analytics, business intelligence, sales and marketing alignment, and closed-loop ... improve conversion rates and help you refine your overall demand strategy.
Demand Funnel – Its impact as a tool for sourcing business and activity planning. To prepare Demand funnel for Savings Account and Current A/C in Bangalore market.
ABSTRACT Demand funnel involves integrating, and optimizing your organization's demand funnel is critical to improving marketing productivity and performance. Through defining each stage of the buyer's journey, you can effectively address prospects' challenges as they move through the demand funnel. Our innovative approach incorporates demand and sales funnel analytics, business intelligence, sales and marketing alignment, and closed-loop reporting to improve conversion rates and help you refine your overall demand strategy. This project focuses on identifying the desired target to be achieved for current (South Region) and savings account (East Region) for Bangalore region. The project examines the different sources for contributing to the total target and also number of leads the region should have in meeting the desired target. This projects highlights effectiveness of demand funnel as a tool in sourcing business and activity planning for saving and current account for Bangalore Region. Introduction Demand Funnel is nothing but a simple planning tool that helps a Sales Manager in his target achievement. Planning involves identification of potential sources and conducting activities with them towards achieving the target. A systematic framework for aligning and grouping similar prospective customers and making their progress as they gradually move through their buying process. Its both a language and a process model for how leads move from inquiry to customer. Defining its stages gives the foundation for segmentation, scoring,routing,nurturing,and reporting and creates that common language between sales and marketing. At the top of the funnel we have "unqualified prospects" – the very many people who you think might need your product or service, but to whom you've never spoken. At the bottom of the funnel, many sales and delivery steps later. The funnel is used because people drop away at each stage of a long sales process: For example, many of the unqualified prospects may have existing suppliers with whom they're very satisfied. Others may have needs which other competitors are better-placed to satisfy. Still others may love your products, but not have the budget to buy them. The Demand Funnel is constructed product wise like Savings and Current Account for Bangalore South and East Region.
Demand Funnel – Its impact as a tool for sourcing business and activity planning. To prepare Demand funnel for Savings Account and Current A/C in Bangalore market. BRIEF REVIEW OF LITERATURE ON DEMAND FUNNEL
An attempt has been made to put forward a brief review of literature based on few of the related studies undertaken worldwide in the area of e-commerce as follows.
1. You-Ping Yu and Shu-Qin Cai (2007) proposed a framework on customer targeting funnel model, supplemented by a composite mathematical model for optimizing decisions related to customer targeting for marketing initiatives and a flowchart to guide its implementation by marketing planners, all in the business-to-context and under conditions of information shortage. This “toolkit” facilitates the targeting of customers most likely to enter into closer relationships with the company, even when a significant proportion of their key characteristics have to be estimated. DATA COLLECTION The project is based on primary data. Data is majorly collected by way of personal Interviews with respective Regional Heads of Savings and Current Account of East and South Bangalore Region. Objectives of the Study
How demand funnel for specific product helps is sales planning To identify the different sources for sourcing current and savings account To assess the potential of each sources To estimate the conversion ratio for each source
Demand Funnel – Its impact as a tool for sourcing business and activity planning. To prepare Demand funnel for Savings Account and Current A/C in Bangalore market.
Process of Constructing Demand Funnel Funnel Stage
Primary Owner
Sample Definition
Inquiry
Marketing
A respondent to a marketing campaign who does not yet meet minimum qualification/behavior criteria.
Marketing Qualified Lead (MQL)
Marketing
An inquiry who meets the minimum fit criteria and has displayed enough interest to be handed off to sales.
Sales Accepted Lead (SAL)
Sales
A MQL that has been accepted by sales for further qualification to determine pipeline-readiness.
Sales Qualified Lead (SQL)
Sales
A SAL that has progressed to an opportunity and is now committed to pipeline
Closed Won
Sales
An opportunity that concluded as a closed won deal.
Demand Funnel for Current Account A Demand funnel enables the Sales Manager to assess the potential at each source, plan activities and allocate resources (time, manpower & budget, if any) required for their conversion. The level and type of activity would differ for each source. The Demand funnel also measures the conversion ratios from one level to another on performance of an activity and tests its efficacy. This enables the Sales Manager to change his strategies after consideration of factors affecting the business, viz, environmental factors, regulatory factors, competition etc.
Demand Funnel – Its impact as a tool for sourcing business and activity planning. To prepare Demand funnel for Savings Account and Current A/C in Bangalore market.
Plan of Study For the purpose of constructing the demand funnel personal interaction with respective current account Regional Head (South) has been done. Based on the interaction target for Bangalore south region for current account for the year 01-04-2014 to 31-03-2015 is 2952 Taking inputs from the Demand Funnel prepared for the year 2014-2015, a detailed sales planning needs to be done by Regional Heads to generate the required number of leads. For effective sales planning, proper sources of generating the leads needs to be identified and needs to be implemented accordingly. Source Contribution To meet the set target for Current account various sources are identifies which is contributing to the overall set target of the region. As per the interaction with Regional Head percentage from each source is being identified. The below percentages shows the percentage contribution from each source Contributing Sources
Cold Call – 10% ; Customer Referrals – 30 % ; Activity – 15% Walk INS – 35%; Charted Accountants - 20% ; Merchant Service team – 20% Conversion Ratio of Leads Login After identifying the different sources for contributing to the overall target, conversion ratio from each source has being identified which is as follows: Cold Call – 10% ; Customer Referrals – 50 % ; Activity – 20% Walk INS – 40%; Charted Accountants - 70% ; Merchant Service team – 40% The total target for the financial year 2014-15 is 2952, As per the interaction with Regional head its being found that rejection of applicants for current account can be in two ways: 1. Document rejection, which is in clarification may account for 15 to 20% which is not the actual rejection where usually stays in Team Lead Tray in Regional Processing Centre, which may be clarified by taking few additional documents from the customer 2. The actual rejection which is approximately around 10%, it could be because of deviation in KYC where customer is not able to give the correct documents, Insufficient balance (Initial Deposit) because of which funding cannot be done to the new account.
Demand Funnel – Its impact as a tool for sourcing business and activity planning. To prepare Demand funnel for Savings Account and Current A/C in Bangalore market.
Demand Funnel for Current Account The table below highlights the conversion ratios of Current Account as leads flow from one stage to the next in the account opening process. For Bangalore (South) Region who has to open 2952 A/cs in the financial year 2013-2014. Source
Cold Call Customer Referrals Activity Walk INS Charted Accountants Merchant Service Team Total
Source Contribution
Logins Required
10%
325 974
10% 50%
3250 1948
487 812 325
20% 40% 70%
2435 2030 464
324
40%
810
30% 15% 25%
Leads to Login Ratio
Leads Required
10% 10% 100%
3247 (10% Rejection Ratio )
10937
Analysis & Interpretation As per the above table it shows the overall contribution to the total target which needs to be achieved in the Financial Year 2014-15. As per the rejection ratio of 10%, Target for the financial year 2014-15 will be 3247(which includes the surplus of 10%). As per the above table major contribution comes from Customer Referrals (i,e 30% ) which is highest where conversion ratio for the same is 50% and second highest contribution is from Branch Walk-ins which account to 25% where the conversion ratio being 25%.As per the above analysis it is estimated that to achieve total target of 3247 region should have at least 10937 leads to achieve the desired target.
Demand Funnel – Its impact as a tool for sourcing business and activity planning. To prepare Demand funnel for Savings Account and Current A/C in Bangalore market.
Demand Funnel for Savings Account for Bangalore East Region
Plan of Study Data Collection is done by interacting with Regional Head Savings Account of Bangalore East Region. The total target for the Bangalore East region which consists of 20 branches has the target of approximately 18,000 for financial year 2014-15. To construct the demand funnel for savings accounts following data are collected: 1. 2. 3. 4.
Understanding the total target for the year 2014-15 Identifying the different sources Identifying the conversion and rejection ratio Construct the demand funnel
Source Contribution To meet the set target for savings account various sources are identifies which is contributing to the overall set target of the region. As per the interaction with Regional Head percentage from each source is being identified. The below percentages shows the percentage contribution from each source
Construction of Demand Funnel for Savings Account
Taking inputs from the Demand Funnel prepared for the year 2014-2015, a detailed sales planning needs to be done by Regional Heads to generate the required number of leads. For effective sales planning, proper sources of generating the leads needs to be identified and needs to be implemented accordingly. The various sources Source Contribution Cold Call – 10% ; Customer Referrals – 40 % ; Activity – 25% Walk INS – 25%; Conversion Ratio of Leads Login After identifying the different sources for contributing to the overall target, conversion ratio from each source has being identified which is as follows: Cold Call – 10% ; Customer Referrals – 50 % ; Activity – 15% Walk INS – 40%
Demand Funnel – Its impact as a tool for sourcing business and activity planning. To prepare Demand funnel for Savings Account and Current A/C in Bangalore market.
The total rejection in savings account as per the standard which is 2%, where in the East region they are able to maintain the 1% rejection in total savings account applicant sourced
The table below highlights the conversion ratios of Current Account as leads flow from one stage to the next in the account opening process. For Bangalore (East) Region who has to open 18,000 A/cs in the financial year 2013-2014. Total Target of 18,000 accounts, conversion ratio being 1% Leads/Logins required 18180 (As per rejection ratio of 1%) Rejection Ratio – 1% Demand Funnel for Savings Account
Source
Cold Call Customer Referrals Activity Walk INS Total
Source Contribution
Logins Required
10%
1818 7272
10% 50%
18180 14544
4545 4545 18180 (1% Rejection Ratio )
15% 40%
30300 11363 74387
40% 25% 25% 100%
Leads to Login Ratio
Leads Required
Analysis & Interpretation As per the above table it shows the overall contribution to the total target which needs to be achieved in the Financial Year 2014-15 is approximately 18,000. As per the rejection ratio of 1%, Target for the financial year 2014-15 will be 18180(which includes the surplus of 1%) which needs to be added to meet the set target. As per the above table major contribution comes from Customer Referrals (i,e 40% ) which is highest where conversion ratio for the same is 50% and second highest contribution is from Branch Walk-ins which account to 25% where the conversion ratio being 40%.As per the above analysis it is estimated that to achieve total target of 18000 region should have at least 74387 leads to achieve the desired target.
Demand Funnel – Its impact as a tool for sourcing business and activity planning. To prepare Demand funnel for Savings Account and Current A/C in Bangalore market. REFERENCES:
You-Ping Yu, Shu-Qin Cai, (2007) "A new approach to customer targeting under conditions of information shortage", Marketing Intelligence & Planning, Vol. 25 Iss: 4, pp.343 – 359
