Have you been feeling a bit guilty for tracking traffic since you found out it’s a vanity metric? Ashamed that you love following up your traffic stats?

Well I love my traffic stats too and I refuse to feel bad about it. Making people feel ashamed makes me mad, especially when we are doing nothing wrong.

What are vanity metrics?

“If it won’t change how you behave, it’s a BAD metric”

Vanity metrics are the dark side of the key metrics. Vanity metrics are non-actionable metrics. They are measures that go up with time, no matter what you do. They are metrics that will lead you wrong. They’ll increase your vanity, not the value of your business.

They have a nasty name too - vanity metrics. Whatever these metrics are, vanity is something that’s not a good thing for a person or a business.

Vanity metrics is a great concept - for large businesses

Vanity metrics is a life-saving concept if you have a company so large that your left hand has no idea what your right hand is doing. You’ll have to protect yourself from innovative stunts that your employees can pull off to reach their incentive goals.

For example, let’s imagine you decided to give your salesmen bonuses for the number of sales they made. So they dragged in masses of unprofitable customers to maximize their bonuses. They also neglected the most profitable customers who didn’t buy so often. You, the owner, are left to bang your head against your desk and crying after the lost profits. If you had linked the bonus to some non-vanity metric like customer life-time value (CLTV) this may not had happened.

But do bootstrappers, 2-5 person startup teams or small online businesses need that kind of protection? Do we need to be able to put on the blinders and mindlessly crash towards a single goal?

The purpose of picking a key metric is to improve your business. How you improve a metric matters more than the actual increase - quality over quantity. Most people understand that. We don’t do things that can hurt our businesses just to get the numbers up.

Bringing the vanity metrics idea to small businesses is not only unnecessary but it can actually harm your business.

You shouldn’t follow only your key metric

One of the risks of vanity metrics is the implicit impression that you can follow up just one key metric and stop following the others, especially vanity metrics.

Knowing your key metric and improving only one aspect of your business at a time is a good idea. But you can’t look at only one metric when you set out to evaluate if you reached your goals.

Metrics don’t work in isolation. It doesn’t matter if that metric is vanity metric or not. None of the metrics are immune to isolation. The whole purpose of metrics is to help you understand your business better and to learn what makes it tick.

No matter how you pick your key metric, it can always be abused if you dismiss your other metrics. Even essential metrics like monthly recurring revenue (MRR) or CLTV can lead you to wrong decisions if you blindly follow and optimize just one or the other. You can easily hurt your long-term profits by going after easy cash. You can get into financial problems while trying to improve your long-term profits.

You shouldn’t focus on rate-based metrics too early

Another risk in vanity metrics is the preference to use rates instead of concrete numbers. After the idea of vanity metrics became popular, more and more people are focusing on conversion rate too early.

Some months ago I was listening a presentation about a beta launch. I knew the speaker is a big advocate of Lean Analytics so I asked him to name their current key metric. He went: “I’d say it’s traffic, but we all know traffic is a vanity metric. So traffic can’t be our key metric… Our key metric is conversion rate.”

Outside I was nodding politely. Inside I was screaming “OMG! I have more relatives than you have visitors! You should be focusing on traffic, TRAFFIC!”

I’ve heard people tell me that they have 25% conversion rate only to find out that they reached 20 people and 5 of them bought something. Before you reach hundreds of people calculating conversion rates should be just for fun and speculation. The initial conversion rate has little relation to what the actual conversion rate would be with decent traffic.

The same goes for churn rate too. You’ll need to have a decent amount of customers first.

Percentages are more useful with their baseline

If you want to see the full picture of how your customers flow through your money-making machine, conversion rate needs to be paired with traffic (number of visitors) or the number of conversions. Churn rate suffers from all the same problems and needs to be paired with customer count or number of lost customers.

Vanity metrics make a nice dashboard

When you are experienced in reading the percentage-based metrics, conversion rate shows you the potential of optimizing your marketing and churn rate tells you how fast your whole customer base will turn around. But even then you can’t immediately see the balance of new and lost customers like you can with concrete numbers. Keeping the concrete numbers at hand is not vanity. It delays the need to add new metrics to your dashboard.

Traffic can be your key metric, don’t dismiss it as vanity metric

Key metric is the metric that your business growth is currently most sensitive to. It’s either a growth lever or a bottleneck.

Karl Blanks, a former rocket scientist and current conversion rate expert says“People understand that there are bottlenecks constraining the rate of their business’s growth, and that it’s important to work on the them, but what most people don’t understand is that in many cases the bottleneck is the only thing to work on. Working on a non-bottleneck often yields no increase in throughput whatsoever.”

Traffic may be your key metric. The bottleneck does not differentiate between vanity and non-vanity metrics. Sometimes it leads you outside traditional metrics altogether, being e.g. the rate at which you can create web content.

Declaring some of your metrics as vanity metrics puts those metrics out of your use. You throw away useful tools just to be trendy. But hey… isn’t that… vanity?

Traffic is your lifeblood, track it proudly

Tracking traffic isn’t vanity. The people you reach - your customers - are the lifeblood of your online business. Your business wouldn’t exist without them.

Never be ashamed of knowing exactly how many people you can reach.