Every business owner knows the importance of good accounting and financial planning in order to measure the health and future of their business.
It’s important to analyze the numbers on your business and be able to tell a story with those numbers. Having accurate numbers on your business is the difference between “doing well” and knowing exactly how much profit you’ve made this month.
Getting a good handle on your business metrics is the next step. You want to be able to look at the numbers that come before the money.
This outline will help you measure the success (and failure) of your sales funnel, giving you a better indication of how you can hone it for even better results. Here are few of these tips to help you get started.
Here are the 12 tips to help you get started
- Business analytics is BASED on the steps in your sales funnel.
- Start tracking everything you can think of.
- Track things based on your sales funnel: how many sales do you get/week (END of the funnel), how many inquiries do you get (START of the funnel), and how many people proceed through the funnel (middle steps)
- The funnel keeps you focused on something concrete and pragmatic
- Accounting (something you’re already doing) is one form of business analytics—more specifically, your sales figures!
- If you’re doing accounting and financial planning for your business (and you should be!), you’re tracking revenue and costs
- Tracking revenue is very important to analytics—it is the last and most important step of the funnel
- Revenue can also be describe as “sales” or “conversions” in the analytics world
- Combining your web analytics to your accounting: do you know where each sale came from?
- This is a key concept in your analytics: what streams feed new customers into your tunnel, and how many of them deliver sales?
- Web analytics (i.e. web traffic) describes what’s happening before the sale.
- Where do you get your traffic? Online advertising, social media, SEO, referrals, direct mail?
- There are quite a few free, powerful, and easy (online) web analytics tools.
- Each tool tracks different aspects of your online traffic
- Google Analytics is the “core” of your online analytics
- See below for a list
- There are also quite a few (offline) metrics you can track WITHOUT using any software.
- Track every new lead that comes in (phone/email/foot traffic)
- Track overall phone/email volume as an indicator
- Ask customers where they discovered you from (remember bulletpoint #4!)
- Train your employees to gather the data you need
- It may take some work—at Printivity, we sometimes will spend the time to research the history of each order for: where the customer came in from, which advertisement the customer saw, what product the customer wanted, etc.
- Coupons are one of the oldest examples of offline metrics, and one of the many techniques you can use if you aren’t tech-savvy.
- The idea was A/B testing: print out different coupon codes, one code per different advertisement image/slogan/offer, etc., and run them at the same time. If one did better, you dropped the bad one, kept the good one, and try to outdo yourself the next time around.
- This demonstrates how old of a concept metrics are, and how you can invent something to acquire metrics
- Other examples include: companies hosting different mailboxes (direct mail) and phone numbers (infomercials) to measure how well each advertisement campaign compared with each other
- Armed with analytics, you should be measuring each form of advertising to see how effective it is for you; whether to cut it, keep it, or put more money into similar types of advertising.
- Many companies insist on using advertising methods that are losing them money, because they refuse to track
- Once you track, do a “spring cleaning” on your old advertising techniques
- Armed with analytics, you should be measuring each step of your sales funnel to see which steps you can improve on. Are you flagging each interested customer when they get more serious?
- Are you tracking how far you get for each
- Customer contacts you, requests a quote, and places an order
- Customer shops around, puts you on the short list, negotiates
- Sales tools (like Salesforce) ask their sales reps to “qualify their leads” as “cold”, “warm”, and “HOT!”, so they know how far along are they moving in the funnel
- Which step are you losing them on?
- After you try new improvements, are they working?
- Armed with analytics, you can track how you’re doing on SEO.
- How much traffic are you getting?
- What are your top performing keywords?
- What are your top performing pages?
- Can you create NEW pages (based on your top performing keywords/pages) that rank well and bring new traffic?
- Armed with analytics, you can track how each social media channel/social media is doing.
- How much did each post send traffic to your website (click-through traffic)?
- Which channel is sending more click-through traffic?
- It’s not about how many followers/likes you get; it’s about sending people to the next step of the funnel that will lead to sales
- Start out with the basics so you don’t get overwhelmed.
- Focus on the end of the funnel: getting sales.
- Focus on the beginning of the funnel: increasing interest/awareness.
- As you get better, start filling out the steps in between.
- Test, measure, and repeat!
- Metrics allows you to get a baseline of “where you’re at”
- Then, continually test out new things to try to improve
- Whenever you try something new, this will change your results in some way—make sure you’re measuring and analyzing it!
- How to get started on:
- Google Analytics
- Google Webmaster Tools
- Yelp for Business
- Facebook’s Insight Tools
Just get started: you can fine tune your analytics as you go
If you’re a small business owner, you’re already involved in a lot of analytics as part of owning that business.
Knowing the numbers for your business analytics and how they represent the sales funnel is going to be a great inside look at your business. You’ll be able to hone your sales funnel as you go, making it even better.