How to Improve Your Revenue Using Video Ads

As a marketer, you always want to be ahead of the curve.

The most effective tactics are always the ones that the majority of marketers either haven’t adopted yet or haven’t been successful with yet.

One of the current tactics that fall into that category is the use of video in advertising.

Very few marketers have tried to create video ads, but that will change in the coming years.

The consumption of video in general is growing at a rapid pace. Over half (55 percent) of people watch at least one video a day. Some watch several dozen.


In order to make revenue from the videos they host, video sites (e.g., YouTube, Dailymotion, etc.) have a few options.

They can overlay some text ads. It doesn’t generate much revenue for them, so they don’t do this if they have a better option.

That better option is to play a paid video advertisement before playing the video a user clicked to watch.

Guess how much better these are.

One analysis found that users are 27 times more likely to click on a video ad than a regular ad.

Do I need to say more?

Although video sites are starting to get a wider inventory of video ads to play, they’re not even close to being saturated.

There are still plenty of text ads being shown because the sites have no other option.

On top of that, the video ads that they do have are often shown for unrelated videos (a bad thing) because they’re the best they have right now.

This is your opportunity to learn how to create effective video ads and reap the rewards while you still can.

I’ve created a full guide to creating YouTube video ads in the past.

But today, I want to take it further. If you understand the basics of video ads, it’s time to create video ads that perform even better than you thought they could.

We’re going to look at 6 different ways that you can make video ads that convert better than you ever thought possible. 

A quick look at where video ads are most effective: Before we dive in, you need to understand where video ads are used best.

The biggest key component of an effective video ad network is the size of its audience. Some of the tips in this post require a large potential audience so that you can narrow your targeting down and still have an audience left.

There are two main video advertising networks that fulfill this condition: YouTube and Facebook.


I’ll be writing the rest of this post mostly with Facebook and YouTube video advertising in mind although most of the information will apply to other networks as well.

Don’t be afraid to try out video advertising on other networks, but I recommend starting on one of these two.

They are big enough to have just about every audience you can imagine, including yours.

Let’s look at the 6 tips now.

1. Take full advantage of custom audience options

Like I mentioned before, many video ads are being shown to users who are not actively interested in the advertised product.

While some of those advertisements are purely for brand recognition, the mismatch between the ad and the viewer interest highlights a bigger issue.

Say you were running an advertisement for a new car. In which situation do you think the ad would perform better?

Shown before a video about home decorating.


Shown before a video clip from Top Gear (a show about cars).

It’s pretty clear that the second option is better.

You’ll have a targeted audience of car buyers, who are expecting to watch a video about cars. That’s doubly good!

When someone is planning to watch a video about home decorating and on comes a video about a new car, they’re not happy—understandably—and skip it as soon as possible.

The first major thing that you can do to lower your ad prices and improve your click-through rate is to improve your targeting.

Not only should you use targeting to make sure your ads are being shown to your actual target audience, but you should segment your audience further so that different parts of your audience see different ads.

Let’s look at some common effective examples of segmenting audiences.

Possible group #1 – Potential customers who are aware of brand or product: Your highest conversion rates when selling a product will always be from people who have heard of your brand or product.

Many in this audience just need a little nudge to get them to make a purchase.

You can target these people if you’re active on the platforms you’re advertising on.

For example, you can target people who have already “liked” your Facebook page:


If someone’s done that, they probably have a good idea of what your products are and why someone might want them.

To advertise effectively to this segment, you need to create video ads that show your product doing something great for them.

If you were selling a personal finance tool, you would show in your ad how someone saved hundreds of dollars using the tool.

That will give your viewers the nudge they need to make a purchase.

Possible group #2 – No brand recognition, but interest in your type of product: This group refers to people who don’t know you, your brand, or your products.

However, they have an interest in your industry.

If I was selling a link building tool, I could target people with an interest in SEO.

Facebook and YouTube both have this type of targeting, and most other video advertising platforms do as well.

But remember that targeting is just one part of the equation. You also have to choose what to show your audience.

Since they don’t know you or your products, your first goal with these types of ads shouldn’t be to get the viewers to buy your products right away.

Instead, create a short, interesting video that teaches them something about your niche.

Going back to my SEO example…I wouldn’t even mention a link building tool, but I could create a video that showed that someone was able to rank #1 using a technique I created in the past.

Then, I would link to a detailed case study from the video.

Guess what would be in that case study?

That’s right, a mention of my productthe link building tool. The case study would also give the readers an opportunity to sign up for an email list.

Alternatively, you could link to a landing page from the video, asking viewers to opt in to an email list to receive the full report. Either option could work well.

The point is to establish contact, expose your potential customers to your product and brand, and get them on an email list. Then, you would continue sending them free content, and eventually you can target them like I showed you above in group #1.

Possible group #3 – Target by location: You should only target your video ad to countries and locations that you actually sell to. It sounds like common sense, but many businesses neglect to do it.

On top of that, you can also improve your results by creating videos for specific audiences.

For example, let’s say you sell a lawn care tool.

You wouldn’t want to show the same video ad to Australians, who have warm weather year round, and to Canadians, who have drastically different seasons.

To the Australians, you’d want to emphasize such features as durability and year-round suitability.

To the Canadians, you’d want to emphasize such features as easy storage during the colder months.

Take a second to think about your product and the different locations of your customers (cities, states, provinces, countries, etc.).

Do people in those different locations vary in how much they care about the features you offer?

If so, create specific video ads for each location. You might be able to reuse ads for different locations with a bit of clever editing.

Possible group #4 – Sell to multiple countries? Cover your languages: This type of grouping relates to the last point.

Did you know that you can target users based on language?

If you sell to people in countries that use two or more languages, you should be creating video ads in multiple languages and targeting by language.


If you’re only targeting the main language, you might be missing out on a solid chunk of your potential market.

Recognize the unique properties of your products: The last two groups I showed you won’t apply to every product out there.

But they illustrate an important concept.

Targeting depends on analyzing your potential audience and determining how different parts of that audience think.

Then, you’ll need to find a way to target specific portions of your target audience and create ads specifically for them.

I’ve shown you four possible groups, but there are dozens for all major ad networks. Don’t be afraid to go beyond these four.

2. All good video ads take on an interesting angle: Start with the concept

Some businesses are finally starting to “get it.”

For video ads to be successful, they need to be interesting.

When they’re done right, video ads can actually be shared and go viral. There are many cases that prove this.


While you may not have the budget of any of those companies, that doesn’t mean you can’t reach a large audience with an interesting advertisement.

How do you make an interesting video ad? The first thing you need to do is forget the word “advertisement.”

Yes, you’re paying to display it, but beyond that, your advertisement is just a video.

For some reason, many marketers think an ad needs to shove a product in someone’s face, which just isn’t true.

The vast majority of people on YouTube and Facebook are watching videos for entertainment, so if your video isn’t entertaining, they are going to ignore it or skip it as soon as possible.

And getting pitched a product is not entertaining, so don’t do it.

Instead, create or find an interesting story to tell.

Let me walk you through an example. is an Italian news site of sorts, so they focus mainly on current issues.

They were able to create a video, advertise it, and then have it go viral with over 2.3 million views:


They started with a concept. In this case, they thought about a way to make a video about attitudes towards violence against women interesting.

It might seem a little sad that it’s not enough for the subject matter to be important, that it has to be interesting, but the reason I’ve repeated it a few times is because it’s crucial to your success.

There are many ways to make something interesting:

  • tell a story
  • make it funny
  • make it surprising
  • make it unusual

In this case, they combined most of these elements.

They introduced a girl to several boys and asked them about her. At the end, they asked them to slap the girl. The boys, of course, innocently said that they would never do that.

I was glued to my screen for the entire 3 minutes, and it took me from smiling to thinking about the issue at hand.

The biggest concern marketers have is whether this approach is effective or not. How does an engaging story translate into page views and revenue?

If you’re able to tell a story, with your product being at the center of it, people will want it and seek it out.

Although wasn’t constantly saying, “We have the best content on social issues out there; visit us now!”—viewers still made that connection.

They understand that if they want clever, entertaining, and thought-provoking content, they should click through to the site.

Telling an interesting story is not easy. That’s why the people who are great at it are paid well.

However, it’s a skill like any other that can be developed. I’ve written extensively about it in the past:

3. Know when you need professional help

The thing that scares most marketers away from video advertising is that they can’t do it themselves.

Although you could try to make one with your iPhone (or whatever you use), chances are the video would suck.

And that’s just a basic video. When you consider animation, editing, and voiceovers, it’s just too much for a marketer to learn how to do.

That’s what scares marketers.

We love to do everything, including marketing, sales, product development, and just about anything else that needs to be done.

But creating a high quality video isn’t something that you can learn in a few days or even months.

And if you want to be successful with video advertising, quality has to come first.

People expect almost television-like quality for any video they watch:


This means that your video must have:

  • no blurriness
  • good lighting
  • no background noises or echoes
  • no stuttering or unclear speech

You need to recognize when you are out of your depth and bring in professionals to supplement your marketing expertise.

Putting together a high quality video: A video ad might only be 15 seconds long, but it can often take hours to make.

It will depend on the kind of video you are creating, of course, but a ton of work goes into creating even short videos.

The first step is to decide what type of video you’d like to create.

There are two main types of video ads.

The most common is a standard video with actors in it.

However, animated videos are really popular, particularly if you’re creating a tutorial or an educational video:


Your next step is to hire a professional to help you. This will include:

  • freelance animators
  • video creators (videographers)
  • video editors

As a marketer, you can probably handle the script writing yourself, but that’s another area you could potentially get some help with.

Video editors and animators are very easy to find online. Just browse for them (or post a job ad) on any of the following freelance job boards:

However, if you’re looking to include actors in the video, you’ll have to find local videographers.

Unfortunately, you can’t effectively narrow down the location of videographers on those freelance sites.

Instead, I recommend going to LinkedIn.

Search for “videographer” or “freelance videographer” in the search bar, and narrow down the results using the “people” filter in the sidebar.

Finally, choose “Add” under the location filter, and type in your city:


Not only will you find local professionals, but you will also find people who have worked with some of your existing connections. That’ll allow you to ask your connections about their experiences with the professionals you are considering to hire.

After you’ve found someone to work with, you need to develop a video outline and script. Again, you can probably handle this if you have some experience with storytelling.


Once you’ve gone over these details with your freelancer(s), they will create the video for you. Make it clear that you’re happy to get involved when necessary and answer any questions.

The last thing you want is to be unhappy with the final video because it’s a pain (and expensive) to reshoot.

For the most part, trust your freelancers. If you’ve hired experienced professionals, they will know how to bring your vision to life.

Ideally, you want to establish a relationship with freelancers so that they can continue to create videos for you in the future. It will save you the time of having to find someone new every time you need a video created.

4. Shorter is usually better

You need to be careful, especially if you embrace the tips I’ve shown you so far.

It’s common to get excited about producing a video, aiming for the best, and end up with a video that’s 3, 5, or even 10 minutes long.

Keep in mind that when users see your ads, they see them before the content they actually want to see.

Even if your video is fairly entertaining, most will pick the “skip” option that comes up shortly after your video starts—especially if they see that there’s another 3 minutes to go.


As a general rule, keep your video ads under 1 minute long. Under 30 seconds is better.

This forces you to focus on the most important parts of your message.

According to one analysis, only 36 percent of video ads are longer than 30 seconds.

Further, 13 percent are shorter than 15 seconds, which means that 51 percent of ads are between 15 and 30 seconds long. Aim for that range whenever possible.

The good news is that if you are able to keep your ad within that range, people will usually watch your full video.

The same research found that 79 percent of video ads are watched to their middle points, and 72 percent are watched to the very end. This means that if you can intrigue your viewers in the first half of your ad, almost all of them will stick with you to the end.

5. Videos may be different, but you can (and should) split test them

To edit a landing page, you need to click only a few buttons.

To edit an image, you need to do a bit more.

Video is far more complicated to edit than images or landing pages.

That’s why most marketers produce a video ad, put it out there, and hope for the best.

But you know me—I like to measure and improve everything. And I hope that you have a similar attitude.

When it comes to ads of any kind, including video ads, you must split test.

What’s split testing? A quick answer: If you’ve never done split testing, it’s a simple but powerful concept.

Most things are not optimized when you first create them.

What you can do is create two versions of something and then send visitors to both versions.

By measuring the results, you can see which version performs better.

Typically, you’ll use A/B split testing, which helps you learn about which elements work and don’t work.

With A/B testing, both versions are exactly the same, except for one change.


That way, you know that any difference in the results is caused by that one change. Then, you keep the better performing version and do a new test with a different element.

I’ve written a complete guide to split testing if you’d like a detailed guide; otherwise, let’s move on to how you would do split testing for your video ads.

Step #1 – Identify major elements: The reason why most marketers don’t split test video ads is because they know that editing a video is a pain.

But most split testing doesn’t even need to involve editing the video.

Start by looking at how your video ad will show up:


Then, make a list of the most important elements.

From the above, the most visible elements are:

  • the description
  • the video
  • the brand name

You can’t change the brand name, and you probably don’t want to edit the video (although that’s an option), but you can change the description.

Let half of the audience view one version of the description, and let the other half view the other version.

Alternatively, you can also split test different targeting options.

For example, you could show the exact same ad to two different groups of people. You could divide them based on interests, behaviors, or demographic options.


This will tell you which audiences are best to target, and that information will help you create more effective video ads in the future.

Step #2 – Create different versions of the ad based on those elements:  Once you know which element you will be changing (e.g., description or targeting options), all you need to do is create the two different ads and buy a similar number of views for each.

Here’s a guide to split testing on Facebook, and another for split testing in Google Adwords (for YouTube).

Step #3 – Decide which metrics are most important, and compare: Finally, the most important thing you need to do is decide what your goals for the video ad are.

Usually, it’s going to be cost per click-through. Sometimes, you’ll have to use your click-through rate percentage instead.

Once you have a valid sample size, you can compare the results and determine the winner.

A neat little tool to help you figure out the significance of your test is

Enter the number of samples for both the original and experiment videos as well as the conversions (clicks or whatever metric you’re using):


The tool will calculate the conversion rate of each test. More importantly, it will give you a significance rate (how often your conclusion will be correct) and a measure of how much better the winning test is:


Aim for a significance of at least 95%.

Remember that split testing typically gives you small improvements. However, those small improvements add up over time, so keep iterating and making changes until you’ve optimized your video ad.

6. Studies have shown that music impacts emotion—use it wisely

The final tip I have for you is to use music in your videos, but use it intelligently.

To begin with, always remember that videos are mainly focused on visual content. That should remain the main focus of your video ads.

However, music in the background can make your message more powerful.

The effect of music on mood: One study recruited subjects to determine what effect music has on our moods.

They found that both happy and sad music affects our perception. When subjects heard the happy music and then were shown a person with a neutral expression, they were more likely to say that the person was happy.

Conversely, the other subjects who heard sad music thought that the exact same person was sad.

Basically, we match our perception with the tone of music we hear.


The takeaway is simple:

If you want your viewers to feel a certain way during parts of your video, use music that corresponds to that feeling (e.g., sad music for a sad feeling).

You can use this to nudge viewers to feel happy, then sad, to make your video more impactful.

Music improves focus: You want your viewers to be glued to the screen while your ad is playing.

But if the ad has no sound, no matter how good your video is, most viewers will get bored and zone out.

A study looked at how listening to different sounds affects focus.

The researchers found that listening to either classical music, white noise, or silence improved visual attention. The greatest effect, however, was produced by classical music, followed by white noise. Silence produced the least effect.

The takeaway:

Play some sort of music in the background throughout most of your ads to help your viewers pay attention to your video. If classical music suits the tone of your video, it’s probably the optimal choice.

Music should accent, not distract: Finally, there’s one more study about music and focus that you need to know about.

The researchers tested how music affected the rate of driving mistakes in teenagers.

The bottom line was that when the drivers got to pick their own music, they drove more aggressively and made more mistakes. It makes sense as they were more focused on the music than their environment.

On the other hand, when they listened to “safe” music that was picked by the researchers, they drove better.

The takeaway:

Use music in your ads, but make sure it’s not so loud or catchy that your viewers focus more on the music than your video’s images.


Video advertising is one of the most exciting advertising opportunities that is still maturing.

If you take action right now, you will learn how to profit from video ads before the rest of marketers catch on.

I’ve shown you 6 key principles and tips of effective video ads that you can use to reach profitability quickly.

Once you have a profitable campaign, scale it up and enjoy the results.

I understand that creating video ads isn’t easy. So, if you have any questions, leave me a comment below, and I’ll try to clear things up.

Source: quicksprout

How to Improve Your Revenue Using Video Ads

Zero to IPO: Lessons From The Unlikely Story of HubSpot

HubSpot has had a pretty good run.  Went from zero to IPO.  What’s not known is how unlikely the story of our success is.

II gave a talk at the 2016 SaaStr Conference hosted by Jason Lemkin.  The slides and full video from the talk are included below, with some quick notes on a few of the topics covered. 

Here’s me presenting what turned out to be the most popular slide (more on this idea at the end of the article).


 Here is the full deck from Slideshare.

And, here’s the full video of the talk.

Note: There are some pre-roll videos, and my segment starts at about the 3 minute mark.

If you have trouble vieweing the embedded video, try this:  
Dharmesh Shah at 2016 SaaStr Conference
A quick note on the “Tools are bought, transformations are sold.”  This is one of the more important lessons I’ve learned through my professional career.  When you are improving things by offering a tool (which may or not be something that exists — perhaps yours is just better), it is possible to put up a website, have people try out the tool, and start paying you if they like it or want to upgrade. 
But, if you’re doing something radically new and trying to 
transform how people do things, it’s unlikely that this approach will work.  Even some brilliantly written blog posts or videos are probably not going to get people to think:  “You know, she’s right, I’m just going to start doing things the right way, and here’s a platform to do it — where do I sign up?”.  It will likely require some “selling”.  You’ll need people to explain what’s wrong with the world, how your company solves it, address objections, answer questions, and generally help people get over the hump.  Even 
then it is hard.  But if you try to transform the world with nothing but a website and a credit card form, chances are low that you’ll succeed. It happens — just not that often.
Would love to hear any comments or feedback you have.

Source: OnStartups

Zero to IPO: Lessons From The Unlikely Story of HubSpot

Don’t Drive Your Business Into the Ground: 5 Ways Metrics Can Cause Bad Decisions


We’ve all done it before…

At some point in our lives, whether it’s related to marketing or something else, we’ve lied to ourselves.

It’s natural to want to feel good, and the brain can distort truths to make you feel that way.

But lies get in the way of progress.

They can make you feel okay about not putting in the effort required for success.

The scariest part is that sometimes we don’t even know we’re doing it.

The cause of this, when it comes to marketing and business, is using metrics incorrectly.

Metrics are very important because they allow us to quantify our results.

However, not all metrics are useful, and some might be useful but are hard to interpret.

A very realistic and common scenario involves marketers believing that they are doing a great job (based on the metrics they track) when in reality, they aren’t producing much.

Other times, metrics might seem to suggest that you should change your marketing tactics and strategies. However, it might be that you are misinterpreting the meaning of those metrics, and then you make a change that actually makes your work less effective.

Any of these scenarios will diminish your chances of achieving the success you want so much.

And that’s why it’s crucial that you understand the ins and outs of metrics, which is exactly what I’m going to show you here.

After this post, you should know 5 different ways in which metrics can deceive you and how to protect yourself from that in the future. 

1. Page views and emails do not equal sales

This first aspect of metrics is the most important.

Basically, there are two types of metrics:

  • vanity metrics
  • useful metrics

Care to guess what each means?

Vanity metrics sound nice but don’t mean much.


For example, a search engine could be reporting 1,000,000 searches per month.

But that could mean many things. Most importantly:

  • you could have one really enthusiastic searcher
  • you could have 1,000,000 single searchers
  • you could be getting this many searches because the searcher couldn’t find the right result

It’s not that vanity metrics are necessarily bad; it’s just that they don’t tell you anything clearly or accurately.

Traffic is one of the most commonly used metrics for content marketers, and relying on it is a mistake.

Traffic is a vanity metric.

You could buy a million pageviews tomorrow from some low quality ad network and get absolutely nothing from them.

While quality pageviews would be a decent metric, it’s very tough to measure something like that.

The same goes for the rate of opened emails or the number of email subscribers on your list.

I’ve seen some businesses make nearly zero revenue from a list of thousands of subscribers while others make thousands from a list of only a few hundred.

If you’re measuring email list growth, it doesn’t tell you a damn thing about how your business or marketing is performing.


This goes for all vanity metrics.

You can always find a few metrics in Google Analytics that are increasing every month. Don’t fool yourself into thinking that everything is running perfectly—it might not be.

What makes a metric “useful”? The simplest way to recognize “useful” (sometimes called “smart”) metrics is to look for the 3 “A’s”:

  1. Actionable
  2. Accessible
  3. Auditable

This concept comes from the lean startup but can be easily applied to just about any business.

Let’s break down the signs of useful metrics one by one, starting with how to determine whether a metric is actionable

As you might have guessed, actionable metrics allow you to take action based on the information they provide. And I am not talking about just any action, but one that actually improves your work.

The second “A” is for accessible. This matters most if you work in a team.

The idea is that if you decide on a key metric for a business, you want everyone in that business to understand what it is. More than that, they need to know how to find it, understand it, and use it.

Certain metrics can make sense to technical team members, but maybe not marketing or sales. A good metric should be easily understood by all.

The last A stands for auditable.

This relates to the concept of accessible, and it means that any person on your team should be able to access any data in your business (related to the metric) and create a report with it.

If it can be tracked with Google Analytics, your problem is solved since all team members can easily be added to your website’s account. They can look up metrics and export reports as needed.

The goal comes before the metric: It’s important to remember why we need metrics in the first place.

Metrics allow us to measure things.

And useful metrics measure the things that show whether your marketing is producing acceptable growth or not.

To find these metrics, you need to start with your main marketing or business goals.

Here are a few common ones that you might have:

  • Make a profit (it may be a certain amount)
  • Have a significant positive impact on your customers’ lives
  • Do meaningful work

It usually doesn’t get much more complicated than that.

For each goal, you want to try to determine metrics that show whether you’re succeeding or not.

Let’s look at a few example metrics.

Goal: Make a profit

Possible metrics: revenue, profit, costs of goods sold, current members, monthly churn (customers lost), retention rate, new customers, customers lost (if applicable).

Since most businesses want to maximize their profits, or at least revenue, these metrics are usually the most important ones to track.

Usually, you’ll pick 1-4 of them to track regularly.

Every time when you or anyone on your team does something, it should, in some way, improve at least one of your chosen metrics.

Some of these metrics depend on your type of business. Things like retention rate and churn apply only to recurring revenue businesses (e.g., subscription boxes).

You want to keep your choices as simple as possible.

If your main goal is profit, track profit first and foremost.

For some parts of your marketing, you won’t be able to track profits directly.

That’s why you want other, related, metrics that could tell you when something’s not going right in your business.

For example, if you all of a sudden see a spike in the number of customers you lost, you can use that information to take action and figure out which recent change caused the loss.

Let’s look at one more goal…

Goal: Have a positive impact

Possible metrics: average time on page, customer survey satisfaction scores, percent of return visitors.

Many goals are qualitative, which, of course, makes them difficult to measure.

And while you won’t be able to find a perfect “impact” metric, you can find others that can guide you.

In this case, it’s really difficult to find out how much customers are loving your products.

You’ll hear from those who had either a really great or bad experience but not from the “average” customer. Doing surveys is usually the best option you have, but you will always have a bit of a sampling issue.

If your product is an online product, like a course or SAAS, it’s much easier to measure a metric like this. You can usually just look at how often your users return to your site or tool.

Some goals correspond to more metrics than others. As long as a metric gives you unique, actionable information, it’s worth tracking.

Finally, you could come up with a way to regularly evaluate how satisfied you are with the work you’ve been doing, but that’s another tricky one to measure.

Some goals, particularly qualitative ones, don’t need to be tracked through metrics (do reviews on a regular basis). Otherwise, make sure that any metric you focus on fit the “3 A’s”.

2. Metrics alone don’t always tell you the whole picture

You should always have justification for any action you take or conclusion you make.

If you are saying that your marketing is working well, you’d better have the metrics to back it up.

Most marketers understand this, which is a good thing.

However, many don’t back up their conclusions correctly. The most common error I see is that marketers back up their conclusions with metrics that don’t tell the whole picture.

Let me give you an example.

Say we have a marketer named Joe.

He tracks customer satisfaction as a metric. He observes that customer satisfaction went up last month and concludes that the business continues to grow as a result of the content he created.


Do you see the issue with concluding this based on this metric alone?

Joe’s boss, let’s call him Neil, isn’t quite convinced.

Neil digs into the business’s data and finds its customer retention rates. As it turns out, the retention rate went down, meaning that the business lost more customers than usual.

Putting these two metrics together reveals a very different picture:

The average customer satisfaction likely went up because many unsatisfied customers left the business.

That’s a serious problem.

This is why you need to ensure that the metrics you rely on don’t mask potential problems.

Selecting metrics that show you the whole picture: It’s never good to rely on a single metric to make a decision (in most situations) because they rarely give the whole picture on their own.

At the same time, you don’t want to have 15 different metrics—it’ll make it hard to draw a clear conclusion.

Instead, aim to have as few metrics—that give you actionable, accurate information—as possible, and base your decisions on those.

Scenario: You’re trying to assess the effectiveness of your current content marketing strategy.

In order to do that, we’ll need more than a single metric.

For reasons I went over earlier, traffic and email subscribers aren’t the best metrics here (although they may be the only choice for young blogs).

Instead, I’d rather focus on either qualified leads or actual sales if possible.

A qualified lead is different for every business. For example, it might be a webinar participant.


Someone who signs up and attends a webinar is obviously interested in the topics you cover and is likely a potential customer. This is enough to make them “qualified.”

This metric is useful because the more attendees you have, the more sales you should make. Unlike traffic, where more doesn’t always mean better, qualified leads correlate well with sales.

Therefore, our first metric is the “# of webinar attendees.”

But that’s not enough. It doesn’t tell us the whole picture.

The number of webinar attendees could be going up, but that doesn’t mean that the content marketing is succeeding.

Instead, it’s possible that most of those results are from your past work, unrelated to your current content marketing strategy.

Or it’s possible that you’ve learned to promote webinars more effectively through other channels than just content.

So, we need additional metrics.

The first one is to divide your webinar signups by source. You want to see which piece of content each signup initially landed on.

The ones that come from your recent content will tell you whether your current strategy is actually producing results.

Once you have this data over at least a few months, it will be clear which content is driving your visitors through your sales funnel.

What about your promotional tactics?

You need some sort of a metric that standardizes your signups. After all, if you create a new pop-up that is twice as effective as your old opt-in, that doesn’t mean that your new content is twice as effective.

Therefore, your final metric in this set needs to be a scaling metric.

Before you fully implement a new tactic to get more webinar signups, you need to split test it against the old one.

Once you have a sufficient sample size, you’ll have results that’ll look like this:


Based on these results, with almost 100% certainty, we can tell that the new tactic is better.

However, the improvement has a range from 177% to 323%.

Ideally, keep running the test until you have a tighter range, but the average number is usually the best choice.

Overall, you have a few options:

  • take the worst case scenario (only improved by 177%)
  • take the average (250%)
  • take the best case scenario (improved by 323%)

You could also take a combination.

Based on each of these, you get a scaling factor by dividing these numbers by 100 (to convert from percent to decimal):

  • 177% becomes 1.7
  • 250% becomes 2.5
  • 323% becomes 3.23

Then, you need to multiply the number of webinar leads you had in the past by the number you chose.

For example, pretend that these are your original results and that you implemented the new and more effective tactic in April:

Feb March Apr May
Webinar leads 100 120 325 360
After 2.5x adjustment 250 300 325 360


Notice that you adjust the values for the months that used the old, ineffective method by multiplying them by the scaling factor.

Now you can make a fair comparison.

In this case, with a 2.5x adjustment, it shows that there is steady growth in the number of webinar leads.

After considering all possible factors that could skew our original metric, we now have a set of metrics that we can use to determine whether our hypothetical content marketing strategy is effective or not:

  • number of webinar leads (original metric)
  • webinar leads by source
  • scaling factor based on promotional methods (could be more than one)

How to come up with your own sets of metrics: I understand that this isn’t the easiest thing to do, but it will get easier with practice.

To simplify things, let’s break this process down into a procedure.

Take it step by step, and it won’t be very difficult.

  1. Clarify what you’re trying to determine (a goal of sorts).
  2. Determine your primary metric, the most important one directly related to your goal.
  3. Brainstorm possible situations in which your primary metric could be positive but not actually indicative of the results (like content marketing not improving even if webinar leads increased).
  4. Come up with at least one metric that will help you determine whether those situations happened (they are essentially safeguards).
  5. Write down your final set of metrics, and monitor it on a continuous basis.

Now, when you need to make a decision or draw a conclusion based on your metrics, you can be confident that it’s the right one.

3. You can’t measure everything

Some things are easy to measure…

But others are extremely difficult.

As a general rule, quantitative things, like the number of customers, views, or dollars, are going to be straightforward to measure.

But what about qualitative things like customer satisfaction? Or if you want to measure how much of an impact your content is making?

You can’t just go into Google Analytics and find a metric called “customer satisfaction.”

So, what do you do?

Your only choice is to find the best metrics that represent those things you are trying to quantify somehow. It’s not perfect, but it gives you something concrete to base your decisions on.

Finding the next best thing: We’ve already looked at this to some extent. When you can’t measure something directly, you find other metrics that measure things that correspond with your main concern.

For example, you might not be able to measure sales directly. Or sales may not occur for an extended time, and you want to make sure you’re on track.

So, you measure the next best thing: qualified leads.

These could be webinar attendees like I mentioned earlier, or they could be email subscribers.

You need to be careful with this because they need to be qualified leads. A random email address or one that you get because the user just wants a free bonus is not qualified.

However, if they request a demo or opt in without any bonus, they are likely potential customers.

The reason why this distinction is so important is because qualified leads will correspond to revenue. The more qualified leads you have, the more you will make in a fairly linear fashion.


However, unqualified leads may or may not correspond with revenue. It’s really difficult to determine how much more money, if any, additional leads will make you.

The takeaway here is to find a metric that corresponds closely with your goal.

This applies to both quantitative (like revenue) and qualitative aspects.

Consider customer satisfaction. What metrics are related to it? Here are a few possibilities:

  • results from surveys given to customers
  • return customer rate
  • complaint rate or number of complaints

None of these are perfect solutions, but if you combine them, you’ll get a pretty good idea whether your customers are happy or not.

Beware of sample bias: One of the biggest issues with this type of approach is that you have a sample bias.

For example, customers who’ve had a very negative or very positive experience are the most likely to fill out your surveys.

And while it’s good to hear from them, you also want to hear from the rest of your customers. Your “average” customer is arguably the most important one.

You’ll get a sample bias with many metrics that describe qualitative aspects of your business.

Take your return customer rate.

If a customer buys something else from you, they’re probably pretty happy. Then again, just because someone doesn’t buy from you doesn’t mean that they are not happy.

Additionally, someone might not be very satisfied but still buy again from you because of some other reason like price or lack of other options.

What does this mean for you?

It means that none of these metrics are perfect. Taking multiple factors into account will help give you a more accurate picture, but even that’s not enough.

The only effective way of dealing with this is to understand the sampling biases you have.

For example, when it comes to survey results, put the most weight on the ones that aren’t especially negative or positive. Each of these likely represents several other customers that didn’t fill out a survey.

Likewise, put less weight on the extremely positive or negative surveys because you hear from a much larger proportion of these types of customers.

Think about the potential issues you might have with your samples, and put more emphasis on those areas that don’t provide you with much information.

4. Metrics can be manipulated, so make sure you know how you track them

Judging work performance using metrics can be a very dangerous thing to do.

The clearest example of this can be found in fast food restaurants and retail stores.

Managers and employees are told to meet certain quotas, e.g., food delivery times or number of sales, or else they risk being penalized or even fired.

When you take that approach, you shouldn’t be shocked to find out that employees are willing to manipulate metrics however they can.

They will start timers late or create fake accounts (to be cancelled later) to meet those quotas (yes, those kinds of things happen).

And while you may not take that approach with your team, maybe you give out raises, promotions, or something else to those who meet a certain performance metric.

Metrics are thought to be a way to track employee performance.

But they are often easily manipulated.

The good news is that if you chose “useful” metrics (from part 1), you are tracking metrics that are harder to manipulate.

But consider vanity metrics such as social shares or traffic.

If you told a writer or social media manager to get a certain number of social shares on each post, many would simply create fake Twitter accounts and schedule them to share each post 10+ times each.

Of course, this wouldn’t lead to real traffic for you, but it looks good on their metrics.

Same goes for traffic. It’s easy to buy hundreds of junk views for pennies even though they’re completely useless. You’ll see plenty of these gigs on Fiverr:


The best solution is to pick difficult to manipulate metrics, like profit, and to not judge your team members solely on metrics. Metrics should primarily be used as feedback that guides how you spend your effort.

However, if you do decide to incorporate metrics into performance evaluations, you need to know how to track them accurately.

For example, if you’re looking at social shares, you need to specify a certain expectation. You could say that only one social share per social account counts towards the metric and that the account needs to have at least 50 followers.

To track something like this, you will have to create your own simple tracking system.

For views, you might only count the ones that don’t bounce or are from certain countries. If you suspect fake views might be a problem, you probably wouldn’t want to count traffic from countries like India, which is often used for view bot IP addresses.

5. Metrics don’t always lie, but they can easily be misinterpreted

Metrics are important, but they have to be recorded and interpreted correctly, or you’re at risk of making big mistakes.

All marketers and business owners should have at least a basic understanding of statistics.

If you don’t have any background in statistics, sign up for this free “Introduction to statistics” course online. There are many other similar courses offered by top universities, so take advantage of them.

Most importantly, you need to understand concepts such as variance.


Variance measures how far results can deviate from the average expected result.

For example, you might use a specific email outreach template and track the number of backlinks it generates for your content.

Let’s say you get five links from the first 100 emails you send.

Does that mean that you’ll get five for every 100 emails you send from now on?

Not at all.

Depending on how big the variance is, sometimes you might only get one link, and other times you might get 10 links.

Imagine that the first time you sent 100 emails, knowing that you’d judge the results based on your links metric, you only got one link. If you judged your results right away, you’d say that this email template sucks.

But as you send more and more emails, your link percentage would rise to the average expected value.

In other words, you need to have a valid sample size before you interpret results; otherwise, they mean nothing.

When you go through an introductory stats course, you’ll learn about variance along with sample size and other related concepts.

The main takeaway here is to first learn about basic statistics and then to ensure that your metrics are accurate before you take them into account.


You should rarely make decisions concerning your business or marketing based on gut feeling alone.

Metrics give you confidence to make decisions because you know that you have numbers to back you up.

However, it’s crucial that you choose the right metrics and know how to track and understand them correctly. If you don’t, you’ll end up drawing incorrect conclusions, which are bad for your marketing and business as a whole.

I’ve shown you the 5 main ways that metrics can play tricks on you as well as ways to avoid making the wrong decisions based on them.

If you have any questions about using metrics in your work, I’d like to help out. Leave me a comment below with as many details about your business and the metrics you use as possible, and I’ll try to provide some insight.

Source: quicksprout

Don’t Drive Your Business Into the Ground: 5 Ways Metrics Can Cause Bad Decisions