How’s business? How many times do people ask you about your business and you answer with the default, “It’s good.” That’s fine for the public, but to make informed, confident decisions about your resources, you must set and measure against metrics to answer that question honestly.
Metrics are especially important when you determine what marketing efforts make sense to undertake. You can apply marketing metrics no matter the stage of maturity of your practice. Newbies will have more critical client attraction and conversion metrics, while established practitioners will focus more on loyalty metrics.
Here’s how to measure your marketing efforts:
1. Establish what your marketing objectives are.
- Do you want to add a certain number of new clients, or is your focus on bringing in more assets from your current clients?
- Do you want to establish or grow your online presence?
- Are you seeking more automated marketing follow-up and systems?
- Do you want to increase your prices or change the way you delivery your service?
2. Apply the metrics that fit.
After you outline what you want to achieve, apply the metrics that fit. Here are some examples that may work for your practice:
- Email open rates
- Email click-through rates
- Number of prospects added to the mailing list
- Number of social media posts per month
- Number of media interviews per month
- Number of events hosted/attendees/resulting consultations
- Number of freemium sign-ups per week
- Conversion percent of freemium-to-consult
- Number of consultation requests per month
- Conversation rate—consultation-to-client
- Average AUM per client—initial amount and incremental assets added per year
- Renewal rate (if retainer), or retention rate (money management)
- Average number of hours billed per client, repeat engagement percent, number of months until next engagement (if hourly)
- Number of referrals generated per client
- Loyalty score—client engagement (for example, measured with the number of meetings per year, phone calls, emails, events attended, referrals sent, etc.)
3. Select 2 to 4 key metrics for your practice.
You want accountability but not overwhelm. Set your target for each metric you choose. If these are new measurements for you, you may have to adjust as you figure out what’s realistic.
4. Determine the frequency for tracking results.
Decide what you need to feel motivated. Once a week will give you a chance to make adjustments without being a slave to the daily performance.
5. Track, learn and adjust.
Metrics exist so you have performance feedback supported by real numbers. You can dial up or dial back your marketing efforts based on how well you’re performing against targets.
The next time your father or friend asks, “How’s your business?” answer however you want. At least with metrics, you’ll know the real answer.
Kristin Harad, CFP®
Marketing trainer for advisers
San Francisco, CA