Marketing And Revenue Generation Is All Numbers; You Have To LOVE Numbers To Win At Lead Generation And Revenue Growth
Sticking with the theme of love for February, we took a quick poll from our team and found the seven metrics they love working with and talking to their clients about.
This list isn’t filled with the obvious numbers, like website visitors, source numbers or email open rates. This is real tradecraft for marketers.
These metrics only get uncovered when you work with hundreds of clients over almost 20 years and when you apply analytics and technology.
Here are the revenue growth metrics you’ll fall in love with in 2021.
1) Pipeline Velocity
If you haven’t realized it yet, revenue generation is almost entirely about aligning the activities of your marketing, sales and customer service teams so that they are all rowing in the same direction. Give your prospects and customers the most amazing experience so that they never leave you and are happy to continue investing in your partnership because they’re getting the results they expect.
Pipeline velocity is one of the newer metrics that clients love because it shows the speed at which leads are becoming customers. It’s defined as the speed by which leads move through your pipeline, whether won or lost.
What’s interesting about the pipeline velocity metric is that you should care more about the changes in the number over time than you should about the actual number. In other words, pipeline velocity data is only relevant when compared to the velocity over time.
Tracking pipeline velocity is a lot like tracking regular velocity, which is to say you divide a change in position by the change in time.
The equation is: number of sales-qualified leads (SQLs) in your pipeline times the overall win rate percentage of your sales team times the average deal size (in dollars) divided by your current sales cycle in days.
Using this formula, your result will be the estimated amount of revenue you have coming through the pipeline every day. The higher that number, the better your pipeline velocity.
Use this metric to advance your marketing and sales alignment, and you’ll love it in no time. Here is a more detailed article on pipeline velocity.
2) Website Visitors To Sales Opportunities
This is a new and interesting metric because it pairs two typically disparate metrics. Almost everyone classifies website visitors as a vanity metric. It’s a metric that marketers love and CEOs dismiss as worthless.
“Who cares how many people come to our website? How many sales-ready leads did we get? How many people are ready to by right now?” – Actual CEO (We’re not sharing their identity to protect the innocent.)
When it comes to sales opportunities, every CEO perks up and get excited. But there is a direct correlation between the number of people who visit your site and the number of sales opportunities that marketing and your website generate.
This is also easy to calculate. Take the number of sales opportunities generated by the website in a month and divide it by the number of visitors to the site that month.
If you have 30,000 visitors and you generate 30 sales opportunities, your metric would be a .1% conversion rate. This metric measures the quality of your website visitors with relation to generating sales opportunities. It also measures how effective your conversion strategy is at grabbing people at the late stage of their buyer journey and getting them to talk with you.
You might be thinking: Is .1% good or bad?
Believe it or not, it’s good. Here’s why: Research and our own data show that 96% of the people who visit your website aren’t ready to talk with sales or buy immediately. They’re in the Awareness, Education or Consideration stages of their buyer journeys.
This means of the 30,000 visitors in our example, 28,800 of them aren’t ready, leaving only 1,200 of the visitors as relevant for the sales opportunity question. But this is a benchmark, and benchmarks aren’t always helpful. If you’re getting 30 sales opportunities from these 1,200 people who are ready, you’re converting 2.5% of those “ready” visitors.
When we evaluate client data at the beginning of an engagement, we typically see website visitors to sales opportunity conversion rates in the .03% to .1% range. Our example is at the high end.
But what you should really be doing is tracking this number monthly and working every day to improve it. Companies that have been with us for a while see this metric rise to between .3% and .6%, roughly a 10X improvement, with the right application of tactics and optimization.
This is a metric you’ll quickly love when you see its relationship between new customers and revenue.
3) Number Of SQLs From Late-Stage Buyer Journey Offers
If you liked the last metric, you’re going to love this one even more. We call anyone who asks to speak with a rep a sales-qualified lead (SQL), but that’s just us. Any SQL who is qualified by the rep as a legitimate opportunity worth following up on is called a sales opportunity.
Your vocabulary and qualification stages might be different. But for the case of this article, let’s stick with this definition of SQL.
As we mentioned in the last section, 96% of the people visiting your website aren’t ready to speak with a rep. But it’s going to be hard to generate sales opportunities and new revenue if your visitors don’t want to talk with you.
The number of SQLs is a critical measure of your success in telling your story and engaging visitors so they want to talk with reps. The best way to do this is with what we call late-stage buyer journey offers. These are conversion points on your website for people who are ready to talk with you but might need a bit of convincing.
Here is what most companies use for such offers:
- Schedule a demo
- Get a quote
- Speak with a rep
- Contact us
- Free consultation
Take a good look at the list. What do you see? I see a sales rep ready to try to sell me something. That’s also what your prospects see if you’re using these offers.
Instead, try converting these offers into something that delivers more value for your prospects. Here are some actual examples we’ve created for clients:
- Schedule a 30-minute safety evaluation for your operation
- Send us a picture of your concrete floor and we’ll give you tips to make it shine
- Free design review of your common space with tips and techniques to improve its look on a budget
- Are you paying too much to the government? Give us 30 minutes and we guarantee to find ways to cut your taxes
- Share your biggest project management challenges and in just 20 minutes we’ll show you how our software will eliminate them from your business
See the difference? The prospective customer gets something of value in every case.
If you’re doing this well, the number of SQLs should be going up month over month. If you’re adding new late-stage buyer journey offers regularly, you’ll see this number going up. If you work to optimize your existing offers, you’ll also see this number going up.
As you get better at this, you’ll love this metric as much as we do.
4) Chats To Sales Opportunities
This is a newer metric but one that is gaining adoption fast. Adding chat to your website does accelerate revenue growth and drive sales opportunities:
Kayako reported that 79% of businesses said implementing live chat resulted in increased customer loyalty, sales and revenue.
Inflow noted there was a 3.84% increase in conversion rates, with a 6% overall lift in revenue.
ICMI found that website visitors who engage with your company via live chat are worth 4.5 times more than visitors who don’t. (Source: Bold360)
Forrester noted there was a 10% increase in the average order value when reviewing the sales from customers who engaged in a chat before making a purchase, when compared to those who did not use chat.
Chat is perfect for accelerating the sales process and removing friction from how prospects engage with your sales team. But not every chat is going to produce a new and active sales opportunity.
Knowing the percentage of chats that do produce sales-ready leads or sales opportunities is a great way to measure how effectively you’re using chat as well as how efficient your reps are at chatting with prospects and moving them along their buyer journeys.
5) Sales Cycle In Days
This is a metric most people are aware of, but few track it and track it accurately. Do you know down to the day how long it takes you from very first touch to final signed contract?
At Square 2, our current sales cycle is 34 days, down from 45 days last year.
Reducing the time it takes to get prospects to say yes and sign your paperwork is critical to revenue generation. This can improve revenue across the company dramatically. It’s like adding months to the end of the year.
To illustrate, reducing your sales cycle by 8% would be like adding an extra month to your year. You’d be able to sell in 11 months what you usually sell in 12 months, giving you that extra month to exceed your goals.
How can you reduce the sales cycle? Great question. One way we did it was to eliminate the need for references. Do you know we haven’t had to give prospects a single reference this year?
How did we do it? By sending clients this link in an email before they ask for references.
Our reference reel includes the people they’d likely be talking to anyway, so why bother asking for references? Do you know the reference process typically added between one and two weeks to the end of our sales cycle? By the time we check in with them, pass their contact info along, have the prospect and client sync up schedules, schedule the call, have the call and then get back to us, one to two weeks goes by.
One simple tactic removed that extra time. You can do this too, and you’ll love watching your sales cycle shrink and new customers close faster and easier.
6) Percentage Of Advocate Customers
The idea of advocacy is relatively new. We introduce this to all our clients and find it new to them in most cases. Do you have happy customers? Sure you do, but do you know how happy? Would they tell everyone in a 1,000-person session that your company is amazing? Not so sure, right?
You need to actively work to create advocates for your business. You need to know exactly how happy your customers are with your products/services, your team, your billing practices and their entire experience with you. You should be measuring this quarterly at a minimum.
The more advocates you have, the more video testimonials (like what we showed above) you’ll be able to produce. The same holds true for success stories, reviews, referrals and so on. Your business growth will accelerate when you start paying attention to this number.
Once you start tracking this, you’ll love watching your advocacy numbers go up and to the right.
7) The Number Of Positive Online Reviews
Our businesses are more transparent than ever before, meaning that anyone can find anything they want, including reviews. Have you Googled your own company? You’ll probably find reviews that you didn’t know about.
You should be actively working to encourage your happy customers to write positive reviews for your company, and you should be tracking this.
Does your industry have any online directories that also collects reviews? If not, you might want to consider starting one.
A number of review sites focus on digital agencies, and we regularly encourage clients to share their experiences there. We know from the data that prospects are checking these sites to see what other people say about us. After all, prospects don’t really trust you or believe everything you say, but they do believe your customers.
This is going to introduce a whole new set of challenges for you, like dealing with the occasional bad review that might be misdirected, inaccurate or just plain mean. Even the best restaurant in your city gets a bad review from time to time.
You should be prepared to respond and try to make it right. But more importantly, if you have 100 reviews and few are bad, most reasonable people will see that as what it is. Maybe that person was mad. Maybe that was an isolated incident and your company is rock solid overall.
Actively working to drive online reviews is going to help you generate more leads, and it’s going to help your prospects get to know, like and, most importantly, trust you faster. You’ll close more business, and you’ll close it faster.
This will no doubt be one of the new metrics you fall in love with.
All of these numbers, while new, are going to be key to driving revenue for your company in 2021. Take this opportunity to bake them into your programs and create the tactics necessary to move these metrics – and move them aggressively.
Square 2 — Building The Agency You’ll LOVE!
Posted By Author Mike Lieberman, CEO and Chief Revenue Scientist
Mike is the CEO and Chief Revenue Scientist at Square 2. He is passionate about helping people turn their ordinary businesses into businesses people talk about. For more than 25 years, Mike has been working hand-in-hand with CEOs and marketing and sales executives to help them create strategic revenue growth plans, compelling marketing strategies and remarkable sales processes that shorten the sales cycle and increase close rates.