Welcome to the second post in our series to help you achieve everything you need to this year. If you missed the first one, you can find it here. You may have heard that you should ‘measure what you treasure’, which simply means you should track the metrics that are important to you and your business (and ignore the rest, if that suits you).Measure what you treasure. Click To Tweet
At its simplest, this advice means you should monitor the things that let you know where you are with your business, so you can measure growth and figure out exactly what you should be working on. That could be sales, income, subscribers, traffic or followers, depending on your business model, and will most likely be a combination of at least three of the above.
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So, it’s a brand new year. Are you ready to take your online business to the next level and watch some explosive growth unfold over the coming months? Before you start to plot and plan what you want to do to make that happen, it’s important to stop and look at where you’re at right now.
Business planning for future success is all about data. You can work most efficiently and spend your time and money most effectively if you know exactly where you are starting from. By recording data, you can start to see what’s working, what isn’t, and what trends are starting to play out.
First, decide how you want to record this information. You can write it down by hand in a notebook, open up a Word or Google doc to do it digitally, or use a spreadsheet, or a fancy tracking app. Spreadsheets include the option to calculate additional information like weekly and monthly averages and map your data out in graphics to help you get a clearer picture. Personally, I use a simple Word doc for most of my stats.
Secondly decide what you want to record. This will depend on you and your business, but remember you should be tracking your most important metrics, and not a lot of peripheral stuff that doesn’t matter. Many social media marketers, for example, track social media follows closely. This is useful if your social stats convert to website traffic and your website traffic converts to sales, but for many people it’s the least useful metric of all. You can increase your Instagram following by 100% without making a single cent in extra income, so consider if this is a metric worth tracking, or if the real metric you want to track is conversion or traffic sources.
If you find a particular social site is sending you a lot of traffic, for example, you might want to build up your following there, but you might also want to look at your strategy, content, or paid advertising on that site to see if that has more to do with your traffic than the number of followers you have there.Don’t waste time tracking metrics that don’t actually affect your income or impact. Click To Tweet
There are a few things, however, that most online businesses will want to track.
To grow your business it helps to expand your reach. For online businesses, that means getting more traffic, but also engaging the people that come to your site by encouraging them to click around and read more. Good things to keep track of are total visitors, unique visitors, bounce rate, and where the traffic is coming from.
Your next goal is generally to convert traffic to email subscribers, as building an email list is one of the most important things you can do for your online business. Here you want to track total number of subscribers, conversion rates for each of your opt-in forms and pages, open rates for your emails, and unsubscribes. As you start to collect and review this data regularly, you’ll get a much better picture of your subscribers.
You’ll also want to calculate ‘cost per subscriber’ if you run paid ads to get people onto your list, and ‘income per subscriber’, which is the amount of money you make from each email campaign, divided by the amount of subscribers you have. Even if a fairly low number of your subscribers convert to customers (which is not unusual) if they buy big ticket items from you, your income per subscriber could still be quite high.
Customers and Sales
Nurturing your customers is vital, as the most likely person to buy a new product from you is someone who already bought a previous product from you, as long as they were happy with it. Keep track of how many total customers you have and how many sales you make to them per day, week, and month. Other good numbers to look at are total lifetime value of your average customer, repeat purchases, sales generated by paid advertising campaigns, sales generated by affiliates, and refund rates.
Income and Expenses
Last but not least, look at your bottom line. This is your typical accounting data. You want to keep track of your income as well as your expenses. With those two sets of numbers, you can easily calculate your overall profit. I find it helpful to look at profit for the month, but track income on a daily basis.
Yes, you can look at most of this data in various different places like Google Analytics, your shopping cart, and your autoresponder service, for example, but it’s important to draw it all together in one place. This makes it much easier to connect the dots, spot patterns and see the relationships between the different sets of numbers.
Now that you have your initial data collection set up, make it a habit to update the numbers regularly so you can see what’s working, what isn’t, and how much you’re growing as you move through the coming months.
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