Website visitors, bounce rate, social media impressions, email open rates, cost per click, conversion rates by traffic source, engagement metrics, brand awareness surveys.
He spent three hours every Monday morning analyzing data. But when asked if his marketing was working, he couldn't give a straight answer.
"The metrics look good," he'd say, "but I'm not sure if we're actually growing the business."
The Metrics Trap
It's easy to get lost in data. Marketing platforms give us dozens of metrics to track, and they all seem important. But tracking everything means understanding nothing.
Most marketing metrics are vanity metrics - they make you feel good but don't tell you if your marketing is actually working.
The Three Metrics That Matter
For most small businesses, only three metrics really matter:
1. How many new leads did we get?
2. How many leads became customers?
3. How much did each customer spend?
Everything else is just interesting information.
Why These Three Matter
Leads: This tells you if people are interested in what you're selling
Conversion: This tells you if your sales process is working
Revenue per customer: This tells you if you're attracting the right customers
If these three numbers are trending up, your marketing is working. If they're not, you need to fix something.
The Lead Generation Metric
A lead is someone who has expressed genuine interest in your service. Not someone who visited your website or liked your social media post. Someone who took an action that indicates buying intent.
For most businesses, leads are:
- Contact form submissions
- Phone calls from marketing efforts
- Email signups (if they're qualified)
- Consultation requests
- Quote requests
Track where your leads come from, but don't get obsessed with every traffic source. Focus on the channels that generate the most qualified leads.
The Conversion Metric
This is the percentage of leads who become paying customers. If you get 100 leads and 20 become customers, your conversion rate is 20%.
A low conversion rate might mean:
- You're attracting the wrong leads
- Your pricing is off
- Your sales process needs work
- Your service isn't what people expected
The Revenue Metric
Track both total revenue and average revenue per customer. This tells you if your marketing is attracting profitable customers.
If your leads and conversions are up but revenue per customer is down, you might be attracting price shoppers instead of value buyers.
The Simple Tracking System
You don't need expensive software to track these metrics. A simple spreadsheet works fine:
Month | New Leads | New Customers | Conversion Rate | Revenue | Revenue Per Customer
Update it monthly. Look for trends over 3-6 months, not week-to-week fluctuations.
What About All Those Other Metrics?
Website traffic, social media followers, email open rates - these can be useful context, but they're not success metrics.
High website traffic doesn't matter if it doesn't generate leads. Thousands of social media followers don't matter if they don't buy anything. Great email open rates don't matter if they don't drive revenue.
Use secondary metrics to diagnose problems, not to measure success.
Setting Targets
Once you know your baseline numbers, set realistic targets:
- Increase leads by 10-20% quarter over quarter
- Improve conversion rate by 2-5 percentage points annually
- Grow revenue per customer by 5-10% annually
Dramatic improvements happen over time, not overnight.
The Monthly Review
Spend 30 minutes each month reviewing your three key metrics:
- Did we hit our lead target? If not, which marketing channels underperformed?
- Did we hit our conversion target? If not, what changed in our sales process?
- Did we hit our revenue target? If not, are we attracting different types of customers?
Use these insights to adjust your marketing strategy for the next month.
When Secondary Metrics Matter
Use other metrics to diagnose specific problems:
- Low leads but high website traffic? Your website isn't converting visitors to leads
- High email open rates but low leads? Your email content isn't compelling enough
- High social media engagement but low leads? Your social media isn't driving people to take action
Action Steps You Can Take This Week
1. Set up tracking for your 3 key metrics only. Create a simple system to track leads, conversions, and revenue. Don't overthink it - simple is better.
2. Create a monthly marketing report template. One page, three metrics, with space for notes about what worked and what didn't.
3. Review and adjust marketing spend based on data. Look at which channels generate the most qualified leads at the lowest cost. Double down on what's working.
The Bottom Line
Data is useful only if it leads to better decisions. Tracking dozens of metrics doesn't make you data-driven - it makes you data-overwhelmed.
The goal isn't to have perfect information. It's to have enough information to make good decisions. Three metrics give you that. Everything else is just noise.
Measure what matters, ignore what doesn't, and use the insights to grow your business.
