17 Metrics to Measure the Success of New Business Development
When it comes to gauging the success of new business development, CEOs and founders are key voices to listen to. From tracking relationship depth metrics to calculating return on investment, we’ve compiled the diverse insights of seventeen industry leaders. Discover the metrics they prioritize to measure progress and ensure their business strategies are on track.
- Track Relationship Depth Metrics
- Measure Prospect Outreach Success
- Assess Clarity of Business Mission
- Focus on Client Retention Rate
- Calculate Lead-to-Customer Conversion
- Analyze Sales Cycle Duration
- Monitor Customer Acquisition Cost
- Evaluate Customer Lifetime Value
- Track Organic Search Traffic
- Gauge Employee Satisfaction Levels
- Maximize Product-Market Fit
- Monitor SERP Keyword Rankings
- Measure Relationship Value Index
- Count Trials in Development Success
- Assess Recruitment Strategy Effectiveness
- Examine Operating Profit Percentage
- Calculate Return on Investment
Track Relationship Depth Metrics
While traditional metrics like lead generation are important, I believe the truest measure of new-business-development success is the depth of client relationships. We track metrics like Net Promoter Score (NPS) and customer lifetime value (CLV). This ensures new business development isn’t just about revenue, but actively building the future we envision for our company.
Krishna Bhatt, Chief Executive Officer, Webuters Technologies
Measure Prospect Outreach Success
A key metric in developing new business is prospect reach-outs. You must start with a robust pipeline of specific industry contacts through the use of AI technology and research. Once you have built the top of your new business development funnel, the volume of contacts will pave the way to your success. It becomes a numbers game. Set your own daily MAP (Minimum Acceptable Performance) standards, and exceed those expectations each day. The top skill you need will be relationship development.
By implementing the PMA Business Relationship Model, starting with an initial connection, moving to benefiting their personal and/or professional needs, then developing mutual respect, and ending with the building of trustworthiness through your actions, you will create mutually beneficial business relationships and drive your new business development to new heights.
Mark Krajnik, LSSGB, CPC, Fractional Chief People Officer, Performance Mindset Associates
Assess Clarity of Business Mission
Clarity and comprehension are key. After initial marketing tactics have been set up (social media, website, email marketing, etc.), are people able to easily identify what your business does, who it does it for, and why, or what your mission is? If this is clear and fills an evident gap in the industry, it’s a success! And growth will follow.
Keyana Kroeker, CEO, Key Creative
Focus on Client Retention Rate
One metric that I like to focus on when measuring the success of new business development is the retention rate. As a long-time freelancer and consultant, client satisfaction is very important to me. When your name is directly tied to your brand and your work, it’s more important to keep loyal customers than to sign on new ones.
Ken Freel, Freelance SEO Consultant, Nuaveu
Calculate Lead-to-Customer Conversion
I work in the B2B and B2C space as a service provider, and what helps me track the progress of my business is by determining my monthly lead-to-customer conversion rate. The lead-to-customer conversion rate tells you if your service/product design and multi-channel marketing strategies are effective in bringing in customers, which can then translate to business revenue. When your lead-to-customer conversion rate is between 2% and 5%, you’re on the right track.
Rebecca Sylvain, CEO, Nannies and Kids United
Analyze Sales Cycle Duration
We think an often-overlooked yet important metric is the length of the sales cycle. A faster time to close deals (whether won or lost) means reps can manage more deals and ultimately lowers the average cost of sales per customer. Just taking a sales cycle from 60 to 30 days doubles the number of new deals a rep can take on in a given year.
Corey Schwitz, CEO & Founder, On-Demand Salesforce, Hubspot and Revenue Ops Customization, Skydog Ops
Monitor Customer Acquisition Cost
One of the key metrics I personally rely on to gauge the success of new business development efforts is the Customer Acquisition Cost (CAC). It’s a straightforward yet powerful metric that tells me how much I’m spending to acquire a new customer. I find it incredibly telling because it directly impacts the bottom line and can be a strong indicator of the effectiveness of marketing strategies and sales efforts.
The way I see it, understanding CAC in the context of the Lifetime Value (LTV) of a customer is crucial. It’s not just about how much it costs to bring a new customer through the door; it’s also about the long-term value they bring to the business. This ratio of LTV to CAC helps me to not only measure immediate success but also to forecast the potential return on investment over time.
By closely monitoring CAC, I can make informed decisions about where to allocate resources, how to refine marketing campaigns, and when to pivot strategies if we’re not seeing the desired results. It also allows for a more granular analysis of which channels are most effective at bringing in valuable customers at a lower cost, which in turn can significantly influence the scaling strategy of the business.
In essence, while there are many metrics out there to measure the success of new business development, CAC stands out to me because of its direct tie to financial health and its role in strategic decision-making. It’s a metric that keeps me grounded in the financial realities of business growth and ensures that our efforts are not just bringing in any customers, but the right ones.
Georgi Todorov, Founder, Create & Grow
Evaluate Customer Lifetime Value
When it comes down to measuring the success of new business development, there’s one metric that often gets overlooked but is a true game-changer: Customer Lifetime Value (CLV).
Why? Because it doesn’t just show you the initial win; it gives you a panoramic view of the long-term relationship you’re building with your customers. It’s about much more than just a single transaction—it’s about understanding the ongoing value your customers bring to your business over time.
This insight helps you make informed decisions about where to invest in your product, your customer service, and your marketing. It encourages a focus on quality, long-term relationships over short-term gains.
Keep a keen eye on your CLV, and you’ll steer your business development efforts in a direction that not only grows your client base but also deepens those relationships for years to come.
Kellen Casebeer, Founder, The Deal Lab
Track Organic Search Traffic
One of the key metrics new businesses should use to measure their success is organic search traffic, since this metric indicates how well your website is performing in search engine results pages (SERPs). It reflects how effectively you are targeting your niche and the efficiency of your marketing campaigns and SEO efforts in attracting relevant visitors to your site.
Let’s face it, if there is no audience on your website, then there are no customers; hence, your business will not be successful.
Monitoring organic search traffic can allow you to gauge the visibility of your website for target keywords, track improvements in search engine rankings, and assess the overall impact of your SEO strategies on driving organic traffic growth.
Additionally, analyzing organic search traffic can help identify opportunities for optimization and refinement to enhance your website’s visibility further and attract more potential customers.
Hareem Sajjad, SEO Executive, Analytico
Gauge Employee Satisfaction Levels
Besides the plan to make a financial profit, every business is planned to strategically add value not just to its target audience but also to the employees that help keep the business running. As a general manager, I understand that employee satisfaction is a huge indicator of how much a business has successfully developed over a certain period of time.
The truth is, not just in the present, but also in the future, employee satisfaction is always crucial to sustainable growth and development in every enterprise. It determines how much of themselves employees bring to the workplace and how willing they are to contribute to growing the business.
I am constantly reminded that satisfied employees are committed employees, and the fact is, the kind of satisfaction that leads to commitment doesn’t happen within the snap of a finger; this kind of trust takes time to be cultivated. Additionally, satisfied employees also boost customer satisfaction rates because their job role and accomplishments meet their expectations; therefore, they are most excited to offer customers the assistance they need.
The truth is, running a business is a full-time job, but it is one that a single individual would not be able to manage alone if growth is to be sustained. This makes ensuring employee satisfaction paramount and tracking this metric an efficient means of measuring the success of new business development.
Andrew Johnson, General Manager, National Drug Helpline
Maximize Product-Market Fit
While revenue is undoubtedly an essential metric for any startup, it exists down-funnel from so many others that it can’t be your primary performance indicator in the early stages. Investors want to see a path toward growth and profitability, so look to maximizing product-market fit—though what that exactly means will differ for each startup.
For example, the electric vehicle market’s biggest challenge is infrastructure; charging stations need to be installed to inspire more consumers to adopt EVs, which will foster more development, and so on. As such, we measure product-market fit by how many new channel partnerships we’ve acquired. This metric shows investors that we’re laying the foundation for long-term growth and sustainability, which in turn encourages more partners to see ChargeLab as a valuable opportunity. That kind of outlook will help us achieve the scale necessary to make mainstream EV adoption a reality while ultimately maximizing revenue.
Shaun Stewart, President, ChargeLab
Monitor SERP Keyword Rankings
One of the key metrics we track for SEO clients is rankings on search engine results pages (SERPs). By monitoring keyword positions, we can directly measure how our optimization efforts improve visibility for relevant keyphrases.
Higher positions lead to more impressions, clicks, and free traffic over time. As core keywords move up the SERPs, a compounding effect occurs—more organic visitors discover our clients’ content, more leads convert, and revenue increases.
Zoltan Fagyal, SEO Consultant & Founder, Back Bay Digital
Measure Relationship Value Index
For Empathy First Media, success in new business development hinges on cultivating meaningful connections. Our Relationship Value Index (RVI) gauges the depth and longevity of client relationships.
By measuring factors like trust, communication, and shared values, the RVI ensures that our growth aligns with the authentic connections we forge. Building relationships that stand the test of time is a testament to our commitment to empathy-driven business practices.
Daniel Lynch, President & Owner, Empathy First Media
Count Trials in Development Success
One of the metrics I use to measure the success of new business development is the number of trials we conducted to make it happen. It depends on what the business development is, but sometimes, more trials or failures during the development of a new business scheme add to the end product’s success because of the time, effort, resources, and meticulousness that went into reaching its fruition.
I think people often overlook failures or trials over wins when they launch something new in business, but I believe that end results shouldn’t just be the basis for measuring success. The process should always be part of the bigger picture when evaluating the entire business as a whole.
Jamie Frew, CEO, Carepatron
Assess Recruitment Strategy Effectiveness
One of the metrics we use to measure the success of our new business development is the effectiveness of our recruitment strategies, particularly in matching skilled workers with their ideal jobs in the manufacturing and construction industries.
Our focus on ensuring a perfect fit for every unique requirement demonstrates our commitment to innovation and efficiency, which are crucial for the long-term growth and stability of our clients’ businesses. This approach not only addresses immediate staffing needs but also adds real value by enhancing efficiency and reducing friction at every step of the recruitment process.
Ana Alipat, Recruitment Team Lead, Dayjob Recruitment
Examine Operating Profit Percentage
There are ten key performance indicators that I recommend businesses track, one of which is operating profit percentage—or operating margin. This metric gives an overall picture of the financial health of a business, demonstrating its ability to generate profits. The figure is calculated by dividing the net income by the business’s revenue.
Not only is this KPI valuable for internal planning, but it can also be included in financial reports that lenders or investors will review to establish a business’s profitability when making loan or investment decisions.
Paul Carlson, Managing Partner, Law Firm Velocity
Calculate Return on Investment
One common metric for measuring the success of new business development is Return on Investment (ROI). It assesses the profitability of investments by comparing gains to costs.
A positive ROI indicates successful business development, with benefits outweighing the initial investment. Other metrics, like customer acquisition cost and conversion rates, can also be considered based on specific business goals.
Maryna Mitchell-Dereviaga, AI Video Generation Expert, Elai.io
