“Marketing is the process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return.”
— Philip Kotler
For the last nine months, Eric Ries’s The Lean Startup has been a foundational text at Stigma Marketing & Development. It wasn’t a light business read; I used it as a critical model, applying its principles to my own business and the development of the Authentic Marketing Model. For months, it’s sat in both my office and bathroom.
Being able to present the Authentic Marketing Model for the first time to professionals at the Rocky Mountain Business Women’s Center helped clarify some areas of improvement while helping test its proof of concept. This experience provided more motivation to get the model to a point it could be shared (more to come on that…it’ll be a lead magnet and free class offered in Missoula). The Lean Startup helped frame metrics authentically and as an extension of business, and I’m excited to develop this further later.
The Strategic Chasm Created by False Success
Metrics matter, but their utility depends entirely on the marketing strategy that drives them and how we interpret their output. I’ll keep pounding the drum that marketing is an extension of business, and as such, marketing metrics are authentic signposts for how things are working. But, if the metrics are treated as the goal or trophy, they fail to serve their intended purpose as diagnostic and growth tools.
Ries offers a clinical diagnosis for why so many businesses fall into this trap:
“Vanity metrics wreak havoc because they prey on a weakness of the human mind.”
— Eric Ries
This human flaw—our natural attraction to the big, easy, ego-boosting numbers like total page views or gross follower counts—allows teams to claim success while obscuring the actual, often difficult, customer journey. Leadership & Self-Deception explores this same phenomenon, and it’s something we explore in the Get Out Of The Box Training. When metrics and sales aren’t doing well, leaders can fumble under the responsibility. Metrics and measurements can make us feel like failures or gods, but they’re meant to be real data and our real things that are helping humans. They tell us if things are working and how we can improve. Avoiding, misinterpreting, or letting them go to our heads are recipes for disaster.
Ries demonstrates how this weakness is the genesis of the strategic chasm between Marketing and Business Development. Marketing, chasing the lure of Awareness metrics (like followers and impressions), generates mere noise and volume. Business Development, focused on Conversion, is left to sort through unusable, unqualified data. The two sides start measuring success using different metrics, while the underlying products and services and consumer relationships suffer. The two sides become divided, unable to work from the same reality or shared strategic objective.
As Ries notes, vanity metrics allow leaders to “form false conclusions and live in their own private reality.” This private reality is precisely why the traditional marketing funnel is often upside down—we’re obsessing over the quantity of the audience (a vanity metric), yet neglecting to measure the quality of our actions and the depth of our connections.
“Where performance is measured, performance improves. Where performance is measured and reported, the rate of improvement accelerates.”
— Thomas S. Monson
The Antidote: Actionable Metrics and the Three A’s
Authentic marketing demands a mindset shift. It moves us past superficial sales and focuses on building the dedicated value engine that is the heart of the business. The antidote to vanity is what Ries calls Actionable Metrics. He flatly says they “are the opposite of vanity metrics,” in part because they break the mask of vanity so we can actually peer under the hood.
Actionable Metrics are the foundation for bridging the strategic gap and building a reliable marketing engine. They track the measurable aspects of real human relationships—the verifiable improvement of a person’s life through the process of connecting with your business. This allows those important metrics, like Open Rates and CTRs, to not be the end goal but valuable intel for growth, simplifying, or pivoting.
For a metric to serve this essential strategic function, it must meet three non-negotiable criteria (The Three A’s):
- Actionable: A measured change must immediately dictate a specific, testable action or next step for the team. If the metric doesn’t directly inform a Pivot or Persevere decision, it is merely background noise.
- Accessible: The data must be clearly defined and universally simple. For small businesses, this often means focusing on easily tracked, direct engagement over complex models. The team must be able to understand the actual measurement, what it does for the bottom line, and how it aligns with the core business hypothesis.
- Auditable: The metric must be verifiable by tracing it back to the raw, individual customer event data. “Metrics are people,” and they tell a story, not a result. Unless data can be confirmed on the ground level, with real people (our customers), it’s flawed and unreliable. This commitment to transparency prevents manipulation and provides the essential context required for trust and validated learning.
Crucially, no single metric tells the whole story. Using these criteria for metrics helps diagnose the complete customer journey and understand our business, not just claim a surface victory.
“A company that fails to listen to its customers is heading for trouble.”
— Philip Kotler
Four Mindset Traps That Kill Strategic Growth
Actionable Metrics provide a necessary grounding to help avoid the four common mindset traps that derail entrepreneurial success. Some of these Ries talks about, like the last one (Fear):
1. The “Metric is the End Goal” Trap
When conversion becomes the ultimate goal, the metric stops being a tool for learning and becomes a tool for justification. We resort to local optimization that inflates the number but degrades the service. This is a business running on hype and fumes, not authentic service and human connection. The true end goal is a running, managed system that consistently delivers value; metrics are simply the diagnostic gauges telling us how to improve that service delivery.
2. The “Fame Equals Success” Trap
This is the illusion that high engagement or brand recognition guarantees business health. In truth, it’s part of the mythical rat race we never had to compete with, and how social media has turned us all into celebrity wannabes. As entrepreneurs, we need an actual, disciplined business model to market, not just high follower counts. As marketing pioneer Philip Kotler noted, “Marketing is not the art of finding clever ways to dispose of what you make. It is the art of creating genuine customer value.”
The focus on “fame” shifts our energy from solving a genuine customer problem to solving a visibility problem. These are internal issues, ones that stem from human psychology. Brands that rely on forced fame might achieve temporary visibility, but those that stay authentically connected to their base, focusing on disciplined Unit Economics (e.g., the ratio of what it costs to get a customer versus what that customer is worth), are the ones that outlast the fads, from multigeneration brick-and-mortar stores and Nike to life coaches and B2B sales.
3. The “Grand Effort” Trap
There is a myth that marketing requires massive, complex, multi-channel machinery. It does not. In fact, it begins as soon as you suggest your business idea to another person. Marketing always starts from the ground up and flows horizontally, something Seth Godin teaches. It requires intentionality, consistency, and validated content. The key is showing up where your customers are, not everywhere. A single LinkedIn profile or YouTube Channel may be all your business model needs, or maybe just a local community newsletter. While I love websites, there is a whole world of options available to us. The old startup rule of “do what doesn’t scale” still applies. Wasting resources on a complex, neglected website or an overly ambitious campaign is the definition of grand effort, not strategic action.
4. The Fear Trap
Ries identifies fear as a root cause of reliance on vanity metrics. We fear looking at the true, unbiased results because they might tell us our central hypothesis is wrong—a primary source of imposter syndrome. Authentic, auditable metrics are the cure for this fear. They provide grounded, verifiable feedback that removes the ambiguity and allows us to pivot with confidence, confirming that the work is about learning, not just being right.
The Strategic Conclusion: Inverting the Funnel
“The smallest viable market is the key to the new marketing.”
— Seth Godin
The sales funnel is not a volume game; it is a value game. The traditional approach is obsolete because it prioritizes the quantity of strangers at the top—the definition of the vanity approach. The funnel works best when it is inverted—when we flip the focus from acquisition to advocacy. This also allows us to build our marketing engine organically and in phases.
This inversion is the strategic decision to shift focus from initial acquisition (vanity) to retention and advocacy (value). Instead of measuring the vast, noisy top-of-funnel (impressions, clicks), we measure the deep, specific action in the middle and bottom—what Ries calls validated learning. This core strategy matches what Seth Godin teaches: “The goal is not to scream at the anonymous masses. The goal is to carefully craft a message for the smallest viable market.” Marketing growth comes from building a loyal “tribe,” not from chasing strangers.
Connecting the Dots: Your Daily Metrics vs. the Master Metrics
For any entrepreneur, from the counselor to the salon owner to the plant nursery, the ultimate goals are high-level financial and relationship benchmarks that define long-term viability: Customer Lifetime Value (CLV), Net Promoter Score (NPS), and high Cohort Retention Rates. These are the Master Metrics—the measures of a truly successful, sustainable value engine.
You need to know how to be aware of these without proprietary software, intuitively. But a software that provides a Client Event-Based Tracking Framework helps. Your existing CRM, accounting, or POS software is often the best tool for this.
The Operational Reality: Structuring Your Business for Master Metric Awareness
Instead of hunting for complex formulas, you achieve high-level Master Metric awareness by committing to two core operational disciplines and leveraging tools you already use (POS, CRM, or a simple dedicated ledger). This is about intentionality in data collection, not proprietary software.
| Master Metric | Operational Tracking Focus | Strategic Purpose |
|---|---|---|
| CLV (Customer Lifetime Value) | Data Point: Client Acquisition Date & Revenue Events. Every revenue-generating interaction (purchase, re-booking, product sale) must be logged and tied to the client’s original name and acquisition date. Integration: Use existing POS/scheduling reports, or create a simple Client History Ledger to log revenue and dates per client. | This confirms the Value Density of your service. High CLV means you are delivering exceptional, repeatable value and the relationship is worth the acquisition effort. |
| NPS (Net Promoter Score) | Data Point: Direct Referrals by Client. Log every high-quality, unpaid referral a client sends to you. Integration: The key is in the client onboarding question: “Who referred you?” Integrate this mandatory question into your intake form, checkout process, or first consultation. | This confirms Authentic Advocacy. It shows the client is spending their own social capital—the highest form of trust and loyalty. |
| Cohort Retention | Data Point: Retention by Acquisition Month. Group all new clients by the month they started (the cohort) using your booking/CRM system. Action: Run a simple report check 3, 6, and 12 months later to see what percentage of that initial group is still active. | This confirms Product Stickiness. A low retention rate confirms a failure in product-market fit or service delivery, not a marketing problem. |
“The fundamental activity of a startup is to turn ideas into products, measure how customers respond, and then learn whether to pivot or persevere.”
— Eric Ries
The True Interpretation of Common Marketing Metrics
Here is where the rubber meets the road. These are the metrics you track every day, and here is how to correctly interpret them to inform your Pivot or Persevere decisions:
| Awareness (Volume Focus) | Diagnostic (Relationship Focus) | Pivot or Persevere (Strategic Mandate) |
|---|---|---|
| Total Page Views | Pages Per Session | High Pages Per Session validates the content architecture and flow. If low, Pivot the user journey immediately to reduce friction toward the service page. |
| Total Subscribers | Email Click-Through Rate (CTR) | High CTR confirms the segmentation, content value, and offer relevancy are strong. If low, Pivot the offer or segment—the communication is not compelling action. |
| SEO Ranking | Search CTR (Search Console) | High Search CTR proves the messaging (title/description) aligns perfectly with the user’s intent. If low, Pivot the copy immediately—the visibility is wasted by confusing messaging. |
| Impressions / Follower Growth | Direct Message/Lead Conversion Rate | Lead Conversion Rate (from social to client) determines if the platform is a profitable channel or a time sink. If low, Pivot the entire platform investment to a clear CTA that drives measurable business. |
The inverted funnel is not merely a tactic; it is the operational governance model that defines the business relationship with the customer. It definitely closes the strategic gap by relentlessly prioritizing retention and advocacy over acquisition volume. This fundamental inversion shifts the entire operational focus from the anxiety of selling to the absolute confidence of creating genuine customer value—a structural commitment that builds integrity into every interaction and allows the Master Metrics to confirm the true financial density of the relationship.
This pursuit of value, however, requires an unwavering commitment to Validated Learning. We cannot rely on hope; we must rely on verifiable data. The system is held ruthlessly accountable by Actionable Metrics, which serve as the scientific input, tracing every success and failure back to auditable human action. This disciplined Build-Measure-Learn cycle forces us to look past superficial noise and drive every crucial Pivot or Persevere decision with cold, objective clarity.
When executed with this rigor, the model delivers two non-negotiable outcomes. First, it secures the value engine, transforming the business from a chaotic lead generator into a predictable, durable system of growth. Second, it is the only reliable path to building a deeply engaged, loyal tribe—customers who spend their own social capital to advocate for the business. This is how we transcend the limitations of vanity, establish true strategic depth, and build a business model that is structurally designed not just to survive, but to profoundly last.
More to come, including information about a free class I will be offering in Missoula next year.
“If it scares you, it might be a good thing to try.”
— Seth Godin
