Business leadership is a funny little bird. It has a variety of skills, a number of tricks and some hard and fast rules. As the world becomes more digital – not just media but all things, every business touchpoint, from marketing to finance to strategic planning – it brings with it a number of new metrics to measure, tools to learn and platforms to develop upon. The speed and pace at which this is happening is, at times, numbing for most organizations and their leaders. It has many businesses operating in a vacuum with a series of blind spots from which their field of vision seems clear. Unfortunately, it is anything but. As such, many are crippling their businesses without knowing. That’s why, at the end of the day, the #1 question every business leader should be asking is: “Does It Sell More Beer?”

Yes, that’s right. Does It Sell More Beer? That is the question you should be asking. None could be more important. Now, of course, I’m not speaking of hops and barley. I’m speaking metaphorically about Asking Smarter Questions in a variety of forms, about marketing delivery, brand messaging, retail logistics and replenishment, human resources development, call center tracking and fulfillment, point-of-sale modeling and so on.

Strategic decisions should have more implicit insight at this point – in this day and time. And frankly, one cannot trust the current process or success of a business to provide for the future. Increasingly, the ability to mine and create insights from data and analytics is a core necessity. Data mining and creating insights from data is perhaps one of the most valuable activities that any business can, and should, perform – religiously. Essentially asking, “Does It Sell More Beer?”

Every business creates an inordinate amount of data – from the mom and pop dry cleaner to the 5,000-location big box retailer. They all create data, and they all suffer from the same issue: they generally don’t use the existing information and data to learn how to sell more beer and create more efficiency in current activities. Clearly, the mom and pop business can’t afford the same service depth as a Fortune 500 company, but tools do exist that are both feasible and reasonable to use.

Just so I don’t exclude the average small business in America, take this example into account. The mom and pop business (dry cleaner, liquor store, flower shop) can use a tool like QuickBooks Point of Sale to uncover data about customers and sales trends. Things such as clothing “type” serviced for a dry cleaner, brand of wine purchased most “frequently” for a liquor store and type of event/”occasion” for a flower shop can greatly impact how service is provided, how marketing is delivered and how inventory is managed.

EXAMPLE: Music Industry, Adaptive Revenue Models
You may have noticed the music industry has undergone dramatic change in recent years. For an artist to go Gold, he/she must sell 500,000 copies of an album. To go Platinum requires one million copies. That achievement was more attainable for artists in the past, and many top albums would go multi-Platinum. Consider the trend below for top albums by year:

1971 – Led Zeppelin (Led Zeppelin IV) – 24,500,000 copies sold*
1980 – ACDC (Back in Black) – 22,000,000 copies sold*
1997 – Shania Twain (Come on Over) – 15,499,000 copies sold*
1999 – Britney Spears (Baby One More Time) – 14,000,000 copies sold*
2003 – Outkast (Speakerboxx/The Love Below) – 11,000,000 copies sold*
2004 – Usher (Confessions) – 10,000,000 copies sold*
2010 – Eminem (Recovery) – 3,415,000 copies sold**
*Source RIAA **Source Nielsen Soundscan

The top selling album in 2010 sold less than 3.5 million copies (over 6 million less than in 2004 and 21 million less than 1971). WOW! What a shock to the industry. Needless to say, it was a very bad year for music. This trend has caused severe anxiety in the music industry – from artists to managers, agents and songwriters alike. The proliferation of services, such as Pandora, Spotify and GrooveShark, has heightened this anxiety, as it begs the question – why would you ever buy an album? You have music on demand and for free. Therefore, the industry is asking itself, “Does It Sell More Beer?” even as we speak.

I have a good friend that runs a very successful artist management group in Nashville. His clients are among the top names in music year after year. He echoes this anxiety, and, as a result, they are turning to new models of revenue. For example, some artists are challenging the venues where they perform to a share of food and beverage (historically the house take). In fact, I know of one specific example where the artist changed venues (at which he has consistently performed for many years) to a new venue where he took 100% of the profit from food/beverage. His “Does It Sell More Beer?” question was more literal than most, but also very profitable and showed a changing model that adapts to current market factors.

EXAMPLE: Franchise Business Services, Financial Reconciliation
This example is as close to the sleeve as it gets. My company has a large and very successful client that provides a low-interest, very specific set of business services. They have been in business for many years, have a multi-billion dollar revenue line and are considered the top of their industry segment year after year. They have been very successful, to say the least.

Initially, we began working with them on many marketing-related activities, such as paid search, SEO, various forms of display media, creative work, etc. – essentially, standard digital solutions. As deliverables, we have provided very detailed insight and learnings about their business, on both a bi-weekly and monthly basis, in addition to the standard reporting. From the onset, we put measurement and process in place to tie every digital touchpoint to offline sales, as all their sales take place offline.

Throughout the first six months of the relationship, as we tied digital touchpoints to offline sales and revenue activities, we noticed a number of issues that existed in their internal corporate operations and franchise-level tracking.

The issues primarily existed in site analytics measurement, call center measurement and also franchise revenue reporting measurement. We quickly began to reposition the site analytics as well as call center tracking. That immediately had a huge impact on revenue reconciliation measures. The next step was weeding through thousands of individual franchise revenue reporting measurement jobs. This led to the holy grail of data.

What we found was the process for delivering corporate financial reconciliation data was cumbersome and antiquated. As a franchise-based business that calculates revenue from a defined percentage of gross sales, gaining accurate and timely financial reporting is key.

So, although the business had been successful for many years before we came along, opening the doors to the proverbial question, “Does It Sell More Beer?” created entirely new revenue streams that failed to exist prior (even in an already successful business), taking the company from a less than 1 to 1 return on media activities to a conservative 7 to 1 return in under 18 months.

There is a reason stadiums worldwide cram more seats into their venues each year. It sells more beer.

So ask yourself, is what you are doing going to sell more beer?

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