Marketing math made easy with Lee Wochner

Jaclyn Uloth: Welcome to the podcast that lightens the tension when things sort of get hard… That’s What C! Said, the Counterintuity podcast, featuring interviews with leaders and doers who have helped to make our world a better place through their actions — and especially through marketing, communications, and embracing change. Here’s our host Lee Wochner.

Lee Wochner: Welcome to That’s What C Said, the Counterintuity Podcast, where we talk about marketing and strategy, especially for nonprofits and public agencies, but also all sorts of businesses and world improving endeavors. Recently, we’ve been talking here about planning, planning how best to lay the groundwork for a successful new year. And this week, we’re gonna talk about setting key numbers.

Now you might say, well, gee, how come this just you again? Where are your guests? We’re going to have guests back in January and we’ve already recorded one or two of those. We’ve got those in the can. We’ve got some amazing guests lined up who are making big impacts in the world who are going to talk about how they did that and how they’re getting their message out and their marketing and their strategy. But we really wanted to help you guys plan out a successful year for next year, just as we ourselves are doing here.

And so this is yet again, a podcast about planning, featuring just me. Originally, I was gonna talk about vision, marketing, and finance, and we did indeed cover those things in the three podcast episodes before this one. So if you haven’t checked them out yet, you might want to now. There’s good stuff in there. Vision sets the basis for your marketing and actually for all your actions, not just your marketing.

And the simple little exercise I recommended in that podcast episode lets you check in on that, on how you’re acting in accordance with your identity and your values. Marketing is something that I talked about in the second in the series, which helps you focus on how you’re gonna spread the word about what you and your organization or company do.

And then the third one was finance, which was primarily about budgeting, in which I provided two different budgeting models and how to do them, including the scary one. And in that one, I also gave my economic forecast about a year from now. You can tell me how I did, especially compared to highfalutin economists who won major prizes and all that. But I’ve been around a little while and I think I have an informed guesstimate.

And I especially recommended In that podcast that whether you’re a nonprofit or not, you should be pushing for all the dollars now because the closer we get to the presidential election the dicier it’s probably going to get. People like to know what’s going on and like to feel secure and every presidential election season they get a little antsy the subtext of all that planning stuff. Well not even subtext because I was entirely forthright about it.

So let’s say the backdrop of all of that was that you’re better off developing a plan than you are just doing stuff and hoping it pans out. And earlier in my life and career, I would just jump in and do stuff. And I hope that I have learned some things. Number one being, don’t just jump in and do stuff, plan it out. And also I hope that you learned that planning doesn’t have to be hard, doesn’t have to be time consuming, and that you shouldn’t dread it.

Or procrastinate or in any way resist it or fear it, you should just walk straight into that light of planning. The light of clarity. One of the great things about getting older, and there are great things about getting older, you get that little discount at the movie theater, for instance, that’s what I hear. I’m not at that stage yet. But I can tell you one of the great things about getting older is that you develop clarity. And clarity, most of us find, is one of the great gifts of being alive.

Because once you’ve got clarity, you know what your life is about and what it isn’t about, what you’re going to do and what you’ll never do, who you want in your life and who you don’t, and all those things you decide to keep, you appreciate all the more because they got sweeter and you appreciate them and you recognize that those are the things you actually want and the other stuff is immaterial at this point. So clarity provides a lot in life. So if you want more clarity, planning goes a long way toward removing distractions.

So if that was the past three weeks, what’s today about? Well, today is a little bonus, a chaser of sorts, the DJ Steve that ends the meal. Today we’re going to talk about tracking numerics for the new year and specifically marketing related numerics.

You can’t really set goals unless you know what you’re trying to accomplish and where you’ve been. And so today we’re gonna talk about an easy way, relatively easy way to establish your numbers so that you can set goals around them for the next year, so that you can plan around them, because planning around them and going after them means you can achieve them. So when you set goals, this is a tip for all of life, I think, your goals should be SMART goals.

And SMART is an acronym that stands for Specific, Measurable, Achievable, Relevant, and Time-Bound, or Timely. That means they’re all going to be numeric, you’re going to be able to do them all, they’re all going to be important, and you’re going to do them all within a certain timeframe. With some of them, that timeframe is going to be 30 days, or 90 days, or such, and with some of them… the timeframe is going to be by the end of the year.

So smart goals are a real help in life, in planning, in achieving things. So here at Counterintuity, we have some smart goals that are annual, having to do with revenue, for example, but we have others that are 90 days smart goals or quarterly smart goals. And then we reset those every quarter, those shorter ones.

And when we do that reset in a day-long quarterly planning session, we might add a couple of new goals and take a couple off that were either achieved or now seem less important. So what we want to do here today right now with you before January 1 is help you establish all of your current numbers, the relevant ones, so you can then chart your growth in those numbers throughout next year.

So establish where you are now, set that as a baseline, and then for next year, ask yourself, okay, how can we improve on these? So there are about 11 billion different smart goals you could set. I’m gonna pick just five that I think will tell you a lot, and I’m gonna tell you how to tabulate them now. And they are reach, engagement, leads, exits, and revenue. Reach, engagement, leads, exit, and revenue.

Reach is the total number of people you’re reaching with your marketing. Engagement is the number of people actively engaging. Leads is the number of donors or prospects. And we can throw in sales or donations because you hope that they convert. Exits is the number of people who left and you want to know how they left and why they left and revenue the total dollars brought. So we call this RELER which is short for reach engagement leads exits and revenue. RELER because your marketing should be reeling people in. So let’s talk about each of them individually.

Reach. Reach is the total number of people you’re reaching with your marketing. How do you calculate it? Well, you break it down. How many unique visitors to your website? How many subscribers to your email newsletter? How many followers to your LinkedIn, your Instagram, your Facebook, your YouTube, et cetera? Set up a chart, Excel is always nice and easy, of all the ways that you’re reaching people with your marketing.

Maybe you have a podcast, for example, or you do mail campaigns. Segment all the numbers by the method of outreach, then tally them at the bottom. That’s your current reach for this year. So you’ve got 100 people on your email list. I’m gonna keep this math very simple for myself. Let’s say you’ve got 100 people on your email list. You’ve got 1,000 unique visitors for the year on your website, and you’ve got thousand followers on LinkedIn, voila, you’ve got 2100 people you’re reaching. That’s pretty low number. I’m sure your numbers are higher. So now you have a baseline.

The next one is engagement. That’s the number of people actively engaging. Just because you’re emailing people and sending them things in the mail and doing whatever else you’re doing that reaches them doesn’t mean they’re paying attention. You want to make sure they’re engaged with the marketing you’re putting out. Otherwise, you are the proverbial tree that falls in the forest with no one around to hear it make a sound.

So, okay, so how do we calculate the engagement rate? So here’s how to calculate the engagement rate. And bear with me. Total engagement divided by the number of followers times 100%. So you take the total number of all interactions, shares, comments, reactions, et cetera, on let’s say your social. And you divide that by the total number of followers you have and then you multiply times 100%.

So let’s take an example here. Let’s take Facebook. Take 30 representative days of your posts. So pick a month. You’ve got, let’s say, let’s say you’ve got 10,000 followers on Facebook. Over the course of those 30 days, you’ve got 200 likes, 100 comments and 50 shares. That makes your total engagement rate 3.5%. We took the total engagement divided and that was, uh, was a, let’s see, 200, 300, 350 divided by the number of followers. That was 10,000. And then we multiply it times 100% and you have a total engagement rate of 3.5%, which by the way is a terrific engagement rate. Most Facebook engagement rates are more like 1%, 2%. So it’s best to do this for each of your outbound marketing channels. That mail campaign, did anybody call you, go to the website from it or your email campaign. So you can see how each is doing.

Now you can see where the engagement works. You sent out a fundraising appeal. How many people sent the envelope back with a check in it? Yes, some people still donate via mail. And it’s also good to do a cumulative score. What’s the engagement rate for all of that? And then you document each of those engagement rates. Again, you may like Excel. Can you move the overall needle for next year? Or do you wanna focus on just one or two?

So I personally, I’ll tell you, I go after email open rates and click through rates. Those certainly tell you engagement because those two would tell you that people are actually opening and reading your email to them. And all those opens should be linked directly to your website, by the way, which will also help your search engine optimization. So those are stats we pay a lot of attention to. We send out an email to, I don’t know, 2,000 people.

Clients, former clients, people who are interested. We wanna look at that open rate. We wanna see who clicked. We wanna see why they clicked. It helps us understand what’s working and what’s not. Your goal with this right now, of course, is to establish the baseline of where you are right now so you can figure out how you’re gonna grow the results for next year. Next up is leads or prospects. That’s the L in RELER.

That’s the number of donors or prospects or sales or donations. This is the number of people you’re prospecting, whether for donations or sales and or it’s the number of successful transactions. You got a donation or a sale because you want these leads to convert.

There’s a lot of value to this number, especially when you attach it to the total revenue result and divide by the number of individuals. So I’m gonna lay out for you a whole bunch of decisions and game playing you can do when you have these numbers. So let’s say you did a fundraising appeal. You had a thousand people you reached out to and five of them each donated $100.

So you reached out to a thousand people. five of them donated $100. That’s a 5% response rate at $100. That’s $500 total. It might be reasonable to assume that if you had a bigger list, say 10 times that, which would be 10,000, you’d get 10 times that in donations, which is $5,000. And that’s one way to go. But what if you were able to get more of them to donate than the 5%? What if the donation rate went up from 5% to 10%? and you were able to get each of them to donate $200, now you’ve got $20,000 or four times the amount.

Throughout the year, you can calculate the number of people you’re approaching, the individual ask, the campaign ask, and calculate the percentage who bought or donated, and the amount received compared to past results, and then work to improve on the results. So again, you get a lot of levers here that you can work. Once you recognize that you have all of these levers, you can see which ones you can pull, and what will make them move the needle better for you.

Oh, probably 25 years ago when I was running a one of the nonprofits I’ve run, I sent out a donation letter asking for $10. And I got a whole bunch of $10 donations, but most of them were for more. And one day I opened one and there was three $1 bills in there. I didn’t know the person had $3. I knew exactly who that was. And the next envelope had $1,000. And the next day we got another one with $1,000. So there was definitely something working about that campaign. We wondered what would have happened if we could have sent it to a bigger list. But we did pretty darn well on that.

Next is exits. Exits is the only downer number here. It’s a negative that we’re measuring. This is where you’re measuring a loss. How many people unsubscribed from your email newsletter? How many donors or clients left as a percentage of your business.? We call these numbers churn. You wanna keep your churn rate as low as you can because it’s hard to build your business when all you’re doing is backfilling the people who left. Examining what we call your exit numbers helps you identify why they exited. Did you send out a particular message that got you a higher unsubscribe rate? Was your message or your product or your service irrelevant suddenly to a whole bunch of people or was that particular message irrelevant? Did you kind of lose touch with people?

And then when you reminded them you were there a bunch of them didn’t miss you and they unsubscribed There’s it. There’s something not to do fall out of touch Did they not find what they needed easily you sent an email newsletter you promised one thing There’s a link they clicked on the link to your website and nope. That wasn’t what they expected to find there.

Once you see where they’re leaving, for example, the page on your website that is their exit, where they bounced right off the site, you can start to figure out why they exited, even just by surveying them. You can survey them, you can ask some people on an individual basis, because you wanna know why people, disengaged with you, kinda gave up. Developing exit numbers and tracking them will help you see if you’re actually growing. Or as they say, going three steps forward, but two steps backward, or even worse, three steps backward, which would mean going nowhere.

Lee Wochner (18:00.67)
And then finally, of the five omnibus numbers we think will most help you establish baseline, we always recommend looking at revenue. And that’s an obvious one. Everybody likes to look at revenue. What was your monthly, quarterly, and annual revenue? And ideally, your profit, or if you’re a nonprofit, your surplus. If your revenue isn’t growing, you’re shrinking. If your revenue is growing, but you’re losing money, you’re overspending and you better take in more money, spend less or both.

So you certainly want that revenue number. So of all of the numbers to choose from, what we’re recommending is these five, your key numbers, reach, engagement, leads, exits, and revenue. Those five numbers with their subsets will tell you a lot about your marketing. With those key numbers, you can actually set targets for improvement. Without them, it’s hard to know what the heck to do.

I just found page four. Now that you have those in hand, you might realize, hey, we need to grow revenue by 5% just to break even, or 10% of our list unsubscribed. And we get a lot of our donations from our email list. We’d better set a goal of increasing our list by at least 10% just to refill that bucket. Or…

You might say, we also get sales and donations from our social media. We see that the sales are coming from the people who are most engaged. That seems like an opportunity. We should set a target of increasing our engagement by say 20% over the course of next year. Now let’s figure out how to do that.

The beauty of numbers, and I found this out a long time ago when I really got, I’m really a writing kind of guy, but once I got into the numbers, which was a long, long time ago, I found the numbers to be kind of a resting place. Because the beauty of the numbers is that they’re fact-based. There’s no denying their reality. That’s why I think they’re a place of comfort. They objectively tell a story versus say creativity which can be much, much harder and in which everybody has an opinion and you don’t know who’s right.

Yeah, trust me, the creative stuff is harder than the numeric stuff. The numeric stuff, once you figure out the numbers, you can get creative about how you’re going to seize the opportunities and solve the problems associated with the numbers. But you gotta know those numbers to do any of that. So now’s the time to decide what you’re gonna track for 2024.

I gave you our proposed list, which was RELER, but there are a million other things you could choose. Get those numbers for 2023 down now so you can use them as a baseline for what your goals will be for next year. And then go make it happen. Go make next year happen the way you want it to happen. You can absolutely do it. Look how far you’ve already got.

Thanks for listening. If you like our podcast, please give us a review. Wherever it is, you listen to it. We’d sure appreciate it. Just like we appreciate you spending some time with us. Thank you. And we’d love to hear from you about your thoughts for the new year and questions about anything related to marketing and strategy. You can email me at lee@counterintuity.com. That’s lee@counterintuity.com. I’d love to hear from you. Let’s plan toward an incredible new year.

Jaclyn Uloth: Thanks for listening! We’re glad you came. That’s What C! Said is produced by Lisa Pham and engineered by Joe Curet. It’s available on Apple Podcasts, Spotify, and wherever you get your podcasts. Please like and follow the show. Visit counterintuity.com to sign up and learn more.