The typical reporting process will involve a bunch of graphs and statistics being stuffed into a 20 or 30 page PDF and circulated, without any sense of what it is communicating, what the story is, or any categorisation or prioritisation of the information within it. In my opinion, this this is just a really ineffective way of going about it, and there’s several reasons for that.
First of all, it’s not action orientated. Maybe there’s a graph that’s telling us the user engagement is stagnating, or the average customer value is dropping, but so what? What are the actual implications of that and what are we going to do about it?
Secondly, very often we’ll find that there’s a lot of vanity metrics contained on these reports. By vanity metrics, what we mean is those metrics that might look good and may make us feel good, but they don’t put money in the bank. An example would be Facebook Likes or Twitter followers.
Finally, it’s really confusing, even for an experienced marketer. If you’re presented with just a PDF with all this information, without any kind of overarching narrative explaining what it all means, it’s a really daunting prospect. So just imagine what it’s like for someone who’s removed from that world, such as a senior decision maker, who doesn’t have that marketing expertise. Just imagine how confusing it is for them. Ultimately, these are the people that we want to understand it the most.
This is why I always encourage companies to boil down these reports to no more than 8-10 headline metrics, and the nicest way of categorising it is as follows: pick a couple of KPI’s that represent the performance of the brand, a couple that represent the performance from an engagement and nurturing perspective, a couple that represent the conversion stage and finally a couple that represent the ongoing customer retention process. Not only does that make it far far easier for the people receiving that information to make sense of it all, but it also gives you far more time to really focus on what it actually means because after all, that’s what the reporting process is there for – to drive action.
Even when you strip back your metrics to just half a dozen, that can still be a lot to process every week, and what happens when two of them appear to conflict? In other words, what happens when the easiest way to grow one will mean reducing another? What should take precedence?
This is why we create north star metics. Your north star is your number one measure of success and should act as a guiding light during all strategic decision making.
It ensures clarity and alignment throughout the organisation, and that when compromise has to be made, everybody understands that this is the metric that takes priority.
Your north star should ideally do three things:
– It should represent the value the customer is taking from your product or service
– It should be a great indicator of present and future revenue
– It should ideally be aligned to the brand core and mission
An example of a north star metric is Facebook’s monthly active users. This is the number one metric at all times and is never undermined. It is a great reflector of customer value, as people are only active if they are having a good experience, it is highly indicative of current and future revenue, and is closely aligned to their brand mission which is to bring people closer together.
Closely related to a north star is what is known as a magical moment, which is the key driver of your north star. For Facebook, this is when a new user gets 10 friends within 14 days – this is the moment at which the user starts to see value from Facebook, and is a great indicator of whether or not they remain part of the Facebook community. For someone looking to sell stuff on eBay, the magical moment is the first time that money lands in their bank account.
The concept of north star metrics along with their magical moments has become huge within technology companies like Facebook, but actually the principles are quite universal, and I would encourage any company – even traditional B2B firms – to ask these questions and identify their guiding light.
Google analytics should nowadays be considered ‘bread and butter’ for any marketer, but the truth is, many marketers are unable to take any meaningful value from it as they don’t consider themselves good with numbers and find it all a bit daunting. Instead, they focus all their energy on doing great work, but without a handle on the actual impact it’s having.
I think one of the reasons many marketers and business people hesitate with analytics is that at first glance, there just appears to be so much information. It’s immediate analysis paralysis. I therefore think the key is to know exactly what to look for, and not be distracted or overwhelmed by the other hundreds of options. Once you are happy with monitoring a small number of things, you will naturally start exploring other aspects of analytics.
To help you establish that starting point, I want to share with you the metrics I look at most frequently:
1. Traffic sources – total traffic to a website or app tells us very little about what’s working. We want to know where these people are coming from and the trends within these traffic sources over time. It can be worth combining this with data from competitor insight tools like similar web to see how your traffic distribution compares to theirs – are they investing in channels you’re neglecting?
2. Website engagement – as a general rule, if your bounce rate is going up then your time on site and average pages views will be going down, and vice versa. Of course, it’s possible that higher engagement could be a sign that your website is confusing and it’s taking people longer than it should to find the info they need, but in my experience that’s pretty rare. Higher levels of engagement are almost always a positive sign that people trust your brand, like the UX and are willing to invest their precious time exploring the content on it. This impacts conversion rates, repeat visitor rates and even future search rankings, as Google doesn’t want to be ranking sites with lousy experiences.
3. Traffic to key landing pages – the majority of traffic to most websites goes to blog posts, and while that’s fine there is usually a very limited short term correlation between blog traffic and revenue. Instead, your blog is probably there more for driving email sign-ups and therefore longer term revenue. In other words, you might find that your website traffic appears to be growing or shrinking, but actually the traffic to the pages that are going to bring in new customers today may be doing the opposite – these pages are typically the product, service or category pages. I therefore suggest creating a segment within analytics that will monitor this landing page traffic so you can see what the trend is specifically for these pages, which will often be very different to the website as a whole.
4. Goal tracking – the very first thing a marketer should do when taking control of a website is establish what the objectives of that website are and how they’re going to be measured. If the objective of the website is to generate enquiries, then a goal needs to exist on the website that tracks enquiries. Ideally, each goal should also have a financial value assigned to it, however sometimes this can be a bit tricky. For example, if you’re an accountancy firm, then what is the value of someone submitting an enquiry when you have to take into account the likely lifetime profit value and the conversion rate from enquiry to sale? It’s by no means an exact science but I would still encourage you to assign a conservative figure to this as it will give much more meaning to your reports if you’re able to say LinkedIn has brought in £12,000 this month, while instagram has brought in £3.70. You will also then find that the reports start to mean a lot more to senior decision makers within the business, which is key as you want them to be taking this stuff seriously.
There are of course lots of others that may be important to your business depending on what it is you’re selling. If you’re an ecommerce business, you’re going to really care about average customer spend and top conversion paths (in other words, the touch points people have in the conversion process), or if your website contains some sort of funnel, then you’re going to want to track each stage of that funnel to see where the leaks are, but the above 4 metrics are pretty fundamental to any website, and if you can develop the habit of checking those each week, you’re soon going to start to develop a much more general understanding of GA.
There’s a common belief that data is something pure, tells it how it is and can always be trusted, but that’s nonsense. Like words, data can be manipulated and mis-represented in all sorts of ways, and choosing an inappropriate time frame within which to present your data is a really common example of how that happens.
All too often I hear people say “Traffic from a particular source has gone up by x%, or conversions have doubled” and then when you ask over what period, you’ll instantly realise that the data doesn’t mean anything. Maybe they’re comparing January to December in a market where December is dead and January is really busy (and the senior DM’s you are reporting to will know that!), or perhaps they’re looking at data from this week compared to last week, when perhaps the website or app doesn’t generate enough traffic for that data to be reliable.
The point is just to really think about the time frame in question. Most commonly, I would want to look at medium term trend data, so that might be over six to 12 months, or to be comparing it to the same month the year earlier. That is unless you are dealing with huge data volumes, in which case looking at shorter term metrics will be reliable enough to take meaningful insights from.
We tend to create reports for people like ourselves – people who understand the intricacies of digital marketing and who care about it.
Actually we want to be creating reports for senior decision makers. These people are:
So creating your reports around these three things is key, and so is how you distribute it. They won’t open pdf’s, so containing the information succinctly within the email body is key, or even better, send it via SMS and do so every week so you maintain a certain pace and momentum.
By doing this, these people will stop viewing marketing as something vague and abstract over in the corner, but something strategic and commercial that’s critical to their future success, and that’s exactly what you want.
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