As a sales or territory manager in the Outdoor Power Equipment (OPE) industry you may be swimming in the data points. Reports, charts, pin points can be time consuming to collect, organize and make sense of with limited time and technology. This article outlines an overview of the metrics that provide meaningful insights to OPE and dealers analytics.
Generally, metrics can be classified into two categories: operational metrics that allow managers to track with overall performance in terms of units sold, revenue acquired and number of customers who made the purchase. On the other hand, there are strategic metrics that allow managers to look deeper into the data and identify opportunities for growth. Usually, operational metrics are used as inputs into more advanced analytics to determine future growth.
Managers can use operational metrics to:
- identify seasonality trends
- forecast inventory needs
- estimate closing year numbers
- evaluate performance of their dealers and marketing campaigns, etc.
Operational metrics are tactical in nature and should be set up in an easy to access and time saving manner. Sales and territory managers should have the ability to access metrics while on the road and get answers without excessive manual data processing. I find it’s most useful to see those metrics in a simple and user friendly online dashboard or interactive report that can be accessible from a laptop, desktop or mobile device. Operational metrics may be simple to calculate but are not always easy to process taking into consideration the scale of datasets. All manual data processing can be automated to free up time for managers to actually learn from the data as it can provide great insight into day to day operations.
Tip: look at the revenue numbers by customer type, by product, by dealer/territory. There may be interesting dependencies on how different customers contribute to the revenue. This simple filter exercise can help to determine who is the best customer and highest contributor to the revenue of the specific dealer.
Strategic metrics are a different story. Their impact involves more in depth analytics, a combination of multiple variables and their joint impact. In order to get to strategic metrics a lot of data crunching must happen in the background. Data scientists combine heuristic methods with statistical modeling to produce the output of knowledge that defines a future growth strategy.
Examples of strategic metrics are:
- targeting new customer segments
- identify next likely to purchase product
- increasing bundle purchases
- identifying customers at risk
- identifying new market opportunities
Strategic metrics provide an insight but also require a strategic view on how to monetize the insight into the revenue. Some of the actions could be long term upsell/cross sell strategy, targeted acquisition campaigns, outreach with special offers, opening new dealers, improving performance of the existing dealer to higher potential, etc.
Tip: get your hands on market basket analysis. This is a type of analysis that can determine what products are often purchased together or in a specific sequence. Having this data will help sales managers to have a better inventory discussion with dealers and also prepare dealers for upsell/cross sell opportunities. Also combined with predictive analytics it can generate a list of customers with a prediction of their most likely next purchase which can be used in marketing campaigns.
In summary, there are a lot of metrics and data points but the big secret is in order to get an answer from the data you must ask the question first. What it means is knowing your goals and application of the data to achieve these goals is a key to success. If you looking for a quick tactical decision use operational metrics to validate your hypothesis, and if you are planning on long term impact use strategic metrics to determine the best path forward.