13 Key Business Metrics You Should Stop Worrying About
It’s easy to get seduced by accruing more Twitter followers and Facebook likes. But they’re not a true measure of success.
Too often, we get so bogged down measuring everything we can get our hands on that we forget to step back and examine the results of our measurements. Don’t waste time tracking success metrics that fail to give you any real information.
We reached out to startup founders from the Young Entrepreneur Council (YEC) to share their top thirteen they would avoid:
1. Twitter Follows
Social media is great. If done well, you are able to leverage fan affinity and get them to share your brand for you. But Twitter follows are the quintessential glamour metric. By itself, a large number of people following you might broadcast quality. Yet, at the end of the day, if you’re having a big Twitter “conversation” and not seeing actual revenue conversions, you’re wasting your time.
– Aaron Schwartz, Modify Watches
2. Facebook Likes
Sadly, Facebook likes on your corporate page don’t add up to much. First, Facebook doesn’t put your posts in your followers’ feeds. Second, Facebook is so saturated that it isn’t a true measure of engagement or success.
– Vanessa Van Edwards, Science of People
3. Projects and Products
When you put too much emphasis on quantity, quality can suffer. This is especially true when members of your team feel responsible for reaching set quotas. Instead of aiming for a certain number of projects, clients or products, focus on landing the right ones. You’ll be much happier, and happiness is ultimately the most important metric of all.
– Brittany Hodak, ZinePak
4. Online Rankings
We all love to be at the top of the search engines for industry-related terms. But with the constant overhaul of search algorithms, it’s not realistic to stay on top for long. Don’t put too much stock into current rankings because they can change in an instant. Instead, concentrate on building multiple sources of traffic to your business using many online and offline mediums.
– Anthony Saladino, Kitchen Cabinet Kings
Of course you need to measure sales, but make sure that you do it in the context of profitability and cash flow. Many high-growth businesses fall into an unhappy trap of tons of sales but not enough cash to maintain the growth. Make sure you put every metric in context.
– Sarah Schupp, UniversityParent
6. Email Open Rates
Many businesses get caught up measuring success in terms of social media popularity (follows, likes, etc.), as well as the number of opens an email campaign gets. These metrics, although important, aren’t necessarily a measure of success. In both cases, the metrics to follow are engagement and revenue. How many opens and clicks are actually leading to sales?
– Janis Krums, Opprtunity
7. Team Size
It’s easy to hire a lot of people, but it’s harder to hire a few key ones. Measure yourself on your business progress and the quality of your team–not your quantity.
– Ioannis Verdelis, Fleksy
Many companies optimize for the number of potential customers who sign up for a trial or free product. However, those signups are often just checking you out and have no intention of ever paying. If those signups are not translating into paying customers, then you won’t be successful.
– Bhavin Parikh, Magoosh Inc
10. Unnecessary Metrics
I don’t see this so much as which metrics to avoid but rather not falling into the trap of tracking too many metrics. Organizations need to understand what the critical few measures of performance are for their business and track them relentlessly. Otherwise, we find ourselves tracking everything rather than driving our core business.
– Chris Cancialosi, GothamCulture
11. Page Views
Unless you’re a content-based business using the old ad revenue model, it’s easy to get obsessed with page views. Page views are worth looking at, but it’s much more important to know what all those page views are doing. Take a look at conversion rates, bounce rates and time on the site; those will better determine success.
– John Meyer, Lemonly
12. General Metrics
You should always avoid metrics that are vague in nature, such as “general awareness.” Unless it is measured using quantifiable data, it is not a metric.
– Yuriy Boykiv, Gravity Media
13. Net Profit
It sounds like common sense, but more than 90 percent of entrepreneurs have inaccurate net profits because they don’t account for a market-rate wage for themselves. They underpay themselves and subconsciously believe that their net profits are their compensation. Doing so skews the company financials and tricks owners into thinking they are in a better place than they really are.
By YOUNG ENTREPRENEUR COUNCIL