#332: 7 Must-Track Metrics That Will Make You More Money In 2025
Oct 15, 2024
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Unlock the secrets to financial success by tracking seven essential metrics! Discover the difference between lagging and leading indicators, and learn which types of leads to pursue. Ditch low-paying projects and focus on recurring revenue for stability. Find out why increasing your rates might be beneficial, even at the cost of some clients. Plus, get insights into creating a personalized roadmap for your business to boost your income consistently. Embrace a data-driven approach for greater profitability!
Tracking lagging and leading indicators helps freelancers understand their business performance and economic forecasting effectively.
Monitoring marketing leads, sales leads, and annual client value is crucial for enhanced client acquisition and revenue optimization.
Maintaining a 70% annual client retention rate fosters sustainable growth and predictable income through repeat business and additional services.
Deep dives
The Importance of Tracking Metrics
Tracking specific metrics in a creative business is essential for managing and affecting change. By measuring these metrics, such as finances or project timelines, freelancers can gain clarity about their business operations. The discussion highlights how understanding these numbers reduces anxiety and boosts confidence in predicting income over time. If freelancers neglect these essential metrics, they risk only seeing the negative outcomes, often too late to correct them.
Key Client Acquisition Metrics
To effectively acquire clients, four key metrics should be tracked: marketing leads, sales leads, clients, and average annual client value (AACV). Marketing leads represent initial interest, while sales leads indicate more serious inquiries about hiring services. The transition from marketing leads to clients shows the effectiveness of the business's client acquisition efforts. Tracking the AACV helps to ensure that not only are freelancers gaining clients, but they are also securing profitable projects that contribute positively to their revenue.
Understanding Time and Revenue Dynamics
Freelancers should also focus on the average time to close clients and project completion times to enhance business efficiency. Knowing how long it takes to convert a lead to a client, and to complete projects, facilitates better workload management. Tracking how these time metrics align with revenue helps freelancers optimize their schedules and avoid potential income dips. By analyzing these patterns, freelancers can predict and stabilize their income despite fluctuations in client demand.
Maximizing Profitability through Dollar Per Hour
Tracking dollars per hour is vital for freelancers to understand their profitability concerning different clients and projects. By analyzing the income generated per hour of work, freelancers can identify which projects yield the highest returns and make informed decisions about which clients to prioritize. This practice enhances overall business efficiency by enabling freelancers to eliminate low-paying, time-consuming clients. Adjusting service offerings or pricing based on this analysis leads to smarter business choices and improved financial outcomes.
Retaining Clients for Sustainable Growth
Annual client retention is a critical metric for ensuring sustainable business growth over time. Aiming to retain 70% of clients year-over-year allows freelancers to build a more predictable and secure income stream. The potential for growing revenue exists through repeat business and offering additional services to retained clients. By understanding retention rates, freelancers can formulate strategies to enhance their relationships and increase their value to existing clients, ultimately leading to a more profitable operation.
If you’re not tracking these seven key metrics in your business, you’re leaving money on the table.
Seriously—most freelancers don’t bother, and it’s why they never hit the income goals they SAY they want.
I just dropped a new episode breaking down the 7 metrics you need to track. If you focus on these, you’ll make more money AND do it consistently—plain and simple.
It's not hard to do, but you DO need to know which 7 numbers actually matter.
In this episode you’ll discover:
Understanding lagging vs. leading indicators
What kind of leads to seek
Key benchmarks for your business
Eliminating low-paying aspects of your work
Getting recurring revenue rather than new clients
Why raising your rates is ok, even if you lose clients
How to progress in your business with a personalized roadmap
