On the Importance of Meaningful Success Metrics in Software and Business

Regardless of the type of application you're building it's valuable to define user goals and measure those goals. It's even more valuable to define success metrics essential to the core principals your business is founded upon and create user goals that measure progress toward those metrics. For example, typical goals for an e-commerce site might be:

If a user visits the site, how often do they end up on a product page?

If a user visits the product page, how often do they click the "Purchase" button?

If a user clicks the "Purchase" button, how often do they complete the order process?

With an overall goal of:

If a user visits the site, how much money do they spend on average?

These goals are created in an effort to define the value the application provides to the creator and the user and can be used to measure how well the application is delivering that value. In the case of the e-commerce site, though, the ultimate goal is to judge whether or not the products being sold are compelling to buyers. At the same time, we are trying to judge whether the experience of the website itself is getting in the way of a would-be buyer purchasing an item.

A user who gets lost on the checkout page and leaves the site instead of buying leaves a metaphorical abandoned cart in the aisle. It would be akin to getting to the self-checkout lane in Wal★Mart, becoming confused, leaving your basket of goods, and driving over to Target. But then, at least, the stockers have something to keep them busy.

Of course, these types of goals can be managed for any kind of website or application. A blogger might define goals for engagement such as:

If a user visits my site, how often do they end up on a post page?

If a user is on a post page, how often do they comment?

If a user is on a post page, how often do they click links?

If a user visits my site, how often do they return?

The blogger, like all of us, is searching for a meaning to their existence. Measuring for engagement on a blog post is attempting to answer the question, "Is what I'm writing valuable to my readers?" That question is distinctly different from, "Am I reaching a large enough audience?" Where the latter question is easier to measure and an answer is easier to come by, the answer to the former means so much more. Producing valuable content is far more enduring than the the high of a million fly-by-night visitors.

These concepts need not be limited to relatively simple web sites and blogs. They can also be applied to complex web and desktop applications. With a line-of-business style application, the questions being asked can start off very granular:

How often do users use our new keyboard shortcuts?

When a user enters this wizard, how often do they complete the process?

The answers to these questions can inform you about the value of a given feature or user experience. This can help you decide if you can deprecate an interaction or if a feature needs to be promoted in the interface to get the usage you want to see.

However, real value is derived when goals for an application are defined around business success metrics. These success metrics are existential, like the blogger searching for meaning in their writing. In this way, they depend very much on the type of application you've developed. The metrics you apply to your application say something about what you stand for. You can certainly measure ad clicks or revenue. But is revenue the principal upon which you founded this business? Is that why you're in this game? If so, please look around and gain some perspective.

Spotify measures the number of songs users listen all the way through. A meaningful metric for a company trying to pick the right song for you to listen to. eHarmony advertisements always mention the number of successful relationships and marriages their matches resulted in. I don't know how they keep track of that particular metric. But, can you imagine A/B testing matching algorithms based on the number of resulting successful relationships? That's certainly a meaningful metric for a company "… committed to helping singles find love every day." And it's certainly a number to take pride in.

What's important is that you define the metrics that are meaningful for your business, and that you then measure and act on those metrics. What are the success metrics for your site or application? How do you go about defining them? Having trouble coming up with something substantial? Tweet at me and let's discuss.