Tracking the Metrics that Matter
Although success can look significantly different depending on what you do, almost every business can track success with one thing: The right metrics.
There is one thing that every business owner has in common: They want their business to succeed.
It doesn't matter what industry you're in, what product you sell, or even the problem that you solve, every business owner wants to rise to the top. But how? Most people know what success feels like, but what does success look like?
Contrary to popular belief, this doesn't have to be super complicated to figure out. Although success can look significantly different depending on what you do, almost every business can track success with one thing: The right metrics.
There's a methodology for tracking growth that I use with my clients every day. I believe in the power of metrics and how to use them to project and achieve growth in your business.
Why are high level success metrics so important? Because tracking the right metrics of your business is a surefire way to tell if you're growing your business. Metrics are trackable. They're concrete. They're easy to understand. And they take the guesswork out of the process.
You can track where you are right now and how that compares to this time last month or even last year. Most importantly… you can use those numbers to project what success will look like a year from now.
When we map out what went right and what went wrong with our business, looking to the past is great. But none of that matters unless we figure out how to take what we've learned from the past and apply it to the future. Tracking the right metrics gives you the milestones and the checkpoints that you need to hit by helping you evaluate exactly what you were able to do in the past. Reliable ways to quantify your success cannot be undervalued.
In an evolving business world where you're always looking for an edge on your competition, it can often be better to look inside your business than outside. Tracking your success metrics allows you to bring something concrete to the table when you're trying to figure out what worked well and what didn't really work so well at all. The best part of it is that you don't have to spend a dime to track metrics; it only takes a little bit of time and effort.
Month-by-Month Metrics
Truthfully, there are a lot of metrics that could matter in your business, but there are some general metrics that are helpful for every business to keep track of. That also largely depends on if you're a project-based or service-based business, or if you're an e-commerce or retail business.
With project or service-based businesses, typically you'll need to track these metrics on a month-by-month basis:
- Revenue
- Sales count
- Lead conversion rate
- No-show cancellation rate
- Landing page conversion rate
- Average cost per click
- Click through rate
With e-commerce or retail businesses, typically they need to track these month-by-month metrics:
- Revenue
- Sales count
- Unique website visitors
- Average ad cost per click
- Average ad click through rate
These are the stats that matter the most for your business because they're the ones that will give you the bird's eye view when things are going right. These metrics are very broad and account for a culmination of all the work that you're doing, which means that they all translate to whether there is money trickling into your business's bank account.
Why Month-by-Month Stats Are Important
When it comes to revenue month-by-month, this is a metric that every business should be tracking regardless of industry or niche in order to measure and project growth. It's literally the number that tells you how much money is flowing into your business. Without tracking it, you're really going to be underprepared to do even a basic business analysis.
There is only one part of this metric that could use explanation, and that's the time span. Although some companies may elect to do a formal evaluation of their revenue on a yearly basis, monthly evaluation is more effective. By doing a monthly evaluation instead of a yearly one, you can see the way your revenue fluctuates with different promotions or marketing strategies. Then you can learn how to analyze and adapt those strategies in a timely manner.
If you try to track metrics on a weekly basis, you're going to risk overreacting to inconsequential shifts… and the last thing you want to do is really drive yourself insane and cause yourself more stress.
To find your metric numbers, you need to look no further than your books or your bank statements. If you have an accountant, you should be able to ask them for these numbers.
Similar to revenue, sales count month-by-month is an important metric to track for every business type to track. Your sales count leads let you see how many sales you're making and the money that you're bringing in, but it’s also important to your revenue number. That's because this metric is analyzing the number of sales, not the amount of money. It allows you to look at your revenue and understand if you're converting a bunch of small sales or a few really high dollar sales. That will let you analyze the kind of audience that you need to be targeting and help you optimize your marketing plan. You can also use it to find out which customers are giving you those high dollar sales so you can send them an exclusive deal as a little thank you.
To find this number you can look in your e-commerce platform or keep a manual account if you're running a brick and mortar business.
When it comes to average cost per click and click through rate metrics, these will let you gauge the effectiveness of your online advertisements. They track not only the amount of money that you're paying to have them seen, but it also often how many people have clicked and how many people interact with your ad.
This is important because digital advertising is one of the cornerstones of any great marketing strategy, and knowing how to optimize your ads is essential to achieving growth.
To find these numbers look no further than the platforms that you're advertising on (eg., Facebook and Google) as well as any other platform that you may be on will provide these statistics for you.
Tracking unique website visitors is important for e-commerce businesses because their business is entirely online. It's the same reason brick and mortar businesses like to keep track of how many people are coming in and out of the store. If you can't get people through the door virtually or in person, you're never going to have a chance to sell anything.
Knowing your unique visitor count can also help you gauge the effectiveness of your advertising and SEO, as well as the persuasiveness of your landing page and product pages. If people aren't visiting your website, then you know there are probably changes that you can make to help generate more traffic and in turn more sales. If your number of visitors is high but your sales are low, then you'll know that your advertising and outreach aren't the problem.
You can find this statistic in the dashboard of your website, as well as through Google Analytics and even some of your advertising platforms.
Although lead conversion rate and no-show cancellation rate stats are different, they're also very similar because it's so easy to track them both at the same time. For project- and service-based businesses/industries, a large portion of your job is lead generation. Your goal is to create leads and then convert them into customers. Of course you want your lead conversion rate to be high and your cancellation rate to be low, but it's important to track both because it will paint the most complete picture.
By comparing them side-by-side, you're going to be able to see the rate in which you convert. You can then use that to project roughly how many new clients you can expect to get over any given period of time doing what you're doing. Then you can have a baseline when you try new things to raise that lead conversion rate.
As for finding this data, you can find it in Google Analytics or just turn to your CRM software. Really anywhere you track and organize potential clients, you can track how effective your lead generation enclosure is.
Remember that these stats are important because they not only show what you've been able to accomplish, but they'll also let you project what you'll be able to accomplish in the future as well. And having a good idea of where your business is going is one of the most powerful tools that you can have.
Numbers don't lie. And that's why metrics are your business's best friend.
Metrics take all of the guessing out of growth and they tell you exactly how well your business is doing or not. There are all sorts of numbers that can tell you helpful things about your business.
Collecting your metrics helps paint a complete, honest picture of your business. Once you have that, you can start to make changes that you need to achieve growth simply by comparing your current numbers to your previous numbers.
Tracking your growth and metrics is really that simple… and it's also extremely powerful. You can impact your businesses success in real time just by taking the time to figure out what success actually looks like. Although this includes money in your bank account, metrics show you that success goes much further than that. Track metrics and take control of your business.
Trust me, you won't forget it.
