Jason Widup, VP of Marketing at Metadata, discusses the moving parts involved in planning for demand and revenue. He weighs the dos and don'ts when setting goals and provides the building blocks for an efficient demand model.
By the end of this guide, you'll understand how to set goals aligned with demand and revenue targets, leverage the right demand generation model, and optimize it over time.
Set Clear and Realistic Goals
Traditionally, goal-setting has been a vague and divided process where marketing focuses on vanity leads and sales focuses on revenue. This approach makes it difficult to hit quotas.
To set goals aligned with demand and revenue targets:
- Align the sales and marketing teams
- Leverage historical conversion rates
- Push goals for improvement
- Take realistic risks
Use the Right Input to Build a Demand Model
Certain foundational elements belong in your demand model. Once the base is covered, you can add more advanced elements for additional accuracy.
For the foundation, examine:
- Starting and ending revenue targets
- Sales/Marketing revenue split
- Average selling price
Advanced elements include:
- Opportunity push rates
- Opportunity conversion percentage by stage
Keep things from becoming overly complicated while ensuring data accuracy.
Display Your Input on a Spreadsheet
With input elements selected, you'll need a platform to view and update your demand model continuously. A well-designed spreadsheet transforms into a living, breathing model that practically does its own math, making it easier to meet and push goals with all moving parts visible.
Leverage and Refine Your Demand Model
Accuracy is essential. Once you've set goals, picked inputs, and built a spreadsheet, ensure your model's accuracy in the present and over time.
To maintain accuracy, you should:
- Take measurements several times during each period to verify assumptions
- Check which assumptions were accurate after each period
- Remain adaptable because change is inevitable