I’ve been thinking about something for years… since before I started JibberJobber. A bit of history…
Back in the olden days, just 4 years ago, my old boss would talk about the number of hits on website. When he reported hits the developers would snicker, because hits were not very well defined.
Most executives wanted to know how many people visited the website (unique visitors) or how many pages they looked at (page views). But this notion of “hits”…. hm… let me tell you what a hit was:
Hit: the number of times our server served something. You (the normal human being) thinks it’s something logical, like perhaps unique visitors or page views… but each time our server served an image we got a hit.
Get that? If a page has 3 images on it, you get 3 hits. Want to multiply your hits by 10? Put 27 more images on the page, and now you got 30 hits! Want to really impress the suits? Put 300 tiny 1×1 (pixel) images on the site, you can even make them transparent (so they are invisible), and you get 300 hits!
The programmers saw right past it. The suits didn’t.
So there’s my introduction to this fake metrics crap. If you like this stuff then pick up one of my favorite books, How to Lie With Statistics.
Now, fastforward to today. There are some other metrics that a business like JibberJobber would measure.
What is a user on JibberJobber? If I wanted to impress someone I would tell them the number of people who have signed up… which is usually called a “user.”
Not so. Absolutely not so.
Let me differentiate between:
Signups: this is anyone who has signed up… regardless of whether they have ever logged in or not (much less use the system. This is a super-easy metric to report, but most times I hear it I think it’s a fake number.
Users: Like… LinkedIn has 40M users. NO, they don’t. They have had 40 million people signup….! I think users are people who… use the system.
Upgrades: These are people who fork over the loot… I’ve had peope in JibberJobber upgrade the day they signed up… without ever using the system. Love that, of course… but it doesn’t guarantee they’ll be a “user.”
There’s a terrific post on TechCrunch talking about a freemium site called Evernote – the post is titled Evernote Stats: One Million Registered Users, 360,000 Active, 13,755 Paid
I love this because off the bat it declares the signups (which they call “registered users,” the users “which they call “active,” and the upgrades. Nice differentiation!
Now, the concept on premium upgrades, conversion percentage, etc. is a totally different discussion (and I disagree with how TC got the percentages)… but this is a good place to start talking about real metrics.