CEO-ing Your Business: The 3 Metrics that Matter (FS212)

🎙️ Listen to the episode:
Episode 212: CEO-ing Your Business: The 3 Metrics that Matter (FS212)

In the kinds of very small businesses we talk about at Fizzle, with teams of fewer than 5 people, many with just one person, very little of what we do on a day-to-day is CEO-type stuff.

Most of what we do is run around wearing one of dozens of different hats. Marketing, product development, finance, team building, and on and on.

In a bigger business, a CEO would care about all these things, but they wouldn’t be his or her primary focus. A CEO’s main job in a bigger company should be to own the company’s vision and convince everyone possible of why they should support that vision. Customers, investors, employees, everybody.

Beyond that, a CEO is responsible for making sure the company’s efforts are driving progress toward that vision, and that the business has the resources it needs to succeed (skills, talent, money).

But again, in a tiny business, as we’ve talked about a lot recently, you have to wear a bunch of hats. You have to do the high level CEO stuff, along with a million other things.

And it’s easy to focus so much on DOING the work, that you lose sight of the bigger picture.

So, how do you know if things are going well? How do you assure your CEO self that your “worker bee” selves are doing a good job, in the precious little time you have each month to play CEO?

Why Metrics Matter

This is why metrics can matter so much. By metrics, we simply mean taking measurements of different aspects of your business and monitoring them on a regular basis.

In today’s episode of The Fizzle Show we explain how to play CEO in your business, and the metrics you should follow to keep tabs on everything.

But first, we should also mention that the metrics that matter will change over time as your business grows.

When you’re just starting out, before you’ve built a product, you should be 100% focused on identifying a need or desire in the marketplace, and on finding evidence that the need is worth trying to fill.

Then, when you get to working on your product, you should care most about: 1) building a product quickly and cheaply (the minimum viable product concept), and 2) growing a following / building buzz.

Finally, after you’ve launched a product, that’s where many of these metrics will come in. At this stage, your job is to make sure 1) your marketing is reaching customers and converting them to customers, and that 2) your product is serving your customers, making them happy, and converting that value into revenue for your business.

Metrics and the Marketing Funnel

So, what should you measure as a business? What report should you provide your CEO self so you can know how the business is doing?

The marketing funnel gives us some excellent guidance. A marketing funnel is simply a model of the theoretical journey a customer takes from learning about your business to purchasing your product and beyond.

One excellent marketing funnel based metrics model (say that three times fast) is Dave McLure’s Product Marketing for Pirates: AARRR! presentation. Dave’s model breaks the funnel into these 5 measurements of user behavior:

  • A: Acquisition – where / what channels do users come from?
  • A: Activation – what % have a “happy” initial experience?
  • R: Retention – do they come back & re-visit over time?
  • R: Referral – do they like it enough to tell their friends?
  • R: Revenue – can you monetize any of this behavior?

Our system at Fizzle (funnel metrics)

Internally on the Fizzle team, we use a similar model, adapted for our specific business. Every month we update a spreadsheet. We do this manually and it takes maybe 90 minutes. I actually like the ritual of doing this manually because it gives me a chance to pay attention to each number.

We’re making our spreadsheet template available to you. Enter your email below and we’ll send it right to you.

Download The Simple CEO Metrics Spreadsheet

This will help you run your business intelligently and find essential insights along the way.

Get the Spreadsheet!

The 3 Metrics That Matter (if you only look at three, use these)

If I had to limit the metrics I tracked to just three, they would include some version of the following:

  • Reach (audience growth): how many people are we reaching (for content-based marketing) through our website, podcasts, social media, etc?
  • Signups (conversions): how many of the people we’re reaching are converting into paying customers?
  • Customer LTV (lifetime value): how much revenue do we earn from the average customer over his or her lifetime? For subscription businesses, this is a function of churn and price. For other businesses, it’s a factor of price and number of products sold.

The beauty of these three metrics is, they form the basis of a calculation that can tell us how much revenue we’re generating for a given timeframe. 10,000 people (reach) X 10% conversion (signups) X $10 (customer LTV) = 10,000 in revenue generated for that period.

To double revenue, you can focus on any one number, or on all three at once. Doubling your reach, doubling your conversion rate, or doubling your customer lifetime value would each double your revenue. Or, increase each by a smaller amount and still reach your goal.

Earn a living doing something you love.

Grow an audience and get paid for your work as an independent creator. Fizzle is where creators come to learn, share and make progress toward their online dreams.

I’ve taken a lot of courses and been involved in several paid communities since I started my business, but I’ve never ever felt like anyone CARED as much about seeing my reach my goals as the Fizzle Team. They show up for me as much as I show up for myself. Thank you SO much, you guys!

Claire Pelletreau
ClairePells.com

📓 Articles & Announcements

  • 8 Experiments to Spice Up Your Podcasting Routine

    Is your podcast routine stuck in a rut?  If so, we’ve got just what you need!  Jane Portman from Userlist joins us on the blog today to share her podcasting genius.  Keep reading for 8 experiments you can try when your podcasting routine needs spicing

  • Introducing Fizzle 2.0

    Today is an exciting day for Fizzle. We’re announcing a complete refresh of Fizzle, including every aspect of our user experience – courses, content, live events and more. Since we first opened Fizzle in 2012, we’ve provided thousands of entrepreneurs and creators with training, coaching and community. Today, this refresh marks

  • The Secret to Creating Consistent Content (that nobody’s talking about)

    Hands up if you easily create consistent content week after week without fail. My guess? Since you’re reading this article, that’s probably not the case.   Despite what you may be thinking  – you’re not alone.  Lots of content

🎙️ Podcast Episodes

  • The EXITpreneur’s Playbook with Joe Valley

    Joe Valley is an Author, Guest Speaker, EXITpreneur, Advisor, and Partner at Quiet Light. He has also built, bought, or sold over half a dozen of his own companies. Over the last nine years, Joe has mentored thousands of entrepreneurs whose goal is to achieve their own eventual exit. He

  • R&D Tax Credits with Tiffany Bisconer

    Tiffany Bisconer is a CPA with over 20 years of accounting and tax experience. Tiffany worked with one of the top certified public accounting firms before becoming director of Acena Consulting. She combines her private industry and public accounting experience to work with CPA firms and directly with business owners

  • Behind the Scenes: Fizzle 2.0

    This has been an exciting month for Fizzle! We recently announced a complete refresh of Fizzle, including every aspect of our user experience – courses, content, live events and more. Since we first opened Fizzle in 2012, we’ve provided thousands of entrepreneurs and creators with training, coaching and community.