Below is a widget that is commonly found in marketing dashboards. It measures the number of website visitors over the past thirty days:
On the surface, the data looks interesting but when you think about it more, what does it really tell you? Is 47,157 good or bad? If you can’t answer that question, then what value is there in having such a widget in a dashboard?
At Origami Logic, we use a basic question to decide whether a metric has value – it needs to be able to answer the question, “how is it doing?” In order to answer that question, one needs to know whether the metric is performing well or not. And in order to assess that, a metric needs to be compared to another metric because performance is always relative to something else. The other metric being compared could be:
The same metric but for a different time period – website visitors this month versus last month – or
The same metric but for a competitor – your Facebook “likes” versus a competitor’s “likes” – and there are many other examples.
We recently came across a piece by Scott Brinker (known for his Chief Marketing Technologist Blog) that provides another – but related – perspective (this is the second blog post in a row where we mention Scott so I guess that makes us official groupies). His piece, entitled “Marketing Metrics & Quantum Physics,” talks about how easy it is to become myopic when dealing with metrics. He feels that a single metric, presented on its own, lacks context and may not reflect the truth about what is happening within a business. As a result, he encourages organizations to emphasize relationships between metrics. For example…
…the relationship between conversion rate on a marketing campaign and the ratio of marketing-qualified leads (MQLs) and sales-qualified leads (SQLs). This helps illuminate the quality of leads (measured by semi-independent people or processes) relative to the quantity of leads generated by that campaign.
While the high level objectives of Brinker’s perspective and ours are slightly different, there is a common principle…no good marketing metric should ever stand alone.