If there is something that never deceives, it is numbers.
As much as it may hurt us or seem unfair, data simply reflects the reality of a business.
However, despite the fact that it is impossible to manage a business without measuring, the vast majority of entrepreneurs prefer to look the other way. Out of laziness, ignorance, fear... it doesn't matter the reason. The fact is that they don't do it.
That is why with this post I want to achieve 2 objectives:
Explain the real consequences for your business of not controlling basic data.
I want to tell you the story of Gloria, a mentoring client who also didn't measure anything and wanted to invest in Facebook Ads to promote her new course.
And I'm doing all this to get you on your toes and understand once and for all that without data you're like a kid trying to hit a piñata blindfolded. You'll only get it right by pure luck... and, frankly, I imagine you don't want to leave your income line up to chance, do you?
Well, let's get down to business then.
Why are metrics so important?
There are many mythical phrases in the world of digital marketing such as "content is king" or "the money is in the list", but without a doubt, one that is also read everywhere is:
What is not measured cannot be improved.
I'm sure you've heard it thousands of times too, and almost certainly, it's been to myself a few times.
And I keep saying it because it's true. The first step to growing your business is to understand where your business is. If you don't know where you're starting from, it's hard to come up with a logical strategy. Makes sense, right?
Well, it shouldn't be that bad, when time and time again I come across entrepreneurs who measure absolutely nothing. Nothing at all .
That's why I want to explain to you today through a real case the consequences that this has for your project. Let's see if I can be more successful this way.
Note: Are you not sure what a metric is? Then read this post about what a KPI indicator is first.
[bctt tweet="Are you not measuring anything in your #onlinebusiness? Find out here why this is a big mistake #DigitalMarketing" username="caoscero"]
1. Working without planning or the possibility of foresight
It doesn't matter what work you do, if you offer services you are selling your time, and if you are selling your time, you need to have a clear understanding of how you spend each minute.
I'll give you an example.
Imagine that it's early July and you want to take 2 weeks off in August. You already have several orders that month and a client calls you to ask for something else. You have doubts.
Will you have time to finish everything before you leave?
You are not sure (because you don't measure yourself...!), but you accept so as not to lose that money.
And what was bound to happen happens: not only do you not have time to do that new job, but the one you already had takes longer than expected. The result? You have to take your laptop with you and work on vacation instead of resting and enjoying time with your family and friends.
The basis of any planning is knowing, more or less, how much time each task takes. Without this data, it is impossible to assess whether you have already filled up the month or if you can take on a new order.
I recommend using Toggl and starting to measure each task you perform with each client. Little by little you will have an estimate of how long each task takes.
[bctt tweet="The basis of any planning is that you measure how long each task takes you. Go ahead
and control your time!! #productivity #entrepreneurship #blogging" username="caoscero"]2. The endemic evil of the entrepreneur: zero profitability per client
I'll continue with the example I just gave you.
Even though you spent part of your vacation working, you delivered all the work on time and the clients were happy. What does that mean? That great moment of sending the invoice and seeing how your bank account grows has arrived.
Note: If you haven't set yourself a salary yet (it's about time), the first thing you should do is calculate its amount in relation to the business's income and expenses. How to do it? Download my free basic finance calculator for entrepreneurs.
But look at this funny thing, since you don't have a record of the hours it took you to do that job, you can't know your hourly rate . Which means you don't know:
If that client has been profitable for you (I have seen cases of entrepreneurs charging €3 per hour).
If you need to raise your fare price.
If you are interested in continuing to offer that service.
Or what is the same: you don't know how much money you are earning or even if you are losing it (you would not be the first nor the last).
[bctt tweet="If you don't measure, you don't know the profitability of each client. Have you ever thought that you could be working like crazy and losing money? ? ? I'll tell you how to fix it #entrepreneurship #onlinebusiness" username="caoscero"]
3. Bad strategic decisions = Loss of time and money
We are going to leave the entrepreneur who had to take the brunt of the holidays in favor of another who is preparing to relaunch his star product.
Last year went well, but this year he wants to beat his record and increase his turnover by 20%.
Note: 20% more turnover is a good goal because it is specific and time-bound. Do you have a clear idea of how to set your business goals? If not, read this post.
To achieve this goal, you decide to hire a copywriter to create a new sales page and an email marketing campaign. And that's great, it's a logical investment considering the objective.
Problem?
You don't know what the conversion rate was for the sales page or previous emails, so you won't be able to tell whether the new texts performed better or not.
If you don't measure, you're flying blind with every strategy you apply.
You will never know if they are giving the expected results, if it is better to modify the approach or even if it is not worth it and it is better to abandon that action.
Because remember, what is not measured, cannot be improved...
Does all this sound obvious to you? Read this real case so you don't make the same mistake yourself
Before going into the story I want to tell you, I would like to make two reflections.
1. Beware of overconfidence
I already talked about this in this post about how well you know your business . Many entrepreneurs tend to be overconfident and believe that they have a perfect grasp of their project. But the reality is that as soon as I ask them 3 or 4 questions, they start breaking out in a cold sweat.
Don't think that what I explain in this post are isolated or extreme cases. The vast majority of freelancers are unaware of the most basic numbers of their business.
Don't fall into the trap of "that won't happen to me" because the only way to know is by measuring.
[bctt tweet="? Do you not control any metrics of your #onlinebusiness? ? Then, yes or yes, you need to read this post #DigitalMarketing" username="caoscero"]
2. Not everything is fixed with money
This is also dangerous and widespread. When faced with any problem, many people believe that the solution is to invest more money.
Be careful, because making a business work does not consist of throwing bags of money at it to "force" it to move forward.
It is not like that.
You will see in the next point how, in Gloria's case, increasing her investment in advertising would only lead to her losing more and more money. It sounds silly, but there are many people doing this without knowing it.
The key is to analyze each part of the project to detect errors, correct them and achieve the expected results without having to increase the budget.
3. Gloria's case
And now, I'll tell you the story of what happened to me with a student from the mentoring program, The Chaos Zero Connection.
Gloria was ecstatic because she had finally finished her first infoproduct, an online course. As soon as she finished the email marketing funnel, without thinking twice, she wanted to start paying for online advertising to get income.
Without further proof or verification I was going to invest money in Facebook Ads.
After talking to her, I convinced her that it was better to study the data to see if she had a profitable product.
We ran a test by offering it to their own list first, and the result japan whatsapp number data was a conversion rate of less than 0.50% on a course under €40.
If we take into account that conversion is usually much lower with cold traffic, the sales that were going to be achieved would not even cover the investment in advertising.
Let's do the numbers.
A conversion rate of 0.5% (I'm not even going to lower it) means that you need 200 leads to make a sale. At the moment, the cost per lead within the digital marketing sector has risen, but we're going to set it at €1 per lead (more than optimistic).
This means that to earn €40 you would have to invest €200.
And subtract expenses from that...
A ruin, let's say.
I understand that it took you a lot of effort to create your information product and it hurts to think that all that effort has not given you the results you expected,
