In sales and marketing, there are so many ways to pretend you’re doing well.
All you have to do is find a couple of metrics that are increasing for your business—any metrics at all, really—and tell your boss, “The numbers are up!”
But here’s the reality: In a B2B sales organization, anything you measure that doesn’t directly relate to customer acquisition, customer retention, or revenue is a vanity metric, and vanity metrics are only there to make you look good. In this post, learn more about what is a vanity metric and which ones you should avoid.
Vanity metrics are numbers that may look impressive but often fail to reflect meaningful business outcomes. While they might initially catch the eye, metrics like social media followers or video views often lack relevance to the core health of a website or business. Instead, critical indicators like active users, engagement rates, and customer acquisition costs offer more profound insights into how a product or initiative aligns with overarching business objectives.
Often, vanity metrics reflect your team’s effort, but they have virtually no connection to the impact of your team or the overall health of your business.
Identifying vanity metrics requires a critical eye toward their alignment with business goals. Consider the following questions:
By prioritizing metrics that offer comprehensive insights and actionable data, businesses can make informed decisions to drive success.
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To help keep you reporting on the right things, here are eight metrics that you should stop wasting your time on and the metrics you should start measuring instead with a bit of help from your CRM reports.
One of the most common mistakes that sales teams make is focusing on the quantity of their interactions rather than the quality. An activity report is helpful for understanding your team’s baseline volume of interactions, but without comparing it to other information like your sales numbers or the timelines of leads that should have been won, it’s just a measure of busyness.“
Activity metrics are only relevant when compared with opportunity creation,” says Colleen Francis, president and owner of Engage Selling Solutions, and the author of Nonstop Sales Boom. “Measuring activities in isolation tends to make the seller with the most activities look the best, hardest working, and most successful, when this might not be the case. The best reps are the ones who do the least amount of activities to produce the highest number of opportunities.”
Compare the activities logged by your best and worst-performing sales reps, and look for differences you can use to coach the reps who need help. Are they taking good notes? Are they spending time on the kinds of activities that lead to closed deals? Are they making tons of calls or having lots of meetings but not closing?
If not, you need to know what is actually happening during those calls and meetings. In your CRM, check out the timelines of some of their best won leads to see what they’re doing that’s bringing them real success. (Nutshell‘s activity leaderboard and sales leaderboard can be very helpful with this, by the way.)
Another thing we frequently see among Nutshell’s own customers is sales teams trying to measure conversion rates from one activity type to another. For example, they’ll track how many phone calls “converted” to in-person meetings. While that metric could be useful when testing changes to your phone script, it’s generally irrelevant for two reasons:
By using your CRM’s funnel report, you can identify which stage(s) your team is losing the most deals in, and make targeted improvements. “When a sales rep can’t close deals it’s rarely a case of not being able to ‘close,’” Francis explains. “Usually there is a problem in the qualification or presentation stage of the pipeline. By knowing which stages they are below and above average in, you can zero in on the exact skills they need to improve, thereby increasing their performance.”
“Conversion rates also drive lead generation requirements which in turn drive marketing execution,” Francis adds. “If you don’t know how many leads you need to create the right number of opportunities and closes and by when, your funnel will never be accurate.”
Whether you’re looking at revenue totals or the number of closed deals, growing sales can make sales organizations feel warm and fuzzy, while masking potential inefficiencies. Obviously, sales totals are important to the health of your business, but they don’t tell you how many deals were lost along the way or why those deals were lost.
To get a full picture of your sales team’s effectiveness, you need to keep your eye on two things:
Nutshell has what you’re looking for.
The size of your fishing net doesn’t matter if the net is full of holes. Since website traffic doesn’t directly correlate with marketing conversions, revenue, or even an effective strategy, the total number of monthly visitors or pageviews tells you very little by itself.
Plus, website traffic artificially rises and falls with the money you spend on online advertising. If your recent spike in traffic was bought and paid for in the form of keyword ads and display ads, it’s not a win worth bragging about.
Engagement metrics such as visitor frequency (how often a person visits your website) and visitor recency (the number of days since a person’s last visit) can tell you whether or not your website is offering visitors something they’re genuinely interested in—or if it’s disappointing them when they get there.
Like website traffic, lead volume is something that can be artificially spiked with an increase in advertising spending. It’s also another metric that reflects potential more than results.
Marketing efforts should be focused on finding customers, not “leads.” If your team is finding new and creative ways to stuff more garbage-caliber leads into the top of your funnel, they’re focused on the wrong goals.
Your number of sales qualified leads should steadily increase if you hope to grow your business: How effective is your marketing team at attracting prospects that actually have a need for your product and the ability to buy?
If your lead volume is increasing but your sales aren’t, it means you need to do a better job of explaining the benefits of your product within marketing and advertising messages, and then placing those messages in channels where potential customers can find them.
Social media followers are a dime a dozen. (Actually, they’re even cheaper than that if you buy them in bulk.)
True, having a large social media audience can suggest that your brand is regularly posting helpful, entertaining, and inspirational content to its social channels, but the intentions of your followers can be very diverse. Are they existing customers? Do they want to promote their own services? Do they want a job at your company? Are they doing some strategic stalking from a competitor’s office?
Even less impactful than audience size is impressions, or the number of times your content was displayed (regardless of engagement). According to Jacob Shwirtz, Global Head of Social Media Strategy at WeWork, keeping track of impressions isn’t worth your time. “Multiplying anything by the number of followers you have, or by an assumption of your average follower size, just doesn’t mean anything since we know that a tiny percentage of anyone’s following actually sees or cares about any given post,” Shwirtz says.
To get a better handle on the impact of your social media selling efforts, keep an eye on these two metrics:
Email newsletters are often mis-measured—with subscriber growth being given more attention than the growth of resulting leads or revenue—and like social media accounts, companies often launch them without a coherent strategy, assuming that results will naturally follow.
The big mistake to avoid with newsletters is never asking for the sale. Sure, newsletters are important for customer nurturing and prospect education, but the end goal is to produce revenue through new or repeat business.
If people are subscribing to your email newsletter because they’re interested in your company, you want to make sure that you’re actually using those newsletters to guide subscribers to a buying path. Keep in mind that effective newsletters don’t constantly try to sell—but when they do, they make the ask clearly and directly.
Increasing the number of newsletter readers who go on to engage with a member of your sales staff or otherwise express interest in your products can be done in two ways: 1) Making sure there are purchase CTAs both within the newsletter itself, and on any website page the newsletter links to, and 2) increasing the frequency of the newsletter. As long as you’re consistently offering value to the reader, there’s no reason your monthly newsletter can’t be increased to a weekly or even daily cadence.
Did we leave out your most despised vanity metric in sales and marketing? Leave a comment below, or tweet us at @nutshell!
Update: Thanks so much to Sales Pro Central for awarding this article a 2018 MVP Award for the best Sales Leadership content of the year! We’re truly honored!
Nutshell Campaigns plugs directly into your CRM data, so you can create highly targeted audience segments, track the impact of your emails in real-time, and manage all your communications out of a single tool. Get started for free!
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