Could Your Business Be Doing Better?

December 8, 2011 - by Business Money Today  Comments (0)

I have written several times about measuring the activities in your small business to ensure that it is operating as efficiently as it can; that it is earning the most that it can from its unique set of assets (including property, people, capital and management).

Just recently, I ran across a blog post from a good friend (Doug Dolan) that outlined how small businesses can create their social media strategies and one of his points was to make sure that your strategy was measurable.

His post; "6 secrets for creating a rock-solid social media strategy"

He states; "Track your success. - One of the benefits of marketing on the internet is the various tracking mechanism available for assessing your success. You can use Google analytics, QR codes, url shortening services, and more. These all offer tracking options. Plus, some of the social media sites provide their own tracking reports."

While this article is not about social media or actual marketing, Doug makes a great point about tracking your efforts.

Way too many companies or small business owners are so focuses on doing what their business does, they leave little time for measuring results. But, if you don't measure, how do you know what you are doing is working as well as it should?

Now, the top measure of any small business is always sales - if your sales are growing - you are definitely doing something right - but, what if you could be doing better?

Or, your sales are increasing but your profits are flat or declining. This could mean that your expenses - especially those related to growing those sales - are eating into profits.

How would you know this? By measuring the results of those expenses.

Let's look at some examples and ways that you can measure certain aspect of your business to ensure that you are getting the best bang for your time and money.

Let's say that your small business recently implemented two new marketing programs:

1) A print flyer program mailed to your targeted neighborhood demographics.

2) A radio spot to run during the afternoon drive time.

From these efforts, your sales have increased 5% - not bad.

But, is that increase related to both marketing programs and if so is it distributed evenly?

Now, if you were measuring both of these campaigns, you would know the answer.

Let's say you did measure both campaigns independently and found that the print flyer was driving 100% of your sales increase.

With that knowledge, you could stop the radio spot and put those wasted funds into more print flyers - might even be able to increase your sales an additional 5% by doing so.

The reason that most small business owners don't track their efforts is that they usually just believe the propaganda that their marketing partners (radio sales person, newspaper ad salesman, etc.) tell them to sell them that ad space - all based on their own agenda.

Further, many business owners may just not have the time. But, if you take the time to implement a tracking system when you are setting up your marketing campaigns or get your media partners (marketing partner) to do it for you - it really can be pretty simple and not take too much time - but the rewards will far out weight any time cost.

Example: For the print flyer discussed above, you could offer a promotion code directly related to that offering.

Thus, when potential customers call, they will provide that specific code.

Then, not only can you track your marketing efforts of getting customers to call - you can track their purchases from that point on.

Or, instead of a promotion code for when the customers calls, if you want to drive them to your website for information and purchases, you can set up a duplicate sales page on your site (something like - www.yoursite.com/4325 - ) and then track the customers that not only come to that landing page but, with cookies, track them through the entire sales process and even track them if they come back for more purchases at a later date.

You might have even seen commercials on TV that have web address with strange numbers in them.

Not only are these ad tracking who comes to their website after viewing the ad but they are also tracking when that ad ran, the time of day the ad displayed and during which TV show - to measure the greatest impact on their target market (which ad, at which time got the most results).

That is why you will see funny numbers in a website address like www.growyourbusiness23.com and then later when viewing the same ad, you see pretty much the same web address but with a different number on the end like www.growyourbusiness15.com.

For the radio spot, you could also do a promotional code for when someone calls in or just simply have them call different numbers.

Most radio stations' marketing departments or your advertising agency can help you set these up.

Thus, you can track different radio ads at different times of the day all based on what number gets called.

The idea with tracking your results is to ensure that you and your business are not wasting money (precious money) on items that are not providing the greatest return that they can.

Even if, from our example above where the print flyers worked better than the radio spot, you might want to try a TV ad or magazine ad for a short period and measure that.

Why? Because; while the flyer might have increased your sales 5%, a TV ad might increase your sales by 25%.

But, you would only know this if you measured your results and tried new things to improve those results.

The bottom line in running any business successfully is to ensure that your business is earning (return) the most that it can from the expenses the business employs (meaning from the assets that it has paid for or is paying for and uses).

So, the best way to ensure that your business is returning the most that it can is to measure each expense item and make sure that everything your business spends its money on, it is getting either equal or more revenue back or it is saving an equal amount or more than what it is spending.

If you truly want to grow your small business or at least get the most out of it (make it work better), you have to measure your results.

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