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Metric Measurement Mishaps

 by zack on 20 Jul 2013 |
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So in the last post we established how important it is to keep track of relevant marketing metrics. We even went so far as to suggest a few of which most every marketer should take note. But what happens when you’re tracking too many metrics and not drawing any relevant conclusions? Or worse, what if you’re reading data the wrong way? Metric measurement can often be as misleading as it is helpful. You need to make sure that you aren’t going about the process in the wrong way. Today we’ll talk about some common mistakes in metric measurement, and how you can avoid them.

No one likes a cluttered desk. There’s not enough space for you to work or think effectively. An orderly organized workspace is essential to productivity. Why would your online interface be any different? Too many metrics can just provide clutter to the marketing metrics dashboard. You’ve go to effectively prioritize the metrics you’re tracking, and in order to do that you’ll need to classify different metrics and order them by relevance.

Now what determines relevance exactly? The bottom line, as usual, is profit. You want to always keep that in the back of your mind. This can come in very handy when doing the initial pruning to your crowded dashboard. The “vanity” metrics that marketers like to track can make you feel proud of your efforts, but they don’t actually do that much for your bottom line. CEO’s and CFO’S should be much less concerned with how a marketing department is performing, and much more concerned about how their campaigns are effecting sales and profits.

Vanity Metrics

These vanity metrics can include a lot of different categories. Even the metric we recommended yesterday, Reach can be considered a vanity metric. However, that doesn’t mean that you shouldn’t track this metric. Instead just prioritize it at a lower level than some of your other more relevant metrics like conversion rate or cost per conversion. Reach is still an important part of your sales strategy, but it’s only important inside of the marketing department and doesn’t really inform you of anything useful once you’ve moved farther along in the sales funnel.

Instead focus on pursuing metrics that measure business outcomes and improve marketing performance and profitability. If you opt for metrics that sound good and impress people, you’ll lose sight of that all-important bottom line. Other examples of vanity metrics include things like content impressions, or Facebook “Likes.”

If you’re working within a marketing department and don’t have a lot of pull over the entire process, you might also want to be careful of which metrics you choose to share with your superiors. To clarify, cost per advertisement can be very helpful to a marketing department, but sharing these kinds of metrics with someone who pulls the purse strings can give the impression that marketing is a money pit, and an excellent place to cut overhead.

Beyond vanity metrics there are some other pitfalls marketer can fall into when it comes to metric measurement. Here’s a common example. One of the most prominent metrics commonly cited is lead quantity. On the other hand, barely 50% of marketers opt to measure lead quality. Concentrating on quantity without also evaluating quality can lead to campaigns that look good on paper but don’t result in higher revenues.

Efficiency vs. Effectiveness

The tendency is to focus more on efficiency than effectiveness. Many marketers will find these terms familiar, but for the uninitiated: efficiency metrics show how many things you are doing, while effectiveness metrics quantify how well you are doing things. It’s easy to focus on efficiency because it shows that you aren’t just twiddling your thumbs and marketers love to prove that they’re being useful, but the metrics that matter more are the ones that show results in your bottom line. Effectiveness metrics are, predictably enough, more effective in that regard.

Use efficiency objectives to improve the inner workings of independent departments, not to develop overall strategy for your marketing or sales plans. The person in your organization in charge of marketing should be the most concerned with efficiency metrics. If you’re one of those DIY employers, then let these stats sit on the back burner until you have the time to address them. In the meantime, put more of your attention on the effectiveness metrics that provide a glimpse of what’s working best to bring in the most money. If you insist on measuring efficiency metrics, then before you do so establish a clear connection between efficiency efforts and sales results. If you can clearly mark that path, you’ve turned and efficiency metric, (traditionally seen as a liability or waste of time,) into an effectiveness metric, (relied upon heavily by upper management.)

Eyes on the Prize

Metrics unrelated to your goals are a waste of time. Use your marketing goals to determine your choices on which metrics to track. Are you trying to build buzz around your brand? If so, then tracking social media metrics like Facebook likes or Twitter followers might be a good decision. However, Social media metrics are notoriously unreliable and difficult to quantify, because it’s hard to measure your influence outside of social media exposure. 

Metrics in isolation are never as useful as multiple metric measurements. Cross examining metrics against one another is a great way to increase validity. If you find out that 30% of your site’s traffic is coming from a certain source, let’s say Twitter. That’s great. You’re social media marketing efforts are paying off. Pat yourself on the back.

Wait a second… Look at this other metric over here that says approximately 0% of those leads are converting. Now we’ve isolated a problem. Our content is doing great, but further down the sales funnel we’re messing up. Let’s take a look at the Bounce rate. What do you know? It’s off the charts. It looks like our landing page is irrelevant.  

See there? A single metric looked like good news, add two more and you’ve unveiled disastrous hole in the sales funnel. Never be satisfied with easy answers. Look deep into your metrics before coming to any hasty conclusions.

Another way of looking at your effectiveness/efficiency marketing efforts should be seen through the lens of outcome vs. output. Your outputs are your efforts: what you’re doing to get noticed. The outcomes are the actual results. So you may be running a targeted email/social media campaign and tracking the clickthroughs and interactions with your content. The campaigns are your outputs, but the measures you’re taking are insubstantial outputs.

The only reason that clickthroughs and engagements are important is because they lead further down your sales funnel. You ultimately want to track conversions. Keep the clickthrough and interaction metrics handy to prove connection between campaign and conversion, but keep your focus on the prize: successfully converted leads.

It’s all a matter of perception. Your perception to be precise. You need to discover which of your metrics are important to your bottom line and focus mainly on those. Gather information about other metrics as they become relevant to your secondary or tertiary goals. Always pay attention to the metric measurements which are most concerned with your actual outcomes. 


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