Traffic is fun to measure, but it probably isn’t what really matters to you or your business.
It’s easy to get caught up trying to attract more and more visitors, more social shares and more subscribers, but how do you know if those things are helping you accomplish what you really care about?
What if all the things you’ve been measuring turn out to be worthless? What if none of those visitors or subscribers become customers?
How do you know if you’re measuring what really matters?
I’m obviously a huge fan of measuring website traffic and working to increase it. We’ve reported on our traffic statistics almost every month since starting this blog.
But I’ll be the first to tell you that traffic on it’s own is a meaningless metric. Traffic is just one part of a bigger equation.
You probably want to measure traffic, especially in the beginning, but you should also be measuring other important things.
Let’s figure out what you should be measuring for your site, and how to do it.
What to Measure?
Measuring traffic or subscribers without knowing why they’re important is backwards. Sure, you might want to measure those things, but do you really know why? Do you know what overall goal they relate to? Your goal isn’t just to attract a lot of traffic, is it?
Think about your own goals for your site for just a minute. What are the top three things you’d like your site to achieve?
I’d like you to jot these things down.
If your site is part of a bigger business, you probably want it to earn a certain level of income. That’s a no-brainer.
Jot that down first: revenue. (Revenue is just the word for how much money you earned before expenses. You could call it income or profits if you like; you’ll end up measuring both.)
Without revenue your business isn’t really a business. It can’t continue forever unless you earn enough to sustain. You need to measure revenue (if you have none measure it anyway, as a reminder that you need to start earning some).
Now, for your other goals. I can’t tell you what these should be, but I’ll tell you what ours are at Think Traffic.
First, we’ve agreed that we only want to do this business if we feel like we’re having fun and doing something meaningful. These are subjective measurements instead of objective (like revenue), but that’s OK because this is important to us. We’ll get into how to measure this in a little bit.
Are there parameters for how you want your business to exist, or what you want it to provide, beyond revenue? Maybe you’re looking to have a social impact of some sort.
Next, think about your customers (or potential customers). Without customers you have nothing. Your business or project exists to serve people. One of your primary goals should address your customers specifically.
For us, we want our customers to a) be satisfied with what we provide, and b) achieve results by using our solutions. Note that those two aren’t necessarily the same thing.
We figure that if our customers are satisfied and achieving results, our solutions will be worth sharing. Businesses with high customer referral rates are shown to be more sustainable and profitable. Businesses with unhappy customers don’t last very long.
In fact, if you’re going to measure just one thing, some would argue that should be simply whether customers would recommend your product or service to someone else.
So here’s our list of high-level goals for Think Traffic and the business behind it:
- Earn enough income to support everyone who works for the business comfortably (we have specific numbers behind this, and you should too).
- Have fun and do meaningful work.
- Satisfy our customers and help them accomplish results using our solutions.
Pretty simple, right? Your goals may differ, and you can change the order if you want. In our list, the customer-focused goal actually comes first because revenue and fun tend to follow when your customers are taken care of.
Notice that traffic wasn’t in the list above. Traffic isn’t a top-level goal, it’s a sub-goal, which we’ll get to in just a second.
How to Measure Your Top Priorities
The list of priorities above aren’t all you need to measure. Some aren’t directly measurable, and others have important sub-metrics that will tell you if you’re headed in the right direction or not.
Your next step is to break down each top-level goal into components to measure.
For example, revenue is a factor of how many products you have for sale, how many people are on your email lists, how many people are visiting your sales pages, the conversion rate of your sales pages, etc.
Take each top-level goal and think about which factors will help you measure your progress toward that goal.
Beware vanity metrics. For example, does the number of Twitter followers you have really matter? Can you tie that number directly to one of your top level goals? Probably not. Vanity metrics are more dangerous than a waste of time, because they can make you feel good even when the ship is sinking.
Here’s roughly how our list of priorities might break down (along with where you might get the data for each):
- Total email subscribers (from email provider)
- Total site visitors (from analytics)
- Sales page visits (from analytics)
- Sales page conversion rate (from analytics)
- Total revenue (from payment provider)
- Revenue per customer (revenue divided by customers)
Customer satisfaction + results
- Average customer satisfaction rating (from survey)
- Average customer-reported results index (from survey)
- Customer exit satisfaction rating (from survey)
- Customer churn rates (for monthly subscriptions, from payment provider)
- Product refund rates (from payment provider)
Team fun + impact
- Team fun assessment (survey quarterly)
- Team impact assessment (survey quarterly/annually)
This is just a sampling. Your top-level goals might have other important drivers.
Bonus Points for Automated/Visual Data
The simplest way to measure this data is to keep a set of spreadsheets that you update weekly or monthly. Manually updating data isn’t a terrible idea, because it forces you to also review the data on a regular basis.
However, much of this kind of data can be automatically calculated and presented visually for trend-spotting and correlation watching. Some things can only be spotted when data is presented visually. It’s also nice to be able to change time periods (daily, weekly, monthly, yearly) with the touch of a button.
We’ve been using Geckoboard internally recently and we’re loving it. Geckoboard gives you the ability to pull from various common third-party applications, or you can create your own custom data feeds to present any kind of metric in multiple visual formats.
Here’s a generic view of what Geckoboard can look like:
Our dashboard looks somewhat similar. It’s doing a great job helping us stay focused on our top three goals, and the underlying drivers of each. We still use spreadsheets and other tools, but we’re working to put everything that matters into a single dashboard that instantly shows us the health of the business.
Changes to the Think Traffic Monthly Reports
Every month since starting this blog we’ve reported our traffic statistics. We’ve shown exactly how many visitors stop by each month, where they come from, and which content attracts them. We’ve done this because we believe our transparency can help you learn how to grow your own site.
But you may have noticed something about these reports: not much changes in our strategy from month-to-month.
Our basic recipe for growing traffic is simple: create content that solves problems for readers, connect with other bloggers and online entrepreneurs, show up, work hard, challenge yourself.
This simple formula has consistently produced record setting months, month after month for nearly three years. Here’s our traffic growth since this blog started in March, 2010:
November and December were record months, with nearly 200k visitors each. You can read everything we’ve done to grow this blog over the years in our monthly reports.
It’s great to set traffic records, but what’s the bigger picture? Are we meeting our primary goals as well?
This is the trouble with just measuring traffic, it doesn’t really tell you much on it’s own. In our case, we aren’t setting records in terms of revenue, so it’s time to make some changes and focus on measuring what really matters.
This is a long winded way of telling you that we won’t be doing these monthly reports in exactly the same way. We plan to do more occasional business updates, and to focus on helping you measure and improve what really matters to your business, not just traffic.
Stay tuned for more details about what we’ll be reporting in the future.
For now, I’d love to hear what you think in the comments below.
Coming Next Week: Fizzle in Prime Time
Our biggest and most ambitious business project ever is almost ready for prime time. We’ve been working with nearly 400 beta testers over the past four months to polish and tweak and prep Fizzle for a bigger audience.
If you haven’t heard about Fizzle yet, it’s a comprehensive learning platform and incredibly supportive community for online business builders.
We’ll be opening the doors to the public next Wednesday, January 16th. I’ll have more details here later this week, along with a very special giveaway and launch day discount.
Mark your calendars and sign up to be notified if you want to hear more.
Now it’s your turn. What do you measure in your business in addition to traffic stats? How do you measure what really matters?
Tell us in the comments!
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