Recently, I’ve seen a resurgence of the term “vanity metrics” in my social stream. I think when people say something is a vanity metric, it’s because they’ve actually realized they weren’t using the metric correctly. Instead of finding its best use, they throw it out.
They’re missing the point of a proxy metric.
This post on the Content Marketing Institute blog about which 4 metrics your CEO needs is a recent example. The article itself has some great points. Yes, your CEO cares most about the end-point metrics, and there’s really only one end-point metric: Profit. She won’t necessarily care about the parade of metrics you can track that (hopefully) precede profit. Except maybe ROI – which is, essentially, the amount of money that had to be spent to make more money.
But the enlightened marketer knows the parade of metrics that precede profit will allow you to predict which things have a better chance of leading to profit…instead of having to wait until “the end” to know if what you’ve put into market had any effect.
And that brings us to the difference between a vanity metric and a proxy metric.
A vanity metric is a number that allows you to give yourself a nice pat on the back. For example: Views. You created something, people watched it. Congratulations! Feel good. Enjoy the vanity.
A proxy metric, on the other hand, is one that allows you to see whether one piece of content is on track to perform as well as another piece of content that led to profit (or MQL or SQL) at some point earlier in time. For example: Views.
Wait…what?
“But John,” you’re probably not saying, but work with me here, “you said views were a vanity metric, how can they also be a proxy metric?”
The real difference is in how you’re using the metric.
From the CMI post: “You may be pleased with your email open rate or the number of Facebook “likes” your most recent post received, but these numbers won’t impress your CEO. In fact, sharing these metrics with your CEO may demonstrate that you are out of touch with the true needs of the business. Using vanity metrics does not position you as a strategic player, but rather as a tactical marketer lacking a vision for how marketing can truly drive growth.”
I’d say instead: Not understanding how to use the metrics of “likes” and open rates and many other proxy metrics to better predict success and hone marketing efforts over time is what will demonstrate to your CEO that you are out of touch with how marketing can truly drive growth. Suggesting that those are vanity metrics is a sign that you don’t understand how measuring one action can be an indicator of more formative metrics that will come in the future.
In other words: Vanity metrics only become that way because they are viewed in a silo – as disconnected measurements. Vanity metrics are the spoils of random acts of marketing. Proxy metrics are the formative data that hone an ecosystem of content and experiences working in concert to motivate your audience to an action.
So how do you turn a vanity metric into a proxy metric (and how do you leave the true vanity metrics behind)?
1. Start thinking about every metric directionally.
Every metric can be viewed as a measurement of success or an indication a next step has been taken. The first allows you to stop looking for what happens next; the latter means it’s only an indication you should be thinking about what happened next. If you see “likes” as what you were trying to achieve, whether you succeed or not, it’s about vanity. It’s mostly pointless. If you see “likes” as an indication that your audience wants more of that type of content, and they are more engaged, and you can look to see what next actions they may have taken (a click-though, a conversion, a buy) – then you’re thinking directionally. And “likes” become a proxy metric – a distant, early sign of success. (Or, if there aren’t “likes,” it’s a distant early warning sign of wasted marketing action.)
2. Mine (or build) benchmark data, start looking for correlation or causation, and understand why both are important.
The real power of thinking directionally comes next. Because if you see the proxy metrics of “likes” on one piece of content leads to X% of click-throughs to another piece, and the conversion rate is Y% of those clicks, you now have benchmarks to measure your next piece of content. So if the “likes” on the next piece of content is greater than X%, you will want to measure if Y% is also larger. If it is, you’re likely on to some high performing content. You’ve found correlation. You’ve found a relationship between actions. If you find through further tests that certain types of content create more “likes” and then more click-throughs and then more buys, you’ve stumbled up causation – where one act causes the other. And then you should feel good about your ability to recreate the effect.
3. Ditch the metrics that don’t connect to others.
If, over time, you find that “likes” on similar content types have no consistent effect on downstream metrics like click-throughs and buys, then you’ve proven there is no correlation or causation. At that point, “likes” have proven to be a vanity metric, and you shouldn’t care about how many of them you get (even if it feels good).
You’ll be employing proxy metrics that show which actions you’ve taken that have lead to success now, which ones are most likely to lead to success in the future, and which ones you have now learned to not waste time on again. Do these things, and the next time you present to your CEO they will see you as a marketer who completely understands how marketing can drive growth.