Vanity Metrics Can Be Deceiving

Vanity metrics are metrics that look good on the surface, but don't actually tell you anything about the health of your business. They are often used to make a startup look more successful than it really is.

Common examples of vanity metrics include:

• Total number of registered users
• Total number of downloads
• Total number of pageviews
• Total number of social media followers

The problem with vanity metrics is that they don't tell you anything about whether you are building a sustainable business. For example, you could have a million registered users, but if none of them are paying for your product, you don't have a business.

Actionable metrics, on the other hand, are metrics that are tied to the drivers of your business. They tell you whether you are making progress towards your goals. Examples of actionable metrics include:

• Conversion rate
• Customer lifetime value
• Customer Acquisition Cost
• Retention rate

By focusing on actionable metrics, you can get a much more accurate picture of your progress. This will help you to make better decisions and increase your chances of success. Cohort analysis is a powerful way to generate actionable metrics.