The M-A-T Effect is a guide for decision making that we use with Tech Founders at Sales for Startups. We use it to improve the quality of results that Pre-Seed to Series A B2B tech startups produce when building predictable sales operations.
The letters MAT are short for:
- Measure
- Analyse
- Take Action
These three parts are broken down by the following 8 steps, which this article outlines.
The ‘Measure’ step
The purpose of the Measure step is to capture relevant information to help you make decisions.
- Determine the metrics worth tracking
- Understand existing performance
- Use for goal setting based on the existing data
Determine the metrics worth tracking
Vanity metrics include impressions, “likes,” shares, comments, followers, open rates, views, traffic, time on site, bounce rate, and more. Often called “engagement metrics” they are the most-used metrics in social media, content marketing, digital advertising, PR, and inbound campaigns to measure the performance and success of marketing efforts.
Instead focus on the metrics that can make a difference to your overall business goals.
- Lifetime Value of a Customer
- Gross Revenue
- Net Revenue
- Profit Margin
- Conversion Rate
- Leads Generated
- Customer Retention Rate
- Number of calls made + emails sent
- Number of meetings or demos scheduled
- Number of meetings/demos completed
- Number of opportunities created
- Number of quotes delivered
- Length of sales cycle
- Number (and size) of deals closed
- Cost-Per-Conversion
Understand your existing performance
Depending on the model of your business, your conversions will fall into one of two categories: a sale or a lead. In each case, there are ample points at which a prospect can “drop off” the customer journey and guiding prospects from awareness through to advocacy can be a challenge.
Start by measuring your existing performance on a few general metrics and then pull out the most important metrics to you. The list below is a good starting point:
- New Customers
- Lifetime Value of a Customer
- Cost-Per-Acquisition
- Gross Revenue
- Net Revenue
- Profit Margin
- Conversion Rate
- Leads Generated
- Customer Retention Rate
- Website Traffic
- Cost-Per-Conversion
- Referrals
Instead of relying on your gut, use a CRM to track all of your data and make this your single source of truth. If it’s not in the CRM, then you have a problem.
Goal setting based on the data
It is dangerous to assume that the numbers tell the full story. It’s better to think of data not as a bullseye but as a trail of breadcrumbs. Metrics point you in the right direction based on problem areas, but until you uncover the root of the problem, you cannot make a fully accurate decision.
Companies who set objectives and come up with key results that are metric-based indicators of success will have more chance of succeeding, by making those key results visible, to encourage accountability at all levels of their organisation.
We sometimes see Founders set goals within a void, “we want to triple our number of leads next month”. When you look back at the data there is no trend that shows that even with the greatest will in the world this could be the wrong strategic aim.
The ‘Analyse’ step
The purpose of the Analyse step is to interrogate the measurements you’ve taken and then start to understand what this means for you with regards to sales conversion:
- Defining sales analysis
- Data-driven decision making
- Better customer engagement
Defining sales analysis
Sales analysis is mining the data for insights to evaluate the performance of your sales team against the overall company goals. It provides a greater level of understanding about the top performing and underperforming products and services, highlights the problems in selling and marketing opportunities, and enables a comprehensive sales forecast and supports further revenue generation.
We know that 68% of plans are not successfully executed. That’s why we implement two week sprints for our customers. The two week sprints are full of opportunities to learn more with less time.
- Managing your two week sprint
- Hold weekly planning & review meetings
- Measure sprint progress
- Log new actions and your reasoning behind them
- Celebrate wins
- Record and document your winning systems
Data-driven decision making
With the data at hand, you can now plan your next steps and what actions you’re going to take now you know what you know.
Growing a startup is a game of constantly testing hypotheses and seeing if they work in a live market environment.
You can record what you’re looking to achieve by taking corrective or incremental action and if it worked. Another way to think of it is like analysing your serving action in tennis after some three lost service games and then making some small adjustments in the way you throw up the ball, did you get more first serves in? Did you get any non returnables? Did you win more points in the game? And ultimately did you win your service game?
Better customer engagement
If you can determine why a deal closed, or didn’t close, you adapt, iterate and improve your sales cycle in order to keep your customers happy and loyal. Once you understand their needs you can develop your brand to meet them and naturally progress them further to upsell and cross-sell other aspects of your business.
If you don’t analyse the data you have, what’s the point in having it in the first place.
The ‘Take Action’ step
- Put your insights into action
- Then rinse and repeat: Measure, Analyse and Take Action
Put your insights into action
For example, you measured stage conversion, where you measured how many and what percentage of deals passed through each stage over the last month.
You analysed the data and found that at the proposal stage, there was a large drop-off of prospects and then when looking at the days between stages, you saw an elongation of “days in stage” at the proposal stage.
This led you to looking at 10 of the previous deals at proposal stage last month and you saw that on eight of them there were no formal next steps agreed and calendared with the prospects.
So now you decide you need to take action
You decide that the first test would be to advise the sales team that before agreeing to submit a proposal to your enterprise buyer, you agree on a time and date for a proposal review call, at the end of the previous call. If they don’t agree, you don’t create a proposal.
Why would you spend your time creating a proposal if they don’t want to review it and get their key questions answered?
This is also a smart soft close, as they might say, I think we’re too early for a proposal at this stage for x or y reason. You can then re-qualify and understand what you’ve missed or where clarity and value hasn’t been expressed up until this point.
Rinse and repeat
You can now measure whether this increases the rate of proposals that go to the “contracts agreed” stage for example, you can see if it decreases the time in stage too. This is measurement. Then you’d analyse those findings and take new action if you needed/wanted.
For further information on which sales reports we found most valuable for tech startups, we have published a new eBook on the Seven sales reports to improve sales conversion at your B2B tech startup. Download it below.