Metric Contstraints: How Inflexibility Around KPIs Stifles Product Innovation
Discover how rigid business metrics compromise product progression and innovation as audiences change. Learn from real-world examples and strategies to overcome this common challenge.
In the domain of product design and development, metrics serve as critical tools for measuring success and guiding decision-making processes. However, an over-reliance on fixed metrics can inadvertently stifle innovation and impede the evolution of new ideas. In this blog post, we’ll delve into the pitfalls associated with rigid metrics and examine real-world examples where such metrics obscured genuine progress.
1. The Dilemma: Page Views vs. Social Feeds
In news publishing, where advertising revenue hinges closely on page views, the predominant use of page view metrics can significantly influence product development — particularly within platforms where social feeds might produce a more positive outcome for the audience and business.
Advertising revenue in news publishing is often tied directly to page views, correlating these metrics with ad impressions and subsequent revenue generation. Consequently, the focus on page views can heavily sway product decisions, potentially directing efforts towards increasing page views rather than nurturing meaningful user engagement or community interactions.
However, when considering platforms centred around social feeds within news publishing, fixation on page views can pose significant challenges. Social feed environments thrive on user interactions, content sharing, and community engagement — elements not adequately captured by traditional page view metrics. Users might spend extended periods within the feed, engaging deeply with content and discussions, which may not reflect as increased page views.
Therefore, when developing social feed-oriented news platforms, adapting measurement strategies to encompass a broader range of user engagement metrics becomes essential. Metrics reflecting interaction depth, content virality, or community growth offer more relevant indicators of success in fostering vibrant social environments. This shift ensures product development remains aligned with the primary goal of facilitating meaningful user interactions and community building, rather than solely optimising for page views driven by advertising revenue. It also ensures that products have a suitability for purpose and will engage new audiences and thus develop and ensure revenue continuity.
2. The Challenge of Misleading Conversion Metrics
Another common pitfall arises when existing metrics misrepresent actual performance due to changes in user behaviour or experience optimisation. Imagine a scenario where a website undergoes a significant redesign and navigation optimisation to enhance user flow around the product, and streamlines in-page conversion processes.
Following the update, initial data might suggest a decline in conversion rates based on traditional metrics due to an increase in input at the top of the conversion funnel. However, closer examination reveals that while the conversion rate appeared to drop, the number of users entering the conversion funnel increased dramatically. This surge in raw numbers translated into a higher total number of conversions, albeit at a percentage rate seemingly less favourable by the old metric.
In this scenario, a fixation on existing metrics could lead to the premature dismissal of a successful redesign. The focus should shift from fixed metrics to a holistic understanding of user behaviour and business objectives, allowing for nuanced interpretations reflecting the true impact of product changes. A basic review of raw numbers within existing metric formulas can offer valuable insights into outcomes.
Navigating Innovation Through Adaptive Metrics
To mitigate the risks associated with fixed metrics in product design, teams should adopt a flexible and adaptive approach to performance measurement:
• Contextual Metrics: Define metrics aligning closely with specific goals and unique product characteristics. Consider metrics capturing user engagement essence, like time spent on the platform or interaction depth.
• Continuous Evaluation: Regularly reassess and refine metrics based on evolving user behaviour and market dynamics. Avoid rigid adherence to predefined metrics that may inaccurately reflect innovation or progress.
• Holistic Analysis: Embrace a comprehensive view of performance by considering a spectrum of metrics beyond traditional KPIs. Incorporate qualitative insights and user feedback to supplement quantitative data.
In summary
While metrics are essential for gauging product performance, their rigid application can impede innovation and obscure genuine progress. In some instances, the rigid adhesion to a set of metrics could also lead to the ultimate demise of a business as they cling to an old method and in the process fail to innovate at inflection points in the market. The history of technology and business is filled with these dinosaurs.
However, by embracing the need to adapt metrics and deliver contextual evaluation, businesses and product teams can navigate the delicate balance between innovation and measurable success in an everchanging digital landscape.
