Key Metrics for Revenue Growth

Most marketing reports only focus on easy-to-get metrics. Not those that measure growth + profitability. Metrics like... - ROAS from ad platforms - Traffic & CVR from Google Analytics - Revenue (Net Sales) from Shopify They're simple to pull. Your team checks them daily. Copy/paste into the report. But these metrics don't give you the real picture. Instead, we need metrics that tell us: - Are we growing? - Are we efficient (profitable)? ===== Here's some (better) metrics that actually reflect your business health: 1. Marketing Efficiency Ratio (MER) Calculate: Total Revenue / Total Marketing Spend (not just ad spend) Shows true marketing productivity regardless of attribution. --- 2. New Customer Rate Calculate: New customers ÷ Total active customers (eg. L12 mo) If this drops, you're not growing your customer base. You need to continually replenish your churned or lapsed customers. Note, Also good to look at the % of revenue coming from new customers. --- 3. Customer Acquisition Payback Period Calculate: Months to recover fully-loaded CAC from contribution margin *Note this is challenging to calc. at the customer-level as the majority of your customers won't "pay back". You'll want to look at aggregate curves here. Depends on the business model, but typically 3-6 months = healthy. 12+ months = you might be over-estimating your LTV, and never get payback. --- 4. Contribution Margin per Customer (First 90 Days) This is actually just "90-day LTV:CAC" but when most people say "LTV" they really mean "Lifetime Revenue" or "Lifetime Net Sales". Calculate: (Revenue - COGS - fulfillment - returns - marketing) / New customers in that period Shows actual profitability per acquisition. --- 5. Monthly Cohort Retention (90-day) Calculate: % of Month X customers who purchase again within 60 days Predicts long-term health better than any other metric. --- 6. (Bonus) Customer Concentration Risk Calculate: % of revenue from the top 10% of customers High concentration = fragile business model. The customers you think are the most loyal actually have some of the highest chance of brand-switching. ===== It's all about efficient growth. These metrics answer: "Are we acquiring good customers profitably and retaining them?" Everything else is noise. What else would you add? #marketinganalytics #ecommerce #profitability

Track the Right Numbers; Not Just the Loudest Ones 🚨 Stop Chasing Vanity, Start Scaling with Clarity Most business owners fall into the same trap, tracking the loudest numbers instead of the right ones. They obsess over follower counts, web traffic, or gross revenue, but completely ignore what actually drives scalable growth. Let me be blunt: Scaling your business isn’t about what looks good. It’s about what works. 💡 Early in my retail business career, I learned this lesson the hard way. We were tracking the wrong KPIs, foot traffic, sales per square foot, NPS, even daily cash in the till, without ever tying those numbers to margins, lifetime customer value, or conversion rates. Don't get me wrong, those aren't unimportant metrics, per se, but when you are trying to turn a profit, those aren't the most critical KPIs. We grew... but not at a significantly profitable rate. 📊 Here’s what changed everything: We shifted our tracking from noise to impact metrics. That meant focusing on: ✅ Customer Acquisition Cost (CAC) ✅ Lifetime Customer Value (LCV) ✅ Conversion Rate by Source ✅ Sales Velocity per Rep ✅ Retention and Churn Rates ✅ Net Profit Margins ✅ Forecast Accuracy vs Actuals And guess what? That clarity gave us control. 📈 According to a study by Harvard Business Review, companies that implement data-informed decision making grow 15-20% faster than their competitors. It’s not about tracking everything. It’s about tracking the right things. 🔥 Don’t just watch numbers. Let them tell you a story; one that fuels momentum, forecasts growth, and uncovers blind spots before they become breakdowns. If your current dashboard isn’t giving you confidence in your next move, it’s time to evolve your metrics. Because if you don’t know the scoreboard, how can you win the game? #MyBizCoaches #BusinessConsulting #FractionalExecutives #KnowYourNumbers #SmartScaling

Just had an insightful conversation about Money (and finance) with Sonny Gill.  On a ResultMaps podcast we'll call "Money with Sonny" (props Erika Riehle). We talked about the numbers that truly matter for scaling businesses. I found these insights worth highlighting: 1️⃣ NRR (Net Recurring Revenue) vs GRR (Gross Retention Rate) While GRR simply measures if you've retained customers, NRR captures the FULL picture including expansion and contraction. As Sonny wisely noted, "It's the measure of how the value of a customer has changed over a period, not just whether you retained that customer." The frustration? Defining what constitutes "contraction" - especially for companies with complex pricing models beyond simple seat licensing. His advice: "Keep it simple. If a customer value is $100 on Jan 1, if that value increases it's expansion, if it decreases it's contraction." 2️⃣ Rule of 40 This might be one of the most honest metrics in SaaS. It combines growth rate + profit margin, which should equal 40+. Why it matters: "It ensures you keep a balanced look at how you're investing resources and aren't chasing growth at all costs," which often means negative margins. Similarly, it prevents you from pursuing profits by grinding down R&D and marketing - decisions that damage long-term business health. 3️⃣ Beyond Financials When I asked what metrics should always be on a business health dashboard, Sonny emphasized non-financial indicators: • Market share/penetration • Employee NPS/engagement  • Customer satisfaction His warning: "If your heat map is green but your business isn't progressing, you're not measuring the right things." The most critical insight? Context matters. "Understand where your business is in its lifecycle and what you're trying to achieve." Don't just grab standard metrics from the internet - if you're targeting an MVP in six months, NRR might be irrelevant compared to product and engineering KPIs. What metrics have you found most valuable at your current business stage? And which ones do you think you might be overvaluing? [Check the full interview in the comments]

𝗔𝗿𝗲 𝗬𝗼𝘂 𝗠𝗶𝘀𝘀𝗶𝗻𝗴 𝘁𝗵𝗲 𝗕𝗶𝗴𝗴𝗲𝗿 𝗣𝗶𝗰𝘁𝘂𝗿𝗲? Many sales and marketing leaders focus on metrics that matter to their individual teams. While tracking website traffic, lead volume, or pipeline velocity is common, have you stepped back to see how these numbers fit into your overall revenue engine? Below is a snapshot of the key metrics each function typically tracks—and the revenue engine metrics you should monitor together for a complete picture: 𝗙𝗼𝗿 𝗦𝗮𝗹𝗲𝘀 𝗟𝗲𝗮𝗱𝗲𝗿𝘀:  • 𝗣𝗶𝗽𝗲𝗹𝗶𝗻𝗲 𝗩𝗲𝗹𝗼𝗰𝗶𝘁𝘆: How quickly deals move through your funnel. Faster velocity means efficient conversion.   • 𝗖𝗼𝗻𝘃𝗲𝗿𝘀𝗶𝗼𝗻 𝗥𝗮𝘁𝗲𝘀: The percentage of leads that turn into opportunities and closed deals.   • 𝗔𝘃𝗲𝗿𝗮𝗴𝗲 𝗗𝗲𝗮𝗹 𝗦𝗶𝘇𝗲 & 𝗪𝗶𝗻 𝗥𝗮𝘁𝗲𝘀: Indicators of deal quality and sales effectiveness. 𝗙𝗼𝗿 𝗠𝗮𝗿𝗸𝗲𝘁𝗶𝗻𝗴 𝗟𝗲𝗮𝗱𝗲𝗿𝘀:  • 𝗪𝗲𝗯𝘀𝗶𝘁𝗲 𝗧𝗿𝗮𝗳𝗳𝗶𝗰 & 𝗦𝗼𝗰𝗶𝗮𝗹 𝗘𝗻𝗴𝗮𝗴𝗲𝗺𝗲𝗻𝘁: Although often seen as vanity metrics, they offer a glimpse of initial interest.   • 𝗟𝗲𝗮𝗱 𝗩𝗼𝗹𝘂𝗺𝗲 & 𝗤𝘂𝗮𝗹𝗶𝘁𝘆: Focus on not just the number, but the qualification of leads (e.g., MQLs).   • 𝗟𝗲𝗮𝗱 𝗩𝗲𝗹𝗼𝗰𝗶𝘁𝘆 𝗥𝗮𝘁𝗲 (𝗟𝗩𝗥): The growth rate of qualified leads, hinting at future sales potential.   • 𝗔𝘁𝘁𝗿𝗶𝗯𝘂𝘁𝗶𝗼𝗻 & 𝗥𝗢𝗜: Which campaigns are truly driving valuable leads and revenue. 𝗙𝗼𝗿 𝗖𝘂𝘀𝘁𝗼𝗺𝗲𝗿 𝗦𝘂𝗰𝗰𝗲𝘀𝘀 𝗟𝗲𝗮𝗱𝗲𝗿𝘀:  • 𝗥𝗲𝘁𝗲𝗻𝘁𝗶𝗼𝗻 & 𝗖𝗵𝘂𝗿𝗻 𝗥𝗮𝘁𝗲𝘀: High retention and low churn show that your team is building lasting, profitable relationships.   • 𝗨𝗽𝘀𝗲𝗹𝗹 & 𝗖𝗿𝗼𝘀𝘀-𝗦𝗲𝗹𝗹 𝗥𝗮𝘁𝗲𝘀: Measure success in generating additional revenue from existing customers.   • 𝗡𝗣𝗦 & 𝗖𝘂𝘀𝘁𝗼𝗺𝗲𝗿 𝗛𝗲𝗮𝗹𝘁𝗵 𝗦𝗰𝗼𝗿𝗲𝘀: Gauge customer satisfaction and loyalty. 𝗥𝗲𝘃𝗲𝗻𝘂𝗲 𝗘𝗻𝗴𝗶𝗻𝗲 𝗠𝗲𝘁𝗿𝗶𝗰𝘀 𝘁𝗼 𝗠𝗼𝗻𝗶𝘁𝗼𝗿 𝗧𝗼𝗴𝗲𝘁𝗵𝗲𝗿:  • 𝗜𝗻𝘁𝗲𝗴𝗿𝗮𝘁𝗲𝗱 𝗙𝘂𝗻𝗻𝗲𝗹 𝗖𝗼𝗻𝘃𝗲𝗿𝘀𝗶𝗼𝗻: Track the seamless movement from MQL to SQL to closed deal.   • 𝗖𝗔𝗖 𝘃𝘀. 𝗖𝗟𝗩: Compare the cost of acquiring customers with the revenue they generate over their lifetime.   • 𝗨𝗻𝗶𝗳𝗶𝗲𝗱 𝗗𝗮𝘁𝗮 𝗘𝗳𝗳𝗲𝗰𝘁𝗶𝘃𝗲𝗻𝗲𝘀𝘀: Assess how well customer data is shared and used across teams for smarter targeting and personalization. Shifting your focus from isolated metrics to these holistic KPIs gives you clarity on where your revenue engine excels—and where it needs improvement. Together, these indicators provide a comprehensive view of how effectively your organization drives sustainable revenue growth. Are you ready to break down silos and embrace a holistic view of your performance metrics -  to unlock the full potential of your revenue engine?

Most eCommerce brands obsess over revenue and ROAS. But the real game is in the metrics no one talks about. Here are 10 overlooked KPIs that actually drive growth (and how to optimize them): ~~ 1. LTV:CAC Ratio (The Ultimate Health Check) LTV:CAC = Customer Lifetime Value ÷ Customer Acquisition Cost 1:1 = You’re bleeding money 3:1 = Healthy 5:1+ = Printing cash If you’re below 3:1, either: ✅ Lower CAC (better targeting, UGC ads, referrals) ✅ Increase LTV (subscriptions, upsells, memberships) == 2. 90-Day Repurchase Rate If a customer doesn’t buy again within 90 days, they probably won’t. Fix it by: • Winback campaigns with targeted incentives • Selling bundles that create habits • Building a loyalty program that rewards repeat buyers == 3. Contribution Margin (What’s Actually Left?) CM = Revenue – (COGS + Shipping + Discounts + Ad Spend) If your CM is under 30%, you’re scaling a business that won’t survive. Get margins up by: • Cutting discount dependency • Negotiating lower fulfillment costs • Adding Onward shipping protection == 4. Subscription Churn Rate (The Silent Killer) High churn = your brand is a leaky bucket Fix it by: • Adding pause & skip options via SMS (Skio for example) • Add more delivery options and product variety • Sending an email 7 days before renewal reminding them potential lost perks == 5. Time to Second Purchase (T2P) Track how long it takes for a customer to place their second order—then cut that time in half. Tactics to speed it up: • AI-based Email/SMS flows with hyper-targeted recommendations • Exclusive discounts for second-time buyers • Reorder reminders based on average usage time == 6. Gross Margin per Order (The Scaling Checkpoint) At scale, 40%+ gross margins keep you profitable. If you're below that: • Increase prices (test 10% bumps) • Reduce discounting, do Cashback instead (@ Onward) • Negotiate better supplier terms (carrier rates, 3pl, etc) == 7. Refund & Return Rate A high return rate = a CAC multiplier. Fix it by: • Charging for returns (but offering free exchanges) • Clearer product descriptions & sizing charts • Post-purchase emails on how to use the product == 8. Organic vs. Paid Revenue Ratio If 60%+ of your sales come from paid ads, you’re in trouble. Brands with real staying power win on organic channels. The fix? • SEO & content marketing • Affiliate & referral programs • Retention tactics (VIP, loyalty, subscriptions) == 8. SKU Concentration Risk If 80%+ of your revenue comes from one product, you’re vulnerable. Great brands expand without overextending. Turn one-time buyers into multi-SKU customers with: • Bundles • Exclusive add-ons • Subscription perks == 9. % of Revenue from Returning Customers A healthy DTC brand makes 40%+ of revenue from repeat buyers. If you’re below that, focus on LTV levers: • VIP memberships • Personalized email/SMS offers • Post-purchase nurture flows Follow Josh Payne for deep dives on DTC, SaaS, and investing.