As a marketer or sales rep, it's likely that you’re constantly sifting through data, looking at analytics and building reports. But have you ever taken a step back to look at the big picture?
Think about it. When setting SMART goals, are you setting targets that are simply attainable or are you looking at the big picture and setting targets that will have a real, quantifiable impact on overall progress?
Because inbound marketing is evolving at such a rapid pace to keep up with buyer behaviors and interests, you need the flexibility to execute activities and test hypotheses in real-time. Having a clear idea of the overall goal will help you make a data-driven decision.
To start, inbound marketers and sales reps need to know what to focus on delivering over the next year. What is the single most important objective?
Beginning with a financial target then breaking it down into a customer target, a operational target and a learning target. For example:
What is your financial objective? And why? Grow revenue, Maximize profits, Revenue growth rate...? Once you know the financial requirements of your objective, how does that translate to customers?
What is your customer objective? To reach your revenue target, what's the most important customer objective? Will you need to acquire customers at a faster pace, from new markets? Or will you need to address a high customer churn rate before any significant growth is possible? Whatever you end up focusing on just remember to clearly define why it's priority.
Because marketing and sales work so closely together to drive new revenue, bring the two teams together around your financial, customer and operational targets.
Build Your Reporting Process
1. Set up your framework
To set up a framework for your marketing and sales reports, start from the financial, customer and operational targets you outlined above.
For each target, you want to assign one metric that communicates how you are progressing towards your objective each month. This will give you high level view of how well you are moving towards your annual targets.
Next, break down your annual target into monthly goals.
If your financial focus is to increase new revenue, you may set a monthly revenue growth rate target to answer the question: “How much new revenue are we generating from inbound marketing and sales efforts compared to previous.”
Next, figure out how many new customers you need to generate. Take your revenue goal and divide it by the average revenue per new customer to determine your customer goal.
($100,000 revenue goal) / ($2,500 average revenue per customer) = 40 New Customers
Now we know that marketing and sales have to work together to acquire 40 new customers each month.
2. Define Key Performance Indicators
Breakdown each monthly goal into 3-5 key performance indicators. With a monthly goal of 40 new customers, what indicators are going to be most important.
Take you time here because these indicators are what define your activities. To acquire 40 new customers a month maybe you've determined that sales is actually getting quality leads from the marketing team so you focus attention on sales.
After taking a quick look at your sales productivity, you see some flaws in the process. Marketing is passing high quality leads to sales but sales isn't prioritizing them correctly, losing the impulse marketing worked so hard to establish.
Because marketing is doing a good job converting high quality leads, we want to focus on connecting quickly with hot prospects. So we may choose to focus on an indicator like, [#] of days new leads remain open without a connect attempt. (new lead that hasn't been reached out to yet)
You also notice that sales is having a hard time connecting with prospects at all. (which could be the cause of ignoring hot leads) So you decide to track and measure the average number of connection attempts after noticing reps were only attempting to connect, on average, three times per qualified lead.
Do this for each of your monthly goals until you have a core group of indicators to drive performance.
3. Describe KPI data sources
For each key performance indicator, add a description. Include a brief summary of where the data is coming from, how the data is collected and how often you will be collecting it. Take a look at the example below:
One of our performance indicators from above is [#] of days new leads remain open. The purpose of tracking this metric is to prove (or disprove) our hypothesis that marketing is driving qualified leads with high impulse that sales is waiting to long to follow up with, resulting in missed opportunities and low conversion rates. This data is coming from our CRM and it is collected on daily basis onto a separate spreadsheet.
4. Set Reporting Frequency
How often should you be adjusting your activities? This is the question you want to answer. Collecting your data is different than reporting on it. An experiment is conducted to validate your hypothesis. Throughout the month, you will be collecting data on daily basis and making small tweaks along the way to hit your goal.
Then, at the end of a determining interval (i.e. monthly), a report is produced that explains the outcome of your hypothesis, what worked and what didn't work. Make sure you don't overwhelm yourself with all the data, rather focus on what data you need.
Next I want to walk you through how to build a proper reporting calendar to match your strategy. By the end of this article you will have a calendar that tells you what information you need and when you need it, so you can focus on what is important.
Build Your Reporting Calendar
Now that you know what you are tracking, how often you are collecting data and when you will be reporting on results, you can begin to plot your reporting calendar. Below is one example of how a marketing and sales calendar can be configured.
- Report on progress towards your annual objective each month. Share the report across management on the first Monday of every month.
- Report the performance of each indicator weekly in the context of your monthly progress. Share the report with management every Friday, but only if things are way off track for the month.
- Collect all data on daily basis for rapid learning validation and new developments in real-time. Make sure to collect good data as your collections are the source for your weekly and monthly reports.
When data is collected in a meaningful way, following a disciplined schedule, reporting becomes an outcome vs. a project of it's own. Start by setting up a solid foundation and defining the right key performance indicators. Then define how your key performance indicators are measured and how often you will be reporting on them.
It’s difficult enough to stay ahead of the curve and outperform competitors in your market but sometimes all it takes is enough flexibility and the right data to act on an opportunity that no one else is looking at.