Running a successful online course business requires more than just creating and delivering valuable content. As a course creator, you need to track and analyze various financial indicators to ensure the profitability and sustainability of your program, course, and business. In this blog post, we will break down the key financial metrics that you as an online course creator should pay attention to in order to gauge the health and success of your business.
One of the primary financial indicators to track is revenue. Tracking your different revenue streams such as: course sales, private coaching income, affiliate income, and any other revenue streams separately will help you see which programs or courses are bringing in the most revenue or are the most popular. This will also help you assess the growth rate of your income over time to determine if your marketing efforts are paying off. As mentioned, consider tracking revenue on a per-course basis to identify which offerings are generating the most income. This is something your bookkeeper or accountant should be able to help set up for you when you onboard with them.
Course completion rates and student engagement are crucial indicators of your course's effectiveness and popularity. Keep track of the percentage of students who successfully complete your courses, as well as the average time they spend engaging with the content. High completion rates and active student participation signify that your courses are meeting the needs and expectations of your target audience. To take it a step further, you can also track this by capturing testimonials and keeping a database of those. We like to use Notion for that!
To truly understand the financial health of your online course business, it's important to analyze your costs and profitability. Calculate your operating expenses, including content creation, advertising/marketing, and platform (software) fees. Compare these expenses to your revenue to determine your profit margins. This analysis will help you make informed decisions about pricing, cost optimization, and resource allocation. We see most of our clients spend about 10% of revenue on advertising, another 10% on software, and if they have a team, sometimes up to 30% of revenue on contractors and staff.
With a launch-model business, you should be looking at these metrics at least quarterly, but we recommend looking at all of these numbers on a monthly basis, even if you aren’t launching monthly. Your business still has monthly operating costs which you should have a handle on.
Each of our clients receives what we call a Monthly Debrief where we highlight their key Revenue, Costs, and Profitability as well as Cash flows from the business. Stay tuned for another blog on Cash Flows and managing your launch money!
By tracking key financial metrics, online course creators can gain valuable insights into the success and sustainability of their businesses. Regularly monitoring revenue, course engagement, and profitability metrics enables course creators to identify areas of improvement, optimize their strategies, and make data-driven decisions. Remember that these financial indicators work in tandem with non-financial factors, such as student satisfaction and feedback, to paint a comprehensive picture of your online course business's performance. Embrace the power of data and analytics to drive your course creation journey towards greater success. And contact us if you’d like to engage a team of financial pro’s to help you keep track and hold you accountable to your plans!
Want our free guide for calculating & tracking KPIs in your course business? CLICK HERE!