Are you caught up playing the endless and fruitless game of tracking vanity metrics? As Eric Ries, author of The Lean Startup has stated, “Vanity metrics are dangerous.” And while all business owners now know that they must measure their results in order to know how effective their marketing efforts are, all too often many measure the wrong things. And before you figure out which metrics you should be tracking, you need to determine what your business are.
So what metrics and stats should you actually be tracking and which don’t mean jack squat? What are vanity metrics and what are actionable metrics?
Let’s start by quickly defining the difference between vanity and actionable metrics (well as we see them)
- Vanity metrics: Numbers or stats that look good on paper, but don’t really mean anything important, that don’t actually make a difference to your business.
If you get caught up tracking things that don’t really matter you’ll look back after a few years and see how much energy you wasted maximising stats that don’t matter.
- Engagement or Actionable metrics: Stats that tie to specific and repeatable tasks you can improve and to the goals of your business.
When it comes to metrics and campaign tracking, one of the easiest mistakes you can make is to make is to focus on “vanity metrics,” instead of the metrics that really matter Vanity metrics are things like page views, number of followers, or the number of downloads of your free report. They make you feel good, but they don’t actually add anything to your bottom line.
Engagement metrics, on the other hand, help you understand how much of an impact your website and social media presence are having on your ability to attract, retain and convert potential customers. By measuring how potential customers engage with your website and your social media presence, you’ll be able to develop a far better understanding of whether your marketing efforts are working.
If a metric isn’t actionable and you can’t do anything to make it better, then why are you tracking it?
Overall, your goal should be to track the kinds of activities that lead to customer acquisition, sales, and revenue down the line. If you have a highly interactive page, you may want to track certain clicks as an engagement tool. Or, if your site is highly static and you don’t have a blog, you may want to focus on a metric like pages viewed per visit. It all depends on how your site is set up and what you’re hoping increased engagement will lead to.
Your main priority, though, should be to find the metrics that are correlated to sales and revenue, that are not easily manipulated by irrelevant activity, and that are actionable - that is, that you can make changes based on the data you uncover to improve your results and, therefore, your sales.
The number of social media followers your social profiles have attracted is one of the vainest of all the vanity metrics you can attract, yet it often consumes far too much of the company’s attention. Repeat after me - just because someone follows you does not mean they’re engaged with your brand! Instead, focus your social media tracking efforts on metrics like:
- Engagements per post: likes, comments, shares
- Engagement rate per follower
- Click to Website, or what action you want your followers to take (sign up, shop, message etc)
For example, you can use these specific metrics to inform the different split tests you’ll want to run on various social media posts and post types. Do videos do well with your Instagram audience? Test them and find out! How about infographics on your business’s Facebook page? There’s only one way to find out - and that’s to test, test, and test again.
It might sound repetitive and boring, but these tests are truly worthwhile. When you find the types of posts that resonate best with your community, you can share more of those types over others in order to drive increased engagement. And when it comes down to it, more engagement with the same or fewer posts equals better conversion rates, less cost, and more revenue.
And now the 3 reasons you should pay less attention to and hold less value on vanity metrics:
- Measurement of any kind takes time, money, and attention. Your mind only has so much attention to give, and your company has only so many staff hours and dollars. By focusing your attention on vanity metrics, you’re taking these resources away from the engagement metrics that really do matter.
- Vanity metrics lead you astray. You may have a lot of followers, high page views, or a great follower ratio, and still be ineffective when it comes to social media marketing. And unfortunately, you won’t be able to discover the underlying issues that need to be addressed if you’re focusing your attention on the wrong information.
- Vanity metrics simply don’t affect your bottom line. When you measure things, you want to measure things you can test, improve, and simplify in order to build the company’s business. Driving more page views without noticing the high bounce rate doesn’t do that. Neither does having 10,000 followers - none of whom like, comment or share your content.
Here are some examples of the different types of metrics that typically matter to you as you progress through each stage of entrepreneurial maturity.
- Vanity Metrics: traffic, followers, subscribers, reviews, social media shares
- Starting to move to Action: # of sales, revenue, conversion rate, time on site, customer satisfaction
- Action Metrics: profit, retention length, churn rate, revenue per customer, costs of good sold, impact
Very simply, you need to focus your limited resources and attention on the things that matter most if you want to succeed. What metrics you should be tracking in your business really depend on your goals and tracking metrics that aren’t aligned with your goals is a fast lane to Failureville. At the end of the day, vanity metrics don’t matter. True engagement metrics, on the other hand, help you understand which of your activities are effective at reaching your audience and which aren’t. By focusing on the effective content, you’ll increase your influence, drive sales, and grow your company’s revenue.
Time to take some action, connect with us today.