Measures of Success
Various KPIs / Metrics that can be used to
measure the success of your business
What are measures of success?
If you don’t know what success looks like, how will you know when
you’ve got there? And more importantly, how can you celebrate?
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Knowing where you are going is one thing – a Business Vision is extremely important.
Having goals that you can measure at definite points in time, means that you can track
where you are at with your journey & adjust your strategies & tactics as necessary.
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This document has been put together to get you thinking about how you measure
success in the various areas of your business:
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Financial
Customer Service
Human Resources
Operational
Sales
Marketing
Pick the areas in your business that are relevant for measurement and report on them
regularly (diarise dates of measurement)
Note trends and take action if necessary
Most importantly, celebrate success – both small & large…. It keeps you & the team
motivated on the journey towards that Vision!
Financial measures of success
Measure
Description
How is it measured?
Turnover (Gross
Income)
The amount of
revenue taken in by a
business in a particular
period
Usually annually by
looking at the business
accounts – whether
that be in the
calendar, fiscal or tax
year
Gross Profit – overall
and by product
Overall – a business’
turnover minus its cost
of goods or services
sold
By product – the
amount that a
product is sold for
minus the cost of that
product
Usually annually by
looking at the business
accounts –
Revenue minus costs
of goods (COGs)
Net Profit (aka the
“Bottom Line”)
A business’ total
revenue minus its total
expenses
Usually annually by
looking at the business
accounts –
Revenue minus total
business expenses
(including COGs)
Expenses costs
An outflow of money
for an item or service
for the business
As a % of income
Notes
Financial measures of success
Measure
Description
How is it measured?
Breakeven
The amount of
income required to
cover all of your
expenses
$ income - $ expenses
& COGS = $0
Size of debt
Money owed by the
business to creditors
As an absolute figure
or a % of assets
Cashflow – forward
forecasting
The amount of cash
generated and used
by a business over a
given period. Real
cash the business has
available to run
operations, cover
liabilities and expand
Actual cash received
and spent against
what is recorded
Top selling product or
service by revenue
The most revenue
gained from the sale
of a particular
product or services in
a business – as
compared to other
products/services sold
The price of products
against the services
sold multiplied by the
amount of products
and/or services sold
Notes
Financial measures of success
Measure
Description
How is it measured?
Top selling product or
service by margin
If margin is the
difference between a
product’s (or
service’s) selling price
and the cost of
production, then this
will be the
product/service with
the greatest margin
per sale.
Comparison of
product sale price
against cost of
production of product
Chargeable vs nonchargeable hours
Chargeable hours are
spent directly with the
client or working on
client projects
Non-chargeable hours
do not generate
revenue yet are
necessary to keep the
business running
smoothly
Chargeable hours are
recorded and
exchanged for a
specified amount of
money
Non-chargeable hours
are hours that the
clients are not
charged for. These
must still be recorded
to help you
understand your true
hourly rate
Notes
The goal is to establish
a fee structure that
factors in the nonchargeable hours ie.
Clients pay for those
non-chargeable hours
but do not see those
hours on their invoices
Financial measures of success
Measure
Description
How is it measured?
Breakeven
The amount of
income required to
cover all of your
expenses
$ income - $ expenses
& COGS = $0
Size of debt
The amount of debt
the company
currently holds
As an absolute figure
or a % of assets
Cashflow – forward
forecasting
The timing and
amount of cash
flowing into and out of
a company over a
specific period.
Actual receiving of
cash into the
company account
(not credits or
invoicing) against
loans and bills to be
paid (including timing
of payments)
Notes
Sales measures of success
Measure
Description
How is it measured?
Number of customers
Number of customers
of business
Actual amount of
customers buying
products or services
from the business
Income per customer
The average amount
of income brought
into the business by a
customer
Actual amount - total
business income
divided by number of
customers
Market share
The % of a market’s
total sales earned by
a particular business
over a specified time
period
Business’ sales divided
by total market’s sales
over the same period
Where do leads come
from? Lead
generation
Lead = person that
has the authority and
budget to purchase a
product or service.
Lead generation = the
methods for
generating consumer
interest into products
or services of a
business
Recording the
method by which a
customer came to
purchase a product or
service from the
company
Use Google analytics
for online lead
generation
Notes
Sales measures of success
Measure
Description
How is it measured?
Conversion rates –
from lead to
opportunity
The act of converting
a lead into a business
opportunity
Recording
marketing/sales
process
Conversion rate – from
opportunity to
proposal
The act of converting
an opportunity into a
business proposal
Recording
marketing/sales
process
Conversion rate – from
proposal to sale
The act of converting
a business proposal
into a sale. Online, the
proportion of visitors to
a website who take
action to go beyond
a casual content
view, as a result of
marketing or
advertising
Online:
Website visitors
Abandoned carts vs
completed sales
Physical:
Number of physical
sales or contracts
signed against
pipeline
Number of valuable
meetings
BVOM = the business
value of meetings. A
successful meeting is a
satisfaction of
meeting or event
objectives (often nonfinancial)
Set down clear
meeting objectives
and record if they are
met. Actual amount.
Notes
Human resources measures of success
Measure
Description
How is it measured?
Average length of
tenure
The average length
that an employee of
the business remains
employed by the
company
Recording
employment figures
and getting average
length of tenure as
time goes on
Retention of staff /
staff turnover
How often staff leave
the business over a
particular period of
time
Recording
employment figures
Staff satisfaction /
engagement
How happy the
employees are
Formal engagement
survey
Best Places to Work
Survey
Spend on PGs
How much the
business spends on
personal grievances
for unjustified dismissal
for example
Actual amount from
accounts
Place to work
How many people
applying for jobs or
sending in CV
Record amounts in HR
Best Places to Work
Survey
Notes
Operational measures of success
Measure
Description
How is it measured?
Notes
Customer delivery
times / SLA
performance
The degree to which
the business is able to
serve its customers
within the promised
delivery time
Ask:
1. Is the customer
getting what it
wants when it
wants it or when
advised?
2. Do the supplier
and customer
agree on how ontime delivery is
measured? Any
variations on
delivery must be
agreed to. Date
of delivery
3. The number of line
items on order
Ensure there is a a
clear up-front
agreement with the
customer allowing for
variations to amounts
delivered and time
frames for delivery,
you need to be
speaking the same
language
Time spent on job vs
time quoted
Does the business
quote accurately for
the jobs it is doing for
the customer
Quotes vs actual
hours taken to
perform job
Operational measures of success
Measure
Description
How is it measured?
Defect rate
Number of orders
supplied to customers
that have defects in a
certain period of time
Number of defective
orders
Total number of orders
-during a given time
period
Notes
Customer service measures of success
Measure
Description
How is it measured?
Notes
Number of customer
referrals
Satisfied customers
that refer other
customers to the
business
Recording of where
the customer
originated from
Ensure that you are
recording referrals
Number of customer
complaints
Number of customers
unhappy with the
business or product
Process for customer
complaints recorded
Customer
engagement
The engagement of
customer with the
business or its brand
Recording of
sales/marketing
process and actions
taken by customers
Time taken to
respond to customer
enquiries
Customer retention
X = the difference
between the date
that the customer
enquires with the
business and the
date the business
responds to the
customer
How many customers
come back to the
business for repeat
purchase of services
or products
Actual amount
Recording by
sales/marketing staff.
Online: Client
account reviews
Marketing measures of success
Measure
Description
How is it measured?
LTV
Lifetime value of a
customer (present
value of the future
cash flows attributed
to the customer
during their entire
relationship with the
customer)
Average order total x
average number of
purchases in a year x
average retention
time in years
ROI
Return on Investment
– evaluates the
efficience of an
investment
(Gain from
Investment – Cost of
Investment) divided
by Cost of Investment
CPR
Cost per response (or
click throughs)
Actual number of
people clicking
through on call to
action – cost of an
ad divided by the no.
of people who click
on it)
Progress against
strategy
Notes
Marketing measures of success
Measure
Description
How is it measured?
CPA
Cost per acquisition
(cost per sale)
Total campaign cost
divided by amount of
conversions/sales
CPE
Cost per enquiry
Total campaign cost
divided by the total
enquiries
Unprompted brand
awareness
Where a large
number of people
around 1-2k are
asked to name
brands/businesses
that they have heard
of with no hints from
the interviewer
Actual number
through survey
Prompted brand
awareness
Where a person is
asked whether they
know of a certain
brand/business
Actual number
through survey
Customer
engagement
Engagement of
customers with a
brand or business
Notes
Marketing measures of success
Measure
Description
How is it measured?
Competitive
marketplace
Where large numbers
of producers
compete with each
other to satisfy the
needs of of
consumers
Market share (sales)
against total industry
sales
Brand preference or
Net Promoter Score
Which brands are
preferred under
assumptions of
equality in price and
availability
Net Promoter Score
divides a business’
customers into:
1. Promoters
2. Passives, and
3. Detractors
- Survey
- NPS – take the
percentage of
customers that are
Promoters and
subtract the
percentage who are
Detractors (also
survey)
Notes
Digital measures of success - website
Measure
Description
How is it measured?
Notes
Conversion rate
to goals
Actions that website
visitors can perform
can be tracked by
setting goals through
Google analytics
Google Analytics
goal setting and
results
Key word
positions in
Google
Where do you sit in
Google for the key
phrases & search
terms that your
customers use?
Using the private
browsing or
incognito mode of
your browser or
specialised software
– Semalt, Hubspot
etc.
Needs to be unbiased. Google
remembers your preferences
and where you have been
and serves up results
accordingly
Branded to nobranded
keywords
Non-branded
keyword does not
contain the website’s
brand name (website
obtains visitors who
are not familiar with
the brand). Branded
keyword indicates
that a searcher
knows what website
they are looking for
Google analytics
(Traffic source
keywords report –
filter your brand
keyword by
excluding your brand
name). Then focus
on increasing the
rankings of keywords
that convert visitors
best to your site
If all you’re getting is branded
search traffic, you’ll want to
conduct a technical and
content SEO audit of your site
as something is probably not in
order. A well optimized site
(unless it’s a brand with strong
marketing prowess or has
broad terms in their name)
should see a majority of traffic
from non-branded terms
Digital measures of success - website
Measure
Description
How is it measured?
Conversion Funnel
E-commerce: the
journey a consumer
takes through an
internet advertising
or search system, to
the website and
completing a sale
(the numbers of
visitors will decrease
at each step of the
process)
Physical sale: Enquiry
through to purchase
complete or
contract signed
Google analytics
Visitor
demographics
Who uses your
website eg. gender,
age, income, where
they live and what
device they are
using
Google analytics
Devices &
operating systems
used
What devices site
visitors are using to
access your website
Google Analytics
Notes
Digital measures of success - website
Measure
Description
How is it
measured?
Referrals
Visits from sources
outside Google’s search
engine eg. A link from a
hyperlink on one site
goes directly to another
site (social media posts
linking back to your site),
or, another search
engine for eg.
Google
Analytics
Top visited pages
Pages that have the
most visits
Google
Analytics
Calls to unique online
0800 number
Notes
Can be tracked
as a specific
goal through
Google
Analytics
Most popular phrases
Unique pages on site
How many pages of
content does your site
have?
Site map
Important for Google
SEO – content that is
relevant & useful & that is
added to regularly
Digital measures of success - website
Measure
Description
How is it
measured?
Notes
Bounce rates
% of visitors who
visit site and leave
rather than
continuing to view
other pages within
the site
Google
Analytics
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Returning = people
who have visited
website come
back again
Google
Analytics
The number of
pages viewed or
clicked on the site
during the given
time
Google
Analytics
Returning vs
new visitors
Page views
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Does tracking the pages where more
website visitors exit the site tell you the
pages don’t work?
Or that they were perfect and the
customer found what they were looking
for?
If lots of people keep returning, is it
because they repeatedly can’t find what
they’re looking for?
Or, that the content was spot on?
Is the number of views high because the
navigation is frustrating?
If you have great navigation, and low
page views, people may have found the
info they were looking for quickly, then
nipped off to a cheaper competitor
By tracking page views, what type of
behaviour are you rewarding?
Digital measures of success - website
Measure
Description
How is it
measured?
Notes
Number of
unique visits to
website
Number of times
distinct people visit
the website
Google
Analytics
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Visit duration
Length of time a
visitor spends
viewing the
website
Google
Analytics
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By tracking visits what are you really
tracking?
Requests for data from the server?
Number of pages viewed?
Similar to page views – was it a short visit
because the found what they needed
and left, or because they couldn’t find
what they wanted quickly enough, so
they left?
Conversely, were they there for a long
time because they were really engaged,
or because they couldn’t find what they
were looking for?
Digital measures of success – Goals in Google Analytics
Measure
Description
How is it measured?
Filling in a contact us
form
Where a visitor fills in
a form as a call to
action
Google goals
Downloading a file
Visitor downloads
from the website
Google Goals
Watching a video
Number of visitors
who viewed a video
you have uploaded
to your website
Google Goals
Purchasing a product
Number of people
purchasing from your
website
Google Goals
Purchasing a number
of products
Measured by value
or by quantity
Internal business
records
Average size of
basket
The average amount
spent by a customer
in a single transaction
Google Analytics.
Total amount of sales
against number of
sales
Spending a certain
amount of time on a
particular page
The average amount
of time a visitor will
spend browsing or
reading a certain
page
Google Analytics
Notes
Digital measures of success - email
Measure
Description
How is it measured?
Click through
rates
Number of people who
click through from the
email to your website
or landing page
Click throughs against
the number of emails
delivered
Open rate
The number of people
who opened your
email
Google Analytics
Unsubscribes
The number of people
who clicked on
unsubscribe option at
the bottom of the
email
Email marketing tool
Shares
Unit of capital in a
company
Company register
Number of
subscribers
No of people owning
shares in a company
Company register
Notes
Be aware that an Outlook
‘preview’ is considered an
‘open’, it doesn’t however
mean the customer has read
it
Digital measures of success – social media
Measure
Description
How is it measured?
Potential
Reach
How many people you
have the potential to
reach
Likes, followers, fans,
subscribers etc.
Actual
Reach
How many people the
business actually
reaches through its
marketing
Metrics on Social media,
analytics
Engagement
& Interaction
How may repsonses,
likes etc.. You get to
your marketing
Metrics on Social media,
analytics
Social
listening
How many times your
brand is talked about
on social media
Metrics on Social media,
analytics
Time to
respond
How long it takes to to
reply to comments on
Social Media
Metrics on Social media,
analytics
Notes
Digital measures of success – paid online advertising
Measure
Description
How is it measured?
Reach
Impressions
Number of impressions or
serve ups
Click through rates
from advertising
From a banner or
Google Adword
Click throughs against
the number of banner or
ad impressions
Notes
P
E
0800 332 007 or 09 308 2697
hi@ventell.co.nz
Icehouse Community,
Level 4, 125 St Georges Bay Road, Parnell
PO Box 9884, Newmarket
www.ventell.co.nz