Experts believe that building, running, and managing a successful business is supposed to be a roller coaster of challenges, obstacles, and emotions. Just when you are basking in the glories of success, a new HR issue or supplier chaos may crop up. Amid all these challenges and emotional turmoil, you should steer your business toward fulfilling long-term goals and ensuring the stability of your organization in the face of crisis situations. All you need to do is to keep track of the way your business is progressing. You must focus on evaluating if your business is heading in the perfect direction. Try identifying specific things that are failing to work well and that necessitate rectification.
Several business owners believe in managing their business instinctively according to their gut feel. However, if you are serious about achieving success, you must focus on keeping track of specific business metrics or relying on data. Business owners leverage data for knowing ways to boost their business. They set goals and define performance metrics. Organizations often utilize those precise goals for driving their winning stratagem. Michael Giannulis firmly believes that there are numerous KPIs or key performance indicators that could be evaluated to understand your business growth.
Top Business Metrics in the Eyes of Mike Giannulis
You could rely on your precise business goals for tracking relevant business metrics. If you track irrelevant KPIs, you will concentrate on things that may not matter. Let us explore some business metrics that you should keep track of to ensure smooth functioning and rapid growth of your organization.
Customer Acquisition Cost
This metric seems to be an accurate measure of the entire cost of acquiring a brand new client, including all aspects of sales and marketing. Customer acquisition expense is calculated accurately by dividing your total acquisition expenses by the total of new clients or customers over a specific period.
It conveys to you if your advertising and marketing investments are getting paid for themselves. Over a period, your overall cost of acquisition tends to dip as there is a boost in brand image and business growth. However, examine existing industry norms that are relevant to your kind of business to ensure if you are on par with your competition.
Customer Retention & Loyalty
Customer loyalty involves grabbing the attention of the right consumer, convincing them to purchase, purchase pretty often, purchase in higher quantities, and introduce even more clients. You could focus on building a robust customer-business relationship and boost brand loyalty by ensuring that you treat your customer the way they wish to be treated. There are three effective techniques for measuring customer retention and loyalty: Purchase Analysis, Direct Feedback at a POP, and customer surveys. All these necessitate a regular and systematic process instead of relying on ad hoc implementation.
Sales revenue is a critical business metric that tells many things related to your organization. We understand that month-over-month sales outcomes reveal if people are keen on purchasing your product or service, if your marketing endeavors are paying off, are you staying competitive or losing out to the competition. While accurately evaluating the sales revenue of your company, keep in mind that sales outcomes are impacted by a host of other factors. You should track the latest developments in the market, competitive actions and previous marketing campaigns, etc. Boosting your sales revenue could prove to be a long-term stratagem instead of a temporary increase in sales.
We have discussed some of the top business metrics that you should keep monitoring to know how your business has progressed over some time. Remember to focus only on relevant business metrics that are critical to your specific business needs.