Funnel Measurement best practice

A member of our LinkedIn Group – Funnel Management – asked a straight question: what are the best-in-class metrics metrics? The full discussion is within this Funnel Management discussion.

We have three sources to draw on in answering this question:

  • Our day-to-day work work in building plans for growth businesses;
  • Occasional detailed funnel metrics work for larger clients – diving deep into their funnel and looking for incremental improvements every month or quarter (Kaizen for the funnel)
  • The sales and marketing alignment study we did with MarketingProfs.com where we looked – amongst other things – at the role measurement plays in creating alignment

Here is something of a netted out picture of funnel measurement.

BTW – if you aren’t already, you can receive email, RSS or LinkedIn updates on our insights into the Funnel. See our Sales and Marketing Tips here.

  • Change your sales stages to buyer stages. This simple shift moves you away from “I did xxx”, to “they now think yyy”. We don’t really care what you did, only what they now think as a result. If your buyer hasn’t changed their concept (ref to Miller Heiman’s Conceptual Selling), then they haven’t moved – no matter what you have done.
  • Code every opportunity with BDM name, Stage in the journey,Lead source (where you found their name), and Campaign (what triggered this opportunity on this occasion)
  • Change your CRM so that when you move an opportunity from one stage to the next, a date field (you often have to add this to the standard set of fields) for that stage is populated. Don’t skimp here – you want a unique date field for each stage.

You basically want to know: what do I need to fix (or stop) and what do I want to do more of. Picture the following. I have populated this with absolute numbers, but could have populated with value, lag (time taken), leakage (% that failed to progress), and I could slice it differently for each BDM. Let’s use simple absolutes for now though:

Sales-GeneratedCampaign ACampaign B
Name50010,00010,000
Acknowledge the gap40010002000
Agree the need300300600
Understand my solution200200400
Engaged100100100

 

Based on this, you could assume all 3 sources are equally valuable (they each contributed the same number of sales). If your Marketing team only measures leads, then they will tell you Campaign B is a killer (twice as many leads as Campaign A, and 5 tiems as many as Sales doing its own spade-work). But if you measure end to end, you can see that Campaign A is much more effective than Campaign B because you need much less time from the sales force to deliver the same result as Campaign B.

If I had no more data, I’d drop Campaign B, and find ways to increase the yield from Gap to Need in Campaign A, and probably my Propose-to-close ratio across the board. This is where measuring lag comes into effect, but that’s another conversation again.

Every month or quarter, pick one stage in one campaign, and put all your focus on improving your progression for that stage. For this reason, when you design campaigns, design them to last 13 years, not 13 weeks (as we usually get asked to do). This means you need a clear plan the whole team buys into, and that’s why our Funnel Coaches around the world have all been trained in building sales and marketing plans worth building, measuring and improving. Measuring a funnel populated with opportunities created by “last month’s great idea” is a waste of time.

Here are some other articles on measurement you might find useful:

If you enjoyed this article, send it to your friends (Tweet, email or LinkedIn news). You may also want to comment below.

 

funnel-plan-sales-and-marketing-planning-tool