One of the fun things about running an online business is looking at the numbers.
One of the unfun things about running an online business is looking at the numbers when they aren’t going up or even worse going down.
So what numbers really matter?
To be honest, the only number that matters is revenue.
The key is understanding what other numbers lead to that. We’ve seen how a big following (a number people love to track) doesn’t always correlate to big numbers. But it can lead to big numbers.
And that’s the thing about numbers. You have to be very careful with them. Having a big mailing list doesn’t matter if people aren’t opening the email.
Ask anyone that has gone viral on social media about how much it helped their business. Most will say it didn’t help them at all and in fact was more stressful than anything.
The reason why is because going viral brings you a lot of the wrong people.
So the second most important number behind revenue is how many of the right people are you bringing in?
Unfortunately, that number can’t be measured because you don’t have the details on every single person that comes across your brand.
Everything Must Be Viewed as a System
Okay, I’ll admit that this section isn’t needed to understand how to build a Pocket Business, but it is helpful in understanding how to troubleshoot one.
This is where systems thinking really comes in handy. The idea is that you can’t look at your business as individual parts because you’ll miss something.
Instead, you need to view the whole system and how the individual parts interact with each other.
Before we talked about how people don’t know if your product is good or not so changing your product before people have bought it won’t tell you much. I also mentioned that in this case you should change the messaging to see if that helps.
But there is something else that should be looked at.
What if the messaging is right but you’re bringing in the wrong people? How are you bringing in the wrong people? The content you’re creating on social media is attracting the wrong crowd so when you funnel them down to your offer they don’t want it.
But instead of looking at that, you think you should change your offer.
The same thing happens when a sales page isn’t converting. Could it be the sales page needs some improvement? Yes.
But what if I told you that the majority of people that buy from you have made the decision to buy from you before they hit the sales page? The sales page is nothing more than a way to buy the offer.
If that’s the case then why wouldn’t a sales page convert? Either you’re getting the wrong people or the content leading up to the sales page didn’t prep them well enough.
A Numbers Breakdown
First, anyone that tells you, “The industry average is…”, is just making up stuff. What industry?
Second, at the beginning, any numbers are good numbers because they let you know where you’re at. That’s why it’s important to get stuff out there and measure.
Third, a number by itself is rarely helpful.
If you tell me that you’ve launched an offer and only made $73 then that doesn’t tell me much. If you tell me you’ve launched an offer to a mailing list of 10,000 people and only made $73 then that’s a story.
Let’s use an example of something that happened to me.
With my TikTok account I wanted to test a new offer so I added the link to my bio. This offer was $79.
At the time (no idea when you are reading this) my TikTok wasn’t anything major. Around 6000 followers and my videos were averaging between 250 – 1000. Some would do better but for the most part this was the amount of views I could expect from a video.
Are those good numbers or bad numbers? To be honest, those numbers don’t matter because my goal was to sell the offer. So if I only got 10 views but the offer was selling then would the views actually matter?
After a month of consistent posting I sold two of the offers. On the outside this looks like a disaster.
Here I am teaching you this stuff and yet I couldn’t sell more than $200 worth of goods. What gives?
- Did my videos suck?
- Did I not do enough call to actions?
- Was the audience wrong?
- Do people buy on TikTok?
These are important questions and I didn’t have the answers. All I had were guesses which is the only thing you have sometimes when running a business.
So your job is to run tests against those guesses.
Over time I began to see what one of the big problems was. The audience that I was attracting on TikTok were also watching videos from other people on how they make $10,000 a week.
You might’ve seen those kinds of videos where someone looks like they are in a basement, but miraculously started making $10k a week without any experience.
My videos on the other hand were diving into the details of business building and how you should approach things. It was a lot of Layer 2 stuff but there wasn’t much of Layer 1 (outcomes and problems).
That meant a lot of people didn’t understand why they should watch me. Those who did became fans but it’s hard for a video to blow up without the Layer 1 because people won’t stick around long enough to understand the rest.
But there was also an issue with the audience on TikTok.
I know this because the same content (but in written form) did well on text-based platforms like Twitter, LinkedIn, and Threads. There, the audience I was attracting was more mature in their understanding of the problems that come with building an online business.
Did this mean LinkedIn (as an example) is a better platform than TikTok? Not at all. It just meant for my particular messaging, LinkedIn was better.
I have other offers that do better on TikTok than they do on LinkedIn and it all comes down to the messaging. This is why you have to be careful with numbers.
Take a step back and look at the whole System to see if everything is doing its part or is there one piece that is causing all of the chaos.
Are Big Numbers Bad?
There might be some confusion in that I’m saying big numbers aren’t bad. Big numbers aren’t bad.
If you can get a lot of the right people then please do so.
I used to run a site that did very well with Google. It ranked #1 for a couple of big terms and these are the numbers it did.
There was no mailing list. There was no funnel.
People came to read a blog post and then saw the offer at the bottom and purchased.
But it required a LOT of people. We’re talking over 500,000 people a month to do this.
Other revenue charts that I’ve shown you were from brands that didn’t even come close to doing 10% of that traffic.
The point is that over time you do want the big numbers but chasing big numbers just to chase them will burn you out.
But over time, if you can work on building an audience of over 50,000 people and the majority of them are the right people, then you should do so. At that point, it becomes impossible not to make money.
However, you don’t have to wait until you get to that point. All it takes is one person to buy your offer so focus on getting the most out of each interaction that you have.
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