Unleashing Business Potential: Harnessing Data to Drive Success
Embrace Your Inner Numbers Nerd
Many entrepreneurs shy away from quantitative analysis, often intimidated by the complexities of data manipulation. However, as Amy points out in her podcast, 'The Motivated CEO,' loving numbers is not about being a math whiz; it's about understanding the stories they tell about your business. Whether it's cash flow analysis or customer acquisition costs, every data point offers insights into what’s working and what isn’t.
Start by shedding any fear of numbers. Remember, data is merely a tool to illuminate paths that might not be immediately visible. Track simple metrics and observe their changes over time to gradually deepen your analysis without overwhelming yourself.
Simplifying Metrics for Effective Insights
Understanding where your money comes from and where it goes is the cornerstone of sound financial management. Amy advises focusing on three key areas, with cash flow being paramount. Begin by identifying your top-selling products or services and note the less successful ones. This approach not only pinpoints effective revenue streams but also helps minimize wasteful expenditures. Regularly monitor these metrics to maintain and improve profitability.
Customer Acquisition: Know Your Sources
Another pivotal metric is identifying where your customers originate. Are they coming from social media, referrals, or direct searches? Utilizing tools like Google Analytics can reveal these pathways, enabling focused marketing efforts and resource allocation. Replace generic tools like Linktree with customized pages on your website to gain more control over this data, further enhancing its accuracy and usefulness.
#### Conversations and Objections: The Gateway to Customer Minds
Tracking interactions with potential clients reveals common objections and hesitations. This information is invaluable for refining your sales strategies and understanding market needs. Viewing sales as a solution to a customer’s problem, rather than a transaction, can reframe the approach to be more engaging and less daunting.
Implementing Actionable Strategies from Data
Once you have begun tracking these metrics, the next step is to use this data to make informed decisions. Schedule regular reviews, such as weekly or monthly CEO days as suggested by Amy, to analyze data and plan adjustments. This can mean refining product lines, reallocating marketing budgets, or tweaking service offerings based on customer feedback and sales performance.
Incorporate automation and delegation wherever possible to streamline processes and improve efficiency. Remember, data isn't just numbers; it's feedback that can lead to significant improvements in how your business operates.
Keeping the Human Element in Your Data Strategy
While data is critical, it’s just as important to maintain a personal touch in your business. Ensure that your data collection and analysis always aim to enhance customer experience and satisfaction. Stay curious, ask questions, and use data to fuel a more intuitive and responsive business model.
Conclusion
Using data to drive business decisions might seem daunting at first, but with the right tools and mindset, it becomes an indispensable part of achieving growth and sustainability. Start simple, stay consistent, and let data pave the way to a more prosperous business future. As you integrate these practices, keep an open mind and be prepared to adapt—what you discover may very well be the catalyst for your business to thrive
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Transcript for Episode 310. How to Use Data to Grow Your Business
Amy [00:00:03]:
Are you using data in your business to drive your decisions? I'm telling you, this is the missing piece of the puzzle that you have been looking for. Grab your notebooks, grab your pens, because today's episode is going to be packed full of strategy. These are strategies that you can use to move the needle forward, to move the needle forward in your business to create a sustainable business where you're making the income that you want, when you're generating a profit, when you're truly running a business, and not just a side hustle, not just an expensive side hobby, you know, whatever you want to call it, using data is key. And why? Why data? So many clients, when they come to me, they're like, but, yeah, I'm not a numbers person. Well, guess what? I'm not either. I literally took three years of math in high school. I remember my senior year, they're like, hey, do you want to sign up for calculus next year? And I, again, I don't like math. And I was like, well, do I need another math credit to graduate? And they're like, no.
Amy [00:01:29]:
So guess what? Nope, I only have pre calc under my belt. And then, you know, the college algebra, all of that. So I'm not a numbers person in the traditional sense, but I am a numbers nerd. And why? Why am I in love with numbers now? Because data drives decisions. Our data is showing us and telling us a story. It's literally there to show us in our business. This is working. This is not working.
Amy [00:02:07]:
Clients are coming from here. They're not coming from there. This is where I should focus my marketing efforts on, because this is working. They give us such valuable feedback that when we leverage them properly, can be like pouring fuel on a fire. And when you know your numbers, when you know your target, you can reverse engineer any goal, no matter if that goal is a million dollars or $100, it doesn't matter. Your goal is unique to you. But where do you start? This whole entire process can feel so overwhelming when you're like, but I'm already doing all the things. I'm already acting as the marketer, the manager, the outreach specialist, the editor, the content creator, the salesperson, the maker.
Amy [00:03:07]:
All of these things that we're doing in our business, all of these things, it can be overwhelming. But this is the difference between treating your business again like that side hustle and a sustainable business. So what I want you to do is start simple. Don't go crazy with it. Simple is sustainable. You need to figure out, okay, what is going to work for you. So for me, I've become intentional about blocking time out on my schedule. Fridays are my CEO day.
Amy [00:03:46]:
Fridays are my get stuff done day. And I use this to work on my business, to really focus on growing the business in a way that feels good to to me to take the time out. And I have my weekly tasks that I do every Friday. I've got monthly tasks that I only do on the first Friday of the month. And then I also have blocked out times for my CEO days where I'm really going into each system and asking myself, how can I make this better? How can I make this more efficient? Going in and revisiting those standard operating procedures to look for other opportunities to automate, to delegate, to really take that intentional minute to reflect on how am I using my time? Am I using my time in a way that's best suited for me? Are these tasks that I'm doing to be busy? Or are these actually things that I need to be doing in order to move the needle forward? So when we're tracking our data, I want you to start really, really simple. And we'll focus on three key areas. Because these three key areas, if you focus on nothing else and you can track as much data in your business as you want, but just starting out, focus on these three key areas, and the first of which is cash flow. Look at what is actually selling.
Amy [00:05:27]:
Track what is selling and what is not selling. I know it sounds so blatantly obvious, right? But start tracking where the money in your business is coming in from. And in addition, I want you to start tracking those expenses. You need to know that break even point. You need to know what that overhead is, because every business has operating expenses. We have those recurring monthly expenses for all of those subscriptions and things that we're not actually using, get rid of them. If you're not using it, get rid of it. You can invest that money other places that would grow your business.
Amy [00:06:12]:
So you have your monthly cash flow, your monthly expenses. And then what I want you to do is any yearly expense that you have. So for me, things like Zoom and canva, all of the other stuff that's a one time a year, divide that by twelve and take that figure and add it to your monthly expenses. Add up all those monthly expenses and then you know your overhead. This is your break even point. This is how much money you need in your business to level out, to be at zero, right? We don't want to be operating in the red. We want a profitable business. We want to be making a profit.
Amy [00:06:56]:
And even this act of figuring out and looking at your numbers and analyzing. Okay, what's selling, what's not, a lot of us avoid it because it's scary, because we don't want to, to get honest with ourselves and be like, you know what? What was working last year isn't cutting it this year. But don't be afraid of your numbers, because what they'll do is they'll tell you exactly where you should redirect and refocus. All right, this is working really, really well. This is selling really, really well. And then get curious, well, why? Why is this selling well? What can I do to, again, put more effort into that thing, that product, that service that is selling well? How can I do more of that and do less of what's not working? How, how can I. When you approach your business with that curiosity, that beginner mindset, and be like a toddler, they're always asking why. I remember when my kids were little, they were always, everything was, why? Why, why? And you finally get to the point where you're like, because I said so.
Amy [00:08:15]:
That's why. Do the same thing in your business. So start with cash flow. That's number one. Where's money coming in? Where is money going out? What is my break even point? This is something you should be looking at every single month, and it's going to fluctuate. I work with clients all the time that we're trying to get those fluctuations to be a little bit more level, to be more consistent, but it involves taking that zoomed out, 30,000 foot approach in order to do so. So now that we know cash flow, I want you to track where are your customers coming from? How are people getting into your world? How are they gaining awareness about you? And one of the most common pushbacks I get, I know this is another really simple one, but clients push back all the time. They're like, okay, but how? How do I know where they're coming in from? Okay, you can ask, you can ask them, you can put it on a form.
Amy [00:09:24]:
You can use the analytics on the back end of your business to see. Look in your website. Google Analytics is completely free, and you can see where your traffic to your website is coming from. And that right there, my friend, is a beautiful, beautiful thing. Here's another little insider tip. If you have a link tree and you have a website, please get rid of your link tree. Link tree. I love you, but we want that data.
Amy [00:09:59]:
If you have a link tree and you have a website, make a website page and just hide it. That looks just like a link tree. Because what it is, if you go to my Instagram page, amytraw, you can see because I do this, I have my website quicklinks. So when I go into the back end of my website, I can see exactly how much of this traffic coming to my website is coming directly from Instagram. There's also these really cool tags, and this is a little bit more advanced. So if you have a web person in your world, make sure you're utilizing the UTM tags. It's a concept. If you go on YouTube, there are some awesome, awesome videos about it.
Amy [00:10:47]:
I'm not going to get into it in this episode because I am by no means an expert at the back end of that, but that can be another missing piece of the puzzle that can really be helpful in allowing you to know where is this traffic coming from? Where are my customers coming from? Every client that comes into my world, I have on my intake form. How did you hear about me? Was it a referral? Was it social media? Was it, you know, the podcast? How did you come into my world? Because what does that do? It gives me data. I can use that data. Then instead of doing all of the things all of the time, I focus my energy. I focus my energy. And now I'm being intentional. I'm showing up in the places that are converting versus trying to be everywhere all the time because that's exhausting. I don't have the time and energy for that, and I'm sure you don't as well.
Amy [00:11:51]:
And then last, the last piece of the puzzle. And this is especially true for you service providers. I want you to track your conversations. I want you to start listening. What objections are coming up when you're talking to prospective clients? What are they telling you? We're so afraid of hearing the word no that a lot of times we're not ever asking for the sale. But I encourage you to reframe that thought instead of feeling salesy. Oh, my gosh, sales is gross. Sales is sleazy.
Amy [00:12:32]:
No, obviously they're interested. You have the solution to the problem that they have. They're looking to solve the problem. You're simply presenting an invitation to the solution. Sales doesn't have to be gross. It doesn't have to be sleazy. This is something I struggled with a lot when I was first in business. I really, really struggled with it.
Amy [00:13:01]:
But then when I realized, you know what, I've been selling my whole life, and so are you. We're selling all day long. If you're a mom, to a toddler. Let's just talk about them again for a second. Trying to get a toddler to put pants on when they don't want to put pants on. Like, you are selling. You are selling that like, no, kid, you gotta do this before we leave the house. We're always selling, even when we're recommending things to our friends, that's selling.
Amy [00:13:32]:
When we're telling them about the awesome new restaurant we went to, we're essentially selling the restaurant. So it's all in how you approach it. It's all in your mindset about how you're viewing sales. So start tracking those conversations, start listening to what objections are coming up, write them down, and really start to think, okay, well, how can I reframe that objection? How can I better address that objection in my content, in my messaging, in my conversations that I'm having? Again, it's providing you with data. Utilizing the data isn't glamorous. This isn't the fun, sexy part of running a business. It's not dancing around on Instagram. It's not all the pretty graphics that we're creating in canva.
Amy [00:14:33]:
No, it's basic. It's kind of boring. But this is the missing key. This is the missing key. And it's important that when you're looking at your cash flow, you're looking at where your customers are coming in from, and you're looking at your conversations, when you're looking at this data that we trend it over time, we're looking for patterns. No matter what you see, these numbers mean nothing about you as a person. No matter if you are having awesome success or you're nowhere near where you want to be yet. And the keyword being yet, the data will drive your decisions.
Amy [00:15:24]:
The data will help you grow your business. Start simple. Block that time off your schedule and start treating your business like a business. Use the data to drive your decisions, and you will see results. I'm cheering for you. And until next time, cheers to making the money you want so you can create the impact you desire.
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