[guest post by Keira Walter]
You could be throwing money into the void, using ineffective advertisement techniques and relying on a subpar call to action in order to draw conversions. If you aren’t paying attention, your performance may be suffering. Knowing what to monitor will help you develop a functioning plan for obtaining and keeping customers.
Cost of acquisition
Every customer costs you money. The ultimate question is, how much? Choose a time period, and compile a report showing you exactly how much you’ve spent. This includes all of your marketing costs and sales costs, as well as any overhead you’ve encountered during the process. Divide that by the number of customers you’ve acquired during that marketing period. Compare that number to your profits. Is it feasible to be spending that much on the amount of customers you have? If not, you may need to improve your methods.
Your conversion rate
What are you trying to persuade people to do when they visit your website? If you want them to purchase something, download something, or sign up for something, you’re going to need to measure how many people actually complete the desired action before exiting your website. Your conversion rate is essentially the rate of your success. If you’re getting a lot of visits but nobody is responding to your call to action, it’s time to improve your website and make your call to action more appealing.
Many website owners make a crucial mistake of relying on simple view count alone while checking their websites’ efficiency. Existing customers may visit your website multiple times. This drives your view count up higher, but in a misleading way. In order to correctly assess the efficiency of your website, you need to know how many visitors are unique, meaning how many new, individual people are viewing your website. Unique visitors matter more than total views, and you won’t know if your audience is growing unless you’re paying attention to the number of these visitors.
Where your customers are coming from
How are people getting to you? If you don’t know how they’re finding you, you won’t know which sources you should be devoting your time to. You may be wasting money advertising or updating on social profiles that aren’t driving people to your website. Checking your referrals lets you know what’s working for you. You may need to strengthen your presence in weak areas, or drop them altogether. If you have an avenue that’s performing well for you, maximizing your performance there will help your referral numbers increase.
How much do you expect to profit from a customer over the duration of their professional relationship with you? It’s hard to plan for the future if you don’t know what to expect. Ideally, you want to maximize the value of each customer. You also need to know how many new customers you’ll be required to generate in a year if you want predictable growth. How much money does the average customer spend on your website per year? Does this number go up, down, or stay the same? Understanding this figure can help you best determine how to upsell, while simultaneously showing you where you can afford to hand out coupon codes, discounts, or loyalty perks.
Without regular monitoring of your metrics, every decision you make regarding your website is merely a shot in the dark. Understanding the numbers is vital for growth, as you’ll be able to shape your decisions based around your current facts and figures.
**About the author: Keira Walter is a writer at eFax who is deeply interested in helping both individuals and companies remain secure online. Being a part of the team, Keira often shares her knowledge through blogging.