As a business owner or marketer, it is critical to understand and measure your business performance. In this blog, we discuss 10 essential questions you should ask to evaluate your business. According to research, 80% of businesses can only answer 5 of these questions. Find out how Stratics can help you answer these questions quickly and efficiently, and how we can support your business in making data-driven decisions.
How many new customers per month do you recruit?
The number of new customers per month is an important insight that allows companies to measure the performance of their acquisition efforts. This is especially important for companies that are growing and looking to increase their customer base.
If the number of new customers increases, it may mean that efforts are becoming more effective and the company is successful in attracting new customers. On the other hand, a decrease in the number of new customers may mean that adjustments are needed in the approach but it may also mean that the potential for new customers has been quietly reached.
It is important to measure not only the number of new customers per month, but also the quality of these new customers. This is because it is not only important to bring in new customers, but also to bring in customers that fit the business and can add value to the organization. We propose a whole set of dashboards and monitoring systems that constantly provides insights, KPI and trends of your acquisition strategy.
What does it cost to acquire a new customer?
The cost of acquiring a new customer is an important KPI to evaluate the efficiency of a company's acquisition (GET) strategies.
Some more interesting KPI that may be of interest:
- CAC (Customer Acquisition Cost): this is the total cost incurred by the company to acquire a new customer, including marketing and advertising costs, salaries and bonuses of sales staff and overhead costs.
- CLV (Customer Lifetime Value): this is the total value a customer generates over the lifetime of his or her relationship with the company. By comparing the CLV to the CAC, a company can determine whether it is worth the cost to acquire a new customer.
- CAC Payback Time: This is the time it takes to recover the cost of acquiring a new customer. If this time is too long, it may be a sign that marketing and sales efforts are not effective enough.
- Conversion rate: this is the percentage of potential customers that actually become a customer. A low conversion rate may indicate that there are problems in marketing and sales strategies that need to be addressed.
Thus, evaluate the efficiency of your efforts and make necessary adjustments to lower the CAC and increase profitability.
How many new customers are still active after 1 year?
The number of new customers still active after 1 year, also called customer retention rate, is an important KPI to measure customer retention. Alternative loyalty KPI are:
- Customer retention rate: this is the percentage of customers who are still active after 1 year. This provides insight into how loyal customers are and whether the company is meeting their expectations.
- Churn rate: this is the percentage of customers who leave during the year. A high churn rate may indicate that the company is having problems retaining customers and that adjustments are needed in services or products.
- Customer lifetime value (CLV): this is the total value a customer generates over the lifetime of his or her relationship with the company. By comparing the CLV to the cost of retaining a customer, a company can determine whether it is worth investing in customer retention.
By tracking these KPIs, you can improve customer retention by understanding why customers leave and what can be done to retain them. Too often, unfortunately, only short-term acquisition results are seen.
How much revenue do your best 10% customers represent?
Knowing the revenue generated by your top 10% customers, also called Pareto principle, is important to assess the value of different customer segments. Here are some interesting aspects of this KPI:
- Top 10% revenue: this is the revenue generated by a company's top 10% customers. It is an important KPI because it helps companies understand which customer segments are the most valuable.
- Customer segmentation: by understanding which customer segments generate the most revenue, a company can improve its customer segmentation. This allows the company to focus on the most valuable customers and optimize its marketing and sales efforts.
- Cross-selling and upselling: by knowing the value of top customers, a company can target cross-selling and upselling. This can lead to increased sales and profitability.
- Competitive advantage: if a company generates a high percentage of sales from its top customers, it may have a competitive advantage over its competitors. This can lead to a higher market position and a higher value of the company.
How many promoters do you have (NPS > 8)?
The number of promoters with a Net Promoter Score (NPS) higher than 8 is an important KPI to measure a company's customer satisfaction and brand loyalty. Some interesting aspects of this KPI:
- Net Promoter Score: this is a measurement tool that measures the likelihood of customers recommending the company to others. Using a scale of 0 to 10, customers are asked how likely they would recommend the company to friends or colleagues. Promoters are customers with a score of 9 or 10.
- Promoter percentage: this is the percentage of customers who give a score of 9 or 10 on the NPS scale. This percentage indicates how many customers are very satisfied with the company and are willing to recommend it to others.
- Customer satisfaction: having a high number of promoters may indicate that customers are satisfied with the company and the products or services offered.
- Brand loyalty: having a high number of promoters can also indicate strong brand loyalty, which can lead to repeat purchases and higher sales in the long run.
What is a customer's LTV (Lifetime Value)?
A customer's LTV (Lifetime Value) is a crucial measure that indicates how much a customer is worth throughout his or her life cycle with the company. It is important for a company to know how much each customer is worth so the company can determine what investments are needed to increase a customer's value. The LTV can be influenced by several factors, such as customer acquisition cost (CAC), churn rate and upselling/cross-selling. Understanding LTV can lead to better ROI on marketing and sales efforts and higher long-term profitability.
How many more customers are engaged compared to last month?
Measuring the number of customers who are more engaged with your brand or product compared to last month is crucial to measuring customer engagement.
- Customer engagement: the degree to which customers interact with your company and the products or services offered. Higher engagement leads to higher customer satisfaction and brand loyalty.
- Engagement KPIs: there are several KPIs that measure customer engagement, such as number of website visits, number of emails opened, number of followers on social media and average time spent in interactions. Our data lake has more than 150 types of interactions.
- Effectiveness of communication and marketing efforts: by measuring the number of customers who are more engaged compared to last month, you can understand how effective these efforts are.
- Make improvements: by understanding which interactions influence customer engagement, you can make targeted improvements and adjust strategies to optimize customer experience.
Every day, Stratics calculates the engagement of each individual contact based on 150 different interactions. Every day we interpret billions of lines of data from millions of contacts to determine for each contact whether engagement is increasing or decreasing and for different product interests.
How many customers can you reach through various channels?
A diversified communications strategy can help you reach different types of customers through multiple channels. By using various channels such as social media, email, search engine marketing, traditional marketing channels and more, you can maximize your marketing efforts and reach more potential customers. The number of customers you can reach depends on several factors, such as the target audience you want to reach, the type of product or service you offer, the resources available and the budget you have at your disposal. It is therefore important to develop a solid strategy and regularly evaluate and adjust it to get the most out of your marketing efforts.
Customer responsiveness can vary depending on the channel used. Online channels such as e-mail, social media and chat are generally faster and more direct than offline channels such as phone and mail. As a result, customer response time can also vary by channel.
Online channels can offer customers quick responses and interaction, while offline channels often take more time and are less direct. Yet offline communication can also offer benefits, for example, in building personal relationships with customers or solving more complex problems.
It is important to remember that customers today are using more and more channels to communicate with businesses, both online and offline. Therefore, it is important to ensure that your communication strategy is aligned with the preferences and needs of your target audience. By taking a personalized and omnichannel approach, you can promote good customer responsiveness and make your business successful.
What is the impact of actions & promotions?
Running marketing campaigns and promotions have a significant impact. Promotions can lead to increased sales and increase awareness of your brand. However, it is important to analyze the impact of these promotions to determine whether they were successful and to improve their effectiveness.
Here are a few basic challenges:
- Increased sales: A successful promotion can lead to an increase in sales. This can be done by offering temporary price reductions, bundle discounts or free shipping, for example.
- Increased margin: selling is easy, making a profit is not. Therefore, it is essential to also measure whether actions and promotions do indeed generate an upsell and bottom-line also result in (increased) margin.
- Increased customer loyalty: A well-executed promotion can also lead to increased customer loyalty. Offering customers rewards, such as free products or discounts for their next purchase, can encourage them to come back and keep shopping with you.
- Increase brand awareness: By organizing social media promotions, giveaways or contests, for example, you can increase your company's brand awareness and reach more potential customers.
- Understanding customer behavior: By using discount codes, customer surveys or other tracking methods, you can gain insight into your customers' behavior and which products are most popular.
- Increased customer satisfaction: By providing good customer service and responding quickly to questions and comments, you can increase customer satisfaction and generate positive word of mouth.
It is important to note that the impact of actions and promotions can vary depending on the company, industry and target audience. Stratics can help you outline an efficient and effective action, test and promotion policy. Need strategic or tactical advice, be sure to get in touch.
What is the ROI for each communication channel?
Measuring ROI (Return on Investment) by communication channel is essential to measure the effectiveness of the communication strategy and better allocate the marketing budget. Here are some interesting aspects of this KPI:
- ROI: This is the ratio of revenue to investment of a communication channel. A higher ROI means that the channel is more efficient in generating revenue.
- ROI KPIs: there are several KPIs that measure ROI by communication channel, such as the revenue generated from an email campaign, the cost per click on an ad and the conversion rate of a specific landing page.
- Effectiveness of communication and marketing efforts: by measuring ROI by communication channel, you gain insight into how effective communication and marketing efforts are and which channels yield the highest ROI.
- Optimize investments: by understanding which channels yield the highest ROI, you can make targeted investments in the most effective channels and better allocate the marketing budget.
- Continuous optimization: customer behavior changes constantly and is often subject to seasonal influences. ROI continuously
Getting started!
In a world where data is increasingly important for decision making, Stratics is ready to help you unlock the power of data for your business. We specialize in data-driven decision making, marketing and sales.
In conclusion, Stratics offers a comprehensive range of services to help companies grow through data-driven insights and decision-making. The company offers
- data management services such as data architecture, data quality and profile unification, ...
- insights management services such as KPI management, segmentation, Data Intelligence, Artificial Intelligence, Business Intelligence, monitoring and analytics.
- coaching and support for tactical and strategic decision-making in marketing, sales and management.
With these services as a trusted partner for data-driven growth and success, companies can increase their competitive advantage and make better decisions based on data.
Kris Vranken
CEO
