Generally speaking, marketers’ main goals are to move one of two needles: revenue or brand awareness. When evaluating success, however, many marketers may waste time on vanity metrics. These vanity metrics, which often come in the form of seemingly important metrics such as page views and social media followers, can make marketers look good or feel accomplished, but do not help their organization understand the most efficient ways to move those needles.
Marketers need to be crystal clear about why they measure the metrics they do, including knowing what happens to the business when they go up or down, and why they are moving in the direction they’re moving. In most cases, if someone can’t easily define a metric or explain why it matters, it’s likely a vanity metric.
Vanity metrics are tempting because they seem important and are highly visible, but their inability to measure the right areas can ultimately spell failure or success for a business. So, how does one avoid the lure of vanity metrics?
Understand the Business Model
The first step to avoiding vanity metrics is to understand the company’s business model and how it takes its products to market — whether selling directly to buyers, alongside partners, through resellers or any other route. Once defined, marketers can identify metrics that impact the buyer’s decision-making process.
For example, if a brand does most of its business through affiliates or channel partners as a white-label service, then social media followers don’t matter much. The quality of a few relationships is far more important than the number of people who recognize the brand.
Focusing on outcomes (i.e., revenue or brand awareness) and working backwards to see what’s moving (or not moving) the needle is a good way to find the metrics that truly impact the business.
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Optimize the Right Metrics
The right analytics portfolio can provide deeper insights into the business once the metrics are in place — such as allowing marketers to identify the viability of new customer or market segments.
To get those insights, marketers should analyze metrics frequently to understand how their data correlates to business outcomes. Gaining an understanding of the reasons behind sporadic ups or downs isn’t quite enough here. It’s also important to look for metrics where improving poor performance or fine-tuning high performance correlates positively with higher-level business goals.
In a way, some metrics are already vanity-proof thanks to legislation such as GDPR in Europe, the California Consumer Privacy Act (CCPA) and the CAN-SPAM Act in Canada. To be certain, these laws are designed for a larger scope than business metrics, but they also inadvertently have this vanity-proofing effect.
For instance, some of these regulations prevent companies from enrolling subscribers to newsletters without them opting in first. So instead of being able to buy a list of subscribers and use that as a metric, email marketers must look to more impactful metrics such as open rates or click-through rates.
Know Thy Enemy and Know Yourself
Ultimately, in most industries, internal growth is only important if you’re keeping up with your competition. That’s why you need to ensure your marketing efforts are both paying off now and moving in the right direction over time. The only way to do that is to regularly benchmark the organization against competitors. Once the top competitors and metrics are defined, brands can evaluate what it means to be good, better and best in the space.
Conducting a competitive analysis against the best in the industry can be a harsh, but fruitful, wake-up call. Marketers can uncover new opportunities to focus on or stay away from, such as spaces that are already too crowded or areas where their product may not be the best fit.
Evangelize Success Internally
Another key aspect of moving away from vanity metrics is evangelizing the metrics within the company. Leadership should always stay up to date on what is being measured and how it impacts the bottom line, but additionally, employees across other teams and departments should also understand this data.
One quick way to test this is to explain one of these metrics to someone outside of leadership and marketing groups and then ask them to define it correctly in their own words. If they can do it, then that’s the sign of a successful non-vanity metric.
Don’t Let a Solid Marketing Plan Go to Waste With Vanity Metrics
The more time marketers spend on vanity metrics, the less time they’re spending on optimizing the metrics that impact revenue or brand awareness.
Moving away from vanity metrics may seem like a lot of work, but ultimately eliminating them from an analytics portfolio will shorten the time it’ll take for organizations to attract new customers, generate more revenue and increase brand awareness.
The right metrics will vary based on the industry, products, audiences, business model and tons of other variables we can’t define in aggregate. Just don’t forget what “true north” looks like: whatever metrics are used, they must always move the revenue or brand awareness needles in the direction you want to go.