A year-over-year comparison puts a period next to the same period a year earlier: this July against last July, this quarter against the same quarter last year. In a business with seasons, it is the only comparison that answers the question people think month-over-month is answering.
Briefly explained
- This period against the same period last year.
- It removes the season from the comparison.
- Month-over-month in a seasonal business mostly reports the weather.
- It needs a year of history before it works at all.
Why does month-over-month mislead?
Because the two months were different markets.
Demand in most local businesses moves with the calendar: weather, holidays, school terms, storm seasons. A report showing leads down forty percent against last month, in the month where that always happens, describes the calendar and nothing else.
Worse, it invites a decision. Budgets get cut in a slow month that was always going to be slow, and the following season starts from behind.
What is worth comparing across years?
The numbers that describe the business, not the website.
- Booked jobs, by service
- Revenue by department
- Cost per booked job. See cost per lead for why the lead number alone is not enough.
- Review count and the pace they arrive at
- Organic and paid leads separately, because they move for different reasons
How do you use it well?
- Compare like periods: same month, same quarter, with weekdays or dates chosen deliberately
- Note the one-off events that make a year incomparable, and keep the note
- Expect noise if you are small. One unusually large job can distort a quarter and prove nothing
- Judge changes you make now against this period next year
That last point is unpopular and accurate. Most marketing decisions cannot be honestly evaluated inside a season.
What do the terms mean?
- YoY: The abbreviation, used on most dashboards.
- MoM: Month over month. Useful in a steady business, misleading in a seasonal one.
- Like-for-like: Comparing periods that are genuinely comparable.
- Seasonality: The predictable pattern in demand across a year.
- Baseline: The stable number you compare against when you have no history yet.
Owner questions
