Database Sizing: Goal Achievement Equations

1. Effective data❓base Principles:

• Quality over quantity: Focus on data quality (accuracy, completeness, relevance).
• Segmentation: Divide the database based❓ on demographics, purchase behavior, interests.
• Continuous updating: Regularly update data.
• Compliance: Adhere to data protection and privacy laws (e.g., GDPR).

2. Conversion Ratios:

Conversion ratios measure the effectiveness of sales and marketing efforts. Examples:

• Lead to opportunity conversion rate: Qualified sales opportunities divided by the number of leads.
• Opportunity to closed deal conversion rate: Closed deals divided by the number of sales opportunities.
• Customer retention rate: Number of customers who continue dealing after a period (e.g., a year) divided by the total number of customers.

3. database size❓ Equations for Achieving Goals:

Based on “Met” (known) and “Haven’t Met” (unknown) customers.

3.1. Met Database:

Focus on relationships with existing network. Uses “8x8” (8 contacts❓ in 8 weeks) and “33 Touch” (33 contacts throughout the year) strategies.

Assuming “33 Touch” leads to 2 sales (referral and repeat) per 12 people:

N_Met = (Sales_Goal * 6)

• N_Met: Required contacts in “Met” database.
• Sales_Goal: Targeted closed sales.
• 6: Derived from 12:2 ratio (12/2 = 6).

Example: To achieve 40 closed sales: N_Met = (40 * 6) = 240 contacts.

3.2. Haven’t Met Database:

Focus on generating new leads through digital marketing, advertising, events, etc. Uses “12 Direct” program (12 direct contacts throughout the year).

Assuming “12 Direct” leads to 1 sale❓❓ per 50 people:

N_Haven'tMet = (Sales_Goal * 50)

• N_Haven'tMet: Required contacts in “Haven’t Met” database.
• Sales_Goal: Targeted closed sales.
• 50: Derived from 50:1 ratio.

Example: To achieve 40 closed sales: N_Haven'tMet = (40 * 50) = 2000 contacts.

3.3. Mix of Met and Haven’t Met:

1. Determine percentage of sales targeted from each database.

2. Calculate the number of sales required from each database:

   • Sales_Met = Sales_Goal * Percentage_Met

   • Sales_Haven'tMet = Sales_Goal - Sales_Met
     3. Calculate the number of contacts required in each database:

   • N_Met = Sales_Met * 6

   • N_Haven'tMet = Sales_Haven'tMet * 50

Example: To achieve 40 closed sales, with 60% from “Met” and 40% from “Haven’t Met”:

• Sales_Met = 40 * 0.6 = 24
• Sales_Haven'tMet = 40 - 24 = 16
• N_Met = 24 * 6 = 144
• N_Haven'tMet = 16 * 50 = 800

4. Gap Analysis:

Compare the required database size to the current size.

1. Determine Target Numbers: Record calculated numbers.
2. Determine Current Numbers: Record current contacts in each database.
3. Calculate People to Add: Subtract current numbers from target numbers.

Gap Analysis Equation:

• People_to_Add_Met = N_Met_Goal - N_Met_Current
• People_to_Add_Haven'tMet = N_Haven'tMet_Goal - N_Haven'tMet_Current

5. Monthly Goals for Adding Contacts:

Divide the annual number of people to add into monthly goals.

• Method 1: Equal Distribution: Divide the number of people to add by 10 (allowing for 2 months of holidays).

  • Monthly_Goal = People_to_Add / 10

• Method 2: Focus at the Beginning of the Year: Add more names at the beginning of the year.

6. Examples and Relevant Experiences:

• Case Study: A real estate company increased sales by 20% using “8x8” and “33 Touch”.
• Experiment: Segmenting the database by interests increased email click-through rates by 15%.
• Example: A software company used “12 Direct” to create webinars, increasing qualified leads by 30%.