The Metrics that Matter for Your Business (And Where to Find Them)
- December 23, 2020
There’s one thing that every business owner has in common: they want their business to succeed.
It doesn’t matter what industry they’re in, what product they sell, or what problem they solve. Every business owner wants to rise to the top…
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. Because, although success could look slightly different depending on what you do, almost every business can track success with one thing: the right metrics.
It’s a methodology for tracking growth that Monique Morrison, Co-Founder of Jeronamo Digital Solutions and a 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 project and achieve growth for your business.
Why High-Level Success Metrics Are Important
Using the right metrics to track how your business is doing is a surefire way to tell if you’re growing your business. They’re trackable, concrete, easy to understand, and they take the guess work out of the process.
You can track where you are right now and how that compares to this time last month or last year. And, most importantly, you can use those numbers to project what success will look like a year later.
When we map out what went right and what went wrong with our business, looking to the past is great. But none of it matters unless we figure out how to take what we learned from the past and apply it to the future. Tracking the right metrics gives you the milestones and checkpoints your need to hit by helping you evaluate exactly what you were able to do in the past.
Reliable ways to quantify success can’t be undervalued. In an evolving business world where you are always looking for an edge on your competition, it can often be better to look inside instead of outside. Tracking your success metrics allows you to bring something concrete to the table when you are figuring out what worked really well and what didn’t work so well at all.
And the best part is you don’t have to spend a dime to track your own metrics. It only takes time and a little bit of effort.
What Metrics Matter
Truthfully, there are lots of metrics that could matter for your business.
But there are some general metrics that are helpful for every business to keep track of. But that also largely depends on if you’re a project/service-based business or an ecommerce/retail business.
Project and Service-Based business will need to track:
- Revenue month-by-month
- Sales count month-by-month
- Lead conversion rate
- No-show/cancellation rate
- Landing page conversion rate
- Average cost per click and click-through rate
Ecommerce and retail businesses will need to track:
- Revenue month-by-month
- Sales count month-by-month
- Unique visitors by month
- Average ad cost per click and click-through rate
These are the stats that matter the most for your business, because they are the ones that will give you the bird’s-eye view of when things are going right. These metrics are very broad, and account for a culmination of all of the work that you’re doing. Which means they all translate to whether there is money trickling into your business’s bank account.
Let’s do a deep dive as to why these stats are important.
Revenue month-by-month is the metric that every business should be tracking, regardless of industry or niche, to measure and project growth. It’s literally the number that tells you how much money is flowing into your business, and one that you definitely already have your eye on. Without tacking it, you’re going to be underprepared to do even basic business analysis.
There is only one part of this metric that could use explanation: the timespan. Although some companies may elect to do a formal evaluation of their revenue on a yearly basis, monthly evaluation is more effective. That way you can see the way your revenue fluctuates with different promotions or marketing strategies, and then you can learn how to analyze and adapt those strategies in a timely manner.
If you try to track it on a weekly basis, you’re going to risk overreacting to inconsequential shifts. And the last thing you want to do is drive yourself insane.
Monthly tracking is the way to go. As for finding those numbers, you need to look no further than your books or your bank statements. If you have a designated accountant, ask them. It’s that simple, but it really is important.
Sales Count Month-by-Month
Similar to revenue, this is important for every business to track. Your sales count lets you see the how many sales you’re making and the money you’re bringing in, but it also adds important context to your revenue number.
That’s because this metric is analyzing the number of sales, not the amount of money. It’ll allow 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 you need to be targeting, letting you optimize your marketing plan.
You can also use it to find the customers 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 ecommerce platforms or keep a manual count if you’re a brick and mortar business.
Average Ad Cost per Click And Click-Through Rate
Both of these metrics will let you gauge the effectiveness of your online advertisements. It tracks not only the amount of money you’re paying to have them seen, but also how often people actually click and interact with them. It’s 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. Facebook and Google, as well as any other platform that you may be on, will provide these statistics for you. All you have to know is what they mean.
Unique Visitors by Month
Tracking unique visitors is an important task for ecommerce 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 (virtual) door, 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 and product pages. If people aren’t visiting your website, then you know there’s 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 on the dashboard of your website, as well as through Google Analytics and even some of your advertising platforms.
Lead Conversion Rate and No-Show/Cancellation Rate
Although these stats are different, they’re also one in the same—mainly because it’s easy to track them both at the same time.
For project and service-based industries, a large portion of your job is lead generation. Your goal is to create leads and then convert them into customers, and these statistics will help you determine exactly that. Are you turning leads 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 keep track of 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. Then you can 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 your Google Analytics or turn to your CRM software. Anywhere you track or organize potential clients, you can track how effective your lead generation (and closure) is.
Remember that these stats are important because they not only show what all you’ve been able to accomplish, but they also let you project what you’ll 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 business’s best friend. They take all of the guessing out of growth and tell you exactly how well your business is doing. And as you can see from the metrics above, there are all sorts of numbers that tell you helpful things about your business.
Then you can use all those numbers to paint a completely honest picture of your business.
And once you have that, you can start to make changes that you need to achieve growth. Then, you can see if you were able to do it by simply comparing your current numbers to your previous numbers.
It really is that simple, but it’s also really that powerful. You can impact your business’s success in real time, all by taking the time to figure out what success actually looks like. And although that includes money in your bank account, metrics show you that success goes so much further than that.
Track metrics and take control of your business. Trust me, you won’t regret it.
The post The Metrics that Matter for Your Business (And Where to Find Them) appeared first on DigitalMarketer.
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