Deciding which website metrics to track will depend on the business objectives and the current phase of a business. As I dive deeper into the user acquisition phase for Meribook, I am revisiting the must have Key Performance Indicators (KPI's) I should focus on. There is a lot of information out there and this blog post is a way to document what I have learned and share with you all.
How to select effective website metrics
Before we decide on which metrics to track, it's important to understand what makes a good KPI and how to determine the most important ones.
You'll find a ton of information on the best characteristics of effective KPI's and here are my top three:
Simple to MEASURE
The KPI should be simple for anyone on your team to understand. Eg: If you are tracking Goal Completion - it's a simple number and anyone looking at that number will know that they achieved the Goal X number of times.
Must be ACTIONABLE
An actionable KPI is one that makes it easy to decide with the information provided. Eg: If the aim of Goal Completion KPI was to reach 2,000 completions in the timeframe, then a 2,322 Goal Completions have met our aim for this time period. In case the aim was 3,000 Goal Completions then we know whatever we tried did not achieve the aim and this should lead to 'actionable' items to steer us in that direction.
Not a RATIO
This is not a hard and fast rule, but based on my learning I have heard that ratio's are best for benchmark tracking. So, if you are just starting out like me just avoid ratios for now.
Now that we understand what make a good KPI, let's look at what to measure specifically.
You see, the most important website metrics will differ based on the type of business you are running.
For SaaS the main metric to focus on should probably be MRR or ARR
For an E-com site it can be Sales Revenue.
Now, suppose we have decided that these are the metric we want to track and do everything in our power to improve. How do we go about tracking these KPI's?
Well, if you look at the above two metrics - MRR or Sales, these numbers are coming from the bottom of your sales funnel. So, what we need to do is break down the customer journey and track the steps a user takes to get to the bottom of the funnel.
These actions or steps that a user takes as part of the customer journey are the KPI's we should be tracking. These are individual areas that we can improve upon which will eventually impact our main KPI.
Here is a simplistic breakdown of some KPI's along the customer journey for the above two types of businesses - SaaS and E-com.
Top: Content consumption & engagement/month (not page views)
Middle: Number of free subscribers/month
Bottom: Number of upgrades/month
Top: Product page engagement (shares/bounce)/month
Middle: Number of add to carts/month
Bottom: Number of sales/month
Note: see how these KPI's are time bound. A KPI should be measured in a frequency that makes sense for your business and based on the effort you are putting in to move it in the direction you want.
Again, what's important to realize is that these KPI's are part of the customer journey and can be actively influenced by our efforts.
Also, make sure that these are not 'vanity metrics' that do not add any real value to your business - like Page Views. Have a look at this excellent article by Content Marketing Institute on best blog metrics to track.
For Blog Performance, they recommend
Sharing – social media link shares, “likes,” retweets
Consumption – page views, unique visitors, average time-on-site
Engagement – session duration, page depth
Retention – percent of visitors returning to your blog, bounce rate, the number of visits, pages per visit (Google Analytics data)
Diving deeper, we can further breakdown our customer journey at the top of the funnel to come up with additional website metrics.
Let's take Content Engagement and break it down further to come up with additional KPI's we can influence and monitor.
Engagement by Organic traffic to page or site/month
Engagement by Paid traffic to page/month
A/B testing to optimize offer and or UI
Just tweaking these and moving the needle on these websites metrics at the top of the funnel, should lead to an improvement in our "Number of free subscribers" or "Number of add to cart" which are our middle of the funnel metrics.
With all else being same, just increase in engagement via Organic or Paid should impact our main MRR or Sales.
We can further break this organic traffic into Search Traffic and Referral Traffic from Social Media and metrics to track these different sources. Going further down the rabbit hole, we can track website metrics based on how often we create content and how it impacts Organic traffic to our site and pages.
For this post I will stop here, and I hope this gives you a good idea on key websites metrics to track for your use case. Also, for those of us just getting started with website metrics, I want to limit the KPI's to those that are readily available to us using Analytics Tools that we can implement on our website and not stuff we have to track manually in a spreadsheet.
I discuss "5 Must have analytics tools for your website" in my next post, so hope to see you there.