Guest Post by Dan Norris
I spend a lot of time online, and I like to know whether my efforts are being rewarded.
In this article we'll look at 8 metrics I follow across my businesses to get an understanding of how well things are going.
1. Revenue
Revenue / Profit is always number one because of how important cash-flow is.
However it's sometimes not the best predictor of future success so I like to look at this month's invoicing vs last month's as well as long term trends.
But it's not the only thing I look at...
I use Xero for overall profit calculations but also look at individual sources like PayPal and Google Adsense to look at the revenue from different parts of my business.
2. Campaigns in Analytics
Campaigns in analytics are super powerful. If you are organized enough to use a tracking URL in your marketing efforts online it's a great way to measure specifically which campaigns are giving you the best conversions and return on your time or money investment. Some online services also automatically create campaigns for you, i.e. Feedburner, MailChimp etc.
3. Conversion Rates
For anything that isn't specifically tracked as a campaign you can still look at your conversion rates from different sources. If you have a goal set up (i.e. opt-ins, or sales etc) you can look at your conversions and then look at the sources to work out which referring sources are converting better than others.
This is better than just looking at the amount of traffic a source is providing because that doesn't provide necessarily information about how targeted the traffic is and how likely they are to become a customer.
4. Google Rank for Keywords
If you are like me you'll rely a little bit too heavily on Google's natural search traffic. I use rank tracking tools to see where I am ranking for various keywords and sometimes just use a new incognito window in Chrome for a quick check. Keeping an eye on this will notify you of issues well before they are noticed in your traffic.
5. Traffic
No internet marketer can get by without traffic so I'm constantly looking at my traffic, mainly total visits this month vs last month, number of visits to specific blog posts, who are my top referring sites etc.
If you run an affiliate program this can provide great info on who your top affiliates are. You may also use an external service for managing the performance of affiliates.
6. Newsletter List Size and Engagement
Newsletter opt-ins are an important part of my funnel in all of my online activities. I use MailChimp which provides some great info on monthly opt-ins, overall list size, number of unsubscribes (none hopefully) and opens and click throughs. Opt ins are useful to work out whether your site or other sources are being effective in encouraging people to opt in. The remaining stats are what I use to work out which email topics are working well and working out the frequency of my emails etc.
7. Server Uptime
Unfortunately I've found most hosts don't give you reliable information on when your server goes down or ongoing uptime percentage reports. But not much could be more important for the internet marketer. Servers going down is going to reduce opt-ins, reduce your amount of customers and your income so it goes without saying that you need to stay in top of this. Pingdom.com's free service is great for this which provides notifications and also reporting on an ongoing basis.
8. Social Media Metrics
I am pretty active in social media and use it to drive traffic and potential customers to my sites. I like to know how influential I am in my given markets and what kind of reach my posts are getting and what people think of them.
There are a few things I use for this including Klout (overall influence) Facebook insights, just checking out the interactions on Twitter and I also like to keep an eye on the comments and trackbacks on my blog.
What did I miss?
I know there are more things to look at and there are a few that I use that didn't make my top eight list here. What are yours? Did I miss any?
About the Author:
Dan Norris is the founder of Web Control Room a free tool that enables internet marketers to understand their data and make better decisions. By talking to the sources you love (MailChimp, Xero, Analytics, PayPal etc) it provides a scannable one page chart showing what is going well and what isn't.
About Lynn Terry
The only thing that jumps out at me that is not on your list is how much are you willing to pay for a customer? That’s equally as important as your profit. Truth is, if you know this number your profit is sure to go up.
For example, let’s say I have a membership site. The average person will stay on a membership program for around 3 months. Let’s say you charge $97 a month. At $97 a month, that is $291.
Therefore, each client is worth $291 to you (monetarily).
So if you want to break even, you can afford to spend $291 to acquire a customer, knowing that you’ll get other revenue from them as well (affiliate offers).
OR, you could spend $100 to get a new customer and bank $191 profit (plus affiliate revenues).
So now that I know how much my customer is worth to me (monetarily) I can put together a fierce marketing strategy to acquire said customer.
If I can afford to pay $100 for a customer and still profit, but my competition can only afford to pay $25 for a customer…tell me…who’s going to win THIS game?
Good article Dan. Thanks!
Hey Shane awesome comment.
At the moment I'm building in a range of metrics into my reporting app (for users of Xero for now) where we really delve deeper into financial metrics. Things like what is your average revenue per customer for the month, what is your total revenue per customer for the lifetime of the customer, who are your top customers etc.
This kind of stuff is really powerful and if you can get this data then you can really start to make some changes that impact your bottom line.
One challenge there though is revenue is not the same as profit so it's somehow hard to work out the exact profit on a sale and therefore how much a customer is really worth to you. If your profit is very close to your revenue (i.e. your costs are very low then you are sweet).
Thanks again for the comment.
This such a great article - we all need to know more about who views us and why!
🙂
Hi Kate,
Thank you and agreed!
The visit flow and conversion rate are the two important things. First attract the potentail customuers and then make them each into buyers.That's enough.
Hey DHGate thanks for the comment. You make it sound so easy!
Hi, Dan,
Great article. Thanks for the tips. I do some of these things already but will definitely think about adding the others to my regular routine, too.
Hi Suzanne, good to hear! Thanks for the comment.
Hey Dan, quick question on this article...
I agree with you that conversions are important to track, so I was wondering if you had any tips for tracking conversions on affiliate products? Being that the sale doesn't take place on my site, I haven't been able to track sales all the way through from an ad to my site to the affiliate product to the sale. I have numbers from the affiliate company sure, but I'm trying to figure out which traffic converts best...
Any thoughts?
Thanks for your time!
Hey Matt thanks for the comment mate.
That's a good question but unfortunately I don't use affiliate links at all and know very little about how all of this is tracked. You can track outbound clicks using Analytics by putting a bit of code onto each link. That would definitely be worth doing and set that click up as your goal. But then you don't know if that person purchased so it's not really going all the way.
Perhaps some affiliate services have a cookie that can do this but I'm not sure, sorry.
If you find an answer feel free to reply back here so I know how to answer it next time.
Hey Dan,
Thanks for getting back to me. I've already set up Google Analytics to track outbound links, I just don't have the final piece to see the sales.
I've been poking around a bit, but it seems as if the only answer is to try to get the seller to put a tracking pixel on their thank-you page. I'm kinda thinking the affiliate companies I work with won't go for that, but I guess we'll see.
Thanks anyway,
- Matt