10 Ways to Increase Your Subscription Stick Rate


Whether you think of yourself as a strong or a weak marketer, it’s likely you are not spending enough time working to keep your customers around longer.  Most folks prefer climbing the next peak.

And yet, you’ve heard it a million times.  It’s a ton easier to sell more to an existing customer than to a new one.

In previous posts, I’ve talked about the fact that every business is one way or another in a subscription model.  You either have customers on recurring billing or are “just” trying to sell them again after their initial transaction.

In this post, I want focus on the traditional subscription (continuity) model, where a customer has signed up for a product or service that has a recurring billing component.  That might mean monthly, quarterly or annually.  The point is that every so often, a customer re-ups with you.  That also means that every so often, they have an explicit opportunity to cancel or ask for a refund.

When I work with marketers about increasing their customer LTV and subscription stick rates, the below list details the top places I dig in.  To make sure we understand what is happening at each level, to set a baseline (if necessary) of where they are, and to help inform prioritization of testing to improve that component of the business.

  1. Do you actually know your subscription / continuity take rate and your stick rate on an overall basis?

This is a simple (note, not always “easy”) one.

Sure you can go crazy by splicing and dicing your numbers countless ways.  By cohort. By channel or front-end campaign.  Gross or net of returns.  By customer count and by revs.

But start with the basics. Of the people who start each month, how many are around for the next few billing cycles. Where are the biggest points where customers drop off? Just starting there will reveal a good bit of info and insight to help inform what you should be testing.

For those of you who are already doing so, hopefully I just gave you a few more ways to think about it.  You can always get more sophisticated about how you segment your customers.  And likely you’ll want to do different things for different segments.

But without a base level of understanding of where you’re at, it’s hard to know what to do next.

  1. Do you know the top 4 reasons customers are cancelling or asking for a refund?

Most likely the list includes “too expensive”, “don’t use the product”, etc.  But you might have something totally different on your list, for example that your product is too complicated to use. While no one wants to hear that type of feedback, I’d always rather know that than not.  Because depending on the order of the most prominent reasons, you can decide what to test next and how to tackle each reason.

  1. Do you have a cancel / save offer, script, and training when customers want to cancel?

Next, what do your agents say when a customer calls to cancel? Do they have specific guidelines or an outline to follow? Have you tested (and measured) different strategies? Ultimately, it’s a business decision on what kind of offers you might want to give to a customer.  I’ll say that it drives me crazy when the mobile phone carriers offer me a big discount when I’ve called to cancel.  Why did it take my wanting to cancel to get such a good offer?  For your business, the scripting might include something as simple as probing why a customer is cancelling.  Sometimes there’s a lack of information or training the customer needs.  Whether or not a rep can keep a customer, at the least, that information needs to be documented and passed along to the appropriate person (See #1 above and #10 below).

  1. Do you have customer care agents or sales agents handling cancel / saves?

This is again another business decision, but if you want a true save strategy, I’d suggest that you test your sales agents, not your customer care agents, for this task.  Sales vs. care agents are totally different people.  Both should come from a place of providing value and service to a customer.  But care agents generally have a softer demeanor, while sales agents are typically more skilled at overcoming objections, speaking to features, benefits, and value of an offer.

  1. Does the product actually meet the promise you made when the customer signed up in the first place?

This one sounds obvious, but beyond making sure your product is a good one, this point goes to real expectation matching.  What does your customer actually think your product or service is going to do? Does their experience match that expectation?

Note, beware if you find yourself saying, “well, if only the customer watched the 20 minute tutorial or did x, y, or z, they would know what to do.”  To those folks, I’d ask what guidance are you giving them to watch the tutorial or to know to take the additional action.  At the same time, if your product is touted as “simple to use” and “you can get going in only 5 minutes”, then arguably it shouldn’t take a 20 minute tutorial to do so.   Or if your site is so confusing that customers who are in fact looking for information can’t find it, I’d posit that your “simple” brand promise is not being delivered upon.  Remember it’s not solely about a customer’s explicit use of your product or service.  But rather their entire experience, from order entry to FAQ’s and customer support.

  1. What info do you put on the credit card descriptor?

You may or may not be as anal as your customers, many of whom look through every line of their credit card statement.  Even though your customers may love you, if what shows up on their credit card statement seemingly has no relevance to the brand they interact with, their chances of challenging the charge and/or calling you to cancel will increase.

This kind of thing can happen for different reasons.  Sometimes, a marketer has a business name that differs from the various products she sells.  And so it’s simply easier to put the company name on the descriptor.  This isn’t exclusive to folks intentionally trying to hide their brands from the company name – my guess is that anyone reading this is a purchaser of something from P&G (Proctor and Gamble) but doesn’t explicitly realize that P&G is the parent company.

Take a revisit of what appears on the credit card statement from a brand new customer’s perspective and think about whether or not it would confuse you.

  1. What happens when a customer’s credit card declines?

Do you have a process to retry, use Account Updater, or to possibly call a customer to let them know their credit card has declined? At the least, testing the frequency and overall quantity of retries is something all marketers should do. Whether that means every day for a week or two, or once a week for 4 weeks, the reality is that the cost per attempt is something you or your team should know (let’s say it’s roughly $0.10). Then it’s simply a matter of comparing the necessary success rate vs. your price point and margin.

Account Updater is something I’ve discussed previously, but the short version is that some banks provide a paid service to update the expiration date of a valid card but one that has simply gone past its expiration date.  It’s an extremely rare customer that will call to update their expiration date.  The beauty of the service is that you only pay per successfully-changed card.

Finally, depending on your price point, margin and call center fees, it might be worth exploring calling customers for whom their card has declined.  By the way, one measure of knowing whether you are proud of your product/service or just trying to sneak under the radar on their bill is how you respond when you consider calling a customer.  If your product is actually of true value, then while yes, some customers will take the call as an opportunity to cancel their subscription (how is this worse than the declined credit card by the way?), you should feel a responsibility to make sure your customers have uninterrupted access to your product.

  1. Do you send an email prior to a new billing period and offer additional products?

This might not seem obvious to extending stick rate.  How would notifying people of an upcoming charge and/or offering them more to buy improve retention?  Like many others out there, I’ve signed up for Dollar Shave Club and must say that their pre-shipment emails are some of the best I’ve seen.  Not only am I informed about my next shipment and given the option to delay it, but they have a very slick one-click tool to add additional items to my order, shaving cream for example.  I may not have needed new blades, but if I needed shaving cream, that keeps me on as a customer.  At the least, they’ve added to the customer LTV.  Best case, because I continue to think of myself as a Dollar Shave Club buyer, I’m more likely to keep my subscription active vs. cancelling altogether.  Which either means new acquisition for them or reactivation, neither of which is easier than maintaining an existing customer relationship.

  1. Do you allow customization?

I alluded to this, but it deserves its own call-out.  Increasingly, customers expect to have some level of control on when and what they receive.  We no longer live in the world of one-size-fits-all.  Customers may really like your product but aren’t using it at the pace you suggest.  Or perhaps they have a busy travel schedule for the next month.  Or maybe they use some of your products dramatically more than others (especially relevant for those in the beauty category).  It’s preferable to give people the ability to customize their order online.  But even if you market it online and only your reps can make the change, I would encourage you to test how much flexibility to give your customers.  This is also where using customer feedback and cancelation reasons can help to inform where you start.  If the number one reason people cancel is that they don’t use it (assuming it’s a consumable) as frequently as suggested – beyond revisiting the amount you’re shipping, how you help them consume the product, etc. – you might want to consider varying the quantity or frequency of their orders.

  1. Do you have someone accountable for retention marketing?

Whether you are a solopreneur or running a 9-figure business, if you have a subscription component of your business, someone should be working to improve it.  It might be the difference between getting to the point where you can stop being a solopreneur and can hire someone.  Or it might mean adding even more margin to your business.  Regardless, do the math.  How many people do you add onto a subscription each month?  What’s the stick rate.  How much do you have to move the needle to justify more attention or a hire to improve the value of those customers?  Again, it might be just you for a while.  Or it might just be a no-brainer to bring someone one.  But make sure it’s an informed choice you’re making.

As one of my friends says, there’s never been a more difficult time to acquire a new customer.  And yet, too often we keep focusing on getting new ones at the expense of maintaining our existing ones.  With a bit of process and working at it, there are ways to keeping your customers around and happy a lot longer.  But it requires attention and some testing.

Now it’s a matter of taking this playbook and applying it your business.  The rewards are worth it.

Cost Optimization Isn’t Sexy Until You See What It Does To Your Bottom Line


I have previously shared the process that businesses can use to scale media and revenues.  If you’re a small company, that’s where the focus should be, because if you don’t have sales, the rest doesn’t really matter.

As you scale, though, it becomes crucial to make cost optimization an additional area of focus.  You of course want to get as much margin on those sales as possible.

I’ll acknowledge that optimizing your media, CPA’s, and revenues can be more fun and sexy than, say, lowering your costs to your shipping carriers.  Or working to improve your merchant processing fees. But if your larger goal is to put more money in your bank account or to have more money to invest back in the business, then shifting from what’s more fun to what is more impactful is an important change to make.

Below is a breakdown of 8 cost-focused categories where I’ve seen significant impact to a business’ bottom line.  As with any area that you want to improve, make sure there is a single person who is accountable for that part of your business.

  1. Merchant Processing
  2. Commissions to affiliates
  3. Commissions to sales reps
  4. Shipping / Fulfillment
  5. Technology
  6. Product Costs
  7. Customer Service


At the risk of repeating something from my prior article, I cannot stress enough how important prioritization is. Whether across cost buckets or in evaluating tests within one.  Sometimes you know straight away where your numbers are out of whack.  Even then, I’d suggest taking the 5-10 minutes to do some math on how much impact you think you can have.  Or how much improvement you need to get relative to other areas you may focus on.


A quick word on testing.  Generally, many of the areas below are more about vendor pricing and so it’s easy to assume that there really isn’t testing involved.  Most of the time, I’d agree with you.  But to the extent you are affecting customer experience, such as changing shipping carriers or repackaging your product, keep a particular eye out for noise from your customers.  These types of changes may not be based on a pure A/B test.  If you approach them as tests, however, then you and your team are likely to be more mindful of watching for changes elsewhere.

Let’s dig in…

1. Merchant Processing

This is arguably the least sexy of anything on this list.  It’s likely not the largest expense on your P&L, but it may be the one you cannot survive without.

If you can’t process payments, you are likely not in business.  And there are a TON of companies who are seeing their processor go away as a result of Operation Chokepoint, the government’s way to shut down marketers with questionable or problematic business practices.

When it comes to payment processing, many businesses optimize for ease and speed at the outset.  As such, they set up with Paypal, Stripe, or a 3rd party that works with smaller, oftentimes higher risk marketers.

But once you achieve any sort of scale, you may be leaving dollars on the table in higher processing fees because you have a sole provider or simply because you haven’t shopped around for a better partner.  Whether Paypal adds incremental orders for you is something you should test, but typically, going through one of these services means you have a higher overall rate or per-transaction fee.  Or how much you’re charged for chargebacks.  Or countless other buckets in that annoying bill that you aren’t really paying attention to.  That is real money out of your bank account.

You might also be eligible for better service, such as a lower reserve (or none at all) or getting approved to process more when your volume increase. Unfortunately, I’ve worked with several clients who weren’t able to scale, not because they didn’t have the demand, but because they literally couldn’t transact those orders.  Their merchant processing partner hadn’t approved them for higher volumes.  That is a painful, frustrating and costly situation in which to be.

Here’s the thing – merchant processing is one of the most annoying parts of running your business. And it’s an area that very few people understand.  But it could be costing you percentage points to your bottom line.  And those points are 100% margin, 100% cash.

So what to do? At the very least you (or someone on your team) should go through your statements to try to understand the different components of your bill.  There are consultants who can help you do this as well; it’s your choice whether you want this knowledge in-house or just want to pay for outside help.  Then get on the phone with your processor to talk through your bill.  Make it a goal to get better pricing and service for your company.

(I’m actually trying to get a friend to put out a marketer-friendly, no sales pitch webinar explaining some of the more important aspects of merchant processing. If that’s something you’d be interested in, shoot me a line here.)

So while merchant processing may not be as sexy as front-end split testing, when all is said and done, what margin do you get on that test that got you a 5% lift, versus the lower points you pay and better relationship you have with your processor?

2. Commissions to Affiliates

These next two sections arguably should’ve been in my prior article, as they are ultimately about media, but a) I forgot to put them in there; and b) they have some commonalities and relate to broader vendor and employee management, so they’re going here.

When it comes to affiliate commissions, I’m actually going to push back on a commonly-held philosophy: trying to pay out out as little as possible.  Many marketers see their affiliate channel, whether offline or online, as a hedge against paid media.  So they use it to balance out their numbers, in case their paid media comes in over goal.  I understand that mentality.  We did this for some time at Beachbody.  But then we realized that we need to manage our paid vs. affiliate traffic channels separately.  The latter wasn’t there simply in case the former had an off week so that our overall numbers looked okay.  Each had to perform on its own.   And our goal was to maximize the opportunity from each.

To do so, we, similar to most people who use affiliate traffic at scale, knew that we wanted to do everything we could to reduce friction for your affiliates – deliver to them ready-made banners, creative, swipe copy, etc.  And in that “etc.” bucket needed to be “give ourselves the best chance of maintaining that partner’s traffic by making working with us as lucrative as possible..”

Most affiliates are driven predominantly by how much money they make.  That’s their business, they’re allowed to think that way.  So while you might be hedging against your cash media, it’s also likely that you are not getting the traffic you could.

This isn’t to say you are blind to issues like fraud or attribution.   Not to mention remembering to nurture the relationship, since behind every affiliate name is a person.  But I’d also suggest looking at the value of customers coming through you affiliate channels.  Figure out what margin you’d be happy with.  There isn’t a great reason why that margin should be any different as that from your paid media channel.  Then payout as much as possible.

Once you know that figure, you can test out different payment structures – how much is paid day 1, over time, or even whether you extend lifetime commissions to your partners.

3. Commissions to Sales Reps

I could make the same argument here re: payout amounts as for affiliate commissions above, so I’ll add an additional nuance.

And it starts with a small point I made just above.

Remember:  Your sales reps are people. 

As such, each is motivated by different things.  What you have to do is figure out a model that works for your business and then attract those for whom that model works.

One area where I’ve seen people make huge gains with their salespeople is in creating the right incentives for the behavior and results they wanted to see.

On one side, paying your salespeople too high of a base salary might result in their doing only as much to not get fired.  (You already have this issue with most employees.)  On the other side, if you pay 100% commission, that might mean too much financial stress for your folks.  In fact, I’ve seen businesses put their sales reps on $500 per week for the first 3 months just so they have some income coming in.  But it’s not so unwieldly that it’s a massive risk for their org.  And then I’ve seen these same companies have some high 6-figure and 7-figure earners from their sales department.

To be clear, there is no right answer.  I have some friends who will argue for hours that any commission is a bad thing.  That the best way to get people to deliver their best is by paying only a salary.  Others see that as the worst thing you could do.  You need to find the model that works for you.

My goal here is simply to raise some considerations to help you think through different structures.

As if there was any doubt, sales is a brutally hard job.  More than 50%, possibly 90%, of the time, you’ve just got the wrong person in that role. And it has nothing to do with comp structure.  There is only so much you can do with the comp structure if you don’t have the right people in the right role.

But if you feel like you do, figure out how to craft a model that works for them and the business.

4. Technology

I’m intentionally steering clear about specific tools or technology partners.  Those choices are too business-specific.  Instead, there are a few processes I’ve seen have great results regardless of business type, technology partner, or otherwise.

The Ask

Last month I was a conference where one of my friends negotiated $7K in monthly savings from 2 different partners – his ESP (email services provider) and his ecommerce platform partner.  Better yet, he got those reductions simply by asking.

Whether or not $7K per monthly is a rounding error for your business or a significant part of your take-home, that’s $84K in real savings.  And this was a reasonably low effort way to reduce costs.

My point here is in some ways the same as elsewhere – you should take a regular review of your partner fees.  And sometimes it’s just as simple as asking for a reduction.


This is going to sound so obvious, but I can’t tell you how many times I’ve seen it make it a big difference.

On a regular (at least once a year), audit of your technology expenses, particularly those with a monthly plan on a credit card.  It’s likely you signed up for some service (or seven) that was a trial that rolled to full price (you’re familiar with that model, right?).  Or someone who is no longer around put one in place.  Regardless, if no one is leveraging that tool, it’s a waste of money.

Some of these services may be $50 per month, some may be several thousand per month.  For starters, if you’re not using something, cancel it.  Just as important, doing this type of review is a healthy way to reinforce to the rest of your organization that you don’t tolerate waste.

(I’d also suggest doing this with your personal credit card.  I’m guessing you have a bunch of similar types of services that you continue to pay for but haven’t gotten any use in months.)


This is by far the most difficult of the three, from almost every possible perspective.  Ultimately, this is about looking back on where you’ve made technology (or frankly other) investments.  Ideally, you evaluate ROI, or at the least, examine how the final costs of certain projects and what you got out of them, even if qualitatively.

Whether in a startup or in a billion-dollar plus organization, people complain about IT.  Tools don’t do what people want. Everything takes too long.  Projects go over budget.

So why does that the adage of “what gets measured gets improved” not seem to apply to IT?  If you’re a performance marketer, then measurement is a hallmark of your business.  And yet so often, whether quantitatively or qualitatively, rarely do we conduct a look-back on IT projects to see what went well (or didn’t) and what, particularly process-wise, can be done better the next time around.

At the least every quarter, sit down with your teams to conduct a formal review conversation.  Leave ego, blame and excuses at the door (I know, easier said than done).  And have some honest and service-driven conversations about how you can maximize your investments in IT, arguably one of the more important enablers (or inhibitors) of your business.

5. and 6. Shipping / Fulfillment

If you don’t ship a physical product to your customers, then by all means jump to the next section.  But I’m going to lump both of these items together here.

A few questions to start.

If you do ship a product, do you know:

  • Do you know your average per order shipping cost?
  • Assuming you ship different products or different configurations, do you know the cost by these subsets?
  • Given that shipping rates are grouped above certain weights, do you know your tiers and have you looked to see if there is a way to decrease the weight of your higher-volume packages?
  • If you ship product to Alaska, Hawaii, Canada or anywhere else internationally, have you examined shipping costs and/or customs and duties fees. It’s possible that customers in these regions are not in fact profitable to the business.

With your fulfillment partners, do you know:

  • The average cost of processing your product through your warehouse partner is?
  • If you have multiple items in an “typical” order, have you explored whether it would be cheaper for your warehouse to pick and pack each order real-time versus “pre-kitting” those orders beforehand.
  • What about storage costs? I’ve got a couple products that I keep at the freight-forwarder at the Port of Los Angeles because their storage fees are so much cheaper than the warehouse’s (or Amazon’s).  I didn’t think storage fees were that big a deal until I got an unwelcome buzz-kill from an invoice late last year.

Or how about something super simple – what percent of your net revenues are shipping and fulfillment?

I’ve got some folks in the physical products space where shipping is ~7% and fulfillment is ~3% of net revenues.  This is such a bad number to compare to because there is no context of their business.  But do you know your numbers?

Getting a benchmark is always the first step towards improvement (“what gets measured gets improved”, right?).  Then, just like all the other parts of your business, it’s a matter of identifying leverage points and working to chip away at them.  Whether it’s changing the way you all operate internally or getting more out of your vendors, you have to put some focus towards these areas.

Even then, sometimes your partners don’t respond.

One of my recent clients had gotten so frustrated with their fulfillment partner that they began in-depth conversations with several alternative vendors.  When they came back to their current partner to talk through why they were seriously considering switching vendors, what became clear was their 3PL’s pricing was actually pretty decent but that their service sucked.  And that was in large part because their left wasn’t talking to the right.  I’ll admit that typically a partner will jump to fix things and then service will fall off again in a short while.  In this client’s case, their current partner, to their credit, has raised and maintained their level of service.  Which is a win for both parties.

Many times, unfortunately, a change is in fact necessary.  And as much as it takes real work to switch vendors, when you know it’s the right thing to do, it’s then a matter of getting it done.  (The same can be said with any relationship.)

Yes, it’s frustrating to have to get to this point, but it all begins with someone having accountability for this part of the business, and then making sure that pricing, service, and anything else you deem important is at the level you demand.  And deserve.

A few other notes here.

Service Levels

Amazon has changed the game in terms of expectations on shipping.  And yet, if you look at a lot of offers running on TV, they rarely tout next-day shipping or even 2-day shipping (which is considered rush).  They can get away with several business days to get their product to their customers.  In part this could be explained because the typical buyer of a TV-marketed product is a bit older, but that can’t explain everything.

Sure, these marketers are likely losing some customers in not offering Amazon-type delivery.  But not everyone is Amazon.  There could be financial, logistics, or technology reasons that limit your ability to get your product to a customer next day.

And you know what? That might be okay.  At least for now.  Because going with a service like Fedex Smart Post, which can take 3-6 days, might be more economical for you.  Even when you factor in the impact on conversion, additional contacts to your customer service department, or to your brand.  But you can’t always optimize for everything.  And at the least, you should be intentional about what you’re doing and know your options.

Direct vs. Through a Partner?

At what point does it make sense to try to negotiate your shipping costs directly with a carrier as opposed to through your 3PL partner?  Many folks manage their shipping agreements through their warehouse partner. At the outset, this is probably a good idea. As your volumes increase, it might make sense to explore what you can negotiate directly.  (I’m assuming that you’re shipping outside of Amazon.)

As a somewhat arbitrary guide, I’d say once you are shipping several thousand units per week, it’s time to have these conversations.

What you may find is that your 3PL, because of the sheer volume they process, gets better rates than you can get.  But it’s possible that:

  • You find that they haven’t negotiated their terms in a while.
  • You might learn about certain fees or services that you were previously unaware of
  • Building the relationship directly might allow you to resolve certain issues in the future, if only because you know the vendor directly. During my time at Beachbody, I cannot stress how important these direct relationships were, even when we continued to work through vendors or agencies.  Simply being able to pick up the phone to avoid any game of “operator” saved us a ton of money, not to mention time.

The worst that can happen is the carrier says your volume isn’t high enough or that your rates don’t change.  But hopefully at the very least, you’ve started to build the foundation for a direct relationship.

One Warehouse or Multiple Locations?

Here are some of the considerations to answer that question.

  • First you need to know the current geographic distribution of your customers.
  • Once you have that, then it’s a matter of understanding shipping cost by zone (how far away from your fulfillment center you ship to).
  • Does your current 3PL actually have multiple locations?
  • What is the net additional inventory position you’ll have to have in place, and what is the financial exposure of that additional inventory? (It’s never a matter of splitting up your existing inventory evenly into the new warehouses. And since inventory = working capital = cash, that isn’t a no-brainer decision for anybody.)

Multiple warehouses may not be applicable for all businesses, but it might be worth looking into.  It might mean net additional inventory and some additional costs with your current 3PL.  It might mean exploring a new partner.  It also might mean lower shipping expenses and few customer service inquiries.

7. Product Costs

Beyond the “ask for a discount” point I’ve made arguably too many times, let’s talk about China.

Conventional wisdom used to be that manufacturing a product in China is cheaper than producing it in the US.  I’d suggest that in many cases that is correct.  But I’d also suggest that it doesn’t capture the fully-loaded cost of delivering a product to your warehouse.

In particular, it misses the cost of shipping your product across that big ocean over there.  If you were one of those unfortunate folks who got caught out when the Port of LA workers went on strike last year, it also misses the cost of being out of stock.  I know of too many 8- and 9-figure businesses that lost millions in sales because their product was stuck in a container.  They literally couldn’t access it even though it was in port.

In addition, when you manufacture in China, you have to consider a couple other items: 1) a month off for Chinese New Year (sure, it’s not a month-long holiday but the effects are at least that long); and 2) shipping via boat is a lot cheaper than via air.  But it’s also a lot slower, so you’ve got a time-in-transit issues to content with.

Finally, know your customer.  In some markets, being able to say “Made in the USA” can be an important marketing tactic.  In others, no one is paying attention.  Or maybe no one has suggested that the customer pays attention and it can turn into a competitive advantage for you.

If there’s one theme that has resonated throughout here, it’s to make sure someone has done the diligence to explore alternatives.

8. Customer Service

Let me start with here with a sampling of metrics with which to manage customer service:

  • Customer Satisfaction (CSAT) / Net Promoter Score
  • Contacts – phone, email, chat
  • Total costs
  • Cost per contact, cost per initial order
  • Calls offered / Calls Handled / Abandonment rate
  • Speed of Answer / Avg. Handle Time / Avg Talk Time
  • Calls answered within SLA’s
  • Disposition Reports – reasons for calling, reasons for cancelling
    • Wizmo (“Where’s my order”), refund request, continuity cancel, escalation, etc.
  • Cancel-Saves
  • AG / BBB complaints
  • Revenues / Margin generated and vs. costs
  • Reship rate

That’s a lot there.  But I find that customer service is one of those areas that needs a particular form of structured metrics to best manage it.  Not to say that the numbers are the only way to manage customer service.  But when you look at that list above, you realize just how much specific information you can have about the performance of your call center.  And that makes identifying areas of improvement that much easier.

Sales vs. Care

Perhaps one of the most important points I can make about customer service is that reps who are great at customer care are not the same ones who are great at sales.  Sure, there may be those edge-case examples of reps that can do both great.  But it’s crucial to approach the call centers differently.

Everyone should be customer-focused.  Everyone should have a sensibility for brand.  Everyone should be aligned with the company values.

But make no mistake.  A sales floor and a customer service department are fundamentally different environments, with unique cultures, and frankly with entirely contrasting personalities. 

So much so that you may want to change how you funnel certain types of customer service calls.  For example, I’ve tested sending continuity cancel calls to sales reps instead of customer service reps.  And found that in most cases, the sales reps do better.  Even after factoring for follow-up calls, discounts, and refunds.

At the same time, if you put a sales person on a customer service floor, 99 times out of a 100 they will not succeed.  This isn’t a criticism, nor a character flaw.  Plain and simple, it’s about putting people in the right roles.

Final Thoughts

I’ll go back to what I said at the beginning.  Without sales, cost optimization is generally moot.  But once you’ve achieved a certain level of scale, your business demands it.

And as the business grows, presumably you are bringing in specialists to focus on various parts of the business.  Task them to set benchmarks and then to work to improve their business area’s performance.   Just as you would for the seemingly sexier parts of your business, like media and revenues.

When I read the book “The Millionaire Next Door,” I remember one big lesson loud and clear.  That there are two components to a P&L.  Revenues. And Costs.  Ignoring the latter can make all the front-end work you do go for naught.  Not to mention, managing the latter can mean less pressure on the front-end.

And managing both revenues and costs?

That’s where scale really happens.



3 Pillars for Ensuring Your Company is Built for Scale

(This is the second in a 3-part series where I share some of my “secrets” to scaling a performance marketing business. If you missed part 1, you can find it here.)

Scale doesn’t happen unless something is working. It sounds obvious, but the reason I start with that point is that if you don’t have a working offer and channel (again, you can see Part 1 of this series), then this post would be moot.  Thus, I’m assuming you have something that’s working.

The next step is about making sure attention is put in the right places. Some is foundational work, some is true operations. And whether you’re at $5mm, $50mm or over $100mm, it’s a bit of a relative question about putting in the foundations for the next level of scale.

So, what constitutes building that foundation? Well, fundamentally, I’m a believer that focusing on the below 3 areas can dramatically increase the chances of scalability and sustainability of a business.
1. Customer LTV
2. Brand
3. Operational Excellence

Customer LTV
I’ve written about the importance of knowing the value of your customer and having a robust unit economics model numerous times. I walk thru the actual model here and go over some additional basics here.

I’ll hit only the key points now:
1. There are 2 primary reasons you need to understand customer LTV and your unit economics model:
a) to manage your media. If you’re running paid media of any form and don’t know the value of a customer, you’re headed for trouble. You need to know how much you generate from a customer, what your goals are (% margin, breakeven by a certain day, etc.), and then that helps you back into your target CPA.
b) to identify the key levers in your model and where to deploy resources for improvement, testing, etc. Knowing your baseline metrics and goals is one thing. Great companies believe that they are never fully-optimized and so have a constant testing program. But everyone is resource-constrained, so knowing where to deploy resources is crucial.
2. Someone on the team must be accountable for maximizing customer LTV, and as a result, the target CPA. That doesn’t mean they do so at the exclusion of the brand (see the next main section), nor does it mean they do everything on their own. But someone must “own” customer LTV. You’re not going to get better at the pace you want if you don’t do so.

3. Customer LTV is a combination of revenues AND costs. It’s more fun and sexier to focus on the former. But if you reduce the latter, that goes straight to more dollars you can put to customer acquisition. Here’s are a couple of my posts about optimizing revenues and costs.

4. G&A, investments, capex, etc. should NOT be a part of your unit economics model. The point of the model is to capture the revenues and marginal/incurred costs associated with those revenues. You don’t need to hire a new person for each incremental order. Sure, at some point, you do need to make those types of commitments, but that doesn’t mean they should be included in that model.

5. Who has checked the data that is behind the assumptions in your model?

If you want to build a business that is scalable and sustainable, you need to focus on brand. Again, look at the patterns. There will always be exceptions, but I’m a believer in playing the odds when it comes to things like brand. And more great companies have put attention towards building theirs.

Having a brand mindset also provides the necessary counterbalance when you are driving so hard on Customer LTV. It can be easy to be so exclusively focused on Customer LTV that you lose sight of what truly serves the customer.

I’ll give you an example from my early days at Beachbody. In one of our offers, we sold 3 bands with 2 handles. In my supposed genius at the time, the math said that if you pulled out 1 of those handles, we’d save money. The math isn’t rocket science. But the move entirely ignored the customer experience – it’s not easy to switch handles from one band to another. Now, I doubt that this decision had a significant impact on the brand experience, but it’s a simple example of how an action might save you money and increase customer LTV while being pretty crappy for the customer. My bad….

I’ve become so much more focused on brand over the past couple years because it’s been noticeably absent from conversations I’ve had with performance marketers (another area I’ve posted about previously). Ultimately, the “brand” conversation is about customer experience. How are you serving them, how do you treat them, what experience does a customer have of your business? As much as we want to drive what the brand means, our customers are the ones who have the final say.

Brand is not simply a logo, fonts, or an ad you run. Your brand reflects the values and perspectives you stand for. The logo is simply a representation of those values, but the logo isn’t the brand. It’s easy to get these mixed up.

A strong brand means a higher company valuation. It means connection with customers, which leads to more repeat customers as well as word of mouth (which is another term for a $0 CPA).

At the same time, the difference is telling in the way that performance marketers vs. traditional brand folks look at brand and sales. Performance marketers believe that sales drives creation of the brand. While traditional brand folks believe that you create the brand, which in turn drives sales. I can’t say for sure who is right and who is wrong. But many people can’t afford to build the brand while ignoring sales.

Which is why the term “branded response” has gotten in vogue. The phrase reflects that it is no longer either/or, but “and” – brand and performance need to be built concurrently. We’ve seen this become particularly prevalent as e-commerce players have used video – Facebook and TV – to build their businesses. The goal is to drive response, but without feeling like the ShamWow! (Btw, Vince made 8 figures off that product, so there’s a good measure of respect behind what might’ve felt like a jab at the ShamWow…)

At the same time, especially if you’re in a consumer business, and a subscription one, the quality of your product and service can be a huge difference in how your customers experience and think about your brand. Just as many marketers ignore brand entirely, too many ignore the importance of the quality they are delivering, believing that good marketing will always win. True, good marketing is helpful. Good marketing + exceptional product – that can be a game-changer.

Where is brand created? The answer, for good and for bad, is that our brands are created everywhere. At every touch point and interaction. Pre-purchase, post-purchase, in the product, name a place. That can be daunting but it’s also the reality. Alignment across the company of what the brand stands for, how you expect to treat customers, vendors, or stakeholders, is crucial if you want to have a consistent experience at all the touch points. And to build something that is defining and long-lasting.

Operational Excellence
To scale, you need to build a machine that runs as effectively and efficiently as possible. At scale, the organization needs to run well so that it’s no longer a couple people getting things done, scrambling to take care of those last customers. Similarly, no longer is everyone in the same room nor even same building. Which means building out the org, internal processes, systems, and beyond.

It’s at this point where the importance of bringing in people who have “been there and done that” is so important. In a company’s early days, you can figure things out real time because often the scope of the issues that arise is manageable. But as the business becomes more complex, sophisticated and expansive in scale, it’s just not practical that the original team can manage these issues.

Not to say that people can’t evolve into these more expansive roles. At the CEO level, Bill Gates and Mark Zuckerberg provide great examples of founders who have transitioned into professional CEO’s of huge entities. But a) they are the exception, not the rule; b) you must be honest about different members’ real strengths; and c) simply because of the expanding scope and needs of the business, new people will need to be brought in no matter what. And if the existing folks on your team aren’t delivering with the new needs, it doesn’t serve anyone to hold them in those roles too long. I’ve seen plenty of examples where those people continue at the company and have a great career. And I’ve seen times where the culture shifts, their ego gets in their way, or there’s just another dynamic that they exit the company.

Operational excellence is such a broad phrase, but here are a handful of questions I ask clients when evaluating this area of their business.
• How well is the company led? (It sounds simple, this gets to the heart of building a business.)
• How well does the company run? (This is different than the first question – I like asking it because if there is supposedly good leadership but things don’t run so well – that’s a disconnect to investigate.)
• Can each functional area in the business point to improvements they’ve made in the past 12 months when it comes to vendor pricing or new / redundant vendors?
• Can you point to certain areas where things used to break but no longer do (increase in order volume, technology issues, quality of data, new hire onboarding, financial statements being produced more quickly, etc.)?
• When something breaks and a flood of customers call to find out what’s happening, do they a) get thru; b) get a reasonable answer with reasonable expectations. (I like a customer service question, especially when something breaks, as it goes to how front-line employees and workers have been communicated to, trained, etc. on what the brand stands for.)
• Is there a single person accountable for the different areas in the business, and do they and their teams have specific KPI’s / performance targets they are trying to hit?
Just asking these basic questions can start to reveal areas of opportunities.

Even if you keep your business focused in certain areas, but as the business sees financial growth, the number of moving parts increases. That could be as simple as more customers buying the same product (which has operational, technological and customer service implications) or more products you sell (the same as the prior issues, but you get to add product development, sourcing, etc.). It can also include new services, new geographies, or new partners, to name a few.

Regardless, each time the business changes or grows, it comes with its own issues. Some of these appear over time and may require step-function changes. At some point, your technology platform may require an overhaul, your office space may no longer be sufficient; or you may need to add a location with your fulfillment partner.

Operational excellence comes with a methodical and organized approach to breaking down the business, assigning specific people to be accountable for those areas, and then setting targets for them to achieve.

Typically, the break points for growth happen at $10MM, $25MM, $50MM, $100MM, and $500MM. Not to say there aren’t challenges along the way, but those levels are when a lot of businesses run into challenges. Knowing they are coming, planning for the next stages of growth, and then managing through as it’s happening are all just components of growth. The good thing is that it’s likely that others have gone through similar issues, and there’s a lot you can model off.

And really, much of this approach of focusing on Customer LTV, Brand, and Operational Excellence, is based on seeing what has worked (and hasn’t worked) at many companies to formulate an approach towards managing scale.

Stay tuned for the final part of this series, where I’ll focus on Next Level Media Management. It’s an area dear to my heart and allows me to share my learnings from managing over a half a billion dollars at media spend. Regardless of your scale, my goal is to provide some actionable insights.

As always, please let me know any thoughts or comments you have on the above.

It’s No Wonder Your Analytics Team Isn’t Getting You What You Need

Not getting what you want

Depending on your perspective, you may or may not want to know how times you were presented with a set of analyses that could have had a meaningful impact on your business, but for one reason or another (which I’ll talk to in a moment), you didn’t realize it.

Most entrepreneurs, marketers, and business leaders whom I meet know that their metrics are crucial to their success.  In particular, they know how those metrics set benchmarks and then inform decisions for how to improve business performance.  But in talking to these same business leaders, I’ve found that most of them are frustrated by what their analytics team provides to them.

See if any of the following sound familiar from your meetings with your analytics team:

  • A brutally painful spreadsheet, printed out at 50% of normal size
  • A table that takes 15 minutes to understand
  • Some cool graphs and data points that don’t have anything actionable associated with them, but they’re really cool, aren’t they?
  • The analytics person delivering a report but having spent zero time thinking about *how* to take action on the data
  • Reports that flat out just don’t make sense because no one spent the 5 minutes looking at the data to ask if it makes sense.  Have you ever seen site conversion jump from 5% to 76% in 2 days? Yea, neither have I.  But the report you looked at last week says it did…
  • A disconnect between what you thought you asked for and what was delivered (this is certainly not exclusive to analytics)
  • How about this scenario: at the end of a metrics meeting you find yourself saying, “Here, you just aren’t getting it.  Let me draw out exactly what I’m looking for.” Then the analyst sits there somewhat shaken, pretends like they understand, doesn’t asks questions, and leaves saying something like, “Ok. I see what you’re saying. I’ll get you something right away.”  (The other two likely scenarios are that you call in the CFO to help or that the meeting ends as another is about to start with something like, “we’ll pick this up later.” 2 weeks later, it still hasn’t.)

Let me be clear about something – this is not about taking sides.  The only side I’m on is that I want businesses to leverage their information and people as much as possible.  And as I’ll get into shortly, there are ways to make significant improvements to avoiding the above scenarios.

During my first few years at Beachbody, I helped to build the strategic analysis team.  Of course I’m biased, but I think that was one of the higher-performing analytics teams in the industry.  At the same time, a good amount of that list above comes from first-hand experience, typically something that I did myself.  The rest has come from helping clients build, leverage and develop their analytics people.  And as much as I’ve grown into a broader marketer, analytics still holds a special place in my heart.

In this article, I’m intentionally going to focus on the relationship and people side of working with your analytics team.  Obviously, there are a host of issues that are crucial to getting what you want – hiring, data integrity, tools, etc.  But in my experience too often the people side of working with analytics is ignored.

First off, to those of you who think you have a one-person analytics team, that’s, well, not accurate.  That person likely works with someone in IT and also pulls data out of vendor platforms.  They may be the one you go to, but it’s important to realize that analytics is never just one person nor one department.  For simplicity’s sake here, however, I’ll be using the term “analytics team” even if that means that one person for you.

I have an entirely separate post about hiring analytics people here, but even if your team comprises “what good analytics people look like” – good at Excel (or at least says they are), something technical in their college experience, and claim to have experience in statistical tools or Google Analytics – too many marketers end up wanting more from analytics.

Are we clear on what exactly Analytics is?

Whether it’s differentiating between buzz words like BI and Big Data, or doing so with some commonly-used terms like reporting and analytics, it’s important to make sure you and your teams are aligned on what these terms mean to your organization.  You have your understanding.  Likely people have worked elsewhere, and these terms have meant something else.

If this is already starting to feel like work, I’d say that’s entirely correct (I hear this often at this point in the conversation when I’m working with clients). And just like everything else in your business, making sure you are getting what you want from your analytics team takes at least a bit, if not a lot, of work.

At the core, however, many people don’t realize just how much is involved in building a high-performing team or just haven’t put the attention and follow-up in the right places.  Hopefully this article helps in those regards.

Now, on to the real matter at hand.  It’s a rare case where the analytics team is trained, in two specific areas.

First, there often is very little training about the business as a whole. Sure, you may have an onboarding process, and perhaps you’ve even talked about your company strategy at your all-hands meetings.  But I’m referring to a more granular view of the business – what historically have been the key levers, where are the known pain points, and so on.

Too often it feels like the relationship between business leader and analytics is solely transactional. Meaning, when you ask for something, you are likely literally asking for the specific thing you want. Or at least you think you are.  No real context is provided. Then when you get something back, it’s not what you really wanted.  And you’re wondering why you have to do all the thinking about what the report you just got means.

Your people will appreciate the time you’ve taken to explain the business.  More importantly, having broader context oftentimes results in their identifying opportunities simply because their eyes were open.  It may seem like a random comparison, but I liken this to how, once you’ve just gotten a new car, you start seeing them all over the place.  When in fact they were always there.  Now, you just had a reason to actually “see” them.  Bottom line, help your people know what to look out for.

Second, it’s a rare analytics team that gets focused training on how to deliver actionable insights in a way that someone else can understand. Because isn’t that ultimately the whole point of business metrics and analytics?

Fortunately, both of these two areas can improve.  With much more on that second point below.

So what’s the solution?

Below, I address the biggest areas of unmet needs I’ve seen in organizations.  Not surprisingly, there are a combination of factors that help to set up a great relationship between you and your analytics team.  One in which you’re getting the information and insights to help move the business forward.  And one where your teams are satisfied, highly-motivated, and high-performing.

Here’s what you can do from the business side 

  1. Reporting vs. analytics

Reporting is a bunch of information put together and delivered to you, likely via email.  Analytics means taking that same information and providing real value.  It means insights and suggestions on what the data means.  This isn’t to say that your folks should necessarily come to you with new landing page designs or ways to optimize your call center scripting to improve customer satisfaction.  But it does mean to show up being able to describe what the information says and where there are areas of opportunity.  At a bare minimum, nothing you see should show up without a summary of key points.

  1. Set the bar high.  

It doesn’t matter how your company used to operate or what the norm was at a prior employer.  Demand more of your people.  Tell your people to come with ideas, implications, and next steps.  They may not be high-ROI ideas at the outset, but just like any muscle, that skill has to be nurtured.  People need to be clear about what is expected of them.  And then hold them to that.

  1. Remember, you’re typically dealing with introverts

One of the greatest challenges in effective communication between marketers and analysts stems from a difference in personality types.  Most analytics folks are introverts (whereas most marketers are the opposite), and so the analysts may take some time to process information or may feel less comfortable with conflict or challenging what you have to say. (Again, this is relevant for more than analytics people, but particularly so in my experience.)

They often struggle with knowing what the best means is to communicate findings – in person or email.  Sure, it’s on them to be proactive, but I can almost guarantee that if you ask them what they are working on today, there will likely be something that you are interested in.

  1. What motivates them

Each person has their own irrational passions (more about that in another post).  Typically, analytics folks want to be able to show what they can do and want to know that their work lead to something impactful.  They want to feel like they are a part of the team, not just some back-office Excel or data monkey (perhaps one of the pejorative terms I’ve heard them referred to).

  1. Don’t allow your analytics team to turn into a reporting one

I’ve seen far too many companies suck the life out of their analytics teams by turning them into report-pullers.  Good analysts bring you insights.  Report-pullers give you data and leave it to you to do the “real” thinking.  If you want the former, you have to guard against the latter.  That’s because it’s really easy to ask for reports from the people who bring you and others analyses.  Tools, clear roles, and an effective manager (more for the VP of Analytics later in this article) can all be components of allowing your people to keep spending the greater proportion of their time doing real value-added work.

Here’s what to ask of your analytics team

For this section, I’m going to speak directly to them, but it’s important that you, the business leader, hear it.  

  1. What is the real question being asked?

You are deeper in the data than almost anyone else.  As such, what someone asks for versus what they really wanted versus what’s possible can all be different.  These are some of the better questions I have found to ask before starting the real work:

  • Can you (person making the data request) tell me what you’re ultimately hoping to find out or use this information for? Too many times people ask for something specific, thinking they know what it is.  But when you actually get context from them, you can suggest other ways of exploring the issue.  Or you may find something else that no one was initially expecting.  (This question, by the way, when asked from a worn-out team member, can come across as confrontational when it fact it should come from a place of service.)
  • Can I repeat back to you what I think I heard to make sure I’m hearing you correctly? This should be standard for anyone receiving a request. Of any sort.  Especially when it can take up a good amount of someone’s time.
  1. Make it as easy as possible for someone to “Get it”

I thought this year’s season finale of “Silicon Valley” exemplified this point really well.  But I was so frustrated by what I thought was the real point.  In the show, a tool (it doesn’t matter what it did for our purposes here) was unbelievably powerful, but no one understood how to use it.  It had been optimized for engineers, not consumers.  (In the show, they seemed to completely miss the UI lesson.)

The same is true for analytics.  Hopefully most of the people you’re working with are bright, but they don’t want to struggle to understand what you’ve done. Your effectiveness in your role is in large part dependent on your ability to translate complex analyses into simple, easy-to-understand, actionable insights that other people can understand quickly.  If you can’t easily explain a chart to yourself, get it out of the deck.

Let me repeat that in a different way.  Your job is not to show off every step you took, all the nuances and edge-case exceptions, nor all the technical details of the data.  Your job is to take all those hours of work, ugly spreadsheets and annoying data manipulations and put the end result and suggested next steps onto 1-2 summary pages.

This is what people who are great at their task, in any field, do.  They make the hard look easy.  Ever tried swimming the butterfly stroke or doing a back handspring?  Ridiculously difficult.  And yet, all we see is the end result, never knowing the struggles and challenges others faced.  Same with entrepreneurs, actors or master artists.  And it’s the same with you.

  1. Telling a story with the data

It’s not just marketing who is in the story-telling business.  Whether you’re sending out a regular report or sharing learnings from some ad-hoc analysis, what is the value in what you are sharing? Add some color or highlight something that has changed.  Said in a different way – add some real value.  Particularly for ad-hoc analyses, what is the real message that the data has helped to reveal?  Where did you start and where did you end up? Why? What did you come across along the way? Where did it lead you?

  1. Look at your subject lines

Examine your own behavior, whether in emails you open or on headlines you click on in social media. You’re much more likely to click when the subject line is hard-hitting, piques your curiosity, or just seems relevant.  If you’ve spent some time on your work or have found something you feel is really cool and actionable, it’s your responsibility to make sure you communicate that effectively.  The first step in doing so, if you’re sharing your results via email, is that subject line.

As a side note, it is unacceptable to say that you didn’t follow up because you didn’t hear back.  Walk down the hall or call the person to schedule a time to review what you sent over.  They may have missed it because your subject line was, well, you know…

  1. Know your audience

Everyone processes information differently.  As such, how you communicate to “pure marketers” is likely to be, nay, has to be different from how you communicate to the CFO.  Take a moment to think through the kinds of questions marketers asks versus the CFO.  Those questions reflect a different lens through which they view the same company.  And at the risk of taking the analogy too far, it’s your job to make sure your analysis is in focus for them, not the other way around.

How you present your analysis, as with most things in life, can make a huge difference.  Remember that when you’ve been deep in the data for so long, you know all the nuances, the side analyses you ran, or the way you joined several datasets.  And because of that, it’s easy lose sight of the fact that the people you are presenting to have zero of that context.

So look at what you’re presenting as if you’d never seen it before.  Would someone who has just come from another meeting to look at this understand what’s happening pretty quickly.  Size, design, layout, tables vs. graphs, colors.  Don’t go crazy but these all affect how your analysis is processed.  Learn what your audience prefers and deliver it so that it makes sense to them and in a way they prefer.

By the way, I ESSENTIALLY JUST SAID THE SAME THING 4 DIFFERENT WAYS!! That’s how important presenting information is!

  1. Educate the rest of the organization

Take it upon yourself to educate others on the business of the business. Walk them through the LTV model, show them the levers, show them what they can impact, show them why your analysis priorities look like X and not Z.  You have (or you better have) found trends, anomalies, mistakes, or opportunities that can benefit the business.  You need to create the venue to share those learnings.

  1. Review your work

On a different note, the best piece of advice I received when I was 22 years old was, “After you’ve spent hours working on something, take 5 minutes to look at it with a fresh set of eyes. And ask yourself, ‘Does this actually make sense? Do these numbers and results seem reasonable?’”  This prevents you from showing gross profit larger than revenues or showing more customers on a subscription on day 60 than started on day 0.

  1. Set up internal checks in your spreadsheets

Don’t get too cocky about how good you are, especially the more complex your analysis or model is.  Use some of that skill to guard yourself against mistakes.  For example, you can have a cell that only displays text when your numbers don’t foot.

My favorite story about this was when a partner at an investment bank was going thru a friend’s deck. He got to a page and told my friend, “These numbers are F’ed up.” To which my friend said, “No way, they are right.” Which prompted the partner to turn the page around to show an alert that the analyst had set up but had clearly not looked at.  And in big bold red letters were the words, “These numbers are F’ed up!”  Set up checks.  But again, take a moment to look at what you’re presenting.

  1. Stop thinking everyone else has it better

At some point, you’re going to have to get over the fact that your dataset is not perfect.  Some companies have better data.  Some have worse data.  But no one has perfect data. Nothing remotely close to that.  Whatever you think some other company has going for them, I can almost guarantee that there is a good amount they aren’t happy with.

This doesn’t at all mean that you stop pushing for data integrity and better systems.  There are certainly levels for each, below which doing analyses is painfully difficult.  But having seen companies large and small, what I can say is that everyone thinks everyone else has it so much better.  When in fact, everyone is a work in progress.

  1. Get over your insecurities

A wise man once told me, “You will succeed to the degree you deal with discomfort.”

I get it.  You aren’t as aggressive as some of the other folks.  People don’t realize how bad the data actually is.  Being a self-promoter doesn’t come naturally to you.  Those senior folks are pretty intimidating.

I certainly don’t mean to cast analysts as weak or feeble.  Far from it.  But I can guarantee that those statements resonated with a whole bunch of analytics folks, just as the first set of scenarios did with the business leaders.

At some point, you have to make a decision to step up.  If you are serious about wanting to help the organization, that’s what it’s going to take.  And certainly, if you are serious about advancing your career, while it’d be nice if everyone were nurtured and developed by their bosses, ultimately you have to take ownership and responsibility for how your career progresses.

A couple notes to the VP of Analytics (assuming you have one)

Most VP’s of Analytics were formerly analysts themselves, where individual contributions were rewarded.  Managing a team is different, but making that transition can be a challenge (again, this holds for many areas well beyond analytics).

And so, speaking to them…

One of the hardest areas to get comfortable with is the idea of training your folks to do something as opposed to doing it yourself.  In the short run, it’s faster to just do it yourself, but part of gaining leverage is the investment you have to make in your team.  That means things will take a bit longer. Will be done a different way (that doesn’t always mean wrong as you’ve hopefully figured out).  And will result in satisfaction and loyalty from your team.

As I see it, you have a few key responsibilities:

  1. Make your team look good. As much as possible, give them credit.  Don’t worry, you will get the secondary credit, since it’s your team.  But while you might have been used to hearing the direct feedback about the good work you did, make sure your team is getting that credit now.
  2. The opposite also holds – if there’s a mistake, shield them as much as possible. This isn’t to say you don’t hold them accountable.  But if there’s a mistake, it’s in part your job to identify it before analyses is presented.  And it’s not lost on me that this can difficult when you are getting your team up to speed.  But if you throw them under the bus in public, you will lose in the long run.  Trust me on this.
  3. Part of your job is to buffer your team from unnecessary requests. This includes requests from the CEO, whose requests can easily get bumped to the top of the list, with almost no regard for whatever else is in queue.  CEO’s rarely filter requests and are known to just send out requests without having a true appreciation of the time and effort involved.

Getting to ROI – A final thought for you, the Business Leader

I know it’s easy to get frustrated with your teams.  As much as that list above is a solid set of areas that you and your analytics team can address, who in your org is ultimately responsible for helping them to get better?

Certainly, it’s important to know where the gaps lie.  If it’s a presentation issue, then look to see who presents information well in your company.  Don’t just look at the “numbers” or finance folks.  In any department, who presents well? Yes, presenting quantitative info is a bit different than presenting creative concepts, for example, but there is still a lot that transcends functional areas.  If it’s one of the other issues, again, think about who in your company does that skill well.

It was intentional that the vast majority of the points geared towards the business side were around philosophical and mindset issues while those for the analytics team were more about communication and day-to-day tactics.  Both sides play a part, as they do in any relationship.  But I’ve also found it’s more effective to approach improving these specific relationships in this way.

That being said, making some adjustments to how you operate is possible and arguably very high ROI.

But I’ll ask the question again – who is actually accountable to develop your analytics team? Meaning, who is helping them how to do their job better?  Who is teaching them how to determine which analyses can lead to something actionable versus ending up in that “interesting but not really relevant” bucket?  And for goodness sake, who is teaching them how to present their analyses in more effective ways?

So that you actually look forward to meeting with them. Because they get you what you want, in a way that you can understand it. And because it leads to something you can take action on.

As opposed to ending those meetings feeling more drained and frustrated than you were an hour earlier.

Just imagine for a moment that at the end of a metrics meeting, you think the following, “Wow, I actually understood what was presented.  It was even more than I had asked for, and best of all, someone else had done the thinking and presented me with a few ideas on how to take action on what we just covered.”

That is not a pipe dream.  That is what a high-functioning analytics organization delivers.  And even if that seems too pie-in-the-sky for you, wouldn’t you rather be closer to that supposed pipe dream than the reality you’re facing today? I’m guessing if you got to this point, the answer is yes.

There is a way to make what you’re doing better.  Maybe there’s an implied judgment in there, but really it’s about acknowledging where you are and then deciding to make it better.

And that’s the sort of decision that you don’t need a metric to help inform.

It’s your move now.

I’d love to hear what are some of the biggest challenges others have faced from your analytics teams?  And if you’re on that team, what is your biggest ask of folks who essentially are your customers?

We Sat at the Restaurant an Extra Hour and No One Ever Came By

The wait staff may have been indifferent or clueless. But I’ve got to believe that the owner would’ve lost it had he found out.

And I’m guessing this sort of things happens all the time in most every other business.

To set the stage, a good friend and I met up at Clutch, a restaurant in nearby Venice (California, not Italy…). At 2pm, it would be a late lunch for me, but there were a decent number of folks seated. My friend wasn’t eating, so I ordered and started eating before she’d even arrived. Halfway through the meal, she arrived. The waitress asked if she wanted anything (she didn’t), and asked if I wanted another beer — I said not now, but I might in a bit. (And yes, I was drinking a beer at a late lunch on Friday. Back off…)

We shared a dessert and closed out the tab.

We then sat at the table for another hour talking. Having worked in a restaurant before, I’m mindful of taking up seats, but there was no crowd and so we weren’t pulling any business from them by sitting around.

But here’s the amazing thing and the missed opportunity.

Not once after we’d closed out the tab did someone come by to ask if we wanted anything. No water. No following up since I’d said I might want another drink earlier. And since we were there an hour, that might even be due cause to ask if we had gotten hungry again. But nothing. Nada.

Sure, it’s nice not to “be bothered.” But if you ask in a respectful way, there’s absolutely a way for the wait staff to ask if we wanted something. I’d argue that someone should do so every 20 minutes. At least get a verbal “I’ll let you know if we need anything else.”

And here’s the bigger thing. How many other times across numerous areas in the restaurant, or in your company, is there missed opportunity. We’re talking about live people who have purchased something just sitting around. The ask doesn’t get easier.

It doesn’t even matter what our response would’ve been in this particular case. Getting a yes is a numbers game to a certain extent. But you’ve got to ask the question.

And I liken asking the question to advertising. People think no one wants to get asked the question. Just like many people think no one wants to see advertising. When in fact that’s absolutely not the case. People love seeing ads. The ones that are relevant to them. Or entertaining. Or inspirational. People just hate seeing bad ads. One that have nothing to do with them. And getting pestered incessantly by them. Just like when people are being pestered by a salesperson. Or wait staff.

But if someone is in your place of business (whether physical or online), and especially when they’ve bought, it’s reasonable to say they are interested and half-way expecting an ask. Doesn’t have to be a rude ask. But an ask nonetheless.

And if you’re a business owner, don’t be so sure your people are doing so. That’s why the secret shopper is an important test to run. Or going through your own site as if you were a new customer, full through to buying and then even returning or cancelling.

As you scale, you have to put some trust in the people on the team, whether 1 level down or 5. That’s one area leverage comes from. But in my opinion, you also need to balance that with a healthy sense of paranoia to check on your business, especially when it comes to sales and customer experience.

You just might find out that that your people, or your site, isn’t going in for the ask. And that kind of missed opportunity is one of the most frustrating. But it can turn an expensive miss into a win.