Over the next several episodes of Pep Talks for Side Hustlers, I’m going to take you behind the scenes of my strategic planning process – so be sure that you’re subscribed so that you don’t miss a step!
From setting big goals to getting into the weeds with data to planning out what I’m doing next and and when it’s going to happen, I’m going to break it all down for you, and share the insights I’ve uncovered along the way.
So at my day job, we used to have these big long strategic planning meetings that a) I dreaded, and b) were a total waste of time. It was basically a giant brainstorm session of all the things we had always done with a few big dreams thrown in with no data to back any of it up, no funding, and no accountability. It would get put away right after it was done, everyone would go back to putting out fires every day until the next year rolled around and it was time to look and see if we actually did anything on that list, and then create a new one for the next year.
That is the opposite of what I’m going to walk you through. We’re going to look at what you’ve done over the past 12 months, or since you started your side hustle, what’s working, what’s not working, where you’re spending your time and money, what you’re getting in return and make decisions about what you’re going to keep doing, stop doing, or what your going to do more of.
Okay, so let’s dive in.
So when I was researching strategic planning, most of the articles I read started with goal setting… but how can you know how to get where you’re going if you don’t know where you are right now?
So instead of starting with goals, today, we’re going to start with data.
Yep, I’m going to ask you to look at ALL of your numbers.
I know, you’re probably totally groaning right now, but this is important stuff to know!
Monthly Data Tracking Worksheet
To help you track your numbers every single month, I’ve got an awesome resource for you from one of my Serious Side Hustlers members – Lyndsay Clement of Ellen Grace Marketing put together a monthly data tracking worksheet and an annual scorecard spreadsheet that will help you get your numbers together – and KEEP them together so that this analysis I’m going to share with you is painless.
You can get access to it by clicking this link.
Okay to do this analysis I'm going to walk you through today, you’re going to need info from Google Analytics, your email marketing software, whatever your using to keep track of your sales and revenue, and your expenses.
Here’s what I want you to pull together from all of these sources:
- Total Unique Visitors to your website each month
- Total number of subscribers added to your email list each month
- Total Number of Customers
- Total Revenue
- Total Expenses
These 5 metrics are going to give us the big picture of what’s happening in our business, and will reveal where our time and money is best spent.
Here’s how.
First, You take the total of your website traffic for the month and divide it by the total # of subscribers. That going to give you a Conversion Percentage of Traffic to Subscribers. Make a note of that percentage.
Then, you’ll take the total number of subscribers and divide it by the total number of customers. That gives you another conversion percentage, from subscribers to customers.
Then, you’ll divide your revenue by your number of customers to get the average dollar amount earned per customer.
Then, you’ll subtract your expenses from your revenue to get your profit.
And then you’ll divide your profit by your revenue to get your profit margin.
We care the most about those 5 numbers: Traffic, The Traffic to Subscriber Conversion Percentage, the Subscriber to Customer Conversion Percentage, the Average Order Amount Per Customer and the Profit Margin.
The number we care about the most is the profit margin. That’s the percentage of money WE get to take home, and we want that number to increase.
And there are 4 ways you can make that number go up.
Yep, you guessed it. Traffic, The Traffic to Subscriber Conversion Percentage, the Subscriber to Customer Conversion Percentage, the Average Order Amount Per Customer.
You have 4 places you can focus your time and money.
- Getting More Traffic
- Getting more of that traffic onto your email list
- Getting more of your subscribers to make the decision to buy
- Increasing your prices or adding new products and services
But which one do you choose?
Most people, myself included, think Traffic. If only I could get more traffic, then I’d have a bigger email list. When I have a bigger email list, more people will buy, and then I’ll hit my goal.
But that type of thinking is totally backwards.
It makes no sense to put more water in a bucket that’s full of holes.
Let me explain.
So I asked myself the following question – and I came to a totally different conclusion that I would have in the past:
Q: If I was maxed out on traffic & subscribers, what is the #1 thing I can do to increase revenue?
A: Increase Conversions from Subscriber to Customer
Q: How can you increase Conversions from Subscriber to Customer?
A: Better copywriting, and a more strategic customer journey/funnel.
Q: If I was maxed out on conversions from Subscriber to Customer, what could I do to increase revenue?
A: Increase conversions from visitor to subscriber.
Q: What’s #1 thing you can do to increase conversions from subscriber to customer?
A: Compelling value proposition & CTA, more strategic optin placement with compelling value prop & CTA.
Q: If I was maxed out on conversions from Subscriber to Customer, and Conversions from Traffic to Subscriber, what could I do to increase revenue?
A: Increase Traffic.
Q: If I was maxed out on traffic, conversions to subscriber and conversions to customer, what could I do to increase revenue?
A: Raise my prices. Offer a new service.
Q: What will have the most impact on your revenue?
A: Increasing conversions from subscriber to customer and working back from there (traffic to subscriber and then more traffic) bc then I’ll see exponential growth.
It’s the logical place to start, even though I know I’m not maxed out on traffic, and even though I know I can increase my traffic to subscriber conversions, but why put all of those people into a bucket for them to just slip right out of one of the many holes? Patch up the bucket, and then work backwards from there.
And I’ve got a spreadsheet you can download that will let you play with the numbers so that you can see what changes will have the most impact in your business.
You can get that over at www.shannonmattern.com/155
So, how do I find out where my holes are, and how do I fix them?
A survey. And in episode 156, I’m going to share with you exactly how I surveyed my email list to find out where the holes are, so if you’re not already subscribed, definitely do that so each new episode downloads automatically every day!
Today’s pep talk is brought to you by Bluehost. Go to www.shannonmattern.com/bluehost and get 36 months of web hosting for just $2.95 a month. That’s less than one trip to Starbucks a month – and if you’re anything like me, you’re at Starbucks more than that!
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