Do you track specific metrics to assist in driving your small business? Hear Dean Mercado discuss not only surviving but thriving in today’s troubled economy!
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Now that could either be a great thing or the scariest possibility for any small business owner or independent professional. Especially with a bit of an economic downturn on our hands… let alone the doom and gloom people seem to be perpetuating around it.
So tell me… where are you heading and how do you know for sure? Is the marketing you’re currently doing working? Is it bringing you a steady flow of new qualified prospects? Is it strengthening your brand? Is it making you money or just draining your precious resources at a time where you simply can’t afford for that to be the case?
Now on the surface you may believe you know the answer to questions like these however, are you 100% positive?
Well one of the most important and tangible parts in determining whether or not anything in your business is working is by maintaining sound metrics. Yes, I do believe that certain aspects of your marketing are not practical to track and measure. However, there are plenty of key metrics that are easily gathered. For example you might keep metrics on things like:
- Number of projected versus actual new Clients each month
- Number of projected versus actual repeat Clients each month
- Number of projected versus actual new prospects each month
- Return on investment for specific advertising or marketing campaigns
- Return on investment for each marketing strategy in general
- Number of web site visits per month and where the visitors are coming from
- A monthly “Profit and Loss Statement” which shows your monthly income, monthly expenses, and whether or not you were profitable during that period. The key here is to analyze and know what the numbers mean and how you can alter your marketing to improve them.
And we could go on and on and on here however I hope you get the point… the numbers simply never lie! And if you know how to read them, they can empower you to make better decisions.
For example, one such way is to look for trends. Compare the most recent month, quarter, and year to the one previous (e.g. August 2007 to July 2007, Quarter 3 2007 to Quarter 2 2007, and the year 2007 to the year 2006). Compare specific months from different years (e.g. August 2006 versus August 2007). Compare specific quarters from different years (e.g. Quarter 3 2006 to Quarter 3 2007).
Additionally look for trends dictating the effectiveness of specific marketing campaigns. And to risk stating the obvious, do more of what’s working and less of what’s not… yes it’s that simple. However, you’ll never know whether a marketing campaign is working or not if you are not collecting and analyzing metrics.
So in closing, remember the numbers never lie. And for small businesses and independent professionals, it’s times like these that separate the “men from the boys” so to speak. So the big question remains, where are you heading and how do you know for sure?