My little nephew and I planted flowers in a window box together last spring. Week by week he would come and visit and check on it or call asking me to send photos of the little sproutling and how much it had grown to his mom's phone. The progress was exciting. Watching it go from little seed to full-grown plant was amazing to him. The excitement he felt for growth is probably similar to the feeling you feel when you track your customer growth with your company. There's a pride in seeing the numbers rise and letting it resonate that "hey, I did that".
Tracking your Customer Growth Rate is important not only to see what you're doing well, but also the alternative. If there's a decline in performance, you should be aware of that so you're able to address it.
- KPI: Customer Growth Rate
- DEFINITION: The rate at which your customer base grows during a period of time.
- SIGNIFICANCE: Customer Growth Rate reflects how you are doing as a company and if what you’re providing your market is something that is growing in demand.
- RECOMMENDATION: Pay close attention to when your company has a spike or a lull in growth. Whatever you were doing when growth spiked: continue it. Whatever you were doing during the lull: stop and try a new approach.
Companies are generating more data than ever before, but most of it just sits there. Getting good insights from it is often too hard, too costly or just takes too much time. That's too bad because the benefits of being data-driven are substantial. (See The ROI of Big Data, Analytics & Benchmarking for more.) Part of the reason we developed our Big Data, analytics and benchmarking software was to solve this problem so CEOs and senior managers could get the data-driven insights they need to leverage strengths, strengthen weaknesses, identify threats and exploit opportunities. This series of blog posts examines the individual performance metrics that make up that analysis.
For more information on the value of measuring financial ratios, read here.