Management consultant, Peter Drucker, famously said: “If you can’t measure it, you can’t manage it.”
If you’re on a diet, you won’t know if you’re losing weight without stepping onto the scales and comparing your current weight to previous weigh-ins. Similarly, marketers don’t know if their campaigns have succeeded – and know how to improve – without measuring the results.
To get back to basics, a metric is a measuring system that quantifies a trend, dynamic or characteristic. Metrics can provide accurate and detailed insights into the effectiveness of an organisation at various levels to measure commercial success. Many businesses call these metrics key performance indicators (KPIs) which, in most cases, is just another term for an important metric that’s tied to a goal in some way.
But time after time, employees end up measuring the wrong kind of metrics that don’t actually reveal anything about the business. These pesky little measures are referred to as vanity metrics because, as the name suggests, they appear to be useful and positive but don’t provide any real intelligence about business performance.
Vanity metrics give employees a rose-tinted view of company success and often lull them into a false sense of security since the information derived does not demonstrate clear cause and effect. So how can you avoid measuring them?
Mirror, mirror on the wall
Whilst vanity metrics can provide some short-term insight for understanding the early-stage impact of a campaign, they will rarely prove the monetary impact. A classic example is measuring the number of visitors to a website rather than how many of those visitors converted into customers. As entrepreneur, Tim Ferriss, puts it: “vanity metrics: good for feeling awesome, bad for action”.
The metrics you choose to measure must be useful and relevant otherwise the information they produce will be misaligned with the actual business performance. All organisations need to measure metrics, whether they’re aspiring for overall growth or measuring a particular campaign. But the metrics must be tailored to their specific business context.
The bottom line is, your metrics need to be actionable and offer context for future business decisions otherwise they’re meaningless and a waste of your time. If your metrics are positive but business growth is dismal, then you may well have fallen victim to vanity metrics. Below, we explore three examples and offer actionable alternatives.
Metric myths demystified
Myth 1. More social media followers mean more customers
Growing your audience on social media does not necessarily get you more customers. Measuring the number of followers can be problematic as a metric for a whole host of reasons. For example, some people buy fake followers to bolster their popularity in the social media world or follow random accounts in the hope of reciprocity, rather than having a genuine interest in your company.
With social followers, quality always trumps quantity. Having a relevant audience is key as they are more likely to engage with your brand and convert to customers. If your Twitter followers are a mishmash of random segments rather than your desired target audience, it’s unlikely that they will purchase from you. To give an example, we analysed the social followers of a new client and concluded that 57% was outside of the target audience. So, although the metric looked high, the audience wasn’t relevant and didn’t engage socially.
Actionable metrics, such as engagement rate and conversion rate, may prove more worthwhile. Engagement rate is available on the analytics pages of most social media platforms and can reveal valuable insight into the success of your posts. Additionally, Google Analytics allows you to see the number of referrals to your website from social media. Learning which posts had the highest engagement means that you can replicate their successes in future.
Myth 2. More website views mean more customers
A high number of page views usually means that you’ve got your SEO right. But just because someone has viewed your page doesn’t mean they’ll convert into a customer. Another of our clients had a high number of website views but was frustrated to see no customer conversions from the website. We found that it had a bounce rate of 86% and revealed that people weren’t clicking past the homepage, suggesting that something on the page was deterring them from becoming a customer.
If you’re tracking the number of hits to a site, analyse this metric in tandem with the bounce rate. If both are high, then you’ve got a problem. Google Analytics can provide you with these measures.
Myth 3: More newsletter sign-ups mean more customers
It’s simple enough to track how many people signed up to receive your newsletter, but are people actually reading your content or parting with their hard-earned money? Often free product demos or newsletters go unused or unseen.
Track how many users return to use your site each day/week/month. These are called active users. In Google Analytics, metrics like visitor loyalty and visitor recency are helpful. You should track what actions visitors took on your website before they signed up for your newsletter or better still, became a customer. You can monitor the user journey in a few different ways, such as adding tracking links to your calls to action (CTAs) so you can see where a user came from and how they moved along your conversion path.
When measuring metrics, create meaningful goals. It’s all very well having a subscriber base of thousands, but if no one is buying, then it doesn’t mean anything. Track a perfect conversion path from awareness through to conversion and repeat. Monitor where visitors bounce or get stuck, create a path of least resistance, and be prepared for the data to highlight flaws in your perfectly planned campaign. No room for vanity here, the data doesn’t lie.
Vanity metrics make you feel good but don’t contribute to business success. Metrics allow you to know significantly more about your business and can signpost the way to organisational success to make your brand one that’s better than the competition. So, before you go about measuring, make sure you don’t have one eye on the mirror.