registration, share of verified users and payment success rate. In dating, they include the number of active users and cost per paying user. In nutra, they include CR to purchase and refund rate.
## Where it is used
KPIs are applied at the level of the affiliate team (cost per lead, CR, approval rate), the product team (activation, retention), the payments team (approval rate, decline rate, chargeback ratio) and management (gross revenue, margin). Company-wide KPIs are aligned with OKRs: KPIs track current performance, while OKRs set the direction for the quarter.
## What it affects
A poorly chosen KPI distorts team behavior. If an affiliate manager is judged only by the number of leads, they will chase cheap but low-quality traffic. If only revenue is tracked without accounting for refunds and chargebacks, the company risks losing its payment processing. That is why high-risk projects usually build KPIs as a pair: volume plus quality.
## Common mistakes
The main mistakes are: too many KPIs at once, no single formula shared across departments, comparing metrics with different attribution windows, no thresholds defining what counts as a bad result, and relying on unverified tracker data. Before introducing KPIs, make sure the data from different systems matches.
FAQ
How is a KPI different from a metric?
A metric is any measured value, while a KPI is a metric chosen as key for assessing progress toward a specific goal. There can be many metrics, but a team usually has two to five KPIs per area.
How many KPIs should a team have?
Usually a few key indicators are enough, reflecting both volume and quality. A large number of KPIs dilutes focus and makes decision-making harder.
How is a KPI different from an OKR?
A KPI tracks the current state of performance, while an OKR sets an ambitious goal for a period along with the key results needed to achieve it. KPIs are often used as inputs for OKRs.