We have all heard the saying, “what you can measure, you can manage?”. It is over-used to the point of being cliché…
Yet, it is true. The challenge is – what to measure?
Start with this – focus on the activities that produce results.
There are two things we must measure – activities and results.
Activities are real-time, happening now, and controllable.
Results are after-the-fact, past based, and non-controllable.
Wayne Gretzky could not control how many goals he got per game. He could, for the most part, control how many shots he took on goal.
You get the difference.
What are Your Business Activities That Lead to Great Results?
What is your strategic purpose?
To grow?
To grow you need a pipeline.
Ok, here is a starting point. Measure your referral rate. Do you know what it is?
Here are some interesting facts –
70% of all new business for service-based businesses comes from referrals…
…and clients are responsible for 30-60% of those referrals.
The simple act of asking for referrals can result in a 9% increase in referrals. Wow!
But do you ask?
Who is Making the Referrals and Why?
Once you know this, you can put a system in place to increase it.
How Much do you Currently Spend on Advertising?
Before you spend another dollar on advertising, find out where your customers are coming from.
How much exactly do you spend?
What is your per client cost of acquisition?
A Few More Probing Questions
What do your clients think of you?
What is your attrition rate?
How frequently do your customers come back to do business with you?
How frequently do you write to your clients – particularly just to say thank you?
What is Your Turnaround Time on Sales Calls and Leads?
Here is an interesting study…
A while ago, a company called Performark mailed in thousands of responses to ads for goods and services costing at least $5,000.
You would think the price tag alone would be enough to trigger a quick response!
Hmmmm, well, not really. It took on average 58 days for a response. 25% of enquiries went unanswered.
Only 1 in 8 requests triggered a follow-up sales call. That call came 89 days – on average – after the initial enquiry.
Two More Activities to Measure
How are we creating new customers?
How do we ensure they keep coming back?
Keep this in mind – a 5% increase in customer retention can cause a 25-85% increase in profitability.
To Summarize
Know your acquisition costs per customer/client.
Know where you are getting quality leads from.
Focus and expand on what is working.
Follow up on enquiries fast.
The old adage “what you can measure you can manage” becomes, “measure the right things to get the results you are seeking”.
Lastly, remember this – you cannot control results, only activities…
What activities will you start tracking?
Thanks for reading…