Crucial questions most sales & marketing leaders can’t answer about their revenue funnel

metrics

You​ ​wouldn’t​ ​drive​ ​all​ ​the​ ​way​ ​to​ ​work​ ​only​ ​looking​ ​in​ ​your​ ​car’s​ ​rear-view​ ​mirror.​ ​But​ ​when​ ​you get​ ​to​ ​work​ ​you​ ​drive​ ​your​ ​business​ ​the​ ​same​ ​way.​ ​Looking​ ​back​ ​at​ ​historical​ ​data​ ​to​ ​make crucial​ ​decisions.​ ​Most​ ​marketing​ ​and​ ​sales​ ​leaders​ ​use​ ​historical​ ​CRM​ ​and​ ​marketing automation​ ​data,​ ​like​ ​how​ ​many​ ​leads​ ​were​ ​created,​ ​sales​ ​meetings​ ​completed​ ​or​ ​deals​ ​closed last​ ​week/month/quarter.​ ​​ ​While​ ​these​ ​metrics​ ​have​ ​their​ ​importance,​ ​as​ ​leading​ ​indicators,​ ​you shouldn’t​ ​drive​ ​your​ ​business​ ​only​ ​using​ ​a​ ​rear-view​ ​mirror.​ ​Best-in-class,​ ​high-growth businesses​ ​are​ ​using​ ​forward​ ​looking​ ​metrics​ ​to​ ​understand​ ​their​ ​complete​ ​lead-to-revenue funnel.​ ​The​ ​following​ ​four​ ​categories​ ​contain​ ​the​ ​most​ ​important​ ​forward​ ​looking​ ​questions you​ ​need​ ​to​ ​answer.​

As​ ​an​ ​aside,​ ​if​ ​you’re​ ​only​ ​looking​ ​at​ ​the​ ​metrics​ ​for​ ​your​ ​particular​ ​department,​ ​and​ ​not​ ​the entire​ ​​lead-to-revenue​ ​funnel​,​ ​then​​ ​it​ ​might​ ​be​ ​worth reading​ ​my​ ​previous​ ​post​ ​on​ ​​sales​ ​and​ ​marketing​ ​alignment​​​ first.  

1.​ ​Planning​ ​&​ ​goals 

  • Is​ ​revenue​ ​on​ ​track​ ​to​ ​hit​ ​future​ ​goals?
    To​ ​answer​ ​this​ ​you​ ​need​ ​to​ ​calculate​ ​if​ ​you​ ​are​ ​on​ ​track​ ​to​ ​hit​ ​your​ ​targets​ ​based​ ​on​ ​your​ ​current funnel​ ​momentum.​ ​So​ ​if​ ​you​ ​keep​ ​going,​ ​at​ ​your​ ​current​ ​pace,​ ​will​ ​you​ ​hit​ ​your​ ​future​ ​revenue goals​ ​or​ ​is​ ​there​ ​a​ ​gap​ ​you​ ​need​ ​to​ ​fill?
  • Are​ ​your​ ​goals​ ​realistic?
    Are​ ​your​ ​goals​ ​achievable​ ​and​ ​realistic?​ ​Possibly​ ​too​ ​high​ ​or​ ​surprisingly​ ​too​ ​low?​ ​And​ ​should they​ ​be​ ​adjusted?
  • If​ ​you​ ​are​ ​not​ ​on​ ​track,​ ​what​ ​changes​ ​do​ ​you​ ​need​ ​to​ ​make?
    What​ ​do​ ​you​ ​need​ ​to​ ​do​ ​now​ ​to​ ​hit​ ​future​ ​goals?​ ​Can​ ​you​ ​identify​ ​exactly​ ​where​ ​in​ ​the​ ​marketing and​ ​sales​ ​funnel​ ​the​ ​problem​ ​is​ ​occurring?​ ​​ ​Why​ ​is​ ​it​ ​occurring​ ​and​ ​what​ ​can​ ​you​ ​do​ ​about​ ​it?
  • Are​ ​you​ ​communicating​ ​the​ ​right​ ​information​ ​to​ ​management​ ​&​ ​the​ ​board?
    Does​ ​your​ ​leadership​ ​know​ ​what​ ​to​ ​expect​ ​from​ ​the​ ​revenue​ ​funnel​ ​in​ ​the​ ​future?​ ​Sales​ ​and marketing​ ​leaders​ ​need​ ​to​ ​keep​ ​the​ ​CEO​ ​informed​ ​and​ ​the​ ​CEO​ ​needs​ ​to​ ​keep​ ​the​ ​board​ ​and investors​ ​informed. 

2.​ ​Marketing​ ​strategy​ ​&​ ​demand​ ​generation 

  • Are​ ​you​ ​generating​ ​the​ ​right​ ​quantity​ ​and​ ​quality​ ​of​ ​leads​ ​today​ ​to​ ​hit​ ​future​ ​revenue targets?
    Are​ ​you​ ​reverse​ ​engineering​ ​your​ ​funnel,​ ​from​ ​revenue​ ​back​ ​to​ ​leads,​ ​to​ ​determine​ ​the​ ​exact number​ ​you​ ​need​ ​based​ ​on​ ​your​ ​current​ ​conversion​ ​rates?​ ​Do​ ​you​ ​need​ ​to​ ​improve​ ​conversion rates​ ​(quality)​ ​or​ ​increase​ ​the​ ​number​ ​of​ ​leads​ ​(quantity)​ ​and​ ​bringing​ ​them​ ​in​ ​at​ ​the​ ​right​ ​time​ ​to hit​ ​targets?
  • Which​ ​channels,​ ​programmes​ ​or​ ​campaigns​ ​are​ ​making​ ​the​ ​greatest​ ​impact?
    Can​ ​you​ ​identify​ ​what​ ​is​ ​having​ ​the​ ​greatest​ ​positive​ ​impact​ ​so​ ​you​ ​can​ ​invest​ ​more​ ​in​ ​this​ ​area?
  • Which​ ​channels,​ ​programmes​ ​or​ ​campaigns​ ​are​ ​making​ ​the​ ​least​ ​impact?
    Can​ ​you​ ​identify​ ​what​ ​is​ ​having​ ​the​ ​least​ ​impact​ ​so​ ​you​ ​can​ ​divert​ ​spend​ ​to​ ​the​ ​high​ ​performing activities?

3.​ ​Sales​ ​effort 

  • Are​ ​leads​ ​being​ ​followed​ ​up​ ​with​ ​the​ ​correct​ ​sales​ ​activities?
    When​ ​sales​ ​receive​ ​or​ ​create​ ​the​ ​adequate​ ​quantity​ ​and​ ​quality​ ​of​ ​leads​ ​are​ ​they​ ​being​ ​followed up​ ​correctly?​ ​Are​ ​they​ ​being​ ​contacting​ ​in​ ​time?​ ​Are​ ​they​ ​being​ ​contacted​ ​enough​ ​times​ ​with appropriate​ ​contact​ ​methods?​ ​Can​ ​you​ ​measure​ ​quality​ ​and​ ​quantity​ ​of​ ​touches​ ​and​ ​time​ ​to​ ​first touch​ ​or​ ​first​ ​contact?​ ​Are​ ​they​ ​taking​ ​too​ ​long​ ​or​ ​not​ ​enough​ ​effort?
  • Can​ ​you​ ​measure​ ​performance​ ​at​ ​each​ ​funnel​ ​stage​ ​per​ ​sales​ ​rep?
    Not​ ​every​ ​sales​ ​rep​ ​has​ ​the​ ​same​ ​level​ ​of​ ​performance.​ ​How​ ​do​ ​they​ ​compare​ ​across​ ​different stages​ ​of​ ​the​ ​funnel,​ ​who​ ​is​ ​performing​ ​the​ ​best/worst​ ​and​ ​why?
  • Where​ ​do​ ​you​ ​focus​ ​your​ ​efforts​ ​to​ ​grow​ ​your​ ​revenue​ ​faster?
    Every​ ​business​ ​has​ ​multiple​ ​levers​ ​and​ ​dials​ ​that​ ​can​ ​be​ ​pulled​ ​and​ ​turned​ ​to​ ​make​ ​a​ ​positive impact​ ​on​ ​revenue.​ ​Can​ ​you​ ​easily​ ​identify​ ​which​ ​ones​ ​to​ ​focus​ ​on​ ​to​ ​maximise​ ​results?

4.​ ​Return​ ​on​ ​investment​ ​(ROI)  

  • What​ ​is​ ​the​ ​total​ ​ROI​ ​of​ ​our​ ​joint​ ​sales​ ​and​ ​marketing​ ​efforts?
    There​ ​are​ ​multiple​ ​ways​ ​to​ ​measure​ ​ROI,​ ​such​ ​as​ ​customer​ ​acquisition​ ​cost​ ​to​ ​lifetime​ ​value (CAC:LTV),​ ​but​ ​are​ ​you​ ​getting​ ​the​ ​best​ ​return​ ​from​ ​your​ ​sales​ ​and​ ​marketing​ ​costs​ ​and​ ​is​ ​your ROI​ ​getting​ ​better​ ​or​ ​worse?
  • What​ ​activities​ ​generate​ ​the​ ​greatest​ ​return?
    Similar​ ​to​ ​looking​ ​at​ ​the​ ​best​ ​revenue​ ​generating​ ​campaigns,​ ​are​ ​you​ ​monitoring​ ​the​ ​actual return​ ​and​ ​factoring​ ​in​ ​the​ ​costs​ ​of​ ​sales​ ​and​ ​marketing​ ​time​ ​and​ ​efforts?
  • What​ ​should​ ​you​ ​spend​ ​in​ ​the​ ​future​ ​on​ ​sales​ ​and​ ​marketing​ ​investments?
    Should​ ​you​ ​spend​ ​more​ ​on​ ​sales​ ​and​ ​marketing​ ​activities​ ​and/or​ ​headcount​ ​to​ ​hit​ ​future​ ​goals?

As​ ​you​ ​look​ ​to​ ​drive​ ​your​ ​business​ ​forward,​ ​with​ ​a​ ​fully​ ​aligned​ ​sales​ ​and​ ​marketing​ ​team,​ ​I’m sure​ ​you​ ​agree​ ​these​ ​forward-looking​ ​questions​ ​need​ ​to​ ​be​ ​answered​ ​to​ ​give​ ​you​ ​the​ ​best possible​ ​chance​ ​of​ ​success.​ ​Many​ ​businesses​ ​have​ ​gaps​ ​in​ ​their​ ​business​ ​intelligence​ ​when​ ​it comes​ ​to​ ​forward-looking​ ​metrics.​ ​All​ ​too​ ​often​ ​the​ ​data​ ​is​ ​in​ ​outdated​ ​spreadsheets​ ​or​ ​static, rigid​ ​reports​ ​spread​ ​across​ ​too​ ​many​ ​dashboards.

As​ ​I’ve​ ​helped​ ​multiple​ ​clients​ ​manage​ ​the​ ​entire​ ​lead-to-funnel​ ​process​ ​and​ ​answer​ ​the​ ​above questions,​ ​you​ ​can​ ​be​ ​reassured​ ​it​ ​is​ ​possible.​ ​By​ ​using​ ​the​ ​Revenue​ ​Funnel​ ​Science framework​ ​you​ ​too​ ​can​ ​correctly​ ​measure,​ ​forecast​ ​and​ ​optimise​ ​your​ ​sales​ ​and​ ​marketing funnel​ ​to​ ​hit​ ​or​ ​exceed​ ​your​ ​future​ ​revenue​ ​targets.

 

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