Showing posts with label kpi. Show all posts
Showing posts with label kpi. Show all posts

Vanity Metrics

Vanity metrics are metrics that are easy to track but don't necessarily tell you anything about the performance of your business. Here are some examples of vanity web metrics:

  • Pageviews: The number of times a page on your website is viewed. This metric doesn't tell you anything about how engaged visitors are with your content.
  • Unique visitors: The number of different people who visit your website. This metric doesn't tell you anything about how often visitors come back to your website.
  • Bounce rate: The percentage of visitors who leave your website after viewing only one page. This metric doesn't tell you anything about why visitors are leaving your website.
  • Social media followers: The number of people who follow you on social media. This metric doesn't tell you anything about how engaged your followers are with your content.
  • Likes and shares: The number of times your content is liked or shared on social media. This metric doesn't tell you anything about how people are interacting with your content.

It's important to note that vanity metrics can be misleading. For example, a high number of pageviews could simply mean that your website is easy to find, not that people are actually interested in your content. Similarly, a high number of unique visitors could simply mean that people are visiting your website once and then never coming back.

Examples of vanity metrics for email marketing:

  • Number of subscribers: This is the total number of people who have opted in to receive your emails. While this is an important metric to track, it doesn't tell you anything about how engaged your subscribers are with your emails.
  • Open rate: This is the percentage of subscribers who open your emails. This metric is often used as a measure of the success of your email campaigns, but it can be misleading. For example, a high open rate could simply mean that your subject lines are eye-catching, not that your subscribers are actually interested in the content of your emails.
  • Click-through rate: This is the percentage of subscribers who click on a link in your email. This metric is also often used as a measure of the success of your email campaigns, but it can be misleading as well. For example, a high click-through rate could simply mean that your links are well-placed, not that your subscribers are actually interested in the content of your emails.
  • Conversion rate: This is the percentage of subscribers who take a desired action, such as making a purchase, after reading your email. This is a much more important metric to track than open rate or click-through rate, as it tells you how effective your emails are at driving results.
  • Unsubscribe rate: This is the percentage of subscribers who unsubscribe from your email list. A high unsubscribe rate could be a sign that your emails are not relevant to your subscribers or that they are being sent too frequently.

It's important to note that vanity metrics can be misleading. For example, a high open rate or click-through rate could simply mean that your subject lines are eye-catching or that your links are well-placed, not that your subscribers are actually interested in the content of your emails.

Customer Segmentation Revisited

The Pareto principle (a.k.a the 80-20 rule, Haddad's Theorem) states that 80% of the effects come from 20% of the causes. In the business world, this has come to mean that 80% of your revenues typically comes from 20% of your customers. Businesses have long sought after more customers who are akin to the 20% that generates the most revenues. How is it done? One method is to use customer segmentation.

Is this scenario familiar to you?

You're putting together list acquisition specs for business unit of your company (or your client's). The BU manager wants to launch a customer acquisition campaign that targets all small and medium sized businesses which have 100-500 employees, have $XX+ millions in revenues, and are geographically located in southern California. Their best repeat business customers comes from professional offices such as engineering, architectural, CPA, and law firms.

Do the specs and requirements match?


Traditional segmentation used to mean that you'd take a database (or list) of customers and carve them out into customer groups based on demographics or socio-psychographic data (e.g., Claritas). Value-based segmentation looks at groups of customers in terms of the revenue they generate and the costs of establishing and maintaining relationships with them. ROI is not just a financial statement hot item, it is a typical key performance indicator (KPI) to gauge how useful customer acquisition strategy is by comparing what measures it took to get that customer's business, how many units of X they purchased, and how many more units of X they intend to purchase.

Just who are your customers anyways?

The basics of customer segmentation answers the following parameters of any industry its applied to: Who, What, Where, Why, and How.

Who
Consumers? Businesses?

What
Your products or services.

Where
Not just for postal recipients. Did they respond to web or email advertisements? Attend a webinar? Buy directly from you or from an affiliate merchant?

Why
The reasons(s) why your products or services won the sale. Is your product or service better than that of the next best substitution product/service? Cheaper? Easier to use? A simple followup with a customer survey usually answers this and keeps the feedback door open.

How
How was it purchased? online? at a physical storefront? at the company store? at a tradeshow/seminar event?