This is a guest post by our co-host, Nick Armstrong.
This week on Prosperity’s Kitchen, the same question came up time and time again: who cares about all these metrics?
In College, did you care about your edgerank on Facebook? Me either. Mostly because it didn’t exist. You know what metrics I cared about?
How many credit hours I could take without having a meltdown (my “peak conversion rate,” maybe).
How long I could ogle a beautiful undergrad before she noticed (my “time on site,” I suppose).
How many dates I was going on vs how many times I was rejected by aforementioned undergrad (my “bounce rate,” if you will).
You’re absolutely right to feel that the stats you’ve been told are important, must-track metrics have been mismatched when it comes to your specific business needs. Chasing your tail collecting stats someone else says are “useful” has probably been wasteful and frustrating for you — mostly because you don’t know why you should care.
Cool. So, whatever, right? Don’t track stats at all and everybody’s honky-dory.
Let me ask you this: if you had to take your dog on a walk any time he asked, but only if you hadn’t taken him once already that day — wouldn’t you want to track that stat?
Your dog might not be too happy about that, but then again — they have more going for them in the happiness department.
OK, so let’s say you have a certain type of customer come across your site somehow. Every time this certain type of customer comes around into your business, they steal something — your time, your effort, your soul. Isn’t it kinda worth figuring out how they get in so you can identify them before they have a chance to eat you alive?
You should only track the metrics which directly relate to you getting (or not getting) paid, laid, and totally happy. Anything else is a distraction.
Here’s why: your unique situation, business, customers, and goals are what define your must-track stats. Anybody who doesn’t know your business inside and out can’t tell you for certain that one stat in particular is more important than any other.
Aside from a few core numbers which everybody should know — unique visitors and subscribers or monthly purchases, for instance (these are the equivalent of blood pressure and weight of your website) — you’re unlikely to share the same set of “must-track” stats as any other small business.
It gets worse, too. Following well-intentioned advice from “gurus” can land you in a world of analytical hurt. I hear on a daily basis: you must track your bounce rate. My response whenever I hear that I must do something is, and forever shall be: why?
Yours should be, too.
If the only dating advice you took in College was from the Prom Queen, you’re missing out. Does the Prom Queen have to work to keep her dance card full? Hell no. I want dating advice from the popular nerd (yours truly) who made a name without gold-plated jewelry and a fancy title.
But then again, if you’re only tracking dollars in the bank, unique visits between your sheets, or, for the more pure-of-heart among us — kisses from the prom queen, you’re not getting the whole story. Nobody wants to be just another notch on someone else’s bed post… so why do we treat our website visitors that way? Our opt-in subscribers that way? Silliness.
Why Just Tracking Your Bounce Rate (or the stat du jour) is a Huge Problem
One stat on its own is totally useless. Any metric in a vacuum will tell you next to nothing. Worse still, a stat on its own is just one piece in the puzzle. Without more information on the business, the situation, the goals, and the customers, it’s possible to get into an endless and meaningless cycle of tweak-then-measure.
If I tell you that my bounce rate for one of my websites is 80%, what would you think?
In the absence of any other information, you might say, Gee, Nick, that’s awfully high.
But then what? If you follow the typical guru advice, you say “high bounce rate bad” and try to tune it down. If so, what you’d be doing is destroying one of my best defenses against bad clients.
I could tell you that one of my websites just hit 900+ unique visitors per month. You might give me a virtual high five, until I tell you that it’s down from a high of 2,600.
It’s like saying, “I’m a tiger in the sack because I’ve had X sexual partners.” Puh-lease. We need a bit more information than that — like a “length of foreplay” stat or a “previous partner post-coital satisfaction survey” or something.
Size matters — but whose ruler are you using to measure? Your own? And who’s counting?
The combination of two stats to yield new information is called meta-analytics and you absolutely have to know the meta-analytics behind your business to be successful at measuring and interpreting stats.
One-off stats are 100% useless in a vacuum, which is why the traditional advice from marketing gurus is so very frustrating.
Keep Cool, My Babies…
The source of all your frustration: the seemingly unceasing tasks required of you as the part-time Commander-in-Chief, part-time janitor of your business. “You want me to do what now?” is a common refrain in my house, too. I’m told it never really goes away. I even heard that same desperate plea from one of my favorite clients, who coined what I now use as my modus operandi: Action Precedes Clarity.
If you’re too afraid to ask out that cute nerd who likes to read because you don’t know what you’d talk about, you’ll certainly never get to kiss ‘em. Action precedes clarity!
End The Never-Ending Cycle of Stats Tail-Chasing
Let’s put something to rest right away: not every tool will be useful for every business owner. Not every stat or metric will have meaning to your business. Nor will every housekeeping task lead you to revenue.
So what’s a good process for cherry-picking stats without missing something important?
- Learn about and understand which metrics are available
- Develop situational awareness
- Understand your goal
- Identify your relevant metrics
- Compare and contrast
- Modify your plan based on what you know
- Update your situational awareness
Understanding which metrics exist to you is important. If you’re on Twitter, you’ve got like… 10 available to you (SocialPing is a good place to start with Twitter metrics). Depending on your newsletter software (I use MailChimp and my dashboard is pretty in-depth), you’ll have a few more to choose from.
Hire a stats geek to walk you through what stats there are available to you, what they mean, and how they work with other stats (the meta-analytics). It never hurts to have a bit of coaching from someone who knows the ropes.
Develop a keen situational awareness of your business: what’s your current client load? What’s happening right now with your bank account? Are you in the black or the red? Are you doing the right kind of work? Are you working towards your long-term goals? Are you on-mission?
If your aim is to get married, tracking only your number of bedded partners isn’t such a valuable metric. Aiming to improve on it certainly won’t help, either.
Understand your goal to understand which numbers matter: are number of customers or customer satisfaction ratings more important? What’s your mission? Are all your tasks in line with it, and are you getting the right messages back from your customers that make sense of it all? (If not, you need to pick better metrics — qualitative and quantitative).
Which stats are important enough for you to take time away from a revenue generating task to tackle? It depends on:
- What are you trying to accomplish at the moment?
- What’s the lead generator which will help you accomplish it?
- Is your current path/plan of attack/call to action working as an effective lead generator?
- Do you have enough traffic and stability to make the stats make sense?
Modify your plan based on what you learn and your situation. As you go from teenage heartthrob to older, wiser, and cooler — things will change. Are the metrics you’re tracking helping you make better decisions? If not, abandon them. Pick new metrics and start again.
A Fine Place To Start: Google Analytics and Customer Satisfaction
I’ve Captained my business, WTF Marketing, for 4 years now, each year learning about some new “must track” metric and some new “must use” tool. Here’s what I’ve learned so far: with a hub-and-spoke model, whether you’re running an information business, a blog, or a retail-based business, certain metrics will be your bread and butter.
Like Tea said in Episode 3: Metrics, tracking what people click on allows you to identify portions of your website you can remove, bits of ineffective content, even your partners who aren’t pulling their weight. That little black dress not working it for your audience? Maybe they like red better. Test it out.
As another introductory step, ask your customers how your brand makes them feel. How do they feel when interacting with you, what do they feel when they’re using your services or products, and how do you stack up to their expectations? This will give you a good baseline of how folks categorize your business and how they regard your service.
Paid, laid, or happy: if your metrics aren’t helping you make better business decisions, they’re not metrics you should be tracking.
Let me know what your thoughts are in the comments below
Photo Credit: David Chief
About the Author
Nick Armstrong is unapologetically awesome at explaining difficult-to-grasp marketing and technology concepts regarding the web. In his day-to-day work, he helps small business owners swear less and profit more through kick-ass marketing.
For the last 3.5 years, Nick’s business WTF Marketing has amassed a large number of happy clients, among them Fortune 100s, solopreneurs, and everything in between, including three distinct $2M+/year businesses. Leveraging over a decade of web design experience and eight years of hands-on, knee-deep community building and marketing.
He founded the Digital Gunslingers in 2009, teaching $5 classes on social media and marketing concepts and donating all the proceeds to charities in Fort Collins, Colorado. You can connect with him on Google+, Twitter, and Facebook.