February 22, 2022

A Lot of Profit

BC (before Covid) I sat in a meeting. The marketing leader talked about how she personalized her website and email campaigns with merchandise that aligned with the interests of the specific customer interacting with her brand.

She mentions that email is responsible for about 15% of her sales, that email conversion rates were +20% vs. before personalization endeavors began, and that her website was performing about 15% better (at times up to 50% better).

As she finishes up her presentation, I'm looking at a $100,000,000 business. Email had to be worth 15% of $100,000,000 ... or $15,000,000. If she squeezed an additional 20% out of email marketing, she was responsible for $2,500,000 in sales.

The rest of her website performed 15% better ... or $11,100,000 for in sales, due to personalization efforts.

If her profit factor were 35%, then we know the following:
  • $2,500,000 + $11,100,000 = $13,600,000 in incremental annual sales.
  • $13,600,000 * 0.35 = $4,760,000 in incremental profit.
  • Cost of the program? Likely a few hundred thousand dollars.
As she finished her presentation, the audience ... the Executives leading this company ... they largely yawned. They had no idea what the financial impact was on the business.

They heard percentages.

They didn't hear sales/profit figures.

This young woman likely generated more incremental profit for her company than her entire Executive Team put together. 

But because she spoke in terms of percentages, she got no credit for the amazing job she did fueling sales/profit.

You contribute A LOT OF PROFIT toward your annual p&l. Take credit for it.

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