You've worked hard developing the right product. You've talked to an endless stream of past purchasers and potential customers about pain points and value to find your product's fit in the marketplace. You've optimized for keywords and SEO and have engaged the community with your social channels. But still, something is not right. You're throwing money in various marketing channels but your revenue is not improving, or worse, it's going down. Finally, you decide that Baotris was right in all those wonderful blogs they wrote and you need to take a look at your data.
So you pull together a report for your digital marketing that you have done for your ecommerce shop and your results look amazing, your followers are up, you have a ton of website traffic, people are opening your emails - so why are you not rolling in money?
What Are Vanity Metrics?
Vanity metrics are aptly named, because they make you look good to others but don't actually help you in any actionable way. In short, they sound more important than they are because they cannot help you to gain deeper insights.
Why are Vanity Metrics Important?
Getting actionable metrics is important because these numbers help you make decisions and to reach business goals. While there is nothing wrong with occasionally pointing to vanity metrics as part of an ad or promotion, these metrics, when used too often can be overly simple and misleading and can lead to falsely large egos and blind spots. Equate these to buying fake followers on social media, it appears positive but that’s all there is to it.
How do I know if Something is a Vanity Metric?
According to Tableau, the easiest way to identify vanity metrics is to ask the following 3 questions:
What business decision can we make with the metric?
In the context of a landing page for a website, knowing the total number of page views for the actual landing page tells you very little, but knowing where users came from to arrive at your landing page holds slightly better information that can be actioned. You can evaluate the pathway numbers and invest more in SEO opportunities if you know that’s where most of your viewers are coming from.
What can we do to intentionally reproduce the result?
When thinking about the cause for metric changes, the impetus for the change is the most important. Is it something you can identify and repeat with similar results? If not, then the change was caused by an erratic external factor, something you do not have control over, such as if a celebrity tweets about your product. Yes, you saw an increase in traffics and conversions, but you cannot make it happen again and therefore, you cannot do anything with this metric.
Is the data a real reflection of the truth?
We all know about fake followers for social media, but it’s just as easy to hire a click farm to visit your website and add to cart. While it boosts the numbers for a short time, the data is not valid and bad data causes more harm than good because it can lead you to false conclusions and therefore hurtful actions.
So What Should I Do With My Data?
Actionable metrics are the good twin of vanity metrics, they tell you what is going on and help you do something about it. Look for actionable metrics in your data (which means they pass the vanity metric test above) and these will guide you towards your next steps so that you are never wondering, what should I do next?
Examples of Actionable Metrics
Where Traffic is Coming From and Conversion Rates for that Traffic - While traffic itself won't help you, knowing where traffic is coming from (Ad Vs Influencer Vs Organic for example) and knowing how that specific traffic converts can help you focus your time and money on the high performing pieces of your funnel and also give you a heads up that something may not be working right with the low performing incoming traffic channels. If you're getting a ton of clicks from ads but those people quickly leave the page, you might ask yourself if your ads and your landing pages are aligned, or maybe you're just targeting the wrong audience and wasting a bunch of ad spend.
Engagement Metrics for Blogs such as Time on Page, Exit %, and Bounce Rate - Instead of tracking the number of views your blog has, engagement metrics such as the above three help you gauge the interest of the reader and if your content is performing how you intend to. If you're writing blogs that should took 5-7 minutes to read but your analytics tools show people are leaving after 1 minute then chances are they do not find your content as interesting or well written as they hoped when they first clicked the link. Exit % lets you know how many people who landed on your blog decided to explore your website more before leaving. Likewise, bounce rate is the percentage of people who visit one page on your site and leave without further clicking. Keep readers engaged with a good CTA (call to action), links to similar content, and other parts of your site such as relevant product pages.
How to Know What Actionable Metrics are Important?
Now you're asking the right questions young grasshopper. While we can't tell you exactly what metrics make the most sense for your company, we can tell you that first you need to create goals for each campaign your run or initiative you put your time into. Ask yourself WHY, why are you doing this, what is the desired goal?
If you're working on a campaign to increase conversions and doing so through email marketing, it's not about how many subscribers or even opens you have - it's about which emails have the highest conversion rates and why. This is where A/B testing comes in. Test 2-3 different types of emails with your subscriber list, whichever one performs the best, figure out why and do it again and again until you notice it doesn't perform as well and then try out some new A/B tests. Send different offers to different groups of your subscriber list, just make sure they are randomly assigned to a group, or you could be skewing your own data.
Actionable metrics also keep you honest and your experiments focused. Boasting about 100 conversions doesn't make much sense if you needed to reach 100,000 people to get there. Your conversion rate (which in this case would be .1%) is actually bad so whatever you're doing needs to be thought out and redesigned.
So create goals, ask yourself why, decide on metrics to track and ensure they can pass the Tableau questions. Metrics and data are here to help you improve and better understand your market and customers. Or, if you can't figure it out, give us a shout and we'll be happy to assist.