10 Field Service Metrics You Need to Monitor (and How Dataforma Can Help You Measure Them)
Once in awhile, you probably indulge in a recurring daydream of finding a magic bullet to grow your business, satisfy your customers and boost revenue through the roof. We’ve all been there. Wouldn’t it be nice if there was just one tool or solution to guarantee things worked in your favor?
The problem is, that’s a “get-rich-quick” scheme, and nothing like that exists — at least, not in the way we want it to, anyway. That probably explains why 76 percent of field service providers claim they struggle with revenue growth.
Luckily, there are solutions. More specifically, there is one type of technology that can help you achieve many positive outcomes. Growing your business — big or small — doesn’t have to be a series of guesswork.
Modern technology has birthed an incredibly lucrative platform to put the business world on the right track. You may know it as big data or machine learning. In reality, it’s a form of business intelligence, used to improve all processes, decisions and services. More specifically, it’s called field service metrics, or field service analytics. Considering 92 percent of executives feel they have to adapt service models to meet their customers’ needs, we’re willing to bet this would be an invaluable tool for most, if not all, business owners and top executives.
What Are Field Service Analytics?
To keep it simple, the best way to describe field service analytics or field service software is as an intelligence or insights-gathering tool. Any field service organization, no matter the focus, can better and more efficiently operate through the use of predictive analytics. It involves collecting data on customer and client trends, user engagement patterns and performance, all in real time to help inform and grow your business.
The most common form of this technology is the big data system, which you can further enhance through machine learning and AI platforms. The latter are more complicated and best left to development and programming professionals, however. For now, just understand deploying a big data or analytics platform internally opens you up to these additional opportunities in the future.
As a business owner, your No. 1 goal is to increase revenue and profits. You do this by improving traffic, performance and customer satisfaction. Predictive analytics can further improve all these elements. Looking expressly at customer satisfaction, for instance, you can pay attention to the products and services your audience is interested in. You can then use this information to deliver targeted recommendations, promotional campaigns or deploy a custom call to action.
It’s about more than just knowing what your customers want in the short term, however. It’s also about knowing what they’ll want in the future. Through the long-term analytics of patterns and trends, you should effectively be able to make future decisions and product launches that resonate with your clientele.
The Benefits of Field Service Metrics
The core — and most obvious — benefit of field service analytics software is that you can deliver exceptional experiences to your customers. Total impact will depend on how you deploy a system, and what you do with the data you collect, but the outcome should generally be the same. You can deploy more personalized, targeted and efficient solutions in the future.
Using field service metrics in customer service environments, for example, will translate to higher customer satisfaction and support ratings. You’ll be able to fully understand what your customers want after they purchase a product, and, more importantly, how you can provide it to them. If and when a solution is not feasible, you can find an alternative or happy medium.
To imagine this, put yourself in the shoes of a customer who has filed a claim to have a malfunctioning product replaced. This experience is stressful any way you cut it. First, the customer will be concerned if their claim is going to get denied and why. Then, they’re going to be worried about how long the process will take, and when to expect a replacement to arrive.
10 Metrics to Positively Impact Your Revenue
With the right platform or toolset, you can expect to see an increase in customer retention, higher levels of team and technician motivation and improved revenue. Dataforma is an incredibly powerful field service analytics platform, with a variety of monitoring capabilities. To understand some of the most important field service metrics, however, we have to get a little more detailed.
The crucial statistics, in order of importance, are the following:
Customer Acquisition Cost (CAC)
Over time, CAC limits will fluctuate. As a startup, it’s one of the most important metrics to monitor. Later on, it provides a benchmark for the average cost of a new client or customer.
The formula is simple. Your CAC cost equals your sales and marketing expenditures for a period of time, divided by the number of customers you gained. If your CAC is high, you’re spending too much on potential clients. Of course, the upper limits are relative to your business, industry and revenue. Small business owners in HVAC, construction, roofing, plumbing or electrical will want a much lower CAC compared to a large-scale business.
Attrition — also known as churn — is a crucial metric that provides insight into your success and revenue stream. It takes into account how many customers or clients have stopped paying for your products or services. It’s especially important to track churn with memberships or subscription-based products. Comparing this to customer retention will give you a clear understanding of what your brand or company is offering your clientele. Are you, for example, delivering exceptional field service and support, or is there a kink in the line somewhere?
It’s up to you when you measure the rating. Some businesses choose to prompt customers at 30, 60 or 90 days. Longer is the preferred option, so you’re asking an inactive customer who intends to come back. Reaching out through a phone call, email, poll or questionnaire can not only help you find out why they stopped paying or canceled their service, but is also an excellent opportunity to try bringing them back on board.
Acquisition is important, but it’s just as critical to retain your loyal customers, too. If you neglect your current user base, there’s a possibility you’ll lose their business, and your steady profits will take a hit. Too many, and those profits enter a decline. This metric gives you an accurate idea of customer satisfaction as it pertains to your entire company, not just particular departments. While you want customers to be satisfied with field service work, you want to know their true opinion of your brand when all is said and done.
Plus, it’s six to seven times more expensive to acquire a new customer, as opposed to retaining a current one. Inactive customers are another target for this metric, so keep an eye on how many customers you’re losing compared to those you gain.
If you need to, you can parse this metric into segments to understand satisfaction related to field service, products or additional experiences. This step is crucial, because 97 percent of consumers feel customer service is important to their loyalty in a brand. If you want to grow that loyalty, keep an eye on retention ratings so you have something to compare your other metrics to.
Lifetime Value (LTV)
LTV is essentially the amount of total income or revenue you expect to earn from a single customer during their tenure with your company. To calculate this metric, you need to know how long the average customer stays with you. Take that number and multiply the monthly revenue you expect to get their LTV.
One thing you’ll also want to do is subtract expenses from the total you spend on installation, maintenance or future support of your product(s). It also relates to field service metrics, because it gives you a clear idea of how much your brand is investing in work or active projects. You never want your expenditures to exceed income, which is a fancy way of saying don’t work for free. The LTV will help you determine what is a warranted service operation, how to organize priorities and even whether it’s worth your technician’s time. While the latter may seem cold, this is a business, and you do have to know when to walk away.
This one is self-explanatory. You want to track your total profitability by paying attention to all revenue you’re bringing in. The most common form is sales or customer acquisition, but there are other factors as well, like interest, late fees, service fees and more.
The importance of this metric depends on your business model and size. For a small business, like a private HVAC provider, referrals are a big deal thanks to word-of-mouth advertising. To calculate this metric, simply determine the percentage of new customers you’ve earned thanks to recommendations from existing or loyal customers.
Of course, this metric has a direct relation to CAC — the first stat we discussed in the list. The higher your referral percentage, the lower your CAC will be, because referrals usually are minimal cost, if any. You could also claim this metric is related to revenue in the same way, as your profits will be higher, due to a lower CAC.
An alternative to this in various fields or industries is bid tracking. In construction, for example, you may have significantly fewer word-of-mouth or viral customers. This is because a majority of work comes in as a lead, and you place a bid on the project. If that’s the case, toss the referral metric and substitute bid tracking.
Product or Service Metabolism
Dustin Dolginow of Atlas Venture coined the phrase “product metabolism” to describe the speed and investment your company makes in a service. This includes the rate at which team members — including manufacturers and suppliers — move, or make decisions.
When you launch a new product — or you’re in the startup phase — product metabolism is usually much higher. Focus, time and decisions all have to do with that product. As the company matures along with the product or service, metabolism slows down.
An important part of this metric involves looking at service and work orders, and the entire field deployment process. For instance, how do you organize and track your work orders? Can you see an accurate history or representation of your team’s duties? Do you know where a technician or representative is at a given time, compared to where they should be?
Also dubbed your “viral coefficient,” this metric involves the growth of your company — big or small — over time. More specifically, it’s the express influence of social and influential tendrils that spread business and brand reputation. This growth can include word-of-mouth referrals, social pushes and engagement, promotions, events and more.
Of course, the measurement involves several cycles or chunks to get a better idea of average growth levels. Let’s look at a quick example.
ABC Roofing Company is just starting out and building their client base. Initially, their customers include friends and family, but as word spreads, more business flows in. They can determine their conversion rate or percentage of organic growth by:
- Taking their initial customer base
- Comparing it to the number of invites or promotional sends
- Determining the number of invites or potential customers that convert to paying ones
Again, the initial calculations are important, but it’s also important to continue tracking this metric over time. You’ll get a more accurate growth rating or chart in the end. The longer you’re in business, the more valuable your growth data becomes.
Conversion and activation rate are closely related, but the latter is more important. That’s because “activation” is the measurement of a point’s conversion rate, when a potential customer becomes an active or subscribed one. For example, if you have a clear call-to-action button or link, activation would be the conversion rate from the point a customer clicks that button and onward.
Higher conversion rates mean one of two things: you offer an enticing product or service, or your call to action is effective. Low activation rates usually mean your product needs improvement, your marketing was ineffective or your call to action fell flat.
This metric is especially important for smaller business, because it helps you adjust and plan accordingly when trying to reel in new customers. You can also substitute it for lead tracking in many cases.
It may seem unrelated, but this metric largely deals with the real-time location and patterns of technicians and team members in the field. You can identify how long commutes take, how long employees spend on a worksite and what kind of effort they put into their work. This metric allows you to identify several things about the field service process, most important of which is where issues or problems may be happening. Customer satisfaction may be down, but you may come to find that’s because your field technicians are not putting in the time and effort they should be.
Of course, GPS tracking allows you to better track and manage your team, no matter where they are. That alone is an invaluable convenience for any project administrator or manager.
How Dataforma Can Help
All these metrics boil down to a single concept: To improve, you must understand what to measure in field service projects. Doing so requires a deeper understanding of the analytics capabilities of field service software.
The good news is that you can track these metrics with the Dataforma platform. Our team’s goal is to help all business owners and field service technicians make pertinent and accurate decisions in real time. It’s an invaluable tool for all project managers and administrators, and most importantly, it will provide clarity in terms of success, revenue and performance.
If you’re not sold on the service, yet still interested, there’s a free demo available. We encourage you to sign up here.
In the end, it doesn’t matter what industry you work in, or how big or small your business is. Are you the head honcho of a local HVAC or construction company, and your work orders are getting out of hand? Maybe you just need to better organize your field technicians across various plumbing projects.
Whatever the case, field service metrics — including the monitoring, reporting and analytics of these stats — are a crucial part of growing your business and keeping that forward momentum steady. We pride ourselves on helping our partners achieve that, so why not let us help you too?