Should businesses be completely ignoring vanity metrics?
Vanity metrics still have a place, but it’s how you use it that is important. Not all metrics are created equal but some metrics are more useful than others, but it’s important to know what your stakeholders really what to achieve or the narrative you want to tell.
In this weeks Let’s Talk, we speak to experts about whether businesses should be completely ignoring vanity metrics.
The experts believe that there is still a place for vanity metrics but it’s important to really understand what you need and want.
Stephen Barnes, Principal, Byronvale Advisors:Vanity metrics still have a place, but it is how you use vanity metrics that is important. Metrics such as followers, likes and views are used to by the social media platform algorithms to rank your engagement so without a steady level of engagement your content may not reach your target audience. Vanity metrics also represent invaluable information for your business regardless of if people care about what you’re saying or not. Follower are letting your brand take up space on their social media feed. Shares show that someone is lending their brand to support your business. Vanity metrics also quickly let you know what is resonating with your potential customers and where you could direct resources.
Sabri Suby, founder and CEO of King Kong: Vanity metrics are window dressings that digital marketing agencies use to sound like they have achieved impressive results, without addressing the important question of: ‘is this making you money?’ These agencies quote the best (albeit meaningless) numbers instead of measuring return on investment through conversion metrics.
If you’re not making money from your spend, what are you paying for? The solution is to measure genuine results, actual return on investment (cash in your pocket).
Vanity metrics like brand awareness, impressions, click-throughs, likes and rankings are soft metrics that can be used internally by digital marketing agencies as part of their process, but they are not results. For example, in our business a certain number of visits to a web page might tell us that part of our digital marketing strategy for a client is working, but the actual result is the fact that we doubled their investment in one month.
Andrew Joyce, co-founder of Found: Every business metric should relate to either user (customer) experience, or the financial health of the business. I’ve often seen businesses ignore metrics which can predict pretty accurately the performance of the business in the future (for example, cost per impression for online marketing, or the number of leads active in the sales team). Metrics which track very high-level metrics (for example, site views) can be fine, but only so long as there is an active plan to convert these into the desired outcome.
David Low, Head of Marketing at Employsure: Not all metrics are created equal. Some metrics are clearly more useful than others, but it’s important to know what your stakeholders really want to achieve or the narrative you want to tell.
For example, website traffic is used to demonstrate growing awareness and interest in your product or service, and therefore can be considered a critical measure.
However, the devil is in the detail – if web traffic is the metric you want to improve, this can lead you to increased SEM spend or push activities linked to organic traffic. But what is the value of traffic without quality? Time on site or conversion rates may be the lead indicator for success instead of hiding behind ‘feelgood metrics’ like web traffic alone.
Vanity metrics are not the enemy and don’t need to be ignored by business. Simply understand what needs to be achieved or know the detail behind the vanity metric.
Tracy Hall, Marketing Director, GoDaddy ANZ: Vanity metrics such as registered users, downloads, and raw page views, while good to monitor, should not be viewed in isolation, as they can be easily manipulated and do not always paint a true picture of business performance.
Instead, we believe it is better to view these in conjunction with metrics that provide a more realistic view of performance such as active users, engagement, cost of customer acquisition, and ultimately impact on sales revenues and profits.
While vanity metrics still do have a place for marketers, it is important that these are weighted accordingly against other performance metrics to help provide a more realistic picture of overall performance.
Cohort Go Chief Marketing Officer Kirsty Jackson: Whilst vanity metrics can make us feel and look good, they can give a false sense of success and rarely help us make business decisions.
The key to making the most of vanity metrics it to utilise them to help guide you towards the actionable metrics that inform your business decisions. For example, a spike in web visitors will lead us to investigate our lead capture form completions or active platform users. It’s these actionable metrics that are worth investing time in collating and tracking.
SuperEd chief customer officer James Coyle: Unequivocally no. When it comes to digital marketing, we believe that almost every single metric is valuable but when taken in isolation, it can be hard to learn something from. It doesn’t matter if you have 1000 views or 100 views on a particular article, EDM or blogpost. Ultimately, every little metric tells you something but where these metrics really start to add value is when you can gauge real conversion rates for any campaign that you run. Responses to your EDM here are critically important for you to understand because overall this tells you about the pipeline, the interest in your product or service, how many users are engaging with you at any point in time. This can be incredibly valuable to a startup business and you learn so much from it. Vanity metrics as an end to themselves should be ignored, but what is critical for fintech startups to consider is to view all marketing data as a path into understanding a bit more about who is engaging with your website or product. If 10,000 people viewed a particular campaign, it means you’ve got one part of the funnel absolutely humming. Using data in an intelligent and meaningful way is critical for startup founders who are looking to create a platform for which every system can work with or leverage.
As a startup founder, it is easy to get swayed by vanity metrics but it’s important to remember that data alone can be such an insignificant drop in the ocean. The real conversation should be around how we apply this data, use it meaningfully but also be careful you don’t use it to reinforce your own perceptions or your own delusions to gain an accurate picture of how your business is performing.