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Measuring Business Blogging as an Entrepreneurial Venture

Posted by Colin Kingsbury

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Mar 13, 2006 3:06:00 PM

Finally a great conversation is taking shape on the role of metrics in blogging. From the beginning I've agreed with John Sumser and Jeff Hunter that the use of metrics is essential. In this post I'd like to flesh out how I and my colleagues at HRMDirect approach them.

Entrepreneurial vs. Mature Businesses
Blogging as a form of communication is fairly new and the use of blogging as a business tool even more so. In a mature business (e.g. direct mail) you don't spend much time arguing over whether something like response rate is a meaningful benchmark of success. Planning and forecasting are statistically-based and fairly accurate. Failure to meet or exceed forecasts is a reliable indicator of execution failure. Pretty dull, huh?

An entrepreneurial venture can be completely different. We are working with a company right now that over the next twelve months will do anywhere between a hundred thousand and thirty million dollars in revenue. The higher number is not realistic, and yet to do even a million could be reasonably regarded as successful. That's quite a scale.

Where the long-term business model is uncertain and often unknown, simple metrics are elusive and forecasts can be little more than horoscopes with numbers attached. An incorrect plan can deliver poor results while being executed perfectly. Success can come from being very lucky and finding the right path the first time, or from stumbling down enough wrong ones fast enough to find the right one before running out of time.

In an entrepreneurial venture the question of utmost strategic importance is not "are we executing the plan well," but, "is this the right plan to be executing?" In the short term, that question will often be answered by soft rather than hard metrics: by positive customer feedback rather than increased win rates, for instance. Leadership is a matter of vision rather than bookkeeping. If you want to see an awkward conversation, put an early-stage entrepreneur together with an I-banker from a major Wall Street firm. Both will leave irritated and more convinced than ever of their own intelligence and the world's foolishness.

Is The Plan Right?
At the tactical level the picture changes completely. It is fine for the founders and investors to discuss whether we should take Strategy A or Strategy Anti-A, but once that decision has been made we must implement it as if were brought down from a mountain written on stone tablets. It's like going on a fad diet: it may be that eating nothing but steak will work better tha eating nothing but grapefruit, but eating a diet of half steak and half grapefruit will prove nothing. In the short term the plan is not open for discussion, at least on a day-to-day basis.

Metrics in the Time of Ambiguity
Likewise, in the short term metrics are not just helpful, they are pretty much all we have. They may be very fuzzy, and we may feel conflicted about them, but unless we plant a stake in the ground somewhere we will have no way of knowing if we have moved at all, let alone in which direction.

In business blogging today it is probably impossible to judge the net present value of a link from Talentism or Recruiting.com to this site. But we can reasonably theorize that they have value, and therefore set inbound links from certain sites as an indicator of some kind of success. Likewise, pageviews tell us an incomplete picture, but what they tell us is not meaningless. If relatively few people visit a blog, and those few rarely return, it is more likely that the blog is failing to engage any audience than that it is successfully reaching a super-select and influential few.

Because only one thing counts in this life: get them to sign on the line which is dotted.
I know that we're living in a new world where networks matter more than individuals and collaboration will produce more returns than competition and zzzz....

The bottom line is that business is ultimately about closing deals. Some people are closer to the blood and guts side of that than others but in the end we're all either adding to the value chain or taking up space. It's not just a question of whether blogging has a positive impact, it's a question of whether that blogging is the best possible use of company resources.

Part of the problem with blogging is that it's fun, and this will lead to people finding justifications for doing it in a work context. Hey, I think it's great, and people should try to find work that they enjoy (because they'll b more productive) but we would't be having this conversation if the activity in question was "making cold calls" instead of blogging.

Think of it as a question of self-preservation. Right now, a good talker could probably sell his or her management on a company blog and evade the question of return on investment and measurement thereof. But there's an old saying on Wall Street that person would do well to heed:
Pigs get fat, but hogs get slaughtered.
It may take some of the fun out of running your own e-magazine to build a business case based around measurable standards of performance, but doing so will radically increase the odds that:

1. You will get rewarded proportionally to the value of your contribution.
2. You will be permitted to continue blogging as part of your job description.
3. You will not get fired when a new manager comes in who doesn't get it.

Someday in the future, I'll talk more about how we got the HRMDirect blog off the ground and the indicators we used to judge its success. But I will say that the experience has convinced us that blogging does have a place as part of an integrated communications strategy.