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Is it a KPI or a Vanity Metric?

The concept of vanity metrics has gained much traction recently as marketers have noticed that the metrics they relied upon in online ad campaigns didn’t produce the expected results. A Key Performance Indicator (KPI) has to reflect the performance of an ad, and many metrics pushed on us by online platforms simply don’t.

It’s a twist on that old adage: all KPIs are metrics, but a lot of metrics aren’t KPIs. While it makes sense at first glance, many metrics have become so ubiquitous over the years that we have a hard time seeing them as unreliable. Even worse, some of us might be stuck using them because it’s the only thing our clients look at (hi ad agencies).

As most marketing spending has shifted online, metrics have become an essential tool to get an accurate picture of their target audience, grow the brand, and build future strategies. However, not all of them are equal, and certain metrics don't necessarily correlate with business goals. That's why they're called vanity metrics.

This blog post will give examples of vanity metrics across all online ad campaign types and propose some actionable metrics to use instead. One thing is sure though; life’s too short to use vanity metrics.

What are Metrics, KPIs and Vanity Metrics?

Metrics were born in the industrial era, as businesses started to track their production to make necessary adjustments but also to gauge their performance. For example, a steel factory needs to know how many beams it can produce in an hour. It’s a crucial metric that will impact the number of employees they hire, the square footage of their facility, the company's financial forecasting, and so on. This type of data has since become crucial to business success.

The number of products produced in an hour is obviously important to look at for any business, but it might not always be a KPI. Using the steel factory example, they might prefer looking at a beam's average cost of production as a more reliable indicator of how their overall business is doing.

In fact, the hourly number of beams produced in a factory can quickly become a vanity metric if it isn’t backed by other indicators. That number isn’t worth much if the company spends more on production than they sell the beams for. Just like a click-through rate doesn’t really tell you anything if customers aren’t buying or leave the page after they click.

Vanity metrics like the number of social media followers, page views, and the number of purchases are nice to boast about, and seeing them go up is rewarding, but don’t be fooled by them. If you rely on them too heavily, they’ll blind you to the real issues that might be uncovered by true KPIs like engagement rate, bounce rate, and total spend per order.

However, it’s important to note that vanity metrics aren’t inherently bad. A lot of the metrics we’ll mention are essential to running marketing campaigns, the issue lies in overusing them or reading into them too much.

Which KPI is a Vanity Metric?

Finding a good definition for vanity metrics can be tricky because certain KPIs might be valid in certain situations or industries but be less actionable in others. Another common instance is metrics starting out as valid and becoming irrelevant as consumer behavior changes on various online platforms. A good rule of thumb for what makes an actionable metric is that it gives you a good idea of customer lifetime value instead of just a snapshot of their journey.

Let’s have a look at the most common actionable KPIs and identify vanity metrics in online advertising campaigns. 

Paid Social Campaigns

Social media platforms like Facebook, Instagram, LinkedIn, and Twitter have become the most frequently visited websites for most users, making them prime advertising locations. Since people build personal profiles on social media, these sites are also able to offer a level of targeting and personalization that no other competitors can match.

Vanity: Impressions

A perfect example of a classic vanity metric you still need to check and include in your reports despite this classification. It’s important to know how many times your ads were shown to, to know that you have a proper sample size to make decisions, and also just to know that your ad is running smoothly. However, it’s not a measure of success in any way. 

Actionable: Return On Ad Spend(ROAS)

This is another interesting example because while ROAS is widely considered to be a solid e-commerce KPI, it might be more so for the advertising agency running the ads than for the online store. The problem with a metric like ROAS is that it’s calculated from topline revenue, and a good ROAS might hide underperforming products. So while it’s a good actionable ad metric, it might need further work(like splitting ads into per product links) to be fully usable. 

Organic Social Media Campaigns

Social media accounts have become a crucial evolution in the world of marketing since they can be one of the most cost-effective ways to create a true, lasting customer connection. However, it is rife with metrics that look good but are really meant to profit the platform you are advertising on. 

Vanity: Number of social media Followers

Watching the number of followers grow on a social media account you’ve worked hard at will always be fun. How many followers an account has can even be a decent indicator of its health if you are growing it organically. However, in a day and age where followers can be purchased for a few dollars, it can quickly become useless and even misleading. 

Actionable: Engagement Rate

A large number of followers is nice, but what really matters is how much they react to and engage with the content. Engagement rate is a great metric to see how well the account's followers are responding to what is being posted.

Vanity: Number of Comments

Again, a lot of comments on social media posts is almost never a bad thing. However, the really important data is what is being said in those comments. No matter what the comments say, their number is always good to keep an eye on but isn’t really actionable.

Actionable: Sentiment Analysis

Most social media management platforms now have an option to run sentiment analysis on comments to determine whether they are positive or negative through Natural Language Processing(NLP). This way, you can tell if users actually like the content being displayed or if they have complaints about it or the products being sold. 

Paid Display Ads

These ads rely on Google Ads’ platform and other independent networks run by online publishers. The ads can be tailored to a user’s search history or past purchases through cookies and free tools like Google Analytics or Tag Manager. These ads can then be very powerful in promoting and building a brand. 

Vanity: Cost Per Click(CPC)

CPC isn’t always a vanity metric, but it certainly is one when it’s the only metric being looked at. It’s easy to say a campaign was better because it brought the same number of visitors as another for less money, but it can easily become borderline useless if you don’t look at what the users did after clicking.

Actionable: Cost Per Acquisition

This is a cousin of the conversion rate adjusted to newer realities. The point of an online display ad is almost always to acquire a new client, so calculating the cost of that action instead is a better indicator of success than just the initial click. CPC is still useful in this situation because it tells you the specific advertising cost, but it’s just a piece of the equation. 

Vanity: Click Through Rate

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Perhaps one of the oldest online metrics, it’s a good example of a metric that is good for certain content types but a vanity metric for others. For display ads, the chance for ad fraud, error and mistaken clicks is too high, but for video, it can be a legit marker for engagement with the content.

Actionable: Receptivity

This isn’t some push to say our metric is better than everything else, we like to think it improves all the other metrics it’s paired with. Receptivity measures the attention levels of website users in real-time using non-private data to allow you to show your ads at the best time or to assess who your ads were shown to after the fact.

Taking the click-through rate example, a low CTR might not be a sign of a bad ad if it was shown mostly to unattentive users. Similarly, showing your ads only to attentive users is a great way to lower your CPA and stop paying for lower-quality impressions.

Organic SEO Campaigns

This is arguably the channel that launched digital marketing into the spotlight. Creating content with the right keywords and gathering backlinks to grow your authority in the eyes of search engines is still a powerful and cheap way to build a strong business. However, like all other online marketing channels, it has many metrics that can lead you astray if you tunnel vision on them. 

Vanity: Page views

The point of SEO is to increase traffic on your website, so a rise in page views is always a good thing, right? This is another metric that isn’t inherently bad, but people often read too much into it. Not only can pageviews be gamed pretty easily, but using them as a core metric will hide many issues that other data points will uncover. 

Actionable: Pages per session

This metric is core in every marketing analytics platform because it’s a great sign that your initial content presented to the potential customer is engaging. It’s basically telling you that the user read the first page he went on and thought, “Hey, this is pretty cool, let’s see what else is on this site,” and that’s half the battle right there.

Switching from Vanity Metrics to Using Actionable Metrics

It’s easy to go overboard and act like vanity metrics are the bane of the ad industry and will actively hurt your marketing efforts. The situation isn’t that dire; in most cases, it’s just that vanity metrics aren’t telling you as accurate a picture as what we consider actionable KPIs.

Paid social’s vanity numbers are in that category because they’re very focused on making you see the ROI of the ads you’re running. That means they can stray from showing you the things that really matter. It’s a good idea to always take the stats available on social media platforms with a grain of salt and do your own further analysis to find the real value metrics.

The same thing is true with organic social. There’s a reason why Instagram and Twitter focus on the number of new followers and comments when you look at their analytics. It’s not because they’re good metrics for assessing the success of an account; it’s because those are the metrics they want to see grow. The answer is the same as with paid, it’s best to use the stats available and further analyze to create good metrics like an engagement rate.

SEM campaigns are a little different because there are a variety of tools you can use to circumvent the ones offered by platforms like Google Ads. Just like social media platforms, they’ll feed you whatever statistic they think will make you buy more ads. It’s a business, after all. Thankfully, these ads offer a lot more creative freedom in the way you measure success. 

Organic SEO doesn’t really suffer as badly from vanity metrics because you control the variables at play on your website. In this case, it’s more about making sure you pick the right things to look at and identify the metrics that are really linked to success.

Are Vanity Metrics Bad?

We hope it’s obvious to you by now that the most common vanity metrics aren’t bad in themselves. They can’t be; all they are is a measure of something happening online. The type of content you’re displaying in your ads and their format can also make a metric less actionable. The real issue is the way we use them and the value we attribute to them.

There can be many reasons for this, like convenience, because vanity metrics make us look good or just because of inertia. And sometimes, when we use a metric for too long, we lose sight of what really matters.

It’s really easy to see nothing but numbers and forget the basics when doing a marketing campaign. It’s wild to think that a lot of advertising professionals don’t even consider whether a user looking at their ad paid attention to it. Attention has been proven to lead to better recall after seeing ads, and Receptivity brings this same concept online.

It’s the return to basics the advertising industry has to go back to. It’s simple, ads perform better when they are shown to users who are paying attention to them. And Receptivity is the only way to gauge user attention, wrapped up in a convenient metric you can start using on your next campaign with just a few minutes of work.

Did this article make you realize you’ve been using a vanity metric all along, and it’s time to change? Did it make you wonder how strong your KPIs are? In both cases, you should contact us to get a demo of a real actionable metric, Receptivity.


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