Why Numbers Mean Everything: Part One

Why Numbers Mean Everything

Why Numbers Mean Everything

Patterns, numbers, equations, those are the things that I believe very brilliant business people study.  The old adage “You Can’t Manage What You Don’t Measure” is definitely true.  How do we manage things?  We measure them.  How do we measure them?  By counting them.  When looking back over my successes and failures I can definitely tie my successes back to multiple attempts.  I can see the number of tries, number of attempted solutions, and number of times that I got up and tried again.  I saw this quote this morning and it reminded me of numbers once again:

“I will never quit. I persevere and thrive on adversity… If knocked down, I will get back up, every time.” ~ U.S. Navy SEALs

Success often depends on how many times we are willing to try something.  Thomas Edison supposedly answered this way when he was asked about the thousands (3 thousand according to some people) of attempts he had made at finding the right fillament for the incandescent light bulb:

“I didn’t fail 3,000 times. I found 3,000 ways how not to create a lightbulb” ~ Thomas Edison

That may sound like a comedic answer to mask the sting of failure, but I believe that that attitude was the secret to Thomas Edison’s successes.  If you can see today’s failures as just positive learning opportunities that bring you closer to the success you are seeking then you’ll find each single attempt to be worthwhile.  It’s just one of the numbers you have to cross off on the journey of success.

Part One: Youtube Optional Interactions

This weekend while I was watching some of my favorite artists on Youtube I started “liking” some of the videos using the Like button under the video player.  I noticed something interesting after checking it out on a few dozen videos.  The ratio of likes to views was basically the same no matter how many views they had gotten.

For example, take a look at a video that has relatively low views How To Get More Followers On Twitter.  As I write this, the video has 18 likes and 6,712 views.  I drop that equation into finder and here is what I see:

Youtube Optional Interactions

18 divided by 6,712 = .002681764005 or in simpler terms, .27%.  That means for the almost seven thousand viewers, only .27 percent took action on “Liking” it.  Liking of course is the optional action that they can take if they want to take some soft action on their enjoyment of the video.

Now take a look at Johnny Cash – Ring of Fire.  As I write this, the video has 11,886 likes and 4,117,092 views.  Once again I calculate the likes versus views and here is what I see:

Youtube Optional Interactions

11,886 divided by 4,117,092 = .002886989166 or in simpler terms, .29%.  The numbers are within 2 hundredths of a percent even though we are talking about 4,110,380 more views.  I started running this equation on all the videos I was watching and found that overall most videos fell in the .002 range.  Here and there you will find one under .002 or over .004 but the pattern is to have .002 percentage of likes to views.

Alright, now that you know this, what does that have to do with anything?  This could mean absolutely nothing to you, or lead you to realizing that the numbers involved in day to day social media, sales, management, and the technical work that you do all have a pattern if you do them consistently.

For me, looking at this data about how many “likes” are received versus views made me want to investigate more how many people share a video after they watch it.  I’m certain the ratio is much higher.  I hope to find this information soon.  I did realize that optional interactions like this that users can choose to do or not do are pretty low compared to views.  Comparably when I look at a recent posting on my Facebook page as the administrator I can see that I’ve had 135+ impressions on most things I’ve shared there, but rarely any likes.  If the math holds true for this social media site as well then I would have to get over 500 impressions to get a single like.

Why Does This Matter?

The fact that I can show you the ratio of views to likes may or may not affect your life today directly as it relates to Youtube or Facebook.  It should make you consider anything you work with that involves numbers though.  If you can take a step back and look at the numbers that are involved in your day to day business and life you can see patterns in anything that you do on a consistent basis.  You can look at you the patterns of numbers and sequences around you and learn to expect what you’ve determined from your study of the numbers.

Today, think about the adage “You can’t manage what you don’t measure”.  Schedule some time to sit back and take a broad overview of your business.  Learn to see the patterns in what is going on around you.  You’ll be surprised to see what you find.

You Need Overflowing Leads

You Need Overflowing Leads

You Need Overflowing LeadsDo you have new leads overflowing all around you?  As I write this post I have 513 new leads sitting in my inbox.  If you don’t have hundreds of new opportunities in front of you then how can you build your business?  You need overflowing leads.

Find a Free or Low Cost Lead Source

Last night I was at my local casino.  The gambling machine in this picture is the one that you drop quarters into and the more you drop in the more quarters drop over the edge into the payout tray.  The person who designed this was incredibly bright.  They realized that if someone heard that clinking quarter in the payout tray often enough, that they would keep dropping quarters in just because they think that there is a possibility that the whole shelf may drop a big payout.  Unfortunately you can play this machine for hours and not make any money.

One thing that the quarter machine does remind me of is a good lead source.  If you realize that there are hundreds of leads out there just waiting to tip over the edge than you’ll stay motivated and keep working to find, develop, and refine a system that gives you leads constantly.

What you need to find is low cost or free leads.  What if each lead only cost you 25 cents, it would only cost you $250.00 for one thousand leads.  What if instead of dropping a quarter in the leads machine you could put a free metal washer?  It sure would be easier to push some of those leads over the edge if you had a bucket full of washers.

Low cost or free lead options are out there.  You just have to commit to seeking a perfect lead source until you find it.  The 513 leads I mentioned were all free.  Because they are free I’ll probably have to discard over half of them, because the quality might be lower than my standards on half of them, but that still means I have 250+ quality leads.  It took me about 18 months to find a solid lead source that fit me well.  It was worth it though, now I have overflowing leads.  Your lead source will be unique to you, so take time to study what fits and what doesn’t fit, and don’t stop until you are satisfied with the cost and quantity of your leads.

Control the Flow

One thing that is critical to your success in lead management is the ability to control the flow of your leads.  Can you turn them on and off?  Do you know what you’ll get if you turn on the lead source for 90 days?  Remember it’s not really a reliable lead source unless you can control the flow of leads 100% of the time.  You need to know that for every 100 leads you’re likely to close X percentage.  This way you can turn on your leads, get busy closing some new customers and see consistent growth in your company.  Be sure you can control the flow of leads when you look at a new lead source.

Create a Solid Approach for Closing Each Lead

Once you’ve received the lead, reviewed it and pre-qualified it, then you need to put it into a system that allows for the highest possibility of converting it into a sale.  Think about the hours that you invest in each new prospect.  I know for my team we can spend 12-40 hours to close a lead.  Depending on the size of the job 40 hours may be worth it.  In some cases it might take 120 hours to close the deal.  Whatever it is, you don’t want a missing piece in your system to lower your chances of success.  When I wrote Stop Hiring Weak Sales People Now I described a method that allows your strongest sales person (often you, the business owner) to close the sales by using a system that sends all qualified leads to you.  Whatever the approach is, you should be careful to study and refine your prospecting and sales approach so that you can wisely use your team’s resources to close more deals.

Follow Up with Long Term Follow Up on Won and Lost Leads

Last week I looked to see how many dollars I invoice compared to the proposals I send out.  39% of all estimated work in my tech company ultimately becomes an invoice.  I think that is a reasonable close rate.  It’s not where I would like it to be, but it’s a good gauge on how much work I need to quote in order to reach my sales goals.  Basically for every million in sales I want to do, I need to send out estimates for 2.5 million.

One of the important pieces that I’ve been focusing on more recently is long term follow up.  No matter if I close the lead or lose the lead initially, there is a huge opportunity to do more business in the future if I am diligent to follow up.  I use a product called Infusionsoft (affiliate link) because of the intelligent tagging and automated decisions that the software can make for me after I set it up.  Whatever software or method you choose, be certain to put something in place that allows you to follow up with closed and lost leads in a consistent manner.  Follow up is key, no matter what industry you’re in, you have to have a follow up plan if you want to increase your close ratio.  Make a point today put some follow up procedures and methods in place that are automated and don’t get lost in the daily shuffle.  There is a quote in Infusionsoft that really stood out to me and I think it’s important to remember:

Don’t get too hung up on getting your copy perfect.  Following up doesn’t require prefection.  Reaching out is what makes the difference! ~ Infusionsoft

I remember that line every time I build a new automation sequence and every time I sit down to write a new post.  Although my work isn’t always as perfect as I would like it to be, I’ve committed to stepping out and producing content on a consistent basis.  My consistent actions produce results, not the perfection or lack of perfection in each action.

So there you have it, four of the pieces I think about when I work to create overflowing leads for my business or one of my clients.  Take action today and generate yourself overflowing leads!

5 Easy Techniques for Small Business Owners to Save Money

5 Easy Techniques for Small Business Owners to Save Money

5 Easy Techniques for Small Business Owners to Save MoneyIf you set out your goals and objectives for the year like I have then they should still be fresh in your mind.  I hope that you’ve placed them somewhere in front of you so that you can see them every day when you wake up and get to work.  One of my annual goals has always been to save 10% on my existing expenses.  If you quickly eliminate 10% of your monthly expenses at the beginning of the year think about how much you have just made.  If you aren’t paying it out to other vendors then it’s money that you can keep in your business and ultimately pay yourself with.

Here Are the 5 Techniques that I Use to Focus on Saving Money:

1. Review Your Checking Account Thoroughly

One of the fastest ways to save some of that 10% that you need to save is to pull up 90 days of bank statements.  Review each charge carefully, especially the ones that reoccur monthly.  If you don’t remember what they are or can’t immediately justify the expenses with revenue that it generates for you then CANCEL THE SERVICE! Don’t wait for a better time, go to the site, call, or take whatever action you have to take to eliminate the charges.  If you can’t remember what you signed up for, then call your bank and they can help you eliminate the charge or track down where you need to call to get this service removed from monthly billing.

Don’t wait, act now and get rid of that unneeded expenses!

2. Eliminate Services That You Haven’t Used in 30 Days

Once again, look through any services that you are getting monthly invoices for and see if you have actually used them in the past 30 days.  If you haven’t then it’s time to remove the service or do what I describe in step three.  My mother used to tell me this rule of thumb when I was sorting through my belongings; “If you haven’t used it in a year get rid of it!”.  She was right.  With business you have to act much sooner than a year, think about it, even a small $25.00 per month fee ends up being $300.00 in 12 months.  Stop it now, eliminate the service if you aren’t using it.

3. Trim Down Existing Services

As you review your checking account and other monthly services that you use you may see services that you originally needed full access to at full price.  Now, with a shift in your model you may only need part of the service or part of the time you originally paid for with the vendor.  If that’s the case then pick up the phone and call the provider.  Adjust the service to what you are using and eliminate the extra unused portion of the service.  Even if you are in a long term contract most vendors, when you explain it carefully, will see the value of keeping you as a client at a reduced rate over losing you completely.  Looking forward always be careful with contract terms.  Things can change overnight in business and you need the flexibility to adapt your model.  Don’t lock into something long term that you can’t afford to honor.

4. Turn Down the Heat

This is an obvious tip, I know, but in reality, it’s something you should do.  Unplug the extra appliances, computers, screens, and electronics that you don’t need.  Turn of your LCD’s at night, and turn down the heat.  Use less water, and turn down the hot water tank.  If you take 10 minutes today to write a best practices list for power usage and you walk around and change how you use power and heat you’ll see a difference.  Remember that $20-30 a month can add up quickly in expenses or savings.  Take action on this now, it’s worth the savings, and it’s worth it to be more responsible with the shared resources that we all utilize.

5. Eliminate Wasted Labor

Eliminating wasted labor is something that is easy to do if you have the guts to do it.  Seeing wasted labor resources doesn’t have to be difficult.  Act wisely when you move to implement the changes you have to make in the labor area.  Take your time and be gentle.  This is a change that personally affects you and your team.  Where is your wasted labor?  Maybe you:

  • Have let hourly staff clock in a few minutes early unnecessarily.
  • Have scheduled a work day that starts before your clients need you.  Starting at 10am could make more sense than starting at 8:30am.
  • Have hired someone for a full time position when it was really a part time position.
  • Have allowed overtime hours to be paid too often.  A policy change could be in order.
  • Have over paid for contract or part time labor, consider effective outsourcing.

Whatever areas you have overlooked in the past now need to be carefully and thoroughly considered.  It’s possible and important to shave some of the cost off of your labor force.  As hard as it is to let a team member know that you have to move them to part time, or in some cases eliminate the position, you have to take action on this.  If you don’t handle your finances wisely and proactively there won’t be any finances to handle.  You’ll go out of business.

A big part of financial freedom is having your heart and mind free from worry about the what-ifs of life. ~ Suze Orman

To lead and grow your business you need financial freedom and peace of mind.  Take control of your finances today and don’t leave anything to chance.  If you take action you can succeed.

The Top 10 Things That Entrepreneurs Do

I heard a very interesting podcast about the world of entrepreneurs back before Christmas.  The guests, Anne S. Habiby and Deirdre M. Coyle, Jr., were talking about their recent article “The High-Intensity Entrepreneur” from the Harvard Business Review. What stood out to me from the podcast and the article was this statement:

Today entrepreneurs anywhere can create value with relatively little capital.Today entrepreneurs anywhere can create value with relatively little capital.

That single line made me think a lot about the simple question, what is an entrepreneur?  Why can they create value with so little capital?  What is the difference between being a one man shop, and an enterprise?  What do entrepreneurs do that make them succeed in the long run?  One of my favorite leaders of all time, Winston Churchill, said this about entrepreneurs:

Some regard private enterprise as if it were a predatory tiger to be shot. Others look upon it as a cow that they can milk. Only a handful see it for what it really is – the strong horse that pulls the whole cart.

Here are the top 10 reasons why I believe entrepreneurs succeed:

1. They Can Sell Anything To Anyone

I sometimes overlook this, but it’s because it’s second nature to me.  I can sell almost anything to almost anyone.  This is the number one thing it takes to be an entrepreneur because if you can’t sell your idea at the beginning you are going to fail quickly.  You have to be able to:

  • Get people to trust you
  • Provide them solutions
  • Close the deal and get the check

2. They Think Large From the Beginning

If you don’t start planning from the beginning to open more locations and franchise or grow your idea then you won’t plan properly.  Entrepreneurs think about:

  • How they’ll add staff
  • What their long term management structure looks like
  • How their financial model changes when their staff and number of locations grow

3. They Build With Systems in Mind

If you don’t start to think about systems from day one you’ll establish a crippling habit by relying on people instead of systems.  No matter who you are working with, the fact that they will ultimately leave you is inevitable.  Don’t be ignorant and blind.  Death, family issues, differences of opinion, and boredom are just a few causes of this.  Work to build systems that help you:

  • Make rock stars out of people with average skills
  • Give you a tight hold on your finances at all times
  • Makes raving fans out of your customers every day

4. They Make Everything Scalable

When you rent your first hosting account, are you thinking about how you’ll be able to move and grow your site?  When you lease your first office location, are you thinking about what expansion looks like?  When you purchase any service, do you think about how it can grow when you have a larger team and you need more?  Partner with great vendors who understand win-win and who can:

  • Start small and grow with you
  • Consistently deliver on time
  • Work with your standards

5. They Pursue Mass Market Appeal

Entrepreneurs are always looking for how they can take their idea to the masses.  The flattening of our world makes this easier to do, but it still means that you have to:

  • Research your idea and market thoroughly
  • Survey your demographic
  • Test market your idea

6. They Provide for Others

The word I like the best from the quote in the article I shared is the word value.  I believe that the opportunity to serve others and create value for your team is the greatest part of your job as an entrepreneur.  Real entrepreneurs:

  • Think of their teams financial needs above their own
  • Think of how to train and grow each team member
  • Try to ensure that their enterprise gives back to their community

7. They Have Incredible Resilience

In order to make it as an entrepreneur you have to be tougher, faster, and more resilient than the rest.  Trying and failing 1,000 times just means that you should keep trying.  Making no money for 2-3 years while you invest is what it takes sometimes.  Entrepreneurs are:

  • People with incredible physical and mental stamina
  • People who refuse to listen to negativity
  • People who’s attitude carries them forward

8. They Learn From Their Mistakes

When I hear someone tell me they are afraid to fail, I have one simple answer.  You will definitely fail.” You might be surprised because that doesn’t initially sound positive, but it actually is.  If you can get over the fact that you will fail and make mistakes then you can:

  • Treat mistakes as learning opportunities
  • Not let fear stop you from trying something new
  • Learn and grow faster than your competition

9. They Know That Businesses Fail

Entrepreneurs know that even the best ideas can fail.  Perfectly laid plans can go of course.  Time can change a model and make it obsolete.  If you understand that businesses fail and close up eventually then you can:

  • Live in reality and plan well personally
  • Learn to see the trends in business
  • Protect your team when you see the end coming

10. They Can Remake Themselves

Once you’ve been around the block a few times and started a few businesses you understand a lot of what I’ve described here.  A true entrepreneur won’t let let the ultimate learning experience of going out of business stop them.  Entrepreneurs can remake themselves, jump into new industries and use what they’ve learned to:

  • Start over with $20.00 in their pocket
  • Sell a concept and then produce results
  • Innovate better than the rest

That’s what it takes to be an entrepreneur.  Do you have it?  If you do then you can deliver results over and over.  Get out there and show the rest of us how it’s done.  Don’t ever let your fear stop you.

More great articles on entrepreneurs:

10 Successful Entrepreneurs You Must Connect With

Entrepreneurs: You do Know You’re Unemployable, Right?

The Entrepreneur’s Handbook – 59 Resources For First Time Entrepreneurs

50 Leaders Who All Young Entrepreneurs MUST Follow on Twitter

Einstein’s Advice For Entrepreneurs

Launching a New Generation of Entrepreneurs