There are two schools of thought when it comes to choosing which KPIs to track. The first is what you might call the "vanity metric" school—these are the metrics that make you feel good but don't do a great job of giving you meaningful information about your business. For example, your total number of social media followers would be considered a vanity metric because the number of followers doesn't always have a direct impact on the size of your business.

The second school of thought would be the "actionable metric" school—these are the metrics that give you insights into what's working and what isn't so you can make changes accordingly. An example of an actionable metric would be your website's bounce rate (the percentage of people who leave your site after only viewing one page).

Which types of KPIs should you pick as ones to track for your small business? The answer is both! While it's important to focus on metrics that will give you actionable insights, it's also good to track vanity metrics so you can see your progress over time (especially because these help you understand how your brand is growing). For example, if you're trying to grow your social media following, tracking your monthly growth is a good way to see if your efforts are paying off. But if you want to know what marketing channel is your best one, track something like the number of new clients or customers you get by marketing channel.