This week, I’ve been working on metrics because I can’t have my fingers in every pie at once – at least not once the number of pies grows beyond my ability to manage them all in my head at the same time. Even if you can do that, it’s very difficult to sense where changes are happening much less where trend directions are changing.
Some of this can be done by gut feel because you’re right in the middle of it, but sometimes gut feel will burn you because you filter what you’re experiencing through existing expectations. Thus the need for metrics – so that you don’t have to spin too many plates at once, assume too many things or make decisions based on too much gut feel.
Metrics are questions, too
Metrics are a form of question.
For example, a common metric for businesses with a web site is “page views”. A page view metric asks the question “How many people saw a specific page this month?”. When all of those page view metrics are combined, it becomes the question “How many people saw our website?”
Website metrics are pretty common and easier to collect than metrics from other media – which are often on you and your team to collect. The work to do that might seem painful, but you can learn a lot from it.
How many people called about the radio special you advertised on KXXX? How many people visited the store and mentioned the radio special you ran on KXXX?
These things are important so that you know whether to invest in marketing that item on KXXX vs. marketing something else on KXXX, vs. marketing anything at all on KXXX.
You would do the same for anything else marketing on any media, otherwise you’ll have nothing other than gut feel to help you make these decisions. Traditional media doesn’t often provide these metrics, because they can’t. Radio, TV and print newspapers can’t do that because they usually aren’t contacted by prospects seeking whatever you advertised. It’s tough to know if you aren’t part of the transaction process.
That doesn’t mean you shouldn’t track them.
The right questions help increase sales
Coming up with the right question can be a lot harder than not having the answers. You have to be careful to ask open-ended questions designed to tell you what you don’t know, rather than asking questions designed to confirm your assumptions.
Where is the profit in your business that you haven’t yet found?
For most people, the answer probably lies in your existing customer base. The next question I’d ask you is how many of your customers are buying 100% of what they should be/can be buying from you?
How can your current customers help you find that profit?
The natural follow to the previous question.
To rephrase it, what percent of your customers are giving you all the business they could? Who are those customers? What actions will be necessary to either sell to the ones who aren’t buying everything you make, or determine the ones who won’t buy?
Once you’ve identified the ones who won’t buy, it’d be good to identify why they won’t and correlate that (if possible) with where they came from as a lead. Are the leads who buy some buy not all (or who buy once but not ongoing) leads who came from a certain type of media or a certain type of marketing campaign?
Are the ones whose initial purchase is different than the ones who do keep buying – and buy it all? Can that be solved by pursuing slightly different leads, or by changing marketing or the product / service?
Finally, can / should that gap be fixed? Does it matter if this group of clients aren’t recurring buyers, or that they don’t buy everything you offer?
Are you communicating with customers optimally at all touch points?
Are there touch points you aren’t thinking of?
I was chatting on Facebook with a reader earlier this week who owns a locksmith business. After our conversation, I wondered if there was an opportunity to get involved in home and/or commercial property sales – ie: lock / key / lockset changes that might be warranted when a property changes hands. It’s an opportunity to get a new client if there are enough buyers who want locks changed at purchase time.
Does your business have secondary transaction opportunities like that?