You've set up your social media, you're generating great content, you've updated your website - but how do you keep track of your business growth?
Keeping track of numbers is at the essence of any business training, be it starting your business or growing your business.
Long gone are the days when just “gut feel” were acceptable ways to gauge business success.
Indentifying Key Numbers for Your Business
Where to start? Most companies find the greatest value in numbers focused on revenue growth, customer satisfaction, return on investment and customer retention rates
1. Revenue Growth
How much money has been gained from marketing strategies and tactics is the question to ask.
While marketing strategies and costs in the past traditionally were expected to be judged on consumer sentiment, perceptions, and brand awareness, we want to understand how marketing activities generate qualified leads that are subsequently converted to sales.
A great way for business owners to understand their impact on revenues is to do lots of testing.
This testing should include measuring sales levels pre- and post-marketing.
Don’t forget no measure is complete without including an understanding of how contacts through various channels improve chances to close a deal.
2. Customer Satisfaction
Customers now expect amazing service and they aren’t afraid to switch voice their opinions via social media.
This growth in consumer power has eroded traditional product or service based advantages, forcing businesses to use customer experience as the big difference.
All businesses know there is a definite economic advantage to keeping an established customer over the longer term.
Some useful metrics for the customer experience are satisfaction scores and other questionnaire measures including the percentage of customers who plan to repurchase.
3. Return on Investment (ROI)
Considerations for measuring your ROI from a marketing perspective should absolutely be measured with the
increase in sales or revenues
4. Customer Retention Rates (CRR)
The customer retention rate is worked out by a calculation of the customers the company keeps with respect to the customers at the start of the period. It does not include new customers.
Most growing businesses gauge their rates monthly, quarterly or annually. The simple formula to work this out is:
CRR = ((CE-CN)/CS)*100
CE = Number of customers at the end of a period
CN = Number of new customers acquired during that period
CS = Number of customers at the start of that period
CRR is a great indicator of customer loyalty and effectiveness of customer service. While a company’s target CRR depends on the industry, market and business goals, most companies should aim for 85-90 percent retention and continually seek to improve it.
5. Customer Acquisition
For new customer acquisition, it is important to track these key metrics:
- Lead generation – how many?
- Closing rate – how many deals closed?
- Revenue per new customer (Lead quality)
It’s not perfect, but it allows you to act and make business decisions without waiting for 100 percent accurate information – so it is a quicker strategy for growth.
If you want to grow your business, enter new markets or even sustain what you have now you need to address your major business and marketing challenges.
Ask yourself what metrics are you currently using to gauge your company’s success?
Or register to attend one of our fully-funded business growth workshops, full details here