Back to basics – make sure your funnel stage definitions make sense
- AUTHOR Jay Jennison
- May 9, 2014
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In honor of it being Friday, I wanted to get back to basics and discuss one of the most fundamental concepts of marketing that will drive accuracy in you marketing analytics – and that is funnel stage definition. It sounds obvious, but more often then not within organizations there is either a lack of definition around the funnel and it’s stages OR the understanding of what defines a specific stage in the funnel differs between teams within the same organization. Regardless of what the case may be, if there is no clear definition or leadership around understanding your funnel then we will never be able to achieve accuracy and visibility through our funnel.
Obviously, without normalized funnel stages across and organization the funnel metrics that they do have will always differ from team to team. And as we all know, when numbers don’t match up, we lose all credibility. SO the foundation begins with defining and normalizing funnel stages across sales and marketing teams internally. This involves some thought on where key hand-offs take place during the entire sales cycle from when a lead is created to when the opportunity closes. While the funnel will differ from business to business, ultimately the funnel structure and stage definitions will be determined by the company’s product, sales and marketing strategy and associated business process. With that said, it is important to consider how marketing is driving campaign responses, how they identify when a lead is ready for sales engagement (sales/marketing hand-off), sales structure, and opportunity stages.
This will only get us half way there though because obviously we require some sort of analytics engine to help run these funnel reports in order to deliver us core metrics like volume, and velocity and conversion rates. This second major piece of importance is ensuring that whatever analytics or reporting engine you use be able to accommodate and configure itself around your organization. Every organization has unique business processes and it is important the reporting back-end has a clear understanding of what your funnel stages are so it can understand, for example when, where, and why a campaign response has progressed to a new funnel stage and link this back to specific marketing activity. A marketing analytics platform that dictates funnel stages, definition, taxonomy, etc. and forces you into a specific methodology should raise a red-flag as this may not fit with your organization and will therefore corrupt your data.