Management expert Peter Drucker is often quoted as saying, “You can’t manage what you can’t measure.” In order to grow and improve your business, you have to be able to measure and monitor the right metrics.
This applies to everything in your business.
Yet determining the right metrics to measure, and understand, is not so simple.
Proxy metrics (or Vanity metrics) vs. sales metrics
On Facebook’s Q4 2016 earnings call held on February 1, 2017, COO Sheryl Sandberg stated that all ads should drive business. She made the distinction between sales metrics and ‘proxy metrics,’ which includes fanbase size, reach, engagement and video views.
“We really believe that at the end of the day what matters the most is all the way through to sales. What matters the most is the A/B test that these people saw ads on Facebook and Instagram, these people didn’t, and here’s the sales lift. And all of the other metrics,” Sandberg said, “are proxy metrics.”
Of course, this is not what most businesses want to hear. We’ve all been trained to believe more is better. That we ought to strive for more fans, more reach and more engagement.
But, generally speaking, those numbers are all vanity metrics.
Marketers need to see the metrics all the way through to the final goal and focus on the right metrics – those that generate revenue.
It’s important to separate out your KPIs (key performance indicators) into the right categories and report the relevant data to the right person within your business.
For example, brand awareness, social media and engagement metrics should be reporting to the CMO/marketing manager/community manager. Whereas, lead generation and sales metrics are what the CEO and CFO mostly want to know. If you report the number of retweets or video views in a week to your CEO and CFO, they may wonder how that translates to actual bottom-line dollars.
The following are some suggested metric categories:
- Brand awareness metrics include social media reach, brand mentions, brand searches, media mentions and website traffic.
- Social media metrics include the number of likes/fans/followers, post reach and impressions.
- Engagement metrics include people who have clicked, liked, commented on or shared your social media posts; people who have viewed your videos; the number of retweets and more. This stat could also include the number of subscribers opening your emails and clicking on links.
- Lead-generation metrics include landing page visits, click-through rate, completed registrations and conversion rates. In other words, any activity that moves the prospect from being an engaged member of your social media channels to becoming a contactable prospect. This can include the prospect submitting their phone number, email address, mailing address or contacting you via Facebook Messenger, Instagram Direct or WhatsApp.
- Sales metrics include appointments scheduled, applications submitted, add-to-cart, initiate checkout, add payment details, and, of course, completed purchases.
“In God we trust, all others must bring data.” – W. Edwards Deming
Tools for measuring your online activity
You may already have a reliable set of tools you use to track an array of metrics in your business. Here are a few of my own favorites:
Facebook Insights: You’ll find these metrics on the “Insights” tab of your Facebook business page. For mobile, use the Facebook Pages Manager app (iOS) (Android) and also check out the Facebook Analytics app. Metrics include Likes, Followers, Page Views, Actions on Page, Video views, Audience retention, Engagement and more.
For video content, I recommend clicking in to each video to study the breakdown of metrics. Otherwise, you can keep an eye on the Overview > Page Summary insights for the past 7 or 28 days and export the data to a spreadsheet for further analysis.
Twitter Analytics: These are at the top right of your Twitter profile or at analytics.twiter.com. View your tweet impressions, engagement, and engagement rate. Pay particular attention to your top tweets and do more of what’s working.
AgoraPulse: This is a terrific all-in-one tool for scheduling and managing all your social media channels. The Reports section has colorful charts that are easy to read and may be a great addition to your analysis.
BuzzSumo: One of my favorite tools, this platform allows you to study how well your own social posts are doing along with any competitor’s posts. Plus, you can use the tool to discover what headlines and topics are doing well, identify key influencers, see what’s trending and more.
One-stop data dashboard
If looking at an array of metrics from a wide variety of sources is challenging for you, you might enjoy a great solution called Klipfolio.
Klipfolio is a tool to create an all-in-one dashboard with visual analytics for all of your metrics at your fingertips. You’ll be able to instantly spot trends and see how your business is performing. Compare this month to last month or the same period last year with a single click. Use filters, segments, and automatic trend lines.
Cash flow dashboard
Just as you need to closely track and measure sales and marketing metrics, you definitely need to do the same with your business finances. Bank of America's Cash Flow Monitor offers an innovative new cash flow dashboard where you can see a 360° view of your business’ financial position or picture in a compelling, visual layout.
Cash Flow Monitor is a one-stop ‘digital control center.’ Accessible online and on mobile, this new seamless and integrated digital platform is designed to help you get more time back in your day by helping you manage all financial aspects of your business.
BA360 empowers you as a busy business owner to optimize your time and resources and gain a deeper perspective on your business so you can get back to doing what you truly love – focusing on the mission and success of your enterprise!
Bank of America, N.A. engages with Mari Smith to provide materials for informational purposes only, and is not responsible for, and does not guarantee or endorse any of the third-party products or services mentioned. All third-party logos and company names mentioned herein are the property of their respective owners and are used under license from Mari Smith. Consult your financial, legal and accounting advisors, as neither Bank of America, its affiliates, nor their employees provide legal, accounting and tax advice.
Bank of America, N.A. Member FDIC. ©2020 Bank of America Corporation