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5 Interesting Ways To Monitor How Your Business Is Performing
This is a guest post from Kayleigh Alexandra at Microstartups.
If you want to get simplistic about the success of your business, you can say all business survival comes down to two metrics: profitability and cash flow.
If you’re making more money than you’re spending, you’re probably in a good position, but anyone who’s run a business knows things are far more complicated than that.
Not only do you need to understand the many factors that contribute to those metrics, but you also need to know various other things that reflect the health of the business: everything from the number of qualified leads in the pipeline to the rate of employee churn. Just because an issue has yet to impact your bottom line doesn’t mean that addressing it isn’t a matter of some urgency.
Naturally, you can’t do anything about these health indicators if you aren’t aware of them, so implementing wide-ranging monitoring methods is mission-critical. There are a number of ways to gauge performance, obviously, many of which you’ll already be familiar with. Still, there could be some you’re missing.
Read on to discover five such tactics for monitoring the performance of your business. You may wish to implement some or all of them, or simply take them as points of inspiration for brainstorming your own methods.
Automate post-purchase email surveys.
Getting feedback from customers is vitally important, yet it’s something that many businesses overlook.
Some prefer to avoid negative comments altogether, deciding they’re not representative of how customers really feel.
Others simply don’t want to do anything with it, assuming they know better and disgruntled customers should just go elsewhere.
Smarter business owners understand that they need all the customer feedback they can get. It’s essential for achieving improvements, cutting costly churn, and inspiring the kind of loyalty that drives long-term customers to spend more and generate lucrative referrals. But what’s the best way to gather valuable customer feedback?
It pays to be proactive, and one of the most reliably effective ways to gather feedback is through automated, timely email surveys (learn more about email automation here).
For instance, you can have a survey email triggered 24 hours after the completion of an order because one sent immediately after may be confused as an order confirmation.
You can then send a more detailed survey after a week after the product has been delivered, allowing enough time for the buyer to have formed an opinion on the quality of the product, but not letting so much time pass that they’ve started to forget about their first impressions. Since you want to hold on to new customers, you need to take the comments seriously.
Glean insight through live chat.
If you go into a brick-and-mortar store, you’ll likely see employees asking shoppers how they can help them and improve their experience. An online store should do the same thing.
This includes surveys and a quality support team who handles support tickets.
You may also consider using a live chat feature to help visitors. It makes it easy to maintain 24/7 chat representation, scales perfectly under heavy demand (given adequate processing power), and can markedly reduce phone calls and wait times.
Still, whenever you can add a personalized touch—such as a number to call or even a friendly note inside a replacement order—you should.
Regularly consult your employees.
Whether you have 100 employees or just one, your employees are of paramount importance to the performance of your business. Most companies understand this and track employee activity very carefully. They find ways to gauge productivity and incentivize excellence, often to good effect.
That said, while those things are important, metrics aren’t everything. Consider having more conversations with your employees. Assuming you have a team, there are inevitably plenty of things happening in the business of which you’re not fully aware—wouldn’t it be useful to learn about them?
And, if there’s a disparity between how your operation is going and how you think it’s going, that’s obviously significant information.
You can try surveys for this, particularly if you have a large team, but it’s better for morale and internal communications that you find the time to speak to people directly (ideally in-person). There’s no reason why you can’t be simultaneously friendly and professional. Ask about anything and everything, and think carefully about all responses, even those that seem questionably relevant—it’s possible for one trivial issue to have broad repercussions.
If you learn about that kind of issue while it’s in its infancy, you can nip it in the bud and prevent it from ever becoming a serious performance-affecting issue. Preventative measures are always better than reactive decisions, and a short monthly catch-up with each employee could make all the difference in keeping your operation running smoothly.
Pay close attention to your lead sources.
All businesses should think seriously about is diversifying their lead generation. Just as it’s dangerous to be overly reliant on one large client, it’s risky to have the bulk of your leads—or all of them—coming from one source.
This is particularly true for digital marketing, because platforms rise and fall a lot more quickly than we like to imagine. It might feel as though Facebook has been dominant forever, but it really hasn’t been, and other popular services (like Snapchat) came around even later.
How long can a business endure? Some companies have been around for hundreds of years, and they manage that longevity by adapting to changes.
Let’s say you get your leads through Facebook Ads, for instance. It’s a great advertising channel at the moment, with industry-leading targeting options and a massive range of prospective recipients.
But what will happen if Facebook runs into problems tomorrow? As we saw from the Cambridge Analytica scandal, even Facebook isn’t impervious to problems.
Due to this, it’s fair to say that your business would be performing better if it were bringing in leads from more platforms, because that’d make it enormously more resilient and would give it more room for growth. Delve into your analytics to figure out where your business is coming from, and see how you can expand that funnel as widely as possible.
Use your industry for context.
Talk of metrics and KPIs tends to push businesses to be very insular, perhaps looking only at their own performance figures from past weeks, months, and years. Small percentage changes can easily captivate managers and investors alike. Are visitors down 5% from last week? Something’s gone awry. Email queries up 15% from last quarter? The email team is doing well.
There’s a massive problem with this, and it’s the lack of context. The question of why visitors are down 5% from last week is incredibly important. It could be due to some ill-advised social media posts damaging the brand’s reputation, yes, or it could simply be due to a nationwide dip in interest stemming from something else getting more attention. If it’s the former, you need damage control. If it’s the latter, you don’t need to do anything. Some dips are totally normal.
While you can’t access competitor analytics, so you can’t compare directly in every regard, you can do things like monitor social media mentions for your main rivals to see how they’re doing. You might see that their mentions dip when yours do, meaning the issue is something unrelated to your specific company.
And, if you find that certain competitors are thriving in notable areas while you’re struggling, that gives you a strong idea of how to improve. Look at what they’re doing and relate it to your efforts. Are they using different tactics or just executing better? The more clearly you see your relative deficiencies, the more precisely and swiftly you can address them.
Understanding how your business is performing relative to your expectations and your competitors is the key to achieving consistent improvement. Without that kind of context on your side, you’ll be left in the dark with no road ahead, so try implementing the five tactics we’ve looked at here to see how far they can take you.
Kayleigh Alexandra is a writer for Micro Startups, your online destination for everything startup. She’s passionate about hard-working solopreneurs and SMEs making waves in the business world. Visit the blog for your latest dose of startup and charity insights from top experts around the globe @getmicrostarted.
