What is KPI (Key Performance Indicator)?

KPIs are the numbers that matter most for measuring your business performance. Not every metric is a KPI — only those that drive decisions.

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Related Terms

ROAS

ROAS (Return on Ad Spend) measures how much revenue you earn for every unit of currency spent on ads. Important: this is revenue, not profit.

Conversion Rate

Conversion rate is the percentage of visitors who become buyers. The global average is 2.5-3%, but industry, device, and traffic source dramatically affect it.

LTV (Customer Lifetime Value)

LTV shows the total value a customer generates over their entire relationship. A healthy LTV:CAC ratio is at least 3:1.

Net Profit

Net profit is total revenue minus all costs (COGS, ads, shipping, wages, taxes, everything). The "true" bottom line — what's actually left.

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What is KPI (Key Performance Indicator)? | Margyn Glossary