Running a business can be a numbers game
When it comes to establishing a presence for your business, there are certain metrics that you need to keep an eye on. Doing this will give you the information you need to find the best way to get your business noticed and get lots of new traffic. While there are many important things that you need to take care of, if you don’t pay attention to the following nine metrics, your efforts could end up all in vain:
1. Customer acquisition costs
Your customer acquisition costs or CAC is one of the most important metrics when you are first trying to grow a business. You need to have customers, and you will need to invest a bit in order to market and get the customers. Your CAC is how much money you are going to put into marketing to get new customers.
2. Customer retention
Getting new customers isn’t enough. You need to be able to keep them as future customers. Don’t neglect the customers you have while you are trying to get new ones. This is going to defeat the purpose of your marketing efforts.
When you lose customers, it is known as attrition, and it happens to every business. Use a 30-day measurement to see if people come back, and then a 90-day measurement will tell you who is gone permanently.
4. Life time value
The life time value (LTV) of one customer is more important than you may think. It is those loyal customers who are going to keep your business going during lean times. You also need to compare the LTV against the CAC. If the CAC is higher, you are not making money.
5. Product metabolism
This is a fairly new metric, and it basically is a measurement of how fast your team makes decisions and brings out updates for products. If it is too slow, you may soon start to notice a loss of customers.
6. Viral coefficient
This is the measurement of your initial customers and how many invitations they send out. Then, you look at the number of converts compared to the number of invites, so you can see how popular the invites actually are.
The most important metric is how much money you are making. If there is no revenue, then obviously you need to make some changes. You need to put all of the metrics together to see the big picture and figure out where changes need to be made.
8. Conversion rates
This is also called the activation rate, and it measures the number of visitors who turn into customers. You can measure by new subscriptions, renewals, software downloads, etc. If the rates are high, you know you are doing something right.
9. Referral rate
This is part of the viral coefficient, and it is also a stand-alone number. You need to ask customers how they discovered your product in order to use it properly. As the rate increases, your CAC lowers.
Here are a few tools you can use to measure the success rate of your business.
- Business dashboard – Use this tool as your all-in-one business dashboard. It monitors social media, analytics, marketing, sales, support, infrastructure, and other business data.
- Brand tool – This tool will help you gain instant access to all online mentions, as well as help you to grow customer satisfaction and get more sales.
- Social listening – You can use this tool to find out what your customers really want, and stay one step ahead of the competition.
- Customer intelligence & analytics – Here is a tool that will help you make better decisions and get more conversions, and you don’t need any IT experience to use it.
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