Avinash Kaushik: Seven super lame customer metrics – and four super awesome ones

And his conclusion about the current state of play in the sector is that most organisations are still ‘faith-based’ rather than ‘data-based’. So what exactly does he mean by that?

 

“Most large organisations are essentially faith based, largely because in the past what we had access to were very sub-optimal type of data sources,” he explains. “For example, we would use GRPs for TV not realising that the data is OK but not very good. We were asking a few thousand people to represent a country of 25 million and hundreds of channels on TV but yet we buy and sell a lot of media based on that.”

 

And there are other factors contributing to the proliferation of faith-based strategies. “Over time, we've optimised a lot of businesses around identifying an ‘expert’ and trusting their gut feel to make the right decision about what ad worked or what products will sell the most, etc.'”

 

So how can we identify those businesses that are faith-based? Are there any tell-tale signs that, dare we say it, may indicate that our own businesses are this way?

 

Avinash says: “The reality is that on the web one of the ways in which you can recognise organisations like that is that they're still relying on measuring impressions or still relying on measuring things that don't actually really matter.”

 

And this isn’t uncommon, he explains. As such, he has drawn up a list of what he terms ‘super lame metrics’, of which many will be very familiar to most of us – clicks, page views, visits, video views, touches, emails and number of reports.

 

So what metrics should we be using? Avinash recommends the following.

 

 

“If I was running a website, I wouldn’t care how many page views it got but I would care about if I am increasing the loyalty and recency of people who come to the website. Loyalty is the number of visits by the same person during a time period and recency is the gap between visits.

 

“For the BBC website my recency is every couple of hours - that's when I go to the BBC website as I’m sort of a politics junkie - and the loyalty is immense as I’m there every day. If you solve for page views, then your mental model drives you to create articles that stand multiple pages or that every time you click on a photo slide you reload a new page – stupid behaviour, right?

 

“But if you solve for loyalty of the person who comes, then you’re asking yourself how you can optimise these periods of such greatness that the same person will come back again and again, even if they don't see as many page views. So loyalty and recency are great metrics.”

 

 

“On the ecommerce side, a fabulous metric is economic value. Economic value is a super awesome metric because it's the computation of all the success events on the website, rather than just the one that you made a purchase. So if you made a purchase, that's great. If you didn't make a purchase, did you download a whitepaper, did you watch a video, did you recommend this address to a friend, did you download our mobile app, etc.?

 

“You could make 15 different micro conversions and the economic value is the sum of all the values generated. One great thing is rather than measure your entire success based on the 2% of people who convert – which is the average of the top 50 websites in the US (usually it's less) - you're measuring success with economic value of the vast majority of the people who come to your site and that helps you create a great business.”

 

 

Another super awesome metric is task-completion rate and I think it is the sexiest metric in analytics. It’s measured using a survey and it's the response when a person leaves your website, and the question you ask is 'Were you able to complete your task on our website?' It doesn't matter why you came. That’s a fantastic metric because it allows our consumers to tell us if we're successful or not rather than inferring it from Omniture or Google Analytics or Webtrends.”

 

While these are just some of the examples of metrics that will help your organisation to think more expansively about your business, have a deeper level of customer-centricity and aim for the long-term, Avinash believes that this alone will set you apart from the majority of firms at present.

 

“That’s why I like these metrics rather than clicks and pages – I mean, what are they?!” he concludes. “You hear businesses say ‘I’m going to buy an ad to network X because I can get to Z number of eyeballs etc.’ Those are profoundly sad ways of thinking and measuring. And they are examples and signs that you are living in a world driven by faith rather than driven by data and new marketing possibilities.”