We’re about to say some bold things about metrics in this post. Things that challenge long-held beliefs about which metrics are actually important. Things that would require the SaaS industry to rewrite a vocabulary we’ve all become comfortable with. We’re about to talk about the long-awaited death of vanity metrics.

 

What are vanity metrics?

Vanity metrics are metrics that work to validate the existence of certain roles within an organization. They’re pretty-on-paper, feel-good metrics that will not directly influence revenue. For example, open rates, social media followers, or webinar attendees.

Sure, they show a level of interest in your product, but when your ultimate goal is revenue, these metrics all fall short. The fact is, no matter how many people open your email, the only number that matters is the revenue number.

 

Let’s Talk SaaS Metrics

MQLs and SQLs are a good example of this. Internally, they may be an important part of how you view your funnel. However, companies often make the mistake of seeing MQLs and SQLs as indicators of progress or even success.

Using MQLs and SQLs as a way to evaluate the effectiveness of your sales and marketing teams is a good recipe for unnecessary friction. There is no magic number of MQLs that will ensure the best leads. No number of SQLs that will guarantee a closed sale. So, until that conversion happens, butting heads over the details in between is counterproductive.
 
Our CEO, Jason, was once a guest on the SaaStr Podcast with Harry Stebbings. They talked a bit about vanity metrics and the redundancy presented by MQLs and SQLs, particularly when it comes to efforts such as ABM.

 

In a Perfect World

In a perfect world, your sales and marketing teams would be collaborating on things like account selection and lead scoring. That way, any leads moving into the sales funnel would be qualified by definition. 

 

When it comes to vanity metrics in general, our advice is to ignore them. Realistically, they’re no more than vehicles for validation. Vanity metrics are better replaced with indicators of real revenue impact, such as conversion rates, funnel acceleration, and increased LTV.

However, this kind of success won’t happen overnight. Keep your momentum-based KPIs on the back burner, to make sure you’re moving in the right direction.