Using a YoY (year over year) calculation is a great way to stay on top of business growth.
What is YoY (Year-Over-Year) and What Does It Mean?
Year-over-year (YoY) is simply a comparison of one period of time with the same period from the previous year.
This can be January 2019 compared to January 2020, or January through March of 2019 compared to January through March of 2020.
YoY is used by businesses to see how much growth (or loss) they’ve had over a specific time period.
It’s also helpful when coming up with looking at past performance to forecast out a new budget or determining how much a specific tactic or channel is performing.
How is YoY Used to Show Growth Rate?
YoY is used by businesses and companies who are looking to compare revenue growth rate or change of their company over a specific time frame.
Let’s say your business sells Marketing Audits where you check out a website and their marketing and give them the 80/20 of what can be changed.
Each marketing audit counts as 1 sale, and brings in $1,000 revenue.
The two following charts show what YoY performance growth could look like between quarters each year for a business.
# Sold YoY Comparison
Revenue YoY Comparison
How to Calculate YoY Growth
Now that you’ve seen an example, let’s learn how to calculate this bad boy.
Expressed as a formula, YoY looks like this:
YoY = (This Year – Last Year) / Last Year
In other words, you are subtracting last year’s number from this year’s, and then dividing that by last year’s number.
This formula will give you the YoY number for the data set you’re working with.
The YoY (Year-Over-Year) Calculator
I put together a calculator/template you can use to avoid typing out formulas multiple times and manually putting it into a calculator.
You can download it using the form below.