Vanity metrics: What are they?

Abeg app, (a social payment platform that is the lead sponsor of Big Brother Nigeria season 6) rose from about less than 10,000 downloads to about 100,000 downloads in just a few weeks after it was announced they will be the lead sponsor of this year BBN.

Startups love to point to big growth numbers, and the press loves to publish them. one million downloads, 10 million registered users, 200 million tweets per day.

All these figures are good to the eyes and ears but do they really reflect the true growth of a business?

What are vanity metrics?

Vanity metrics are statistics that look spectacular on the surface but don’t necessarily translate to any meaningful business results.

Vanity metrics can be appealing for the wrong reasons and misleading.

Let’s analyse the Abeg app for as an example, 100,000 plus downloads, that’s impressive and that figure looks good to the eye but it loses face quickly if there are only about 2,000 active users.

Another fact, the number of active users can also be a vanity metrics if not properly analysed.

Don’t get me wrong, there’s nothing wrong with boasting about those figures, they are good for headline and PR but don’t be carried away because they rarely have a place within your core business growth.

How do you identify vanity metrics?

Without proper context or showing how a metric relates to overall business goals, product teams can easily fall into a vanity metric trap.

Identifying vanity metrics is not as hard like it seems. The first thing to do when setting your business goal is to ensure you set a SMART goal.

I’m sure you are not hearing that for the first time, SMART stands for Specific, Measurable, Achievable, Realistic and Time-bound goals.

Adopting SMART criteria is often a good way to avoid focusing on the wrong metrics.

To identify vanity metrics, you should be able to get answers to two questions

What core business decisions can you make with the metrics?

Any metric becomes a vanity metric if you can’t take core business decisions with it. SMART and actionable metrics help you make business decisions.

Actionable metrics provide feedback and let you see how your business is doing, vanity metrics do the exact opposite.

For example; your Instagram account has over 2.5K followers.

Is that a good metric?

Yes, it looks good to the eyes but it doesn’t mean much if those followers don’t reflect in the product sales.

Can you use that to make a core business decision? Absolute NO.

Is the data a true reflection of the business goal?

100,000 followers on social media, 100,000 app downloads are good numbers to look at, but does that reflect the core business goal?

For example, I worked with a firm that boasts 25K followers on Twitter. Impressive right?

I did a survey to find out how many of the followers actually use the company’s product( a savings and investment app).

I wasn’t surprised, less than 20% actually use the platform, apparently, many of the followers follow the handle for freebies.

Back to the Abeg App analysis, 100K plus app downloads in a few weeks is very impressive but those that really reflect how well the business is doing?

I can’t answer that because I don’t have access to other metrics like

• The total number of signups.
• The total number of active users.
• Monthly Revenue.
• Cost per acquisition.
• The average revenue per user.
• Churn rate and so on.

On a final thought, any metric can be a vanity metric if it can’t be used to take core business decisions. Ensure you set SMART KPI so you don’t focus on the wrong things.

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