3 Easy Ways to Use Metrics to Improve Your Business Model
Metrics can be invaluable when looking to make your business model more robust. Every business has areas in which their methods of bringing in revenue are not as effective as they could be.
If you focus on the problem areas where revenue generation might be dwindling, you can scale your business model and be more successful.
The following metrics can help you analyze and track your progress.
1. How Many Days Does It Typically Take for You to Make a Sale?
When a new customer clicks over to your website, do you know how many days it takes to get them to sign up? Is it closer to 30 days or 90 days? This metric can reveal critical things. When you pinpoint this number, you can get strategic and can try to lower it. If you’re able to make the sales cycle shorter, you can bring in more income each year.
“Often, the reference checking ends up adding a lot of time to the sale. Consider placing references or reviews on your website,” remarked Summer Goldman, partner at Goldman Wetzel, St. Petersburg criminal attorneys.
Are there any satisfied customers who would be willing to speak about your service on video? A happy customer can be a shortcut to bring in more.
2. How Many Proposals Were Successful?
While it is great if you have a close rate of 40%, but what if your close rate could be closer to 85%? That would more than double the monthly revenue. You can increase your close rate by examining the contract or proposal. Is there too much text or legal phrasing that is difficult to understand? If there is, is it necessary? Do you include information about how it can help the customer?
Get to know your potential customer and their struggles to find out what exactly they want. You might need to hold their hand and explain each recommendation thoroughly so that they understand the benefits. Sometimes, small formatting or process adjustments can account for a major revenue increase.
3. What Is Your Conversion Rate Like?
It’s important to keep track of how many visitors your website converts into leads. If 50,000 visitors are landing on your website every month and you aren’t getting many leads, there is likely a serious issue that you should look into.
A normal rate for conversion across the whole website is anywhere from 1% to 3%. Though certain pages likely do convert better, it’s a good idea to look at the conversion rate for the entire site and see if you can improve it by adding more value or offers.
Of course, there are many other kinds of metrics you could look at in regards to revenue, but since these are basic they are a great place to begin.
To sum it all up, since it can be difficult to find out the most effective way to run your business, remember that revenue generation can constantly be improved. Find out what produces the best results and focus on that to help improve your business model. Don’t hesitate to add more metrics to your arsenal as you become confident with where the business is headed.