Use Your Revenue Funnel to Select the Right Metrics
Your revenue funnel dictates which metrics are best to use and a range of factors including size and scale, complexity, volumes, revenue per client, account-based vs. lead based focus will suggest different ways to measure your revenue impact.
Your Revenue Architecture – and revenue funnel – should dictate the metrics you use.
Marketers often seek to understand ‘campaign attribution’ to prioritize investments – yet, in complex multi-stage, multi-touch customer journeys, the impact of any one campaign or touch is difficult to define precisely. Should you attribute to the first campaign touch….to the last touch? The truth is that multiple influences and touches combine to contribute to the sale. As an example, if you are using an account-based marketing approach, you will focus more on account-level metrics like account awareness and penetration instead of just lead volume.
So what are metrics to consider? In this post, we have collected and grouped some common sales and marketing metrics that we use across customer buying stages:
- Attract Stage (Buyer Aware Stage)
- How are you accessing the target market and driving awareness and visibility?
- Engage Stage (Buyer Consider Stage)
- How are you engaging and influencing customers paid, owned and earned media?
- Convert Stage (Buyer Decision Stage)
- How are you delivering experiences and converting sales?
- Manage Stage (Buyer Customer Stage)
- How are you managing customer relationships for retention and expansion?
Attract Stage Metrics
- Database size / database growth / %, Database hygiene (% bounce, new names, etc.)
- Social media reach: # followers / fans % growth
- SEO # website visitors / visitor growth, # Keywords ranked
- Advertising: CPMs, CTR, CPA, CPMs / Impressions / Ad position / $ Cost per click / $ Cost per lead
- Social # referrals / % referral rate, # mentions / shares via earned media / % positive sentiment
- Account: % account coverage, contact growth in key accounts, # website visitors from key accounts
Engage Stage Metrics
- Time on site / important pages / dwell time / % bounce rate
- % CTRs (click through rate) on ads / CTA (call to action) clicks / Blog reads / Subscribers
- Productivity: % improvement in sales time with clients/ % Marketing Leads are Sales Ready
- Accounts: # of account contacts spending time, accounts with active touches, event attendees / # of MQAs – Marketing Qualified Accounts
- Nurture Impact: % converted from leads to MQLs
Convert Stage Metrics
- Sales % win / loss rates from MQL, from SQL
- Sales $ average contract value / deal size
- Sales $ pricing: value / discount % to total gross revenue
Manage Stage Metrics
- Retention rate / Churn Rate
- Cross-Sell Rate
- Colonizations – Expansions in account with same offer
- Crop Rotations – Expansion in # offerings across account
Additional Performance Metrics
We can also track qualitative and quantitative measures that consider the overall impact:
- Total revenue growth Q/Q or Y/Y
- Revenue vs forecast, Revenue vs Goals / Quota
- Efficiency %Lead to MQL / % MQL to SAL / % SAL to SQL / % SQL to Closed
- Velocity – Time of leads to Closed by stage
- New Accounts / Existing Account Mix / Account Penetration of TAM
- Account retention rate
- Salesperson retention and satisfaction
- Revenue per sales person
- Account Net Promoter Scores.
Start with sales and marketing metrics that matter.
By clarifying your business model and corresponding revenue architecture, you can determine the revenue funnel you need and and the metrics that make the most sense to track. We find it better to start small using a few key metrics that are easy to track using your marketing automation / CRM and then build from there, ultimately incorporating predictive and other data driven business intelligence.