For many marketers, metrics, like data, fall into the more-the-merrier camp. Reporting more metrics than less, however, often serves only to confuse and complicate. When we set too many metrics, it’s easy to lose sight of the real data that matters.
Ideally, metrics that are worth investing time, energy and money in are those that help companies make decisions. Unfortunately, the majority of such key data can get lost in the noise we call vanity metrics. While seeing the figures for vanity metrics might make you feel good, they don’t actually offer clear guidance on what to do about your campaign.
As the name implies, vanity metrics make you feel good — it gives the illusion of succeeding, even if you’re not, simply because the numbers are growing. Some examples of these are:
– Number of likes
– Number of shares
– Number of followers / subscribers
– Number of impressions / views
Sound familiar? However, that’s not to say that vanity metrics are completely pointless. For example, if your aim is to raise awareness for a brand or cause, then naturally, impressions and virality matters. But if your KPI is to increase sales and revenue, the above list doesn’t really matter and would most probably annoy your stakeholders who are after more in-depth insights.
In short, what you define as a vanity metric also depends as what you define as a successful campaign. When it comes to listing KPIs for your digital marketing campaign, it’s more important and effective to focus on a few metrics that relate to:
1) your business goals
2) your marketing strategy
3) your sales strategy
Of the list, number 3 — ROI and revenue — is probably the most common and important factor for companies, but it’s also the most challenging to measure and achieve. But by putting the focus on the right metrics, you can alter and steer your campaign in the right direction for results.
Setting your KPIs
To set your KPIs the first obvious question is — what’s your objective? Once you have made that concrete you can move on to identifying which metrics really matter. These are known as actionable metrics, and can include:
Revenue and Campaign Performance:
Setting a KPI for your revenue is a no-brainer, but it also involves factors like how much was spent, the ROI and which ad or channel was most effective. The formula is simple — subtract the amount you’ve spent from the amount you’ve gained in revenue. If the figure is a negative, then you’re clearly in trouble.
Customers and Conversions:
Customers are not to be confused with visitors. You need to find out where your customers are coming from in order to identify areas where you can effectively spend your energy and marketing budget. Did customers come from social media or paid traffic? What’s the rate of conversion into a sale?
Demographics and Behaviour:
These days, demographics go beyond just age, gender and spending power. You can also track which groups are your most profitable customers, versus those who are one-off buyers. You can even break it down to the time of day these customers are most likely to spend — is activity higher on the weekends or weekdays? How many hours do they spend on your site and what time are they on it? By doing so, you can find trends in the data and effectively launch new products, services or offers at your “prime time.”
Beyond just keeping track of these figures, you will also need to regularly adapt to the trends as your business matures — a metric that was important at the infancy stages (these are usually vanity metrics as you try to get exposure) may not be relevant in a few months.
In summary, there are many metrics that provide valuable insights. To ensure that your business has a data lake and not a data swamp, identify what your goals are first. The metrics you choose to set the bar should be a good indicator of progress towards the goal or at the very least, be related. If not, you’ll find yourself out of a marketing budget on a slippery slope to campaign failure. So save your love for metrics that are worthy.
Like what you see? Email us at insights@nugit.co to see how we can help you understand what’s going on in your digital world.
