Any indicator used in isolation to give a good impression about a business’s performance is called vanity metric, without taking into account the relationship of that indicator with other KPIs or variables.
A vanity metric provides partial and incomplete information. It is usually presented without connection to specific objectives, so it is not useful for making decisions or evaluating the real performance or marketing action.
Remember the huge number of registered users on Google+? It was impressive, but in reality, far fewer users used the platform.
To assess a data set, it is essential to have clear preferences and objectives. In marketing, this means working with goals that guide our actions and analyze their results to improve the entire strategy performance.
A monthly increase in traffic to a corporate website may have little relevance if it does not translate into increased sales opportunities. When the goal is to convert visits into contacts, increasing traffic is essential. Still, you also have to work on the conversion chain and closely monitor its performance, to maximize the chances that those visits will be transformed into leads.
This type of analysis helps the data be combined into a meaningful set and can be used to make better decisions, transforming KPIs into actionable metrics.
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How to Identify if a Metric is Useful
The team at Tableau, the leading platform for data analytics and business intelligence, asks three key questions to identify vanity metrics:
1. Does the Data Serve to Make Concrete Business Decisions?
When a metric is actionable, it helps us make informed decisions about our strategy. Vanity metrics, on the other hand, only serve to impress bosses.
2. Is it Possible to Reproduce the Conditions that Led to that Result?
Vanity metrics often hide the specific reasons that resulted in their emergence or responded to beyond our control processes—instead, an actionable metric results from concrete actions within a plan or strategy that contemplated its performance.
As the Tableau article mentions, “If you can’t control the variables and repeat the process to reproduce a statistically similar metric, you can’t improve that process. If you can’t improve the process, you can’t improve that metric. Therefore, it is not useful.”.
3. Is the Data a Reflection of Reality?
A dataset that has been tampered with is likely not to match reality.
For example, can we consider a piece of content to be successful if it receives a lot of traffic from social media? Possibly. But what happens when that traffic is the result of a paid promotion? In that case, it is not so easy to assess their performance.
A vanity metric suggests conclusions that do not necessarily correspond to a real state of affairs.
Vanity Metrics in Inbound Marketing
Inbound marketing integrates analysis and continuous improvement naturally in all processes. When implemented through the software platform HubSpot, analytical never appear in isolation. All reports grouped data intelligently reports and dashboards to facilitate the discovery of significant trends.
That is Hubspot’s solution to vanity metrics: contextualized data with all the information. That the platform collects about the people who browse your website, presented in customizable dashboards that contribute to decision-making. This way of working with data is one of the keys that differentiate the methodology from other marketing approaches.
It does not mean that there cannot be vanity metrics in inbound. But when information is presented comprehensively, it is easier to spot solutions. That work and much more difficult to disguise poor performance with gimmicks and shocking numbers.
Also read: Content plan: Why it is Essential in a Content Marketing strategy