Revenue Performance Management: Platts’ Formula for Revenue Growth In 2010, Eloqua interviewed Mark McCary, Senior Director of Global Marketing at Platts to discuss the company’s Revenue Performance Management (RPM) strategy. Platts is a divi-sion of The McGraw-Hill Companies and is the leading global provider of energy informa-tion in the physical and futures markets. Through its global RPM strategy, the company is optimizing its entire revenue cycle – increased revenue growth and efficient investment of resources - through better sales and marketing visibility and alignment.

Customer Q&A Mark, why did Platts start down the RPM road? Who initiated the project and what were the drivers? That’s a great question, because RPM is a journey, not a destination. A mixture of market-ing, sales and finance started the journey as a six sigma program over 2 years ago. Now we actually have a specific sales and marketing team that meets bi-weekly to discuss ways to improve our lead management processes. That team has worked on optimizing our sales and marketing dashboards, with metrics being tweaked, added, and subtracted over time. There were several things that prompted us to build out our sales and marketing dash-board. First, we wanted clearly defined metrics with associated goals that marketing and sales owned. Further, we wanted specific, agreed upon action items (SLAs) that would truly help us increase our revenues. We also wanted to learn which factors contributed to a high lead conversion and sales acceptance rates as measured by a number of metrics. Finally, we were looking to understand how much direct and influenced revenue market-ing needed to contribute to the organization along with the type of revenue (new customer acquisition versus up sell or cross-sell to existing customers). Two other related objectives were to get an understanding of how many leads marketing needed to contribute along with our lead capacity. This would enable us to more clearly benchmark ourselves, set realistic goals for improvement and move towards a process where we could actually predict future revenue based on lead volume and related demand generation campaigns.

What are the key metrics you track as part of your RPM strategy? For marketing, the key metric is the number of marketing sourced opportunities. This is directly related to our monthly goals for the number of inquiries and MQLs. Marketing sources about 28% of our closed won business today. By paying attention to the MQL pipeline, we ensure that the sales opportunity pipeline is well fed for future months which in turn gives us an idea of whether we will hit our targets or not. We can ramp up or down demand generation activities when needed. The sales acceptance rate and percent of leads rejected gives us a good idea of lead quality. On the sales side, we focus on the percent of leads contacted within 24 hours, percent contacted overall, along with the SAL to opportunity and the closed won conversion rates. These metrics help identify best practices of high performers that we can share with the

RPM Benefits @ Platts

Customer Success Story

Improved lead qualifica-tion rate from 30% to 70%.

Increased lead to opportunity conversion rates from 23% to 31%.

Increased marketing revenue contribution rate from 22% to 28%.

© 2010 Eloqua Corporation

rest of the team. Sales cycle times are another metric that sales pays close attention to because this shows the efficiency of our sales pro-cess and helps us improve our forecasting accuracy. Finally, the man-agement team pays close attention to leads that are over 2-3 months old so we can ensure that each is converted, nurtured or rejected. Did you encounter any significant challenges in the development of your RPM strategy? There were several challenges. The first was what to measure. We real-ly wanted truly actionable versus just interesting metrics, and we relied on best practices from Eloqua and Sirius Decision, running these by our sales and marketing committee to ensure that we were getting the metrics that matter. Automating the data integration between Eloqua and Oracle On Demand was another challenge. We needed a live view of data that would allow us to accurately drill down into each sales re-gion, team, and individual sales rep. Today, our RPM dashboards help us more effectively diagnose problem and opportunity areas within our lead and opportunity pipelines.

Case Study: Platts

© 2010 Eloqua Corporation

Figure 1. Click to Enlarge: Platts Tracks Sales Conversion by Stage in CRM. As part of Eloqua’s C-Suite 16, this Chart is Called ‘One View of Conversion.’

Figure 2. Click to Enlarge: Platts relies on Eloqua to Track Campaign Performance by Lead Stage

What processes have changed as a result of your RPM strategy? The SLAs developed between marketing and sales have made quite a difference. Once we discovered that our organization can only handle about 1200 leads per month globally, marketing significantly pulled back on its demand generation programs, reducing the number of leads sent to sales by 64%. This was done, in part by developing a lead scoring program to make it harder for a ‘lead’ to reach MQL status. Sales management has started using the dashboard in their weekly meetings to focus on lead follow up time. We’ve worked over the last year to improve our lead qualification rate from a low in the 30% range to the high 70% range with certain regions reaching 90+%. This in turn has impacted our lead to opportunity conversion rates from 23% to 31% month to month over the past 9 months. The marketing contribution rate (business closed from marketing sourced leads and opps) has increased from 22% to 28%.

What’s next on your RPM Journey? The next steps for Platts is to add new views to our dashboards so we can see trends across product types and sectors as we move towards product based forecasting. We will also be doing deeper analysis of sales cycle times and opportunity stages for deals we won and lost to see where opportunities are getting stuck. Finally, we have plans to add an analysis area into the dashboard, where our marketing and sales analyst can make notes as to what trends they are seeing and what we should be looking out for in the future.

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