There is one thing that every entrepreneur has in common: they want their business to be successful.
It doesn’t matter what industry they are in, what products they sell, or what problems they solve. Every entrepreneur wants to reach the top …
…But how?
Most people know what success looks like … but what does success look like?
Contrary to popular belief, this need not be too complicated to discover. Because while success may look slightly different depending on what you do, almost every company can track success with one thing: the right metrics.
It is a methodology to accompany the growth that Monique Morrison, Co-Founder of Jeronimo Digital Solutions and DigitalMarketer ELITE Coach, uses for her clients every day. She spoke at her recent DigitalMarketer workshop about the power of metrics and how to use them to design and grow your business.
Why high-level success metrics matter
Using the right metrics to track your business’s performance is a surefire way to know if you’re expanding your business. They are traceable, concrete, easy to understand, and eliminate guesswork from the process.
You can follow where you are now and how it compares to this time of last month or last year. Most importantly, you can use these numbers to project what success will look like a year later.
When we map out what went right and what went wrong in our business, looking back is great. But none of that matters unless we figure out how to take what we have learned from the past and apply it to the future.
Tracking the correct metrics provides the milestones and checkpoints you need to achieve, helping you to assess exactly what you were able to do in the past.
Reliable ways to quantify success cannot be underestimated. In an evolving business world, where you are always looking for an edge over the competition,
It can often be better to look inside rather than outside. Tracking your success metrics allows you to bring something concrete to the table when you’re discovering what worked well and what didn’t work so well.
And the best part is that you don’t have to spend a dime to track your metrics. It only takes time and a little effort.
What are the important metrics?
There are many metrics that can be important to your business.
But there are some general metrics that are useful for all companies to track. But it also depends a lot on whether you are a project/service-based company or an e-commerce / retail company.
Project and service-based businesses will need to monitor:
Month-to-month revenue
Month-to-month sales count
Lead conversion rate
No-show/cancellation fee
Landing page conversion rate
Average cost-per-click and click-through rate
E-commerce and retail companies will need to keep track of:
Month-to-month revenue
Month-to-month sales count
Unique visitors per month
Average ad cost per click and clickthrough rate
These are the most important statistics for your business because they are the ones that will give you an overview of when things are going well. These metrics are very broad and represent the culmination of all the work you are doing. This means that they all translate into whether there is money running into your company’s bank account.
Let’s dig deeper to find out why these statistics are important.
Month-to-month revenue
Month-to-month revenue is the metric that each company must monitor, regardless of sector or niche, to measure and project growth. It is the number that tells you how much money is flowing into your business and that you are looking forward to. Without doing so, you will be unprepared to do even basic business analysis.
There is only one part of this metric that could be explained: the time interval. Although some companies may decide to make a formal assessment of their revenues annually, the monthly assessment is more effective.
That way, you can see how your revenue fluctuates with different promotions or marketing strategies and then learn to analyze and adapt those strategies in a timely manner.
If you try to track it weekly, you run the risk of overreacting to inconsequential changes. And the last thing you want is to go crazy.
Monthly tracking is the way to go. As for finding these numbers, you don’t need to look beyond your books or bank statements. If you have a designated accountant, ask them. It’s that simple, but it’s really important.
Month-to-month sales count
Similar to revenue, this is important for all businesses. Your sales count allows you to see how many sales you are making and the money you are generating, but it also adds context to your revenue number.
That’s because this metric looks at the number of sales, not the amount of money. This will allow you to analyze your revenue and understand whether you are converting a lot of small sales or some really expensive sales.
This will allow you to analyze the type of target audience that needs to be targeted, optimizing your marketing plan.
You can also use it to find customers who are offering these high-value sales, so you can send them an exclusive offer as a small thank you.
To find this number, you can search your e-commerce platforms or keep a manual count if you are a physical company.
Average ad cost per click and clickthrough rate
Both metrics allow you to measure the effectiveness of your online ads. It tracks not only the amount of money you pay for them to be seen but also the frequency with which people actually click and interact with them.
It is important because digital advertising is one of the pillars of any great marketing strategy and knowing how to optimize your ads is essential to achieve growth.
To find these numbers, just look at the platforms you’re advertising on. Facebook and Google, as well as any other platform you are on, will provide these statistics for you. All you need to know is what they mean.
Unique visitors per month
Tracking unique visitors is an important task for e-commerce companies because their business is entirely online. It is the same reason that traditional companies like to control how many people are entering and leaving the store. If you can’t get people through the (virtual) door, you never get a chance to sell anything.
Knowing your unique visitor count can also help you evaluate the effectiveness of your advertising and SEO, as well as the persuasiveness of your landing pages and products.
If people are not visiting your site, you know that there are probably changes that can be made to help generate more traffic and, in turn, more sales. If your number of visitors is high, but your sales are low, you will know that your advertising and reach are not the problems.
You can find this statistic on your website dashboard, as well as through Google Analytics and even on some of your advertising platforms.
Lead conversion rate and no-show/cancellation rate
Although these statistics are different, they are also the same – mainly because it is easy to track them at the same time.
Obviously, you want your lead conversion rate to be high and your cancellation rate to below. But it is important to keep track of both as this will paint the most complete picture.
By comparing them side by side, you can see the conversion rate. You can then use this to design approximately how many new customers you can expect to get in a given period by doing what you are doing. So, you can have a baseline when trying new things to increase the lead conversion rate.
As for finding this data, you can find it in your Google Analytics or use your CRM software. Wherever you track or organize leads, you can track the effectiveness of your lead generation (and closing).
Wrap up
Remember that these statistics are important because they not only show everything you have been able to accomplish, but they also allow you to project what you will be able to accomplish in the future.
And having a good idea of where your business is going is one of the most powerful tools you can have.
Numbers don’t lie – that’s why metrics are your company’s best friends. They take all the growth assumptions and tell you exactly how your business is doing. And, as you can see from the metrics above, there are several types of numbers that indicate useful things about your business.
Then, you can use all of these numbers to paint a totally honest picture of your company.
And once you have that, you can start making the necessary changes to achieve growth. Then, you can see if you have managed to do so simply by comparing your current numbers with the previous ones.
It is really simple, but it is also very powerful. You can impact the success of your business in real-time, always looking to find out what success, in reality, looks like. And while that includes money in your bank account, the metrics show that success goes far beyond that.
Track metrics and take control of your business. Believe me, you will not regret it.
Learn more about Business and Small Business at Digital Business Grow.
