How to adopt a data-driven mindset?
“I think it is an immutable law in businesses that words or words explanations or explanations promises on promises but only performances reality.”
- Harold Greneen
Many people become leaders by accident. Suddenly their thrust into a position of having to make decisions, and they either bloom or crumble under the pressure.
If they find early success from following their intuition, they may start to think they’re smarter than everyone else in the room.
Here’s a secret : they’re not.
For better, more consistent results, don’t base business decisions solely on intuition and conjecture.
Operates with a data-driven mindset.
Making decisions quantitatively versus qualitatively
When you make decisions, more and better data guides you to be more prudent, reducing your exposure to risk.
That isn’t to say that she should succumb to ‘analysis paralysis’, waiting until you have a mundane of data before you make a decision. One of the mark of a good leader is knowing when to say something is good enough. Sometimes, the tip of the iceberg is enough to point you in the right direction.
Requiring people to backup claims with data should become a cultural norm that drives your organization to make better decisions more consistently.
If someone comes to you and says we should invest more in advertising through social media channels, this statement should be backup with data.
CRM software is an integral part of both sales and marketing, which acts to give you insight into what is working and what isn’t. This provides opportunity for making clear decision based on data.
Here are some questions your marketing team can answer with good data from your CRM :
- How many Impressions will you get for every dollar you spend?
- Of your various campaigns, how many Impressions does it take to create a link to your website?
- How relevant to your product or service are the people who click those links?
- On average, how much does it cost to generate a sales qualified lead from pay-per-click advertising?
- On average, how much does it cost to generate a customer from social media?
- How long does it take a lead to become a client? How does this vary between different marketing channel?
- Is the time and cost to obtain a client through social media better than pay-per-click advertising?
- Are you retargeting leads with ads on social media, and is it working?
- Are you generating leads through content syndication, how much does it cost?
When the marketing team is able to answer these questions and report on them to the sales and management teams, you can see how to spend your money most effectively.
With a good CRM, you can track different campaigns and see which salespeople are your best performers. Insight into sales and marketing successes helps you Channel their efforts to maximize productivity and growth. If you aren’t able to get specific answers to these questions from your marketing team, they can improve how they’re serving your organization. All these are well within the capabilities of CRM software with little-to-no technical experience required.
By asking these questions, you make yourselves and marketing teams more accountable. Money spent on advertising and marketing is an important part of the company’s budget and that budget has limits.
The more you can hone in on what works and what doesn’t, the more effective your marketing and advertising will be.
Your goal is to minimize the cost to bring in a client, while maximizing the amount of money each client pays you. Marketing and sales work together to achieve those goals.
Break down the silos between these departments to maximize your conversion chances and minimize the cost to bring in a new client.
The same goes with anything you invest in whether it is internal or external, you need to make a profit to keep the operation going. The more you can rely on data to help you make decisions, the more confident you’ll be in making those decisions. In the absence of data, you’re at least cognizant of that increased risk, which probably encourages you to invest in those ideas more gradually.
Leveraging predictive analytics
Predictive Analytics is a relatively new field that goes a long way toward helping you make data-driven decisions.
By looking at what drives the conversions, you can see what correlates to success. You see mathematical models that tell you how influential your social media hazard in driving customers to buy from you. You can see the influence of salespeople, email campaigns, webpages, and other channels, and you can allocate resources to where you have the strongest correlation to conversions.
The key to Predictive Analytics is getting the whole picture.
If you’re only measuring email and web page traffic, you’re missing many other channels that may be driving people to buy from you. Brand awareness and measuring how your leads begin their customer Journeys are important factors that impact your business.
Imagine what would happen if you had a significant source of leads coming from people who called into your company, but you didn’t have a way to track those inbound calls. If you were to take money away from advertising your phone number, you could be hurting your business, but you would only be guessing.
Be conscious of what you know and what you don’t know.
When you build your data model of how your business Works understand that it probably won’t be a 100% complete. Try to include as many different ways of interacting with your leads and customers as possible, so you can measure as much of the system as possible.