We’re all on a quest for organic sales growth. We all want to find ways to increase our conversion rate, improve our customer lifetime value, expand into adjacent markets, and launch new products successfully.
The problem is there are more ideas out there than we have time or money to implement. Do we try to target a fresh audience on LinkedIn, or do we invest in developing a new events business? Do we revamp our content marketing strategy to improve our conversion rates, or do we get into user experience redesign to help retention? With so many good growth ideas — and simultaneously so much pressure to grow our businesses — it can get stressful.
The sort-of good news is that data can help us optimize our decision making, so we can get the most bang for our buck with our limited resources. But here’s the rub: For most publishers, data is all over the place. It’s housed in every system under the sun, from the cloud to Excel spreadsheets to the old CFO’s hard drive to who knows where else.
Data is hot right now, so you might be panicking about the scattered state of data within your own organization. You might even feel tempted to go out and license the latest technology ASAP — maybe a CDP, DMP, or CRM.
Not so fast! If you take nothing else away from this article, remember this: Don’t spend a dollar on technology until you have a plan.
Now, I’m not saying don’t buy technology. These customer data tools are essential for leveraging one of our greatest assets, namely, a lot of information about our readers and customers. I’m saying approach this investment strategically. After all, a large technology investment that flops can be a fireable offense.
Where Do I Start?
If you’re going to spend money on technology, it has to be coupled with a strategy for either getting new customers or keeping existing customers.
Data technology can empower organizations in their quest for new customers in a number of ways. You can use data tools to evaluate the ROI of various marketing and sales channels to get more customers per dollar of overall marketing/sales spend.
Data can help you understand which content and actions reduce the sales lead time. Knowing what worked with your old leads enables you to move new ones down the funnel more quickly, and it makes life easier for your sales and ecommerce teams. Not only that, data can help you identify the predictors of a quality lead versus a waste-of-time lead (what we like to call a whale versus barnacle) so that you’re only sending marketing-qualified leads to your sales team in the first place.
Understanding various segments of your audience — otherwise known as personas or target audiences — can help you identify the groups that really jibe with your value proposition, so you can find the easiest markets to target. Plus, tracking how these segments react to various pricing, discounting, and bundling offers throughout their journey allows you to offer the right product to the right prospect at the right time.
When it comes to keeping customers, data technology can help you understand behaviors that lead to renewal or upsell versus behaviors that lead to churn. Understanding these actions and behaviors can also clue you into the things that customers love (and what they don’t like so much), so you can provide a better customer experience that leads to greater upselling and more repeat sales. Plus, you can create new products and services that suit your best customers’ needs to drive new revenue streams and encourage even greater retention rates.
How Do I Choose the Right Tech?
Selecting the right technology for your business starts with setting specific and measurable goals – and it’s a good idea to put them in writing. Once you do that, you can start looking at technology solutions that will help you achieve those goals.
If you implement a CDP, for example, what are you expecting to see? Maybe it’s a 20% increase in traffic, 30% increase in new business, and 15% increase in retention rates. Do the math to calculate the economic benefit of these results, and compare that to the cost of investing in the data technology. If you’re not happy with the ROI, either keep brainstorming to find new ways to drive revenue, or wait until you see a clearer path to ROI before making the investment.
How Do I Screen Vendors?
Just as important as the technology itself is the company and team behind it. When you’re considering your options, you don’t want a free dinner. You don’t want a fancy PowerPoint. You don’t want a flashy demo.
You want to be able to hand your strategy off to the vendor and have them show you exactly how their solution will deliver your desired results. How have they achieved similar results with other customers? What exactly do you need (or not need) in order to hit these goals?
If the vendor’s sales team doesn’t have the acumen to answer these questions, buyer beware. It may be a sign that the technology is a shiny new object, not something that will deliver ROI for your organization.
What Else Do I Need to Consider?
Don’t expect data technology implementation to be an overnight success. Think of it as a project to take on over a 12-month time horizon. The first step is a small one, and that’s listening to the right data. From there, you can analyze the data you’ve been listening to, and then, finally, take action on those insights.
It’s also important to remember that technology does not use itself. You need to properly staff and educate your team to act on the insights generated by the data tool you choose.
Implementing your new system will require a lot from the people in your organization. They need to learn how to use the new platform, spend time inputting data, assess and analyze the results of the information they’re receiving, make recommendations to leadership on how to change the business’s approach based on analytics received from the technology, and then make those changes happen.
Data technology can do incredible things to fuel your organization’s organic growth. But an investment in new technology is just that: an investment. You wouldn’t buy a house or put money in the stock market without doing some research and laying a solid groundwork first. The same must be true for your preparations to incorporate a new technology tool into your organization. When you properly strategize for, select, and resource your investment, you’ll be well on your way to predictable organic growth.
Rob Ristagno, Founder and CEO of the Sterling Woods Group, previously served as a senior executive at several digital media and e-commerce businesses, including as COO of America’s Test Kitchen. Ristagno is passionate about helping others grow near-term revenues by applying data science to uncover and test low-risk, high-reward sales and marketing strategies. Committed to spreading this message, Rob is the author of A Member is Worth a Thousand Visitors and the developer of the Growth Mindset Assessment.