When do you actually need outside tech help?
One question that we’ve been asked by business owners large and small, from CEO’s of Fortune 1000 companies and small niche brick-and-mortar shops in Alabama is:
“When should I outsource my technology department to someone else?”
This, first and foremost, is a question that comes from someone with enough elevation to work ON their business, instead of being stuck inside the day-to-day and unable to really do more than “just finish [their] task list”. With this type of thinking, where the owner, the CEO, knows it might be appropriate to outsource something vital to the company, the question begs – which parts? For how long?
Since I’ve known Mike, the CEO of Tech Guys, he’s always encouraged people he’s met to outsource new builds, new development, new things that will make the job easier – but not to fire their own tech company. Sure, there may be an instance where a current tech team is sloppy, spending their entire days troubleshooting small problems at the office, instead of tackling things that increase efficiency, make more money, etc., and on top of that – they may be like the recent story from a new prospect that said her tech company was “argumentative” and ultimately did whatever they wanted. This lack of communication and “play nice-ness” of a tech team like that, in our eyes, needs to get the Golden Ticket to new employment — but only those types.
You see, most tech teams, tech departments are inherently good. They’ve spent their time troubleshooting problems and probably love it. While they may be begging for more autonomy and challenge, they’re also interested in seeing a company grow.
“Throwing the baby out with the bath water” is as strange of statement as it is probably unnecessary with your current tech team. Keep them. They know your business, they know you. If they’ve been around a long time, they probably have personal investment in the success of your company.
But don’t expect them to understand YOUR desire to move your business to a more efficient, transparent company. And when I say “transparent”, I’m not referring to the public knowing you sourced all your paper from Forest Stewardship Council, though that is probably a good move for everyone… What I mean is – can your executives actually see the health of the entire business from a simple dashboard that doesn’t take a Boddhisattva of Copy, Paste and Excel to understand?
Ask yourself this…
“Can I actually see the following real-time metrics of my business quickly and easily, letting me make informed business decisions in regards to how I promote, sell, and leverage my product or service?”
- Average lifetime value of a customer
- Average customer acquisition cost
- Leadsource of creative (email, banner, web page, etc.,) that lead to a sale
- Leadsource that leads to the highest customer lifetime value
- Sales made in the last 30 days
- Sales made in the last 7 days (running 7)
- Sales generated by a specific affiliate, juxtaposed with their traffic, leading to conversion rate (got someone with a HIGH conversion rate? Love on them and get more!)
If you do have this information, you’ve got a smug look on your face, and you probably just checked out your dashboard and gave yourself a pat on the back. You’re probably one in a hundred. You’re unique. You’re the posterchild of what everyone should have. Now, go hug the person that got you those metrics!
If you DON’T have this information at your fingertips – and I mean as quickly as you desire (think: open up your dashboarding software, click the report, then run it, and within 90 seconds, it’s in front of your LCD-glowing face), you’re unable to make efficient business decisions.
I hope you don’t mind me rubbing some salt in those wounds…
If you don’t know your customer acquisition cost by leadsource, you’re going to waste money without knowing EXACTLY where and how.
For example, a 300×250 image ad (ad ID 208892) on CNN.com brings you in a customer at $21.24, and that customer lifetime value is $19.97, you’re going down like a cruise ship in Italy.
Heck, what about times of day? Are people “browsing” during the work day and actually pulling out their credit card at night? Are you day-parting your ads to capitalize on the BUYING traffic instead of the BROWSING traffic?
How about your affiliates? Are other people driving traffic for your business? Are they being rewarded on leads, instead of long-term tracking of sales? If it’s only for opt-ins or low-quality leads, you’ll never be able to quantify the long-term help of that affiliate. Should you dump them and remove all their leads, giving your team less run-around and more time to focus on higher quality leads?
Aaron Ross, in his book “Predictable Revenue” reminds sales teams to hit 10 people 10 times, instead of 100 people once. This is great advice and we totally agree – but CAN you? Does your business have the tracking setup so you know how many times a person was contacted? How many emails did they receive before they purchased, before they reached back out to you and said “I’d love to check out the demo you’ve been talking about”?
Are you effectively tracking the nuances of your auto-responder to see which email makes people buy? Are you watching with hawk-eyes at what causes someone to unsubscribe and then FIXING the email or lack thereof to see a measurable decrease in the unsubscribe rate over time?
Here’s a Himalayan Salt Lamp to stuff into that open sore of your business…
Are you split testing different items on your sales cycle and tracking them not just to next action, like hitting the “Add to Cart” button, but actually through to the lifetime value of the customer? Have you tested a cutesy gold coin icon, as described in “The Lean Startup” by Eric Ries, and see how it affects the sale, not just the clicking of the action button?
Truth is, very few are doing ALL of this. Examples might be Apple, Amazon and Google. They have rewrote the rules on what to test and how to do it. Amazon has a host of robots, similar to the treadmill of people on their Resolutions at the gym on January 10th, pushing forward, testing every nuance of what can be tested. They’re seeing exactly what makes them the most money – Does offering a pair of the Nikon camera that you’re looking at and the 14-28 wide-angle lens really increase your order size? Or would it be better to just offer a UV filter with the kit lens the camera comes with? What’s going to make them the most money? Truth be told, only rigorous testing can tell them.
And with all that data comes the need to warehouse it and crunch it so the results are meaningful and easy to read.
To be candid here, Tech Guys does NOT have all of this data for our own funnels, for our own marketing. We don’t know some of these variables. But what we DO know is the MOST important stuff. Sure, we could spend a few weeks cleaning up our email autoresponder to increase conversion, and it’s actually in the plan to do so, but it’s not necessary to do it right now. If I was to weigh out the benefit of doing that, it might increase customer acquisition by 5-10%. That’s a great increase, but it comes second to other things that might bring in 15-20%, or, heck even 11% more sales. Once we identified what we could do to increase our customer acquisition, we prioritized it to give us the biggest bang for the buck, to spend our time growing our business, not just our fancy-pants dashboard.
All of this is to say the following:
If you DON’T know the Key Performance Indicators (KPI’s) of your business, like lifetime value of a customer by leadsource, what creative turned a prospect into a customer (or acquired that customer), and can see it easily, you need to hire experts to help you get that data, and have them train your in-house tech department to continue providing that information for you, as you grow.
Personally, I’ve heard of few companies that can help you get that information. While I’d love to list 30 companies that could do that, in all honesty, mixing marketing and technology together isn’t the easiest thing. Most tech workers lack the ability to zoom-out and see these KPI’s and how they affect the business. They’re concerned with website load time, ensuring the shopping cart stays within the parameters of the SSL, and all that jazz. Most marketing and business people lack the ability to develop these reports that are so necessary to running a lean and profitable company.
I encourage you to look for ways to get this information yourself. If you find it too difficult and need help developing the dashboards, we’re happy to chat with you and see if we’re a good fit for your problems.
If you’re interested in seeing how Tech Guys Who Get Marketing can help you understand these super-duper-important metrics of your business, shoot Hondo a note. He’ll walk you through the initial process, and if we’re a good fit for your company, he’ll give you a play-by-play of how we work and how we can help. Email him at: Hondo@TechGuysWhoGetMarketing.com (and be sure to ask him about that once time he fell down the stairs… HILARIOUS!)
If you’ve had success in finding these metrics, I’d love to hear your comments on how it’s benefited your business, or if there’s anything I missed that you found has helped you increase sales or confidence in your marketing.
Happy Mardi Gras,
– Casey
(In beautiful New Orleans)