Measurements vs. Metrics: Useful Analytics for Your Dealership
Have you heard the old saying “The world revolves around money” before? Most people believe that statement to be true, but I personally believe in the saying “The world revolves around numbers.”
If you think about it, no matter what situation you are in, it involves some use of numbers. It’s safe to say that the 9 Clouds team spends most of their days looking at numbers, making sure our work is showing effective data for our clients.
With the massive amounts of analytics data available, it is hard for any business — including auto dealerships — to know what to focus on. It’s good to know that your work gets done, but you need to know if the work done is showing signs of improvement for your business.
When you’re trying to find the most helpful analytics to grow your dealership’s leads and sales, you should ask yourself these two questions:
- Is this number a measurement or a metric?
- Is this metric a performance metric or an outcome metric?
Utilizing performance metrics will help your business over time.
Measurement or Metric: What’s The Difference?
Before getting too into the weeds, let’s describe what the difference is between measurements and metrics.
What Is a Measurement?
A measurement is a data point in a particular point in time. Ordinary measurements include things like:
- How many people visited a website in a month
- How much revenue a business received last quarter
- The number of employees a business has
- The number of leads in a company’s sales funnel
A lot of these numbers are important for businesses, as these are usually the numbers they use to base their goals. Out of context, however, these numbers are not very helpful.
That’s where metrics come in.
What Is a Metric?
A metric is a data point in context. Typical metrics include thing like:
- The change in website traffic compared to last month
- The change in revenue month over month
- The number of employees at a company now compared to last year
- The growth in the number of leads in a company’s sales funnel
A metric takes the past into consideration and gives your success (or maybe failure) into context. Metrics also support continuous improvement.
For example, if you set a metric of growing web traffic by 5% a month, you have to keep building upon your success. A metric of growing leads 10% a quarter encourages continuous — and exponential — growth.
Metrics remind me of lifting weights for powerlifting and Strongman training. Every time I hit a personal record (PR) on a specific movement, I’m never really satisfied with it. Sure, I did want to squat 500 lbs, bench 300 lbs and deadlift 500 lbs, and I was happy about it … for about a couple minutes.
After that, I immediately started setting new numbers in my head to lift. I’m always pushing myself to become stronger.
Choose metrics over measurements so you continue to push the limits of what is possible in your business.
Outcome & Performance Metrics
What Is an Outcome Metric?
An outcome metric looks back at what has already happened.
These outcome metrics are studied after the work is completed. They can provide useful insight for the next time you do similar work, but they can’t change the result.
Typical outcome metrics are the examples mentioned above: traffic or revenue growth month over month. Knowing what happened to your traffic or revenue compared to previous timeframes is helpful for knowing what to do in the future. However, if you don’t have the metric until the month is over, you can’t correct course and improve that month’s performance.
For mid-stream adjustments, performance metrics are needed.
What Is a Performance Metric?
A performance metric measures the key activities that lead to successful outcomes.
Performance metrics are analyzed on an ongoing basis to make sure your work is on track to hit the target. If you don’t reach your performance metrics, you know that you will not meet your outcome metric.
Fortunately, performance metrics help you make changes to alter the ultimate outcome.
In my weightlifting example, measuring only my main lifts (squat, bench, deadlift) didn’t make me stronger. Instead, I also measured the strength of my accessory lifts (machine equipment, dumbbell movements, etc.). If I consistently got stronger with those accessory lifts, I knew my main lifts would become stronger!
Performance metrics can be used in multiple platforms. Let’s talk about some of the platforms that the 9 Clouds team uses for our clients and the specific metrics you should think about tracking and analyzing.
Metrics to Track for Your Business
Search engine optimization (SEO) can be a foreign language to most people, but it is a great tool to improve your business’s success online. Here are some useful SEO performance metrics that you should be using.
It’s nice to know if all your work is producing sales and leads to your business. Conversion rate is a metric that does that exactly.
Making it a goal to have an increase in conversions over the life of a campaign is a great example of analyzing performance metrics. It shows if the campaign showed promising results or if something new needs to be done, like updating your website’s keywords or creating new content to better serve your users.
Return on Investment
Return on investment (ROI) is a common measure for every business, and it still applies to SEO metrics.
The reason to look at this metric is simple: You need to know how successful a task or project is. You want to have more money in the bank compared to the amount you are spending on things.
You also should remember that SEO takes around six to 12 months to see an ROI, so know this isn’t a short-term metric to consider.
Believe it or not, social media platforms are a great resource to improve your business’s growth. According to Statista, there are 2.9 billion monthly active users on Facebook and 3.96 billion users across all social media platforms. Here are performance metrics that are good to keep an eye on.
It’s important to have a social media page and ads that create frequent engagement with users. Engagement rate is a good indicator of the goals you’re implementing on Facebook are actually working.
Engagement rate takes into account factors such as:
- Likes and reactions
Another metric that can be insightful is reach. Reach is the complete number of unique users who have either looked at your ad or clicked to look at content on your page. It is a good tool for figuring out what content is working or not working for your audience.
If something is not producing a good number of results for the goals you have set, then you might want to try content that is different or go back to content that has shown good results in the past.
Email marketing is a great way to reach your target audience. However, you need to figure out the right way to use emails without being marked as spam. Here are two metrics that can help you figure out if your emails are working properly.
It’s important for your business to know that your audience is looking at your content. Click-through rate is a good metric for finding out the percentage of your subscriber list is at least engaging with the emails you send out.
Click-through rate does not tell you how long they looked at the email , but it at least tells you that your content is catching the interest of your audience. It also tells you if the content you are sending is appearing as openable content or spam.
The unsubscribe rate is a vital metric for your business to have involving emails, since it shows how many people opt out of your emails.
People unsubscribing from your content could mean a couple of things. They could feel the content that is coming from your business is spam, or they lost interest in your content and don’t want to see it anymore.
Tracking your unsubscribe rate will help your business get an understanding of what content is and isn’t working. You can set goals on lowering the rate between campaigns.
A higher unsubscribe rate is not always a negative thing. Some of your subscribers might not be a good fit for your business, and it will make room for the right audience — which should improve your click-through rate.
It is also important to make your unsubscribe option clearly visible to your users to build trust with your audience.
Want Useful Analytics? Switch to Gathering and Analytics Metrics.
Data is powerful and works best with a clear target. At 9 Clouds, we focus on a handful of key performance indicators (KPIs) to help us measure and improve our performance metrics.
Get the data your dealership needs by downloading our Automotive Performance Benchmarks Report. We compiled marketing metrics from reputable third-party resources as well as from our own automotive clients. With this PDF, you can see how your dealership’s marketing stacks up and set some performance metric goals of your own.