Want a repeatable sales process? You've got to track metrics.
But not just any old metrics. Track the numbers that matter – the ones that help you really evaluate how you’re doing and give you insight so you can make better decisions.
You don’t need to go overboard and track everything – unless that gets you excited, in which case you have my permission. (And let's hang out.)
But there are 5 key metrics you don’t want to forget:
Moola – revenue and profitability
Ah, revenue. We love you. We get excited about “six-figure launches” and sustainable, high producing sales processes. Revenue is easy to track (just look at your bank account) and it’s fun to watch and report. The more revenue you bring in the better you’re doing, right?
Not necessarily. Revenue alone is only part of the equation.
Along with the grand total revenue number, there’s a little thing called profitability. It’s easy to ignore in all the excitement of a sales campaign, but it’s really the more important of the two metrics. It’s the amount of revenue you actually get to keep and spend (ahem – reinvest) in the future.
If you want a repeatable sales process, track sales expenses right alongside revenue:
- What did all those Facebook ads cost?
- How many labor hours did you add to the budget to support this campaign?
- Did you buy new software or pay for graphics?
- What about payment processing fees and hidden expenses?
Add up the expenses and subtract them from the revenue. That’s your profit – and it’s a super important metric for decision making. That six-figure launch of your dreams might not be as profitable (after the advertising spend required to get that revenue) as a simple promotional campaign to your existing list or a joint venture with a strategic partner.
List Growth – who they are and how they found you
Promotion (done right) does more than sell your products and services. It expands your reach and grows your audience. In fact, list growth can be the most important result of a sales campaign in terms of creating a repeatable, reliable sales process for your business.
So make sure you track the numbers, okay? But don’t stop there.
I suggest you take the time to dive a little deeper and get to know the new people on your list. Some may fit your ideal client profile for this campaign while others may be looking for another of your products or services. Still, others joined because they were intrigued with your mission or message but they aren’t ready to do much about it yet.
When you discover who they are (and how they found you) you can begin to build a closer relationship with them – and create reliability in your sales process.
Traffic – it’s not all created equal
Traffic is a good thing, right? More eyes on your website, more people engaging with your promotional materials, content, and webinars. You can find lots of advice from sales gurus and experienced marketers encouraging you to drive more and more traffic to your stuff so you can get better results.
Sorry, I’ve gotta do a little myth busting here.
You want more sales and more brand engagement, not necessarily more traffic. Volume doesn’t matter as much as quality – and quality is all about engagement.
There are a lot of tools to help you track the sources of your online traffic – which I call traffic paths. Google Analytics is one of my favorites. With just a little practice you can dig into the details – and get insight into how people engage with your stuff once they land on it. Once you’re armed with that information, you can make decisions about which traffic paths to expand which to move away from or minimize. After all – the more you know about which of your traffic paths is the healthiest, the more reliable your results will be.
Conversion rates – break down the results strategically
Okay, let’s get serious about marketing metrics and take those traffic numbers we’ve just talked about and put them to work. (Caution: Math Trigger Warning) Time to figure out the conversion percentage for each main marketing channel you usually use.
Hang with me, this is good stuff. I promise.
Let’s talk hypothetically about a typical promotional sales campaign with traffic paths that include Facebook advertising, email marketing, a free webinar, and a series of blog posts. All this stuff can feel like a ton of work – especially when you only have a small team to implement all of it.
Many people I speak to (post-campaign) use words like “simplify” and “avoid burnout” when sharing goals for future sales cycles. They want to scale back the effort without scaling back the results. But, it’s pretty tough to do that without an analysis of conversion rates by tactic.
Here’s how you do it:
- Determine your traffic numbers by tactic (i.e. how many people came to your site from Facebook ads).
- Determine how much of that traffic converted into a sale (i.e. how many of the Facebook ad people bought your stuff).
- Divide the conversion number by the traffic number for that tactic to get the conversion rate (the math part).
Yes – it takes a little planning (so you can gather the information you need) and a little math but the results are rich. Once you know that your email marketing campaign converts at 11% but Facebook ads only convert at 2% (for example) you can make decisions on how to invest your resources – and spend money building and nurturing your list in between promotions rather than buying ads during the campaign. Powerful stuff, isn’t it?
Customer Acquisition Cost – not for the faint of heart
The big kahuna of sales campaign metrics is this one – How much did you pay to acquire each new customer? It takes a little more math to get this number, but it’s worth the effort because once you know this you can create a reliable, repeatable sales process for your business.
Once you know how much money you need to invest in Facebook (or email marketing, blog content creation, promotional webinars, etc.) to get a single new customer you can totally scale your sales system.
- If every $5 you spend on Facebook ads yields one direct sale of $50 is a pretty good deal. You may want to invest more heavily in Facebook ads. (CAC = $5)
- If it takes $500 in Facebook ads to fill a webinar (with 100 people) that yields 10 sales of $50 each (CAC of $50) you might need to think a little longer about using a webinar in the future.
It’s not the size of the customer acquisition cost (CAC) that is most important. It’s the size relative to the revenue generated per sale. A CAC of $5 that represents 10% of revenue generated per sale is just fine. It’s okay to have a CAC of $50 that represents 10% of revenue generated per sale too. But when your CAC is 100% of the revenue generated per sale, you’ve got a problem.