“How is your business doing?” You are sure to either hear this a lot or ask your self this question often after you start your own Etsy or maker business. Measuring success in business is an important thing to evaluate often as you nurture and grow your craft business. As I mentioned in my top five tips for running a home based business, you need to develop a business plan. Your business plan is like a road map for running your business. Part of your business plan will require you to measure the success of your Etsy or online maker business, and I’m going to explain that in more detail in this article.
Most of us will immediately think of money as a metric for measuring success in business. Of course, the goal of every business is to make a profit and show growth. When you are starting out, however, money is not always the best way to measure success, and there are other metrics to keep in mind. Finances, growth, and customers are all things to measure as you evaluate the success of your brand.
Factors for Measuring Success in Business
Counting money is the simplest metric to assess for success. Are you making money or losing money? When you first start your business it is most likely you’ll be measuring success in business by increasing sales. If you brought in more money this month than last month, that feels like a success. As you grow your business, however, you will need to take a closer look at your profit margin. Expenses (like advertising) will grow with your business, and you need to make sure that you are maintaining (at a minimum) or increasing (ideally) your profit margin.
A balance sheet is a great way to keep track of your assets and liabilities so you can have an accurate picture of your business’ worth. This, in turn, will help you measure success. QuickBooks has a free template that you can use to create a balance sheet for your maker business.
Before the sales start rolling in, customers need to find your product. Increasing your following is a great way to grow your business and bring in future sales. Building a social media following is a smart way to make consumers aware of your product. Facebook, Twitter, Instagram, and Pinterest are all ways to grow your social media following. Track the number of followers you have on social media and set goals for increasing those numbers.
While you are growing the number of followers you have on social media, you can also measure other important performance metrics. Some connections to measure might be post comments, pins, shares, hearts, personal messages, and unsubscribes. The time you spend early in your business to analyze and improve these numbers will help boost your sales in the long run.
Customers & Customer Satisfaction
Etsy provides several tools that you can use to analyze who your customers are, how they are finding you, and what they are buying. Google Analytics will provide similar statistics if you are selling on a website, and can be used on Etsy as well. Here is information on how to set up Google Analytics with Etsy.
Analyzing the data to figure out where referrals are coming from, what keywords are being used to find your items, and which items are getting the most views are important to know. Use this information to set goals, and measure your success with attracting and maintaining customers.
Now that you know of at least three metrics you can follow to measure the success of your Etsy or maker business, what do you do next? Here’s a simple plan.
- Write it all down. List the items you want to measure (such as sales, number of Facebook shares, etc.) and record your goals.
- Decide how often you will check in. Do you want to look at your metrics every week, every month, or quarterly? The bigger your business, the more often you should check in. If you’re just starting out, give yourself time to grow the numbers you are monitoring.
- Set your goals. What are you planning to accomplish? Guessing is OK. The point is to have a goal you are working towards. If you want to double your sales in 12 months, make that a goal. If you want to have ten more shares or pins each month, put it in writing.
- Check your progress. Record your metrics to see if you are meeting your goals.
- Adjust as needed. Maybe you exceeded your goals, or maybe some things are taking longer to achieve than expected. It’s ok to adjust your goals.
Setting goals and then working towards them is one of the most satisfying ways for measuring success in business. Deciding what you want to achieve, how you will achieve it, and then meeting those goals will help keep you motivated and focused. Whether you are tracking financial stats, brand growth, or customer feedback, you can measure the success of your Etsy or online maker business.