In a digital world where every click, like and comment matters, we have many KPIs to choose from to track effectiveness. Unfortunately, some of them do not necessarily translate into business benefits: these are the so-called “business benefits. vanity metrics. What is not worth paying attention to? How can an agency or freelancerf try to pull the wool over your eyes? Read on to learn more.
What are vanity metrics?
Vanity metrics, or freely translated vanity metrics, are data that appear impressive at first glance, but in reality do not provide useful information about business effectiveness. Typical examples include the number of followers on Instagram, the number of likes on Facebook, the number of visits to a website or the number of app downloads. These numbers are often misleading because they do not reflect actual engagement or conversions, which are the ultimate indicators of success.
Why are vanity metrics a problem?
The problem with vanity metrics is that they can create the illusion of success. For example, a website may boast a million hits a month, but if visitors don’t spend much time there or perform the desired action, such as buying a product or signing up for a newsletter, those big numbers mean little. Additionally, focusing on vanity metrics can lead to the wrong business decisions. Investing in strategies that are designed only to pump up those numbers often comes at the expense of activities that could actually bring value and growth.
How do you recognize vanity metrics?
To avoid being fooled by vanity metrics, we must learn to identify them. Here are some characteristic features:
- No direct impact on revenue: if an indicator does not show a direct impact on revenue or another key business objective, it is likely a vanity metric.
- They don’t translate into user action: metrics such as likes or shares may look encouraging, but they don’t always mean a user will take an action that benefits the company. They matter if your goal is simply to increase
brand awareness
.
- They are easy to manipulate: if the number can be easily increased through paid promotions or SPAM, it probably doesn’t measure true engagement.
What indicators are worth tracking?
Instead of vanity metrics, let’s focus on actionable metrics, also known as actionable met rics. Here are some examples:
- Conversion rate: How many people made a purchase after visiting your site?
- Customer Lifetime Value (CLV): What value does one customer bring on average over the lifetime of the relationship?
- Customer retention rate: How long do customers stay with your brand?
- Engagement: How do users interact with your content? Do they comment and do their actions lead to conversions?
How to stop focusing on Vanity Metrics?
Instead of blindly following an increase in the number of followers, determine what you want to achieve – whether it’s increased revenue, improved customer satisfaction or something else. Use analytics tools to track the metrics that really matter to your business objective. Regularly test different strategies and optimize actions based on share metrics. Make sure everyone on your team understands the difference between value metrics and vanity metrics. Focus on quality, not quantity. Focus on building a valuable user base that is genuinely engaged and interested in your brand.
Vanity metrics may be tempting, but true business success requires a deeper look at the data. By focusing on stock metrics that actually translate into business results, we can better understand our customers, effectively manage resources and time, and develop strategies that lead to sustained success. The main thing is not to be fooled by empty numbers that are not followed by sales growth and other real business benefits.
