Today’s marketing analytics are powerful. Marketers now have access to all kinds of reports, from things like page views and number of fans to more revealing ones involving leads and sales. With reportable analytics like ‘number of followers’ and ‘time on site’ available, it’s easy to get caught up in data that – more often than not – is not impacting your bottom line.
There has been much press surrounding Twitter these days, and one particular hot statistic is the impressive fact that there are now over 360,000,000 Twitter accounts out there. A more telling statistic? One study claimed that only 21 million of them are active users. Someone blinded by the sheer number of Twitter accounts out there might not focus on the other key metric in this scenario –Twitter is struggling with engagement and retention.
Of course, vanity metrics do tell part of the story: they can speak volumes about your site’s ability to engage prospects, and they can provide invaluable insight into how your visitors interact with your web property. As a small business owner, it’s tempting to spend too much time focusing on these kinds of ‘vanity metrics’, and not spending enough time on the metrics that truly matter – the ones driving revenue.
Here’s a quick guide to help you differentiate between the two:
Let’s take a quick look at a few of the metrics that are more worthy of your time, and more representative of the overall health of your business:
Number of Active Users – far more important than the number of registered users, is the number of active users. Users that are active, are engaged and more likely to share your content and interact with your brand
Blog Shares – this telling number reveals just how many of your visitors view your content as valuable, and worth sharing. Visitors that read your blog posts without sharing them suggests your content is not as compelling as it could be.
Engagement – measuring engagement is a bit more challenging. There are millions of accounts on Twitter that are not classified as ‘active’ because their account owners don’t tweet. But, what about the account owners that log in to Twitter every day and read their feed? Are they not ‘engaged’? For your purposes, focus engagement on action or attention to your content. Shares, follows, activity and downloads are all indicators of engagement.
Cost Per Acquisition – is a metric that truly reveals the health of your business. How much does it actually cost to acquire and retain a customer? The number of followers or fans your business has is irrelevant if none of those people are resulting in leads or sales for your business. Map your leads and sales directly from their campaign so you know how to allocate time and resources effectively.
Lifetime Value – determining the lifetime value of your typical customer is a key factor in determining exactly how much you can spend acquiring new customers. Perhaps your typical customer purchases a product from you every month for 12 months at $100 each. Their lifetime value is $1200, and not the initial $100. That means you can spend significantly more to acquire that customer, provided your margins are high enough.
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