How To Use Key Metrics To Drive Your Business To Growth

Hey, it's Mark Podolski, land geek. Your favorite niche real estate website, thelandgeek.com and on this week's roundtable, we have almost all the usual suspects, sans Mike Zano. We've got Dude Buddy, the Nightcap OG Scott Bossman. Scott. How are those cuddies doing?

Oh, I shouldn't be wearing this hat. But it's new. I like it. I heard Cubs fan. You know, I had 2016. Didn't we, Eric? We had 2016.

Years.

Good for the next hundred years. Speaking of good for the next 100 years, we've got Terea putting in the reps. Harris Terria. How are you? I'm well.

How are you?

She's got Benjamin Button thing going on. Tree is definitely good for 100, 150 more years. I'm great. I'm great. Eric Peterson, the technician. Scott and I were able to go and see Casa de La Peterson, and I am telling you, it is beautiful in Nashville. Franklin. I am no longer making fun of Franklin, Tennessee. There were no ribs. It is an amazing, beautiful place. And to see his wife and his kids and them in the Peterson household, you just walk out just feeling better, just like a better human being. That being said, comparison is the thief of happiness. So I try not to compare my setup to Eric's setup because I would just be in a ball of shame. Eric, how are you? Good to see you again.

Good to see you, too. I'm happy to be here. It was great to have you guys in town for a couple of days and get to spend some time with you. Looking forward to today's podcast.

Awesome. And let's move on. I love it when you call me Big Papa Tate. Litchfield Tate. How are things in Sin City?

Ah, they're good. We had a little bit rain come through this morning, so. Beautiful day.

That's nice. It's always beautiful when it's raining in the desert. It's raining here. It's fantastic. And last but not least, you know him, you love him. The brain, the professor, your flight school Sherpa. Scott Todd from Scott Todd.net landmodo.com learn anything but anything. Investor ninjas.com Scott Todd, how you feeling post Nashville?

I feel great, man. But you know what, Mark? We spent time with Eric, and I never once, not one time, saw him walking around with a rib out of his mouth. So I don't know. I don't know. I think you made that up.

I made it up and I thought, oh, he's not eating ribs. You know, it's going to be fried green tomatoes or grits. None of that actually happened. Although I will say I did try grits, and they were delicious. So Nashville's got a special place in my heart now for sure. But, Terea, what is our topic on this week's roundtable discussion?

This week I would like to talk about business metrics. I know this has been talked about before, but it seems to be a reoccurring topic, especially for some of my coaching clients, where we're having to dig into the business and determine how we move it forward, how do we make better decisions, how do we run the business better? And without having metrics, we're running into problems. Now we're just throwing things out there, hoping they work. And if they work, we're just going to continue to do that without evaluating why they work. So I want to talk about metrics and how we use them to move our business forward.

Right, right. Okay. So I think this is a great topic. If you're at a fancy investment banker conference or venture capital conference, don't say metrics. You want to say KPIs, your key performance indicators. If you want to get really fancy and flexible, you want to say okrs. Right? Your key objectives, your key results. But because we're not pretentious, we're just going to say metrics. Right? What are the numbers that drive the business? And so we're going to go to the unpretentious. And again, he's sober. Nightcap Scott. Bossman.

Dude, buddy, always sober for you, Mark. Well, so, you know, I think this discussion could, could be very in depth. But I guess some of the simple things that we look at monthly are going to be, well, we have some target numbers to reach. Right. So how many mailings are we sending out? Did we reach that? What was our response rate? Which, by the, by the way, I love an LG pass. Now on the homepage, you can just go in and see how many mailings you've had the last 30 days and what your response rate is, which pretty awesome. And, you know, your costs associated with mailing. So we're looking at that. As far as sales, we have target goals for sales every month. So at the end of the month, we'll kind of sit down and say, you know, what were our goals? How many did we sell? Ideally, you know, tacking on a bunch more passive income. And we keep track of that stuff in a spreadsheet. I get a little report from my bookkeeper at the end of the month with some of those metrics along with a monthly P and L report as well, where we can look at those numbers. So those are some of the things we're looking at as we go month to month.

I love it. I just want to make one correction, Scott. You said you're mailing costs as opposed to an investment.

It's not a cost, it's an investment. You're right.

It's an investment. But I really loved everything you said. I don't know if anyone's going to be really too far off from what they're measuring, but I'd love to hear what the technician Eric Peterson looks at for his. Numbers. What numbers matter to you?

Yeah. So, I mean, all the things Scott talked about are all things that we look at on a regular basis. I thought that maybe we could talk a little bit about the buyers list. It happened to come up last night on office hours. And, you know, it's important to watch the growth and manage that buyers list as kind of part of your metrics on a monthly basis or weekly basis, however you want to do that. But obviously, we want to continue to see growth in that buyers list. We're adding more emails. Certainly there are going to be some that fall off. They're going to unsubscribe, but that's okay. But the next level of just kind of monitoring the external sources, those emails coming in, and maybe unsubscribing, we also need to think about on a regular basis, whether that's quarterly, biannually, or at minimum, annually, kind of scrubbing that buyer's list. Okay. And removing those cold subscribers. So a cold subscriber is someone that's not opening your emails over a period of time that might be over the last three months, whatever your. Your quantifier is. But if you continue to leave those emails on your list, you're actually hurting yourself. It looks great because you got a big number because you still have those people on your list. But when you send mail and it's not opened, it hurts your reputation as a. As an email marketer. So that applies to your domain. And, you know, the worse that reputation gets, the less likely you are to show up in someone's inbox. So it's really important to manage that list and kind of, you know, as painful as it might be, remove those cold subscribers on a regular basis. In doing that, I suggest make a segment of those cold subscribers, send them a specific email, warning them that you're going to remove them from the list, and give them the option to let you know they want to stay on the list. And therefore, if they don't respond, we know that in a week's time or whatever, we're going to actually remove those. Those emails from the list. Our list is going to get smaller, but our open rate is going to go up.

Okay.

And the other thing is, I think it's really important to understand where your sales are coming from because it helps us know where to invest our money. So I'll leave it at that.

I think those are two great metrics, and I really like what you said about the email list because your email list is by far your greatest marketing asset. It's the only one that you own. And if it's not growing or if it's not engaged, something needs to change. And then, of course, not knowing where you're getting the majority of your sales from is you're just flying blind. You're marketing blindly. So Those are really two KPIs that you want to keep your eye on. See, I got pretentious there. So let's get me unpretentious and go to Taria. Putting in the reps. Harris Terria, this is your topic. What metrics are you looking at that are driving your business?

So we try to look at our business, like, holistically and I mean, full disclosure. When we started off, maybe we just track, like, maybe our leads or you. That was important. But over time, we begin to try and track everything from the acquisitions to our current inventory, our leads, our sales, our marketing efforts, even down to our expenses. So if we are in a situation where we're trying to evaluate, can we cut back on certain things, which part of our business is costing and shouldn't be costing, track even our expenses. So we try to keep track of kind of everything in our environment. And ideally, we want to look at it on a weekly, monthly, quarterly, you know, on an annual kind of basis. And that's how we determine whether we need to make changes in any parts of our environment or if we want to make changes. We use those metrics to determine how we need to change.

So, Tree, can we get geeky for a second, please? Because I can imagine with all those numbers, are you managing that through a custom dashboard or how are you looking at it?

Yeah, we have custom dashboards for each one of those sections of our business.

And how did you create a custom dashboard?

I hired someone to create custom dashboards.

Brilliant. Brilliant. How much was it?

This guy was about $200 a dashboard.

Okay, that seems reasonable.

For me. It was.

Yeah, that seems really reasonable. Wow. Well, I have nothing else More to add when you're. I mean, when you're. When you're measuring everything, you're literally managing the business about as efficiently as you can as the CEO. So I'm sure Scott Todd has his opinion on that. But let's defer. Let's defer. I love it when you call me Big Papa Tay Litchfield. Yeah. I mean, what are you looking at?

You know, I think one thing that's important to kind of discuss when we talk about KPIs and metrics is that you can get bogged down in this, right? You can. You can spend too much time in the weeds collecting data. And at the end of the day, for me, one of the things that I look at heavily, aside from number of offers that go out to amount of inventory added to number of sales, is I like to know how much my leads cost. That's something that I'm always interested in. And if I have a rough idea of how much they cost, I know when to throw more money at a platform or a process or system that's working for me. The land business is not really about following my gut anymore. It's about following the numbers where it makes sense and the data doesn't lie. Right. I still rely on my gut because it's got me this far. But it's really easy to make those high level, very important decisions based on fact. And when it comes to marketing, that's a slippery slope. You can spend a lot of money incorrectly really, really quickly. And so if you're going to be paying for marketing, it's nice to know, hey, Land Moto crushed it for me last month and it cost me X per lead or X per sale, and I'm happy to pay that all day long. Why would I ever leave it?

Yeah, absolutely. Absolutely. Well, last but not least, Scott Todd, the brain, the professor. Before you give your answer, how you measure, I'm just curious, what are your thoughts on Terrea's holistic approach to really managing every aspect of their business in a custom dashboard?

Yeah, I find that pretty interesting. I think that this actually goes into what I was going to say, which is, I think it's good, but at the same time, I think that you can easily overdo it. What I mean by that is that you can become so metric driven that you just come to a grinding halt. And I've seen this happen before with people like, oh, well, I can't do any of these other things until I get all these metrics in place, and I got to get all these things in place, when really all it comes down to, in my own opinion, is just your mailing response rate. Because the mailing response rate, I mean, everything else that everybody said was good. But see, to me, the mailing response rate tells you at the beginning how well the market's perceiving you. So we talk a lot about, like, the 3 to 5% response rate. And the one thing I hear a lot, especially in this market environment, is I hear people say, oh, well, I'm not getting 3 to 5% response rate. And you know, my response rate's really low. And then it's like, and then what are you doing about it? Right? And I think that that's the thing about all of these metrics. You can have all the metrics in the world and a number is a number. The next follow up question should be, so what are you doing about it? Right? Like, that's what I always ask myself or my team. Like, they might say, well, this is a problem. And I'm like, well, what are you doing about it? So let's talk about the response rate. For example, let's say that you're not getting a 3 to 5% response rate. And remember, that's not. Just because you mailed 100 offers today doesn't mean that, you know, in, you know, I don't know, in two weeks you should have a 3 to 5% response rate. That's not the way that it works. It's a rolling response rate. So what I mean by that is, let's say that you mailed 100 offer letters this week. Well, you got to give them time to go through the process. You got to let it go. It's like a farmer planting the seeds. He goes out there, he plants the seeds, and if he goes back the next day and he doesn't have a crop, he's not upset. He, he understands that it's got to bloom, right? Like, it's got to go through the process to like, grow. So you got to let the mailing go. So If I mailed 100 this week, Mark, on the calendar, I mailed 100, and then let's say six to eight weeks later, I should come back and say, from the 100, how many responses do I have? Oh, I've got one that's a 1% response rate. Well, what is that telling you? Most people would say, oh, this, this business is terrible, man. Like, hey, I didn't get anything. Okay, well, that's the problem is that you accepted a number and you're like, I only got a 1% response rate as opposed to understanding that the response rate is telling you what the market is thinking of your offer. So we've said very clearly, if you're not getting a 3 to 5% response rate, the market doesn't receive your offer too well. So the follow up question should be, okay, I've got a 1% response rate and what am I doing about it? Well, the only thing to do about it is to increase your offer on the next batch of mailings. And a lot of times what happens is people, they get too overly excited. They take and they upload thousands of names in the LG Pass and let it drip out. And they're like, oh my gosh, now I got to change everything. Well, why not just go weekly until you find that groove, right? Like nothing says you have to upload 3000 names in the LG Pass and let them mail 20 a day. Why not just take what you're going to mail that week, price them out, upload them and let them drip every day and come back next Monday and do the same thing or whatever your day is, or maybe do two weeks. But see, the thing is that in a market where you're trying to understand your pricing, you've got to have the flexibility in there. Don't go slam 5,000 names in the LG Pass and then have to worry about, well, how do I fix these? Because then you have a mess, right? Because you're upping them, you're down, you're changing the pricing all over the place. Come first to understand what the pricing is before you scale. And I think that's a mistake. Now let's just say that the opposite happens. You mail your 100 offer letters today, six to eight weeks later, you've, you've got five responses. What's the market telling you? You might say, well, it's telling me that, you know, it likes my prices because it's 3 to 5%. I might agree with you. Or I might say, it seems like it's a little on the high side. Maybe you want to go down a little bit. You see, like it's a, the market talks to you if you listen. And so to Terea's point, everybody else's point, the numbers are great. But then you got to analyze the numbers and you got to understand that a number is just a number until you put some context behind it to take further action. Otherwise you're overcomplicating the business and you should just stick to the response rate of 3% to 5% and then everything Else will take care of itself.

I really like that, you know, we're all in different places in our business. When Sharia first started the land business, she might have been comfortable creating custom dashboards because she has a background in technology already. She's already super geeky, and she's already looked at other ways running different businesses, and she's really comfortable looking at these numbers and knowing, okay, if this is this, I know what to do.

Right.

When I first started, I had, like, a simple metric, which was how many views is my ad getting on ebay? That was literally the first metric I started with. That was it. And if it wasn't getting a lot of views, I would edit it and see what I could do to pump up the views. That was it. So as you evolve, you start looking at more and more numbers. But remember, every system needs to start out simple before it becomes more complex. And then you have a good system. But if it starts out complex, it's impossible to simplify it. So start off very simple, and then start building your. Your metrics from there. And I thought what everybody said was great, but again, we're all in different places with our business, and what will drive your business is going to be different than what drives Tate's or Eric's business. It's just. It's just that simple. So you've got to decide based on your goals, your starting capital, your time commitment, what are the key metrics that you personally need to start looking at to drive your business to the next level. And then you add on a new metric. But the last thing you want to do is get really geeky in the numbers and you're overwhelmed or it's sapping the joy out of the business. So hopefully you've gotten a lot of value out of today's podcast. And thank you, Treya, for giving us a great topic. But unfortunately, Treya, putting in the rep terrace, we're at that point in the podcast now. We're going to put you on the spot one more time. But before we do that, Tate, what do you got? You wanted to say something?

I think you just summed it up really well. Metrics are awesome. They're awesome.

Okay.

I don't know.

Did I smile or something? Did I?

Yeah, I thought you put your finger up like I got a point.

I don't have a point to make. I think you did a great job.

You know what? My fragile ego thanks you.

Listen, there's a reason you're the land geek.

Okay, now you're going too far. All right, Hosting next week's podcast will.

Be taped is marginal reason why you hope every. You host every week. Yeah.

Yeah. All right. Anyways, Teria, what's your tip of the week?

So my tip of the week kind of goes along with our topic, and it is by Peter Drucker, what Measured improves. And I want to reiterate what you said, Mark. In the beginning, we didn't start with, oh, let's gather all of this. We started with the areas we wanted to improve. And so we begin collecting those metrics. And then it just kind of involved. But without having the metrics, you kind of don't know how to improve.

Absolutely. And when you're the CEO of your business, think about Shark Tank and Mr. Wonderful. What's the first thing they ask? What's your numbers? Do you know your numbers? And you could. You'd be shocked how many people have been in business for years and they don't know their numbers. I mean, I'm sure, Tate, when you see that, it just makes you, like, rip your hair out.

Yeah.

I mean, it's just they're so important. Right. And they help out so much, and they, I think numbers for me, give confidence, and that's what I need in the land business. When I'm spending my money on vacant land, I need to know that there's somebody out there who want and appreciate this property. The numbers give me that confidence.

Absolutely. Absolutely. Well, I thought this was a great topic. And I do want to thank the listeners and remind them that the only way that I'll be able to talk baseball with the dude buddy, the Nightcap og and maybe he'll keep coming here, you know, sober, is if you do us three favors. Follow rate Review the podcast. Send us a screenshot of the review to supportlandgeek.com I want to tell you, ask you, I want to just remind you there's four ways we'd like to support you in growing your own land business. The first way is join the free Facebook group and the free Mighty Networks group. The second way is, again, follow the podcast. You don't want to miss the podcast, especially the Roundtable podcast. Every single week, we are discussing a new pain point in the business. The third way that we like to support you is, is if you're getting started, go deep with the Investors Toolkit. And the fourth way is if you have questions, get on a call with the Nightcap OG himself, Scott Bossman, or the zen master, Mike Zano, and see if they can come up something tailored to you. Specifically, the Investors Toolkit and booking a call are at that same link. Thelandgeek.com training and we are here to support you. All right, are we ready to do this? 1, 2, 3. Let. Let freedom Freedom ring. So, yeah, we have a new. We have a new metric.

Yeah.

How many podcasts in a row can we stay in sync?

Can we get. Can we get Tate's, like, energy up on that? Let freedom ring.

I was distracted. I was distracted.

You probably got a sail or something, you know?

Yeah, I mean, I'm about fishing.

I'm not here to brag or boast, but I was distracted. We had some good news come through, so.

Yeah, come on. Just. Just a little.

No way.

Listen, humble brag.

No way. Look, I don't kiss and tell, Mark.

That's not what Allison said.

We better end it right there.

We get in trouble. All right, thanks, everybody.

Thanks for listening to the Art of Passive Income podcast. Are you ready to learn how you can start building a passive income without renters, rehabs, renovations, or rodents? Schedule a free consultation at thelandgeek. Com training. Let freedom ring.