Why find a balance?
Even a perfect product needs Sales and Marketing. Contrary to what some in Silicon Valley would have you believe, products do not sell themselves. Every product, no matter how genius, needs:
- Integrated and Omni-Channel Marketing to educate the public about your product and/or service
- Sales and Account Management to deliver your organizations story and negotiate deals
- A robust data-driven evaluation (analytics) on how Sales and Marketing are performing at the above two efforts.
As someone who works in sales and marketing, I can tell you that about 90% of businesses do not measure enough or the right metrics.
But what about the other 10%? The 10% who obsess about sales and marketing metrics and fight tooth and nail for every conversion? The 10% who put an overlay on every page with an offer, the 10% that send unsolicited mail or emails, calling phones at every hour, or aggressively buying digital ad space to get every ad on every site you browse showing you their product. This is the same company that has sales and account management up at all hours of the night updating thousands of fields manually in salesforce after a call, and obsessively tracks every dollar spent in favor of those sweet, sweet conversion.
This company is a data-driven marketer’s dream, right? This is the type of company that gets it, right?
Enter Customer Experience (CX) Metrics
For that 10%, What if conversion matters less then the organization thinks? After decades of consulting, examining the data of organizations large and small, I have noticed a pattern that transcends organizational size, sector, and model. This pervasive pattern is that the 10% of organizations with outsized investment in Sales, Marketing, and metrics therein experience diminishing conversion returns once they hit 6% lift. I’ll say it again for the kids in the back: After 6% improvement metrics are reached, investing more money in sales and marketing experimentation (a/b testing and conversion optimization) is a bad idea (in a vacuum).
After 6% improvement metrics are reached, investing more money in sales and marketing experimentation (a/b testing and conversion optimization) is a bad idea (in a vacuum).
To those not millennials or younger, this makes no sense. How could that be? Traditionally (say before the year 2000), a CEO investing in Sales and Marketing could consider that money well spent.
But as my colleague Brian Flanagan likes to say, today’s customer touchpoints are “a complex pinball of events” some which are unintuitive, hidden, or post-conversion.
But what about that white whale metric,
the Wonka’s golden ticket metric that puts great businesses on top and keeps them on top? Before I get there, I will propose that all good metrics have a foundational OKR or strategy that the metric attempts to measure. And that magic OKR is:
Deliver a great product or service that your customers love, and provide industry leading customer service atop said industry leading product.
In other words “Deliver Excellence”.
And the corresponding metric that indicates the business is indeed delivering excellence:
Perficient Platinum Performance(tm) Score = (Customer Satisfaction Score) * (Customer Lifetime Value)
For those who have been working in Digital Analytics or Customer Data for a bit, the above idea is anything but earth shattering. But for Growth hackers, product marketers, and old-school CEOs chasing vanity metrics, the above metric is a north star needed to
This number tells business leaders how well their business is performing without having to worry about confounding variables. In fact, I would argue any business more focused on net new revenue or cost reduction or sales efficiency or Multi-Channel Attribution or whatever predictive potion the data science team cooks up in favor of the above score is doomed to fail.
Let’s break down the Perficient Platinum Performance (PPP) score:
Customer Satisfaction Score (CSAT): A value, between 1 and 10 and defaulting to zero (in case a customer has never reported their satisfaction) that is measured by asking a customer (either via digital survey or directly) about their experience. This number can be NPS or some other metric, but it always starts with an explicitly reported value and then blends more data in from there
For example, it could include a metric of willingness to try new features or complete in-product or post-purchase offers. It could include some level of content consumption or affinity and sentimentality metric. But at the end of the day the following does just fine as a starting point:
“On a scale of 1 to 10 (from 1 being never to 10 being incredibly likely) please rate how likely you are to recommend product and services to a friend”
Or
“On a scale of 1 to 10 (1 being awful and 10 being the most incredible experience) please rate your overall satisfaction with your service from as it relates to your recent purchase”
Customer Lifetime Value (CLTV):
The sum total of all transactions over the entirety of the customers lifetime.
This sub-metric is simple. Take all the money the individual has spent on your organization and sum it up.
The interplay between Marketing/Sales and CX
Now, armed with the Perficient Platinum Performance (PPP) score, we can see clearly that see Marketing and Sales has a critical place in overall organizational performance. But optimizing those activities should never detract from the overall customer experience. And that is exactly what those 10% of businesses discussed above are doing. Just as an incredible product will never sell itself, no amount of intelligent Marketing or Sales will sell a bad product or service. In fact, by overdoing the Marketing bubbles or Sales emails, organizations can hurt the customer experience – a fact which is reflected in the PPP score. While those individuals may buy once, the data I have examined shows those individuals are neither satisfied nor repeat customers.
Ultimately, the way to growth is to win Customer’s hearts. And the way to win customers’ hearts is to provide an excellent product with exemplary customer service.
Interested in learning more? Feel free to reach out on LinkedIn or via the form below!
In follow-ups, I will deep dive into unintuitive sub-metrics that matter, how Sales and Marketing practitioners of Journey Science can influence the Perficient Platinum Performance score, and how to measure the ROI of every activity using Journey Science and the Perficient Platinum Performance score.
